Subir Ghosh, Delhi V. ITO ward-51(5), New Delhi

ITA 7887/DEL/2019

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 1087 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-10-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 09-10-2022
• Assessment Year: 2015-2016
• Appeal Filed On: 26-09-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Bogus
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘SMC’, NEW DELHI BEFORE SH. N.K. BILLAIYA, ACCOUNTANT MEMBER ITA No.7887/Del/2019 Assessment Year: 2015-16 Subir Ghosh S-524, Neelkanth House, 302, 3 rd Floor, School Block, Shakarpur, Delhi-110092 Vs ITO Ward- 51 (5) New Delhi (APPELLANT) (RESPONDENT) Appellant Shri Pankaj Sharma, CA Respondent Sh. Om Parkash, SR DR Date of hearing: 10/10/2022 Date of Pronouncement: 12/10/2022 ORDER PER N.K. BILLAIYA, AM: This appeal by the assessee is preferred against the order of the CIT(A)-17, New Delhi dated 23.07.2019 for A.Y.2015-16. 2. The solitary grievance of the assessee is that the CIT(A) erred in confirming the addition made by the AO u/s. 68 of the Act. 3. Briefly stated the facts of the case are that during the course of the scrutiny assessment proceedings the assessee has shown 2 M/s. P.S. Enterprises as outstanding sundry creditor for Rs.25,57,165/-. The assessee filed copies of confirmed ledger account. The AO found that neither this amount has been shown as advance from customer nor any sales was made against this receipt till 31.03.2015. The AO further found that the amount is still outstanding till date because of the cancellation of VAT registration of the party. To verify the genuineness of the transaction an Inspector was deputed to serve the notice u/s. 133(6) of the Act at the given address of M/s. P. S. Enterprises. The Inspector submitted his report dated 20.12.2017 in which he reported that no such party is existing at the given address. 4. The AO issued the show cause notice to the assessee asking him to explain why the receipt of Rs.25,57,165/- should not be added to the income of the assessee u/s. 68 of the Act. 5. The assessee filed a detailed reply claiming that he has a continuous business transaction with M/s. P. S. Enterprises and it is only last transaction of Rs.2557165/- remained outstanding. It was further explained that due to some technical reason the TIN number has been cancelled by the VAT department and, therefore, M/s. P. S. Enterprises requested the assessee not to raise any bill as it will not get credit of VAT in put since the TIN number has been cancelled. 6. The AO dismissed the reply of the assessee stating that 3 merely registration in VAT department does not make transactions with a bogus entity genuine and made the addition of Rs.2557165/-. 7. The assessee agitated the matter before the CIT(A) but without any success. 8. Before me the counsel for the assessee reiterated what has been stated before the lower authorities. 9. Per contra the DR strongly supported the findings of the AO. 10. I have given a thoughtful consideration to the orders of the authorities below. There is no dispute that the assessee has been kept showing regular transaction with M/s. P. S. Enterprises and all such transactions have been done through banking channel in the past. This has also been accepted by the AO at para-3.3 of his order. Exhibit -19 of the paper book show that there were sales transaction with M/s. P. S. Enterprises in F.Y. 2013-14 supported by Ex-21 to 27 which is a running account of transactions of Union Bank of India for A.Y. 2013-14. Similar transactions were made in F.Y. 2014-15 as per Ex-28 and 29 of the paper book. It is also an accepted fact that the VAT registration of M/s. P. S. Enterprises was cancelled due to some technical reason for almost 1-1/2 years and thereafter re- registration was done and the amount outstanding was squared 4 up. 11. In my considered opinion and considering the facts on record the additions made by the AO are only on presumptions and surmises and are contradictory to the facts on record, therefore, I have no hesitation in holding that the additions made by the AO and confirmed by the CIT(A) deserve to be deleted. 12. I accordingly direct the AO to delete the impugned addition. 13. In the result, the appeal of the assessee is allowed. Order pronounced in the open court on 12.10.2022. Sd/- (N. K. BILLAIYA) ACCOUNTANT MEMBER *NEHA, Sr. Private Secretary* Date:- .10.2022 Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI 5 Date of dictation 11.10.2022 Date on which the typed draft is placed before the dictating Member 12.10.2022 Date on which the typed draft is placed before the Other member 12.10.2022 Date on which the approved draft comes to the Sr.PS/PS 12.10.2022 Date on which the fair order is placed before the Dictating Member for Pronouncement 12.10.2022 Date on which the fair order comes back to the Sr. PS/ PS 12.10.2022 Date on which the final order is uploaded on the website of ITAT 12.10.2022 Date on which the file goes to the Bench Clerk 12.10.2022 Date on which file goes to the Head Clerk. The date on which file goes to the Assistant Registrar for signature on the order Date of dispatch of the Order