N.R. Portfolio Pvt. Ltd., New Delhi V. ITO, New Delhi

ITA 88/DEL/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 86522 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-01-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 17-11-2014
• Assessment Year: 2002-2003
• Appeal Filed On: 04-01-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: J P CHANDRAKAR
• Assessee Lawyers: SAUBHAGYA AGARWAL
• Keywords: Initiation of penalty proceedings
• Section: 147; 68

Judgement Text

ITA NO S . 88,89 / DEL/2013 M/S. N.R. PORTFOLIO PVT. LTD. VS. ITO 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH E NEW DELHI BEFORE SHRI S.V. MAHROTRA , ACCOUNTANT MEMBER AND SHRI A.T. VARKEY , JUDICIAL MEMBER ITA NO S . 88,89 /DEL/2013 ASSESSMENT YEAR S : 2002 - 03, 2003 - 04 M/S. N.R. PORTFOLIO PVT. LTD. VS. ITO C/O PRAKASH K PRAKASH WARD - 13 (1) B - 1, SAGAR APARTMENTS NEW DELHI. 6, TILAK MARG, NEW DELHI. (PAN AAACN2431P) (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI SAUBHAGYA AGARWAL, ADVOCATE RESPONDENT BY: SHRI J.P. CHANDRAKAR, SR. DR O R D E R PER A.T. VARKEY , JUDICIAL MEMBER THIS IS AN APPEAL PREFERRED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A) XVI NEW DELHI FOR THE ASST. YEAR 2002 - 03. ITA NO. 88/DEL/2013 2. THE SO LITARY ISSUE I NVOLVED IN THIS APPEAL IS IN RESPECT OF LEVY OF PENALTY OF RS. 1,60,650/ - U/S 27 1(1)(C) OF THE INCOME TAX ACT 1961 (HEREINAFTER THE ACT) . 3. BRIEF FACTS OF THE CASE ARE THAT FOR THE INSTANT ASSTT. YEAR, THE ASSESS EE FURNISHED A RETURN ON 29 TH OCTOBER, 2002, WHICH WAS ACCEPTED AS SUCH. SUBSEQUENTLY ACTION U/S 147 OF THE ACT WAS INITIATED BY AN ORDER DATED 17 TH DECEMBER, 2007 U/S 147/144 OF THE ACT, AND THEREAFTER ADDITION WAS MADE OF RS. ITA NO S . 88,89 / DEL/2013 M/S. N.R. PORTFOLIO PVT. LTD. VS. ITO 2 1,20,34,100/ - U/S 68 OF THE ACT. ON APPEAL, THE CIT(A) GRANTED REL IEF EXCEPT SUSTAINING AN ADDITION OF RS. 4,50,000/ - BEING THE SHARE APPLICATION MONEY RECEIVED FROM 3 PARTIES NAMELY (A) TECHNOCHEM ASSOCIATES PVT. LTD. (B) YOGESH GUPTA (C) GANGA INFIN PVT. LTD. (RS. 1,50,000/ - EACH). ON APPEAL TO THE TRIBUNAL, THE SAID ADDITION SUSTAINED HAS BEEN CONFIRMED IN TERMS OF ORDER DATED 29 TH OCTOBER, 2010. PURSUANT TO THE SAID ORDER OF THE TRIBUNAL, THE AO LEVIED PENALTY OF RS. 1,60,650/ - ON THE ADDITION SUSTAINED BY THE TRIBUNAL. THE CIT(A) HAS ALSO CONFIRMED THE LEVY OF PENA LTY. THE LD. AR SUBMITTED THAT NO PENALTY IS LEVIABLE ON THE FACTS AS NON - AVAILABILITY OF PAN CANNOT BE A GROUND TO CONCLUDE THAT ASSESSSEE HAS FURNISHED IN ACCURATE PARTICULARS OF INCOME. THE LD. DR RELIED ON THE ORDER OF THE CIT(A). HE PLACED ON RECORD, T HE ORDER OF THE HONBLE H IGH COURT CONFIRMING THE ADDITION DELETED BY THE CIT(A) /ITAT. WE HAVE PERUSED THE MATERIAL ON RECORD CAREFULLY AND CONSIDERED THE RIVAL SUBMISSIONS MADE BY BOTH THE SIDES. THE HONBLE HIGH COURT IN THE CASE OF THE ASSESSEE, FOR T HE INSTANT ASSTT. YEAR BY AN ORDER DATED 22 ND NOVEMBER, 2013 HAS SUSTAINED THE ADDITION OF R S . 63,80,100/ - DELETED BY THE CIT(A)/ITAT. IN ARRIVING AT THE SAID CONCLUSION, THE HONBLE HIGH COURT HAS OBSERVED IN PARA 30 & 31 AS UNDER : - VERIFICATION O F PAN HAS BEEN DONE DURING THE PRESENT PROCEEDINGS WHEN IT IS FOUND THAT IN CASE OF M/S. TECHNOCHEM ASSOCIATES PVT. LT D. AND MR. YOGESH GUPTA FROM WHOM SHARE APPLICATION M ONEY OF RS. 1,50,000/ - EACH (TO TALING RS. 3,00,000/ - ) HAD BEEN RAISED, NO DETA ILS REG ARDING PAN HAS BEEN FURNISHED. REGARDING M/S. GANGA INFIN PVT. LTD. FROM WHOM THE APPELLANT HAS STATED TO HAVE RECEIVED RS. 1,50,000/ - AS SHARE APPLICATION MONEY, THE APPELLANT HAS FURNISHED ITS PAN AS AAACG4848B WHICH IS FOUND TO BE INVALID. THE APPELLAN TS AR HAS BEEN APPRISED OF THIS FACT CONSEQUENT TO WHICH AGAIN SAME PAN IS GIVEN FOR M/S. GANGA INFIN PVT. ITA NO S . 88,89 / DEL/2013 M/S. N.R. PORTFOLIO PVT. LTD. VS. ITO 3 LTD. ACCORDINGLY, I HOLD THAT IN ABOVE MENTIONED THREE CASES, THE IDENTITY OF PERSONS IS NOT PROVED AND HENCE THERE CANNOT BE ANY APPLICABILITY OF THE CASE LAW OF LOVELY E XPORTS PV T. LTD. (SUPRA) AND ADDITION TO THE EXTENT OF RS. 4,50,000/ - IS CONFIRMED. 4. FROM THE AFORESAID , IT IS APPARENT THAT THE HONBLE HIGH COURT HAS HELD THAT ASSESSEE HAS NOT PLACED ON RECORD ANY EVIDENCE OTHER THAN S HARE APPLICATION FORMS, SO AS TO DISCHARGE THE ONUS U/S 68 OF THE ACT. IT WAS SPECIFICALLY OBSERVED BY THE HONBLE HIGH COURT THAT MERE PRODUCTION OF INCORPORATION DETAILS /PAN NOS. MAY NOT BE SUFFICIENT WHEN SURROUNDING AND ATTENDING FACTS PREDIC A T E A CO VER UP. THOUGH THE SAID OBSERVATIONS HAD BEEN MADE IN RESPECT OF ADDITIONS OF RS. 63,80,100/ - AND NOT IN RESPECT OF RS. 4,50,000/ - WHICH SUM HAD ALREADY BEEN CONFIRMED BY THE CIT(A) /ITAT ON ACCOUNT OF NON/ERRONEOUS PAN DETAILS. HOWEVER, THE SAID SUM IS A LSO PART OF THE SAME TRANSACTIONS AND THEREFORE THESE OBSERVATION EQUALLY APPLIES TO THE SUM OF RS. 4,50,000/ - . IN SUCH CIRCUMSTANCES, THE ISSUE WHICH ARISES FOR CONSIDERATION IS WHETHER ASSESEE CAN BE SAID TO HAVE CONCEALED INCOME IN RESPECT O F WHICH INA CCURATE PARTICULARS HAVE BEEN FURNISHED. TO OUR MIND, THE ANSWER HAS TO BE IN THE AFFIRMATIVE. THE ASSESEE DURING THE PENALTY PROCEEDINGS HAS NOT PLACED ON RECORD ANY MATERIAL TO SUPPORT ITS ASSERTION AND REBUT THE OBSERVATIONS OF THE HONBLE HIGH COURT. ALSO THE EXPLANATION OF THE ASSESEE HAS BEEN FOUND TO BE FALSE AND IT IS NOT A CASE WHERE A BONAFIDE EXPLANATION IN RESPECT OF WHICH ALL MATERIAL FACTS HAD BEEN FURNISHED BY THE ASSESSEE BEFORE THE AUTHORITIES BELOW . 5. THE DELHI HIGH COURT IN THE CA SE OF CIT VS. FROSTAIR (P) LTD. (2012) 26 TAXMAN. COM 11( DELHI) HAS UPHELD THE ADDITION MADE BY THE AO U/S. 68 AND ITA NO S . 88,89 / DEL/2013 M/S. N.R. PORTFOLIO PVT. LTD. VS. ITO 4 ALSO UPHELD THE INITIATION OF PENALTY PROCEEDING U/S 271(1)(C) (HEAD NOTE OF THE SAME ) IS AS UNDER : - WHETHER ASSES S EE IS UNDER A BURDEN TO EXPLAIN NATURE AND SOURCE OF SHARE APPLICATION MONEY RECEIVED IN A GIVEN CA S E AND HE HAS TO ESTABLISH SHAREHOLDERS IDENTITY: GENUINENESS OF TRANSACTION: AND CREDITWORTHINESS OF SHAREHOLDERS HELD, YES ON BEING INFORMED THAT ASSE S SEE HAD ACCEPTED S HARE CAPITAL FROM SOME COMPANIES WHICH WERE ENGAGED IN PROVIDING BOGUS ENTRIES IN FORM OF LOAN AND SHARE APPL ICAT I ON MONEY. ASSESSING OFFICER ASKED FOR DETAILS UNDER SECTION 142 - ASSESSEE SUBMITTED A LIST OF 18 SHAREHOLDERS ASSESSING OFFICER DISCE RNED TH AT PAN/GIR NO. OF SHAREHOLDERS WAS NOT CORRECT, THEY WERE NOT FOUND AT ADDRESSES GIVEN AND THEY WERE NOT FILING THEIR ITRS WITH CONCERNED OFFICERS WHETHER SINCE ASSESSING OFFICER HAD EXAMINED ALL FACTS IN EXHAUSTIVE MANNER, ADDITION UNDER SECTION 68 AND, CONSEQUENTLY INITIATION OF PENALTY PROCEEDINGS WERE JUSTIFIED HELD, YES. 6. IN VIEW OF THE AFORESAID, THE ORDERS OF THE AUTHORITIES BELOW ARE CONFIRMED AND LEVY OF PENALTY IS SUSTAINED. AS A RESULT THE APPEAL OF THE ASSESEEE IS DISMISSED. IN ITA NO. 89/DEL/2013, THE CHAL LENGE IS TO LEVY OF PENALTY OF RS. 1,60,650/ - SINCE THE FACTS OF THE CASE IS IDENTICAL TO THE AFORE - STATED CASE, THEREFORE, THE IMPUGNED PENALTY IS ALSO CONFIRMED. IN THE RESULT BOTH THE APPEALS ARE DISMISSED. O RDER PRON OUNCED IN THE OPEN COURT ON 08 TH JANUARY, 2015. - SD/ - - SD/ - ( S.V. MEHROTRA ) ( A.T. VARKEY ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED :08 TH JANUARY, 2015 VEENA / AKK CO PY OF ORDER FORWARDED TO: 1. APPELLANT 2. RESPONDENT ITA NO S . 88,89 / DEL/2013 M/S. N.R. PORTFOLIO PVT. LTD. VS. ITO 5 3. CIT(A) 4. CIT 5. DR BY ORDER DEPUTY REGISTRAR, ITAT