ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-1(1), NAGPUR V. M/S NITIN COAL PVT. LTD., NAGPUR

ITA 91/NAG/2018

AI Insights

The case involves the Assistant Commissioner of Income Tax, Central Circle-1(1), Nagpur as the appellant and M/s. Nitin Coal Pvt. Ltd. as the respondent. The dispute arose from the assessment year 2012-2013, concerning an order by the CIT(A)-3, Nagpur which deleted an addition of Rs. 70 lakhs claimed as unexplained cash credit under section 68 of the Income Tax Act, 1961. The Revenue challenged this decision, arguing that the CIT(A) erred in deleting the addition without sufficient proof of the creditworthiness of the creditors and the genuineness of the transactions. However, the Tribunal dismissed the appeal based on the tax effect threshold prescribed by the CBDT.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 131935 (ITAT-NAGPUR)
• Duration Of Justice: 5 year(s) 5 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-09-2023
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 28-08-2023
• Assessment Year: 2012-2013
• Appeal Filed On: 19-04-2018
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Tax effect
• Section: 68; 143(3)

Judgement Text

THE INCOME TAX APPELLATE TRIBUNAL NAGPUR BENCHES : NAGPUR (THROUGH VIRTUAL HEARING) BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER AND SHRI GD PADMAHSHALI, ACCOUNTANT MEMBER ITA.No.91/Nag./2018 Assessment Year 2012-2013 Assistant Commissioner Of Income Tax Central Circle-1(1), Nagpur vs. M/s. Nitin Coal Pvt. Ltd. A-2/4, Vijayanand Society, Near Lokmat, Dhantoli, Nagpur-440010 PAN: AACCN8206E (Appellant) (Respondent) For Assessee : None For Revenue : Shri Rishi Kumar Bisen, DR Date of Hearing : 29.08.2023 Date of Pronouncement : 21.09.2023 ORDER PER SATBEER SINGH GODARA, J.M. This Revenue’s appeal for A.Y. 2012-13, arises against the CIT(A)-3, Nagpur’s order dated 23.02.2018, passed in Case No.CIT(A)-3/78/2016-17, in proceedings under section 143(3) r.w.s. 147 of the Income Tax Act, 1961 [“In short Act”]. 2. Heard both the parties. Case file perused. 2 ITA.No.91/Nag./2018 ACIT vs. M/s. Nitin Coal Pvt. Ltd. 3. The Revenue raises the following substantive grounds in the instant appeal: “ 1. On the facts and circumstances of the case and in law, the Ld. CITA) erred in deleting the addition of Rs. 70 lakhs being unexplained cash credit u/s 68 of the IT Act, 1961. 2. On the facts and circumstances of the case and in law, the Ld. CIT(A) failed to establish the creditworthiness of the creditors and genuineness of the transactions while deleting the additions on technical grounds and failing to appreciate that the same were not proved to the satisfaction of AO. 3. On the facts and circumstances of the case and in law, the CIT(A) failed to appreciate that details of reserve and surplus were not given in case of A.S.V Pvt. Ltd and in other case reserve and surplus comprises of premium only. 4. On the facts and circumstances of the case and in law, the CITA) has failed to appreciate that the companies from whom share and premium was received did not have the creditworthiness to fund the share capital and premium and thereby neither the creditworthiness nor the genuineness of transaction is proved. 5. On the facts and circumstances of the case and in law, the Ld. CIT(A) failed to appreciate the ground realities and documents in case of shell companies which are always in order so that they can act as a conduit in aiding tax evasion. 6. On the facts and circumstances of the case and in law, the Ld. CIT(A) has failed to appreciate that the two key ingredients in making addition u/s 68 namely creditworthiness of creditors and genuineness of the transactions were not proved to the satisfaction of the A.O.” 4. The Revenue could hardly dispute the clinching fact that its sole substantive grievance seeking to revive Section 68 unexplained cash credit addition of Rs.34,97,610/- only as per the relevant column in Form 36 herein; involves less than the minimum prescribed tax effect threshold limit of Rs.50 lakhs as per the CBDT’s latest Circular No.17 of 2019 dated 08/08/2019 made 3 ITA.No.91/Nag./2018 ACIT vs. M/s. Nitin Coal Pvt. Ltd. applicable to all pending appeals as well. The Revenue could hardly dispute any exception thereto in its above extracted grounds. This appeal is rejected in very terms. Ordered accordingly. 5. This Revenue’s appeal is dismissed in above terms. Order pronounced in the open court on 21.09.2023 Sd/- Sd/- [GD PADMAHSHALI] [SATBEER SINGH GODARA] ACCOUNTANT MEMBER JUDICIAL MEMBER Pune, Dated 21.09.2023 S.K.SINHA True Copy Copy to 1. The appellant 2. The respondent 3. The Ld. CIT(A) concerned. 4. The CIT concerned 5. D.R. ITAT, Nagpur Bench, Nagpur 6. Guard File. //By Order// Assistant Registrar, ITAT, Pune Benches, Pune.