M/s. Ramesh Kumar & Others (AOP), Ghaziabad V. ITO, New Delhi

ITA 854/DEL/2013

• Counselvise Citation: 85420114 RSA 2013
• Duration Of Justice: 2 year(s) 7 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-09-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: F
• Next Hearing Date: 21-07-2015
• Assessment Year: 1998-1999
• Appeal Filed On: 11-02-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: VIKRAM SAHAY
• Assessee Lawyers: S K CHATURVEDI
• Keywords: Unexplained investment
• Section: 68

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : F , NEW DELHI BEFORE SHRI I.C.SUDHIR, JUDICIAL MEMBER AND SHRI J.SUDHAKAR REDDY, ACCOUNTANT MEMBER I.T.A.NO. 854 /DEL/20 1 3 A.Y. 1998 - 99 RAMESH KUMAR & OTHERS (AOP) C/O SH PL GOEL, III A 167, NEHRU NAGAR GHAZIABAD 201 001 PAN: AAAAR 6455 K VS. ITO, WARD 29(2) NEW DELHI (APPELLANT) (RESPONDENT) A PPELLANT BY : SH. SK CHATURVEDI, C.A. RESPONDENT BY : SH. VIKRAM SAHAY, SR.D.R. ORDER PER J. SUDHAKAR REDDY, ACCOUNTANT MEMBER THIS IS AN APPEAL FILED BY THE ASSESSEE AND IS DIRECTED AGAINST THE ORDER OF THE LD.CIT(A) - XXV , NEW DELHI DATED 03 .12.201 2 PERTAINING TO THE A.Y. 1998 - 99 . 2. FACTS IN BRIEF : - THE FACTS OF THE CASE ARE BROUGHT OUT AT PARA 4 .1 TO 4.3 OF THE LD.CIT(A) S ORDER, WHICH IS EXTRACTED FOR READY REFERENCE. 4.1. THE FACTS EMANATING FROM THE ORDER OF THE AO AND THE SUBMISSIONS OF THE ASSESSEE IS THAT THE ASSESSEE HAD FILED THE RETURN INCOME OF RS 1,74,568/ - IN THE STATUS OF A FIRM. THE CASE WAS TAKEN UP FOR SCRUTINY BY THE AO BUT THE STATUS OF THE FIRM WAS ASSESSED AS AOP AS THERE WAS NO VALID PARTNERSHIP DEED AS PROVIDED U/S 1 84. THE ASSESSEE IS IN THE LIQUOR BUSINESS AND THE AO WAS INQUIRING ABOUT THE CAPITAL CONTRIBUTIONS OF THE MEMBERS/PARTNERS AND FOUND THAT HUGE AMOUNT OF RS 87 , 43,252/ - WAS INTRODUCED IN THE BEGINNING OF THE YEAR AS CAPITAL AND THE BUSINESS WAS DONE AND THE CAPITAL MONEY WAS 2 RETURNED TO THE RESPECTIVE MEMBERS/PARTNERS AND THERE WAS NIL BALANCE IN EACH OF THE CAPITAL ACCOUNTS. THE BALANCE SHEET OF THE ASSESSEE ALS O SHOWED NIL CAPITAL AND THE NIL ASSETS. A COPY OF THE P&L ACCOUNT, BALANCE SHEET AND THE CAPITAL ACCOUNT IS MARKED AS ANNEXURE - A. 4.2. THE CAPITAL ACCOUNT SHOWED THAT THE TOTAL AMOUNT OF RS 87 , 43252/ - WAS INTRODUCED IN THE NAME OF MEMBERS/PARTNERS AND TH E DETAILS ARE AS UNDER : - S.NO. NAME OF THE MEMBERS SHARES OF THE MEMBERS CAPITAL INTRODUCED RS. 1. VIJAY KUMAR SHARMA 5% 18,18,200/ - 2. RAMESH KUMAR 5% 14,62,420/ - 3. RAJIV SHARMA & PARTY 65% 18,62,632/ - 4. PK GOEL & SONS 25% 35,00,000/ - T O T A L : 100% RS.87,43,252/ - 4.3. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO WAS INQUIRING ABOUT THE SOURCE OF CAPITAL INTRODUCED BY THE MEMBERS AND THE AO HAD MADE VARIOUS INQUIRIES. THE AO HAD ASKED FOR VARIOUS DETAILS AND BOOKS OF ACCOUN TS FROM THE ASSESSEE BUT THERE WAS REPEATED NON - COMPLIANCE BEFORE THE AO AND ONLY VERY FEW DETAIL WERE SUBMITTED. REGARDING THE INVESTMENT OR CAPITAL CONTRIBUTION OF RS. 35,00,000/ - INTRODUCED BY ONE OF THE MEMBERS NAMELY, SH P K GOEL & SONS HUF THERE WAS NO SATISFACTORY EXPLANATION REGARDING THE SOURCE OF THE INVESTMENT AND ACCORDINGLY, THE AO TREATED THE SAME AS UNEXPLAINED INVESTMENT AND MADE THE ADDITION OF RS 35,00,000/ - IN THE CASE OF THE ASSESSEE VIDE THE FIRST ORDER OF THE AO DATED 27/03/2001 A COPY OF WHICH IS MARKED AS ANNEXURE - B. 3. THE ASSESSEE CARRIED THE MATTER IN APPEAL. THE LD.CIT(A) DISMISSED THE APPEAL. ON FURTHER APPEAL THE TRIBUNAL RESTORED THE MATTER TO THE FILE OF THE LD.CIT(A). THEREAFTER, THE LD.CIT(A) ALLOWED THE APPEAL OF THE ASSESSEE. ON APPEAL BY THE REVENUE, IN THE 2 ND ROUND THE TRIBUNAL RESTORED THE CASE TO THE FILE OF THE A.O. THEREAFTER THE A.O. REPEATED THE ADDITION OF RS.35 LAKHS U/S 68 OF THE INCOME TAX ACT, 1961 (THE ACT). ON APPEAL THE FIRST APPELLATE AUTHORITY C ONFIRMED THE ADDITION. AGGRIEVED THE ASSESSEE IS IN APPEAL BEFORE US FOR THE THIRD TIME. 3 4. WE HAVE HEARD MR.S.K.CHATURVEDI, THE LD.COUNSEL FOR THE ASSESSEE AND MR.VIKRAM SAHAY, THE LD.SR.D.R. ON BEHALF OF THE REVENUE. 5. ON A CAREFUL CONSIDERATION OF TH E FACTS AND CIRCUMSTANCES OF THE CASE, ON PERUSAL OF ORDERS OF LOWER AUTHORITIES, MATERIAL PLACED ON RECORD, WE HOLD AS FOLLOWS. 6. THE CONTENTION OF THE LD.COUNSEL FOR THE ASSESSEE IS THAT NO ADDITION CAN BE MADE IN THE HANDS OF THE FIRM OR AOP , FOR CONT RIBUTIONS TO CAPITAL MADE BY , THE PARTNERS OF THE PARTNERSHIP FIRM OR THE MEMBERS OF AN AOP. RELIANCE WAS PLACED ON THE FOLLOWING CASE LAWS. (A) CIT VS. JAISEWAR MOTOR FINANCE (1983) 141 ITR 708 (ALL.) (B) INDIAN RICE MILLS VS. CIT (1996) 218 ITR 508 (ALL.) (C ) SURINDER MOHAN SETH VS. CIT (1996) 221 ITR 239 (ALL.) 6.1. THE LD.SR.D.R. SHRI VIKRAM SAHAY POINTED OUT THAT THE VERY SAME ARGUMENT WAS REJECTED BY THE ITAT IN ITA NO.2129/DEL/2008 VIDE ORDER DT. 31.3.2010 IN THE ASSESSEE S OWN CASE FOR THE VERY SAME A.Y. IN THE EARLIER ROUND OF APPELLATE PROCEEDINGS. 6.2. WE FIND THAT AT PARA 6 OF THE ORDER OF THE TRIBUNAL IN ITA 2129/DEL/08 IT WAS HELD AS FOLLOWS. 6. WE HAVE CONSIDERED THE CONTENTION OF LEARNED DR AND FOUND THAT BEFORE T H E AO, THE ASSESSE E DID NOT PRODUCE ANY EVIDENCE IN SUPPORT OF THE CONTRIBUTION OR RS.35 LAKHS BY M /S P.K.GOEL & SONS (HUF). NEITHER DATE OF PAYMENT NOR MODE OF PAYMENT NOR SOURCE OF INVESTMENT IN THE HAND S OF M/S P.K.GOEI & SONS (HUF) WERE FURNISHED. WITHOUT BRINGING ANY MATERIAL ON RECORD TO THE EFFECT THAT CAPITAL WAS CONTRIBUTED IN THE PRECEDING YEAR, THE CIT(A) DELETED THE ADDITION. THERE WAS NO BALANCE SHEET ON RECORD TO JUSTIFY THE CIT(A)'S CONCLUSION REGARDING I NVESTMENT OF RS. 35 LAKHS IN THE PRECEDING ASSESSMENT Y EAR. EVEN IF THE CIT(A) HAD FOUND THAT MEMBER OF AOP WAS TO EXPLAIN THE SOURCE OF INVESTMENT AND NOT THE ASSESSEE OF AOP, THEN ALSO CIT(A) SHOULD HAVE ISSUED THE DIRECTION FOR VERIFYING THE SOURCE OF INVESTMENT 4 IN THE HANDS OF M / S P.K.GOEL & SONS (HUF). KEEPING IN VIEW THE OBSERVATION OF THE AO AS CONTAINED AT PAGE 3, WHICH HAS NOT BEEN CONTROVERTED BY THE CIT(A), WE SET ASIDE THE ORDER OF CIT(A) AND MA TTER IS AGAIN RESTORED BACK TO THE FILE OF THE AO FOR DECIDING AF RESH AFTER GIVING DUE OPPORTUNITY TO THE ASSESSEE. WE DIRECT ACCORDINGLY. 6.3. THIS FINDING HAS ATTAINED FINALITY AS THE ASSESSEE HAS NOT CHALLENGED THE SAME BEFORE THE HON BLE HIGH COURT. THUS, WE ARE NOT INCLINED TO DEVIATE FROM THE FINDINGS OF THE COORDINATE BENCH IN THE EARLIER ROUND OF APPELLATE PROCEEDINGS, WHEREIN , THE VERY SAME ARGUMENT RAISED BY THE ASSESSEE WAS DISMISSED, FOR THE REASON THAT THERE IS NO PROOF WHATSOEVER , THAT THE AMOUNT IN QUESTION HAS BEEN CONTRIBUTED BY M/S PK GOEL & SO NS, HUF. THUS, WE DISMISS THIS APPEAL OF THE ASSESSEE. 7. IN THE RESULT THE APPEAL OF THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 11 TH SEPTEMBER , 2015. SD/ - SD/ - [ I.C.SUDHIR ] [J. SUDHAKAR REDDY] JUDICIA L MEMBER ACCOUNTANT MEMBER DT. THE 11 TH SEPTEMBER, 2015 MANGA 5 COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENCHES