Etal Enser Pvt. Ltd., Kolkata V. ITO, Ward 5(3), Kolkata, Kolkata

ITA 769/KOL/2017

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 5049 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 7 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-11-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Assessment Year: 2010-2011
• Appeal Filed On: 18-04-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: MANISHI TIWARI
• Keywords: Unexplained cash credit; Unexplained expenditure; Wrong claim; TDS
• Section: 143(3); 133(6); 205; 195; 201; 192; 68

Judgement Text

, C , IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH C KOLKATA BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND DR. A.L. SAINI, ACCOUNTANT MEMBER ITA NO. 769 / KOL / 201 7 ASSESSMENT YEAR :2010-11 ETAL ENSER PVT. LTD., SECURITY HOUSE, 23B, N.S. ROAD, 2 ND FLOOR, ROOMNO.4A KOLKATA-700 001 [ PAN NO.AAACE 6992 J ] V/S . INCOME TAX OFFICER WARD-5(3), AAYAKAR BHAWAN, P-7, CHOWRINGHEE SQUARE,KOLKATA-69 /APPELLANT .. / RESPONDENT /BY APPELLANT SHRI MANISHI TIWARI, FCA /BY RESPONDENT SHRI SUPRIYO PAL, JCIT-SR-DR /DATE OF HEARING 04-11-2019 /DATE OF PRONOUNCEMENT 22-11-2019 / O R D E R PER S.S.GODARA, JUDICIAL MEMBER:- THIS ASSESSEES APPEAL FOR ASSESSMENT YEAR 2010-11 ARISES AGAINST THE COMMISSIONER OF INCOME TAX(APPEALS)-8 KOLKATAS ORD ER DATED 14.02.2017 PASSED IN CASE NO.8/10201/2013-14 INVOLVING PROCEED INGS U/S 143(3) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT. HEARD BOTH THE PARTIES. CASE FILE PERUSED. 2. THE ASSESSEES FIRST SUBSTANTIVE GRIEVANCE CHALL ENGES CORRECTNESS OF BOTH THE LOWER AUTHORITIES ACTION TREATING ITS SHA RE APPLICATION / PREMIUM @ 100/- AND 900/- PER SHARE; RESPECTIVELY AS UNEXPLAINED CASH C REDITS. THE CIT(A)S DETAILED DISCUSSION QUA THE FIRST ISSUE READS AS UNDER:- ITA NO.769/KOL/2017 A.Y. 2010-11 ETAL ENSER PVT. LTD.. VS. ITO WD-5(3), KOL. PAGE 2 5. ADDITION OF PURPORTED SUBSCRIPTION TO SHARE CAPI TAL [ 2,50,000/-] AND PURPORTED SHARE PREMIUM THEREON [ 22,50,000/-] [GROUND OF APPEAL NO.1]: 1(A). THAT THE LD. AO IS WRONG AND UNJUSTIFIED IN H OLDING SHARE CAPITAL RECEIVED FROM THREE CORPORATE ENTITIES AS NOT REAL BY RELYING ON IRRELE VANT AND EXTRANEOUS CONSIDERATION. 1(B). THAT THE OBSERVATION OF LEARNED. AO THAT CRED ITWORTHINESS OF SHARE HOLDERS IS NOT ESTABLISHED IS CONTRARY TO THE RATIO OF DECISIONS I N CIT VS. STELLER INVESTMENT LTD. 192 ITR 287 (DEL) AND CIT VS. SOPHIA FINANCE LTD 205 ITR 98 (DE L) 1 THAT ON THE FACTS AND IN RESPECT TO THE CIRCUMST ANCES OF THE CASE, LEARNED. AO HAS PROCEEDED ON ERRONEOUS BELIEF AND MISCONCEPTION ON LAW IN CONSIDERING SHARE CAPITAL OF RS.25,00,000/- RECEIVED FROM 3 CORPORATE ENTITIES A S UNEXPLAINED CASH CREDIT U/S/S 68 OF IT ACT, 1961. 5.1 THE RELEVANT FACTS OF THE ISSUE ARE THAT DURING THE RELEVANT PREVIOUS YEAR THE APPELLANTS PAID-UP SHARE CAPITAL HAD INCREASED BY 2,50,00/- ALONG WITH SHARE PREMIUM THERETO AT 22,50,000/-. THERE ARE 3 PURPORTED PARTIES BEING PRIVATE LIMIT ED COMPANIES WHO HAD PURPORTED TO HAVE MADE SUBSCRIPTION TO SHARE CAPITAL ALONG WITH PREMI UM THEREON AS HEREUNDER: SL. NAME OF THE PRIVATE LIMITED COMPANY TOWARDS SHARE CAPITAL [AT 100/- PER SHARE] TOWARDS SHARE PREMIUM [AT 900/- PER SHARE] TOTAL PAID [ ] 1 FASTTRACK VINCOM PVT. LTD. 60,000/- 5,40,000/- 6,00,000/- 2 SPACE TRADEV PVT. LTD 75,000/- 6,75,000/- 7,50,000/- 3 TIRUPATI MARKETING PVT. LTD. 1,15,000/- 10,35,000/- 11,50,000/- TOTAL 2,50,000/- 22,50,000/- 25,00,000/- 5.2 THE ITO AO, FOR DETAILED REASONS IN THE ASSESSM ENT ORDER, HAD VIEWED THE PURPORTED PRIVATE COMPANIES TO BE BOGUS/FICTITIOUS NON-EXISTE NT PRIVATE LIMITED COMPANIES ONLY HAVING NAME ON PAPER WITH ONLY PURPOSE TO FACILITATE LAUND ERING OF UNDISCLOSED / SIPHONED OFF INCOMES-VIA MAZE OF CIRCUITOUS NETWORK LAYERING AMO NGST MYRIAD OF SUCH OTHER BOGUS/FICTITIOUS PRIVATE LIMITED COMPANIES. THE REASONS OF THE ITO AO, SYNOPSIZED ARE HEREUNDER : (I) THAT THE FURNISHING OF THE DETAILS SOUGHT FOR W ERE DELAYED; AND LATER ON WERE SUBMITTED THROUGH OFFICE DAK. (II) ON THE STEREO-TYPE CHARACTERISTICS OF THE APPL ICATION FORMS/ACKNOWLEDGEMENTS. (III) ON THE SHAREHOLDERS THAT A PURPORTED SHAREH OLDER [UDAY SHANKAR HAIT] IN ONE OF THE COMPANY WAS AN EMPLOYEE OF THE AR APPEARING IN RESP ECT TO THE ASSESSMENT PROCEEDINGS; AS ALSO THAT IN ANOTHER COMPANY THAT S HAREHOLDERS/DIRECTORS [RINTU MITRUKA AND K K MITRUKA] ARE SISTER-IN-LAW AND ELDE R BROTHER OF THE AR. (IV) THAT UDAY SHANKAR HAIT WHO T IS ALSO CLAIMED BY THE APPELLANT TO HAVE BEING PAID FOR DOING LABOUR JOB WORKS, THAT FROM HIS DEPOSITIO N U/S.131, UNIT IS EVIDENT THAT NO SUCH LABOUR WORK HAD BEEN DONE BY HIM. (V) THAT THE WRITTEN REPLIES FROM ALL THE OTHER SHA REHOLDERS OUR DITTO, AS ALSO IN PROVISION FORMA AND FONT. (VI) THAT FORM TH9E BANK STATEMENTS IT IS SEEN THAT IMMEDIATELY BEFORE ISSUE OF THE CHEQUE TO THE ASSESSEE THREE IS DEPOSIT OF SUMS. (VII) THAT THUS THE PURPORTED 3 PRIVATE LIMITED COM PANIES WERE NOTHING, BUT PAPER COMPANIES FOR JAMA KHARCHI ENTRIES ROUTING. (VIII) AND THAT THIS BEING THE CASE OF THE CREDITWO RTHINESS OF THE PURPORTED PARTIES AS ALSO THE GENUINENESS OF THE TRANSACTIONS BEING DEFINIT ELY DOUBTFUL, THE ITO AO RELIED ON THE DECISION OF THE HON'BLE CALCUTTA HIGH COURT IN THE CASE OF BHOLA SHANKAR COLD STORAGE (PVT) LTD VS. JCIT [2005] 144 TAXMANN.899 ( CAL) ITA NO.769/KOL/2017 A.Y. 2010-11 ETAL ENSER PVT. LTD.. VS. ITO WD-5(3), KOL. PAGE 3 5.3 THE LD. AR, THIS ISSUE BEING THE MAIN MAJOR ISS UE AS ALSO QUANTUM, HAD SUBMITTED LENGTHY WRITTEN SUBMISSIONS BEING FROM PAGE 2 TO PAGE 12 OF THE WRITTEN SUBMISSIONS, AND IN THE PAPER-BOOK COPIES OF DOCUMENTS BEING FROM PAGE 1 TO 103 OF THE PAPER-BOOK. THE LD. AR IN THE SUBMISSIONS HAS ARGUED ON: COUNTER-ARGUED ALL THE OBSERVATIONS AND REASONS OF THE ITO AO AND RELIED ON VARIOUS MANY JUDICIAL DECISIONS MOS T WHICH CITED THE PRONOUNCEMENT OF THE HON'BLE SUPREME COURT IN LOVELY EXPORTS P LT D. [2008] 216 CTR 195 (SC) 5.4 DELIBERATION, DISCUSSION, AND, APPELLATE DECISI ON : 5.4.1. ARGUMENTS WILL ONLY BE ARGUMENTS ONLY, A P LENTY; WHAT IS CORE TO THIS ISSUE IS SIMPLY IS IT BELIEVABLE OF THE PURPORTED PRIVATE SUBSCRIPT ION TO SHARE CAPITAL WITH ASTRONOMICAL PREMIUM THEREON? THIS INSTANT CASE DEPENDS CRUCIALLY ON THE CREDITWORTHINESS OF THE PURPORTED 3 PRIVATE LIMITED COMPANIES, AS ALSO ON THE GENUINENESS OF THE PURPORTED TRANSACTIONS; NOT SO MUCH ON IDENTITY . THE MUCH OFT CITED CASE OF LOVELY EXPORTS [SUPRA] I S ACTUALLY IN ESSENCE ONLY ON THE LIMB OF IDENTITY . IDENTITY IS THE MOST EASIEST AND CAN EASILY BE MADE - IN W HICH EVER FORM AND MANNER REQUIRED. IT IS, PLAINLY PUT JUST A NAME A MASK. AND EVEN ON THE IDENTITY ASPECT WHAT IS ESSENTIAL IS TO GO DEEPER BEYOND JUST THE N AME WHETHER THE IDENTITY ITSELF IS REAL. THEN TO THE MORE FURTHER CRUCIAL TESTS OF CREDITWOR THINESS OF THE PURPORTED PARTIES AS ALSO THE GENUINENESS OF THE PURPORTED TRANSACTIONS ARE THE PURPORTED TRANSACTIONS RATIONALE, LOGICAL, BELIEVABLE. THUS, FOLLOWING ARE THE TOUCHSTONES THAT MUST BE P UT TO THIS TEST; A. IS THE WORTH, THE TRACT-RECORD, THE FUTURE PROSP ECT, OF THE APPELLANT PRIVATE LIMITED COMPANY SO MUCH AS TO COMMAND AND DEMAND FOR THE PER SHARE PREMIUM AT 900/- AS COMPARED TO THE FACE-VALUE PER SHARE OF 1100/- ONLY? B. WHY HAS THE PURPORTED SUBSCRIPTION BEEN ONLY BY PRIVATE PLACEMENT? C. ARE THE PURPORTED 3 PRIVATE COMPANIES WORTH BY T HEMSELVES, AND SO AS TO BE CREDITWORTHY BY THEMSELVES. A. IS THE WORTH, THE TRACK-RECORD, THE FUTURE PROS PECT, OF THE APPELLANT PRIVATE LIMITED COMPANY SO MUCH AS TO COMMAND AND DEMAND FOR THE PE R SHARE-PREMIUM AT 900/- AS COMPARED TO THE FACE-VALUE PER SHARE OF 100/- ONLY? THE NECESSARY FINANCIALS TO ADJUDGE SO, ARE: NOTE: I HAVE TAKEN ONLY THE FINANCIALS OF THE INST ANT AY 2009-10 AS THEY ARE IN THE PAPER BOOK. THESE 2 YEARS FINANCIALS ADEQUATELY SER VE THE ANALYSIS PURPOSE HERE. ON PERFORMANCE: AY 2010-11 AY 2009-10 PROFIT BEFORE TAX 4,51,452/- 4,55,247/- SALES 6,51,48,799/- 8,54,26,424/- ON WORTH: AY 2010-11 AY 2009-10 SHARE CAPITAL 23,02,000/- 20,52,000/- RESERVES & SURPLUS SECURITIES PREMIUM ACCOUNT 34,50 ,000/- 12,00,000/- PROFIT & LOSS ACCOUNT 11,99,263/- 9,35,640/- NET CURRENT ASSETS 1,01,77,521/- 98,96,908/- THERE IS REALLY NO NEED TO EXPLAIN. IT IS PLAIN C OMMON SENSE. PROMINENT SALIENT OBVIOUS ODDITIES ARE: IS IT JUST NOT BELIEVABLE THAT A PRIVATE COMPANY EA RNING PROFIT BEFORE TAX OF JUST AROUND 4 LAKHS IN AY 2009-10 COULD DEMAND SHARE PREMIUM AT 9 TIMES THE SHARE FACE VALUE. ITA NO.769/KOL/2017 A.Y. 2010-11 ETAL ENSER PVT. LTD.. VS. ITO WD-5(3), KOL. PAGE 4 IS IT JUST NOT BELIEVABLE THAT A PRIVATE COMPANY HA VING ACCUMULATED PROFITS AT ONLY 9,35,640/- AS ON 31.03.2009 COULD DEMAND SHARE PREMIUM AT 9 TIMES THE SHARE FACE VALUE. IS IT JUST NOT BELIEVABLE THAT AS ON 311.03.2009, A S COMPARED TO ACCUMULATE PROFITS AT ONLY 9,35,640/-, THE SHARE PREMIUM IS AT 12,00,000/- THE SALES ARE AT ONLY AROUND 8 CRORE FOR THE FY 2008-09, AND AROUND 6 CRORE FOR THE FY 2009-10; AND MOST PERTINENTLY, THE PROFIT IS INFINITESIMAL AT ONLY A FEW LAKH RUPEES. THEN, JUST HOW HAS THE SHARE PREMIUM BE DETERMINED? THERE IS JUST NO BASIS. SO IT IS JUST NOT BELIEVABLE THAT THE APPELLANT P RIVATE LIMITED COMPANY COULD HAVE COMMANDED AND GOT SHARE PREMIUM AT 900/- PER SHARE; 9 TIMES MORE THE FACE- VALUE PER SHARE. AND SO, IT IS JUST NOT BELIEVABLE THAT ANY SANE PER SON WOULD HAVE PURCHASED THE SHARES; EVEN AN IDIOT WOULD NOT SUCCUMB SO. AND SO OBVIOUSLY, THE PURPORTED PURCHASE OF THE SHARES WITH PREMIUM IS NOTHING BUT SUBTERFUGE OF THE APPELLANT COMPANY ITSELF INTRODUCING ITS OWN UNDISCLOSED INCO ME/SIPHONED OFF PROFITS [BY WAY OF BOGUS CLAIM/INFLATED CLAIM OF EXPENDITURES. THIS AS PECT WILL ALSO BE DISCUSSED IN A LATE ISSUE HEREAFTER REGARDING LABOUR CHARGES CLAIMED TO HAVE BEEN PAID TO UDAY SHAKAR HAIT, WHO ALSO S SHOWN AS A SHAREHOLDER/DIRECTOR IN ONE OF THE PURPORTED PRIVATE LIMITED COMPANY.] B. WHY HAS THE PURPORTED SUBSCRIPTION BEEN ONLY BY PRIVATE PLACEMENT, AND ONLY WITH THE 3 PURPORTED PRIVATE LIMITED COMPANIES? THIS TOO- BUT ONLY REVEALS THE OBVIOUS CLANDESTINE LAYERING AND ROUTING. C. ARE THE PURPORTED 3 PRIVATE COMPANIES WORTH BY THEM SELVES, AND SO AS TO BE CREDITWORTHY BY THEMSELVES. RELEVANT FIGURES FROM PURPORTED FINANCIALS RETURN OF INCOME OF THESE PURPORTED 3 PRIVATE LIMITED COMPANIES ARE: RETURN OF INCOME INCOME AS PER P&L A/C BALANCE SHEET [SOURCES OF FUNDS] BALANCE SHEET [APPLICATIONS OF FUNDS] SHARE CAPITAL SHARE PREMIUM ACCUMULATED PROFIT INVESTMENTS IN UNQUOTED SHARES FASTRACK VINCOM PVT.LTD. AY 09-10 [N.A] 4,120 7,90,000 62,10,000 61,00,000 [IN 7 NUMBER OF PVT.LTD.COS] AY 10-11 21,878 3,60,991 9,73,750 1,33,91,367 15,117 1,07,00,000 [IN 10 NUMBER OF PVT. LTD. COS] SPACE TRADEV PVT. LTD. AY 09-10 [N.A] 4,068 7,85,000 61,65,000 35,00,000 [IN 4 NUMBER OF PVT. LTD. COS] AY 10-11 4,30 11,05,205 11,45,000 1,48,05,000 3,020 1,39,50,000 [IN 15 NUMBER OF PVT. LTD. COS] TIRUPATI MARKETING PVT. LTD. AY 09-10 [N.A] 1,78,260 15,13,500 91,21,500 (2,32,856) 84,50,000 [IN 15 NUMBER OF PVT LTD. COS] AY 10-11 0 8,88,848 18,38,500 1,52,96,500 (1,74,602) 89,00,000 [IN 10 NUMBER OF PVT. LTD. COS] FROM THE ABOVE TABLE IS VERY EVIDENT: ITA NO.769/KOL/2017 A.Y. 2010-11 ETAL ENSER PVT. LTD.. VS. ITO WD-5(3), KOL. PAGE 5 THUS, I HOLD THAT IT IS THAT THESE PURPORTED COMPAN IES ARE FICTITIOUS/BOGUS/NON-EXISTENT. THE COMPANIES ACT HAS BEEN MISUSED TO CREATE THEE B OGUS COMPANIES BY MERE SIMPLY CREATING A COMPANY ONLY IN NAME AND FILING H OAX DOCUMENTS. THE PAN OBTAINED, THE RETURN OF INCOME OF THE PURPORTED COMPANIES ARE ALSO HOAX TAKING ADVANTAGE OF PROVISIONS OF THE ACT TO CREATE HOAX FICTITIOUS ENTITIES. 5.4.2 COMING TO THE MANY JUDICIAL DECISIONS CITED B Y THE LD. AR, FIRSTLY AS STATED EARLIER THE JUDICIAL DECISIONS ARE ONLY ON THE LIMB OF IDENTITY , AND THAT TOO ONLY ON THE FACE OF IT. THERE IS MORE THAN JUST THE ACE OF IDENTITY. SECONDLY, I HAV E DISTINGUISHED ON FACTS BY GOING INTO THE VERY ANALYSIS OF THE PURPORTED COMPANIES THAT THE Y ARE BUT HOAX NON-EXISTENT COMPANIES, SOLELY EXISTING ONLY ON PAPER ONLY FOR MONEY LAUNDE RING PURPOSES. THIRDLY, AS THEY ARE NON- EXISTENT, THREE JUST DOES NOT ARISE THE ISSUE OF TA XING IN THEIR HANDS FOR THERE ARE NO HANDS AT ALL. IT IS THE APPELLANT COMPANY THAT IS EXISTING AND DO ING BUSINESS. IT IS THE APPELLANT COMPANY ITSELF ONLY THAT HAS GENERATED THE PURPORTED FUNDS. THE PURPORTED FUNDS HAVE CLANDESTINELY BEEN INTRODUCED IN ITS ACCOUNTS AS SHARE CAPITAL ; AND SHARE PREMIUM . 5.4.3. THUS I HOLD THAT THE 3 PURPORTED PRIVATE LIM ITED COMPANIES ARE HOAX COMPANIES IN THE WEB OF MONEY-LAUNDERING. THE PURPORTED SHARE CAPITAL AND PURPORTED ASTRONOMICAL SHARE PREMIUM WITHOUT ANY CONCEIVABLE BASIS AND WHICH DEFIES LO GIC- IS NOTHING BUT THE APPELLANTS OWN UNDISCLOSED INCOME/SIPHONED OFF INCOME THAT IS BEING INTRODUCED. MY DISCUSSION HERE IS IN ADDITION TO THE MANY OBSER VATIONS OF THE ITO AO IN HIS DETAILED DISCUSSION IN THE ASSESSMENT ORDER. 5.4.4 THUS, GROUND OF APPEAL NO.1 IS DISMISSED . 3. IT EMERGES FROM A PERUSAL OF THE CIT(A)S ABOVE EXTRACTED DETAILED DISCUSSION THAT THE ASSESSEE HAD NOT ONLY FILED ALL THE RELEVANT DETAILS OF ITS SHARE APPLICATION / PREMIUM OF THE THREE INVESTOR P ARTY(IES), BUT ALSO PRODUCED THE CORRESPONDING DIRECTORS BEFORE THE ASSESSING OF FICER FOR THE PURPOSE OF CROSS-EXAMINATION. LEARNED DEPARTMENTAL REPRESENTAT IVE INVITED OUR ATTENTION TO THE ASSESSMENT FINDINGS CONTAINED IN PARA 5.2 IN LOWER APPELLATE ORDER THAT ONE OF THE SHRI UDAY SHAKAR HAIT IN ONE OF THE COMP ANY TURNS ONLY TO EMPLOYEE OF THE AR APPEARING IN THE ASSESSMENT. AND ALSO ANO THER COMPANYS SHAREHOLDERS / DIRECTORS ARE SISTER-IN-LA W AND ELDER BROTHER OF THE AR (SUPRA). BOTH THE LOWER AUTHORITIES APPEAR TO HA VE DRAWN ADVERSE INFERENCE AGAINST THE ASSESSEE KEEPING IN MIND THE ABOVE RELATION AND FINANCIALS OF THE THREE INVESTORS ENTITY(ES). 4. LEARNED COUNSEL REPRESENTING ASSESSEE VEHEMENTLY CONTENDS DURING THE COURSE OF HEARING THAT BOTH THE LOWER AUTHORITI ES HAVE ERRED IN LAW AND ON FACTS IN REJECTING THE ASSESSEES EXPLANATION ON FO REGOING TECHNICAL GROUNDS DESPITE THE FACT THAT IT HAD PROVED IDENTITY, GENUI NENESS AND CREDITWORTHINESS OF THE THREE INVESTOR PARTY(IES). AND ALSO THAT IN CASE THE ASSESSEE HAD ITA NO.769/KOL/2017 A.Y. 2010-11 ETAL ENSER PVT. LTD.. VS. ITO WD-5(3), KOL. PAGE 6 SATISFIED ALL THE THREE PARAMETERS HEREINABOVE, IT WAS NOT FOR THE LOWER AUTHORITIES TO COMMENT UPON THE INVESTOR DIRECTOR(S ) / PROMOTER(S) AND THEIR PERSONAL RELATION WITH THE AUTHORIZED REPRESENTATIV E. 5. LEARNED DEPARTMENTAL REPRESENTATIVE FAILS TO DIS PUTE THAT NEITHER OF THE LOWER AUTHORITY HAS PUT THE ASSESSEE ON NOTICE BEFO RE DRAWING THE ABOVE ADVERSE INFERENCE. BE THAT AS IT MAY, THE FACT ALSO REMAINS THAT THIS ASSESSEE IS A TRADER IN IRON AND STEEL GOODS AS WELL AS MANU FACTURER OF MACHINERY COMPONENTS HAVING REGULAR BUSINESS ACTIVITIES AND S TOCK-IN-TRADE. THE TYPICAL FEATURES OF A JAMA KHARCHI COMPANY ARE PRIMA FACIE IN THE GIVEN FACTS. WE THEREFORE DEEM IT APPROPRIATE THAT LARGER INTEREST OF JUSTICE WOULD BE MET IN CASE THE INSTANT FIRST ISSUE IS RESTORED BACK TO TH E FILE OF THE ASSESSING OFFICER FOR AFRESH FACTUAL VERIFICATION AS PER LAW WITHIN T HREE EFFECTIVE OPPORTUNITIES OF HEARING. IT SHALL BE OPEN FOR THE ASSESSEE TO RAISE ALL FACTUAL / LEGAL ARGUMENTS IN SUPPORT OF THE IMPUGNED SHARE APPLICATION / PREM IUM AS PER LAW. THIS FIRST SUBSTANTIVE GROUND IS TREATED AS ACCEPTED FOR STATI STICAL PURPOSES. 6. NEXT COMES DISALLOWANCE OF LABOUR CHARGES AMOUNT ING TO 7,21,245/-. SUFFICE TO SAY, BOTH THE LOWER AUTHORITIES DRAW YET ANOTHER ADVERSE INFERENCE AGAINST THE ASSESSEE THAT SHRI HAIT HAPPENS TO BE O NE OF THE NAME LENDER REGARDING LABOUR CHARGES. THE ASSESSING OFFICER AND THE CIT(A) THEREFORE TREAT THE IMPUGNED LABOUR CHARGES AS BOGUS. THE FAC T ALSO REMAINS THAT NEITHER THE ASSESSING OFFICER NOR THE CIT(A) HAVE T AKEN NOTE OF THE FACT THAT ASSESSEES LABOUR CHARGES DO NOT INDICATE ANY ABNOR MAL TREND VIS--VIS ITS SALE TURNOVER AS COMPARED TO THE PRECEDING AND SUCC EEDING ASSESSMENT YEARS. THE FACT ALSO REMAINS THAT ASSESSEE HAS NOT PROVED THE ACTUAL LABOUR SERVICES AVAILED WHOLLY AND EXCLUSIVELY FOR THE PUR POSE OF ITS BUSINESS. WE THEREFORE DEEM IT APPROPRIATE IN THESE PECULIAR FAC TS THAT A LUMP SUM DISALLOWANCE OF 2 LAKH OUT OF THE TOTAL SUM OF 7,21,245/-; KEEPING IN MIND THE ASSESSEES LINE OF BUSINESS, WOULD BE JUST AND PROPER WITH A RIDER THAT SAME SHALL NOT BE TREATED AS A PRECEDENT IN ANY OT HER ASSESSMENT YEAR. THE ITA NO.769/KOL/2017 A.Y. 2010-11 ETAL ENSER PVT. LTD.. VS. ITO WD-5(3), KOL. PAGE 7 ASSESSEE GETS PART RELIEF OF 5,21,245/- THEREFORE. CONSEQUENTIAL COMPUTATION TO FOLLOW. 7. NEXT COMES U/S69C OF UNEXPLAINED EXPENDITURE DIS ALLOWANCE OF 1.30 LAKH PAID TO M/S THREE-KIN-ENTERPRISES IN CASH. WE FIND ALTHOUGH THAT THE ASSESSING OFFICER HAD ISSUED U/S 133(6) PROCESS AND OTHER SIDE SUPPORTED THE ASSESSEES CASE, HE WENT TO DISALLOW THE IMPUGNED C LAIM AS INVOLVING CASH PAYMENTS U/S.40A(3) OF THE ACT. THE CIT(A) HOLDS TH AT THE LATTER PROVISION DOES NOT APPLY SINCE THE ASSESSEE HAD NOT RECORDED EXPENDITURE IN ITS BOOKS OF ACCOUNT. WE NOTICE IN THIS BACKDROP THAT NEITHER OF THE LOWER AUTHORITY HAS GIVEN CREDIT OF THE CASH-IN-HAND AVAILABLE TO THE A SSESSEE DURING THE RELEVANT PREVIOUS YEAR. WE DEEM IT APPROPRIATE IN THESE FACT S AND CIRCUMSTANCES THAT A LUMP SUM OF 50,00/- OUT OF 1.30 LAKH WOULD MEET THE ENDS OF JUSTICE WITH A RIDER THAT THE SAME SHALL NOT BE TREATED AS A PRECE DENT IN ANY PRECEDING OR SUCCEEDING ASSESSMENT YEAR. THE ASSESSEE GETS PART RELIEF OF 80,000/-. CONSEQUENTIAL COMPUTATION TO FOLLOW. LEARNED COUNSEL DOES NOT PRESS FOR THE ASSESSEES F OURTH SUBSTANTIVE GROUND SEEKING TO DELETE DISALLOWANCE OF INTEREST P AYMENT OF 5,171/- OF DELAYED DEPOSIT OF TDS LIABILITY KEEPING IN MIND SM ALLNESS OF THE AMOUNT. 8. THIS ASSESSEES APPEAL IS PARTLY ALLOWED IN FORE GOING TERMS. ORDER PRONOUNCED IN THE OPEN COURT 22/ 11/2019 SD/- SD/- ( %) (' %) ( A.L.SAINI) (S.S.GODARA) (ACCOUNTANT MEMBER) (JUDICIAL MEMBER) KOLKATA, *DKP (- 22 / 11 /201 9 ITA NO.769/KOL/2017 A.Y. 2010-11 ETAL ENSER PVT. LTD.. VS. ITO WD-5(3), KOL. PAGE 8 / COPY OF ORDER FORWARDED TO:- 1. /APPELLANT- ETAL ENSER PVT. LTD., SECURITY HOUSE, 2 3B, N.S. ROAD, 2 ND FLOOR ROOMNO.4A, KOLK ATA-700 001 2 . /RESPONDENT- ITO WD-5(3), AAYAKAR BHAWAN, P-7 CHOWR INGHEE S. ,KOLKATA-69 3. 3 4 / CONCERNED CIT KOLKATA 4. 4- / CIT (A) KOLKATA 5 . 7 ''3, 3, / DR, ITAT, KOLKATA 6. < / GUARD FILE. BY ORDER/ , /TRUE COPY/ 3,