Grindly Gases & Petrochemicals Pvt.Ltd., Baroda V. The Income tax Officer,Ward-1(3), Baroda

ITA 914/AHD/2011

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 80266 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 4 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-08-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 25-07-2014
• Assessment Year: 2006-2007
• Appeal Filed On: 29-03-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DINESH SINGH
• Section: 68

Judgement Text

, , , , , , , , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD , !' # $ $ $ $ %, # BEFORE SHRI ANIL CHATURVEDI, ACCOUNTANT MEMBER AND SHRI KUL BHARAT, JUDICIAL MEMBER $./ I.T.A. NO.914/AHD/2011 ( ( )( ( )( ( )( ( )( / / / / ASSESSMENT YEAR : 2006-07) GRINDLY GASES & PETROCHEMICALS P.LTD. 303, B.N. CHAMBERS R.C.DUTT ROAD ALKAPURI BARODA 390 005 / VS. THE I.T.O. WARD-1(3) BARODA #* !' $./+, $./ PAN/GIR NO. : AAACG 7129 F ( *- / // / APPELLANT ) .. ( ./*- / RESPONDENT ) *- 0 ! / APPELLANT BY : MS.URVASHI SHODHAN, A.R. ./*- 1 0 ! / RESPONDENT BY : SHRI DINESH SINGH, SR.D.R. 2 1 ' / / / / DATE OF HEARING 25/07/2014 34) 1 ' / DATE OF PRONOUNCEMENT 08/08/2014 !5 / O R D E R PER SHRI KUL BHARAT, JUDICIAL MEMBER : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST T HE ORDER OF THE LD.COMMISSIONER OF INCOME TAX(APPEALS)-I, BARODA (CIT(A) IN SHORT) DATED 28.02.2011 PERTAINING TO ASSESSMENT YEAR (AY) 2006-07. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEA L:- 1. THE LEARNED CIT(APPEALS) ERRED IN HOLDING THAT PROV ISIONS OF SECTION 68 WERE APPLICABLE IN RELATION TO SHARE APP LICATION RECEIVED BY THE APPELLANT-COMPANY. 2. THE LEARNED CIT (APPEALS) ERRED IN HOLDING THAT THE DECISION IN THE CASE OF M/S.LOVELY EXPORTS WERE NOT APPLICABLE TO THE FACTS OF ITA NO.914/AHD/ 2011 GRINDLY GASES & PETROCHEMICALS P.LTD. VS. ITO ASST.YEAR 2006-07 - 2 - THE APPELLANT COMPANY AND FURTHER ERRED IN CONFIRMI NG AN ADDITION OF RS.3,00,000/- IN RELATION TO SHARE APPLICATION M ONEY RECEIVED BY THE APPELLANT COMPANY. 3. THE APPELLANT COMPANY CRAVES, LEAVE TO ADD, ALTER O R AMEND ANY OF THE GROUNDS MENTIONED ABOVE. 2. BRIEFLY STATED FACTS ARE THAT THE CASE OF THE A SSESSEE WAS PICKED UP FOR SCRUTINY ASSESSMENT AND THE ASSESSMENT U/S.143( 3) OF THE INCOME TAX ACT,1961 (HEREINAFTER REFERRED TO AS THE ACT) WAS FRAMED VIDE ORDER DATED 16/12/2008, THEREBY THE ASSESSING OFFICER (AO IN SHORT) MADE DISALLOWANCES/ADDITIONS OF RS.96,000/- U/S.40(A)(IA ) OF THE ACT, RS.3,00,000/- ON ACCOUNT OF SHARE APPLICATION MONEY U/S.68 AND RS.6,21,602 ON ACCOUNT OF CREDIT BALANCES. HENCE, THE AO AGAINST THE LOSS OF RS.18,69,262/- COMPUTED THE LOSS AT RS.8,51 ,660/-. AGAINST THIS, ASSESSEE FILED AN APPEAL BEFORE THE LD.CIT(A), WHO AFTER CONSIDERING THE SUBMISSIONS PARTLY ALLOWED THE APPEAL, WHEREIN THE LD.CIT(A) CONFIRMED AN ADDITION OF RS.3 LACS MADE ON ACCOUNT OF SHARE A PPLICATION MONEY. NOW, THE ASSESSEE IS FURTHER IN APPEAL BEFORE US AG AINST THE ORDER OF THE LD.CIT(A). THE ONLY EFFECTIVE GROUND IS AGAINST TH E CONFIRMATION OF ADDITION OF RS.3 LACS IN RELATION TO SHARE APPLICAT ION MONEY RECEIVED BY THE APPELLANT-COMPANY. 3. THE LD.COUNSEL FOR THE ASSESSEE SUBMITTED THAT T HE AUTHORITIES BELOW WERE NOT JUSTIFIED IN MAKING THE ADDITION. SHE SUB MITTED THAT THE APPELLANT HAD FURNISHED CONFIRMATION FROM THE SHARE APPLICANTS. THEREFORE, THERE WAS NO OCCASION TO MAKE ADDITION O N THIS COUNT. IN SUPPORT OF THIS CONTENTION, SHE RELIED ON THE DECIS ION OF HONBLE TRIBUNAL ITA NO.914/AHD/ 2011 GRINDLY GASES & PETROCHEMICALS P.LTD. VS. ITO ASST.YEAR 2006-07 - 3 - (ITAT JODHPUR THIRD MEMBER BENCH) RENDERED IN THE C ASE OF UMA POLYMERS (P) LTD. VS. DY.CIT REPORTED AT (2006)100 ITD 1 (JD)(TM). 4. ON THE CONTRARY, LD.SR.DR SHRI DINESH SINGH SUBM ITTED THAT THE ASSESSEE FAILED TO FURNISH THE DETAILS WHETHER THE SHARES WERE ACTUALLY ALLOTTED TO THE SHARE APPLICANTS. IN THE ABSENCE O F SUCH DETAILS, THE AUTHORITIES BELOW WERE JUSTIFIED IN MAKING THE ADDI TION AND CONFIRMING THE SAME. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. THE UNDISPUTED FACTS REMAINING FROM THE RECORDS ARE THAT THE ASSESSEE HAD FURNISHED THE CONFIRMATION LETTER. THE OBJECTION O F THE AO WAS THAT THE SHARE APPLICATION MONEY WAS RECEIVED IN CASH AND TH E LD.CIT(A) CONFIRMED THE ADDITION ON THE BASIS OF RELIANCE ON THE DECISION OF COORDINATE BENCH RENDERED IN THE CASE OF DCIT VS. R ASUN EXPORTS PVT.LTD. (2010) TIOL 731 - ITAT HYD., DATED 30/04 /2010. THE LD.CIT(A) OBSERVED THAT IT IS NOT CLEAR WHETHER THE SHARES HAVE BEEN ALLOTTED OR NOT TO THE APPLICANTS. DURING THE COUR SE OF HEARING, THE LD.COUNSEL FOR THE ASSESSEE CONCEDED THAT FOR THIS LIMITED PURPOSE, THE MATTER CAN BE RESTORED TO THE FILE OF AO TO VERIFY WHETHER THE SHARES HAVE BEEN ALLOTTED TO THE SHARE APPLICANTS. 5.1. AFTER CONSIDERING THE TOTALITY OF THE FACTS, I T IS NOT COMING OUT WHETHER THE SHARES HAVE BEEN ALLOTTED TO THE SHARE- APPLICANTS OR NOT. THIS ASPECT IS REQUIRED O BE VERIFIED BY THE AO. SINCE THE ASSESSEE HAS FURNISHED CONFIRMATION LETTERS FROM THE SHARE-APPLI CANTS WHICH IS NOT ITA NO.914/AHD/ 2011 GRINDLY GASES & PETROCHEMICALS P.LTD. VS. ITO ASST.YEAR 2006-07 - 4 - DISPUTED BY THE AUTHORITIES BELOW, THEREFORE THE O NLY ASPECT IS REQUIRED TO BE VERIFIED WHETHER THE SHARES HAVE, IN FACT, BEEN ALLOTTED TO THE SHARE- APPLICANTS. IN CASE, THE SHARES HAVE BEEN ALLOTTED , THEN THE AO IS DIRECTED TO DELETE THE ADDITION ACCORDINGLY. THUS, THIS GRO UND ASSESSEES APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN COURT ON THE DATE MENTIONED HER EINABOVE AT CAPTION PAGE SD/- SD/- ( ) ( %) !' # # ( ANIL CHATURVEDI ) ( KUL BHARAT ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 08/08/2014 8 .., .../ T.C. NAIR, SR. PS !5 1 .9 :!9) !5 1 .9 :!9) !5 1 .9 :!9) !5 1 .9 :!9)/ COPY OF THE ORDER FORWARDED TO : 1. *- / THE APPELLANT 2. ./*- / THE RESPONDENT. 3. $$ ; / CONCERNED CIT 4. ;() / THE CIT(A)-I, BARODA 5. 9%< . , , / DR, ITAT, AHMEDABAD 6. <=( >2 / GUARD FILE. !5 !5 !5 !5 / BY ORDER, /9 . //TRUE COPY// ? ?? ?/ // / $+ $+ $+ $+ ( DY./ASSTT.REGISTRAR) , , , , / ITAT, AHMEDABAD 1. DATE OF DICTATION .. 4.8.14(DICTATION-PAD 6- PAG ES ATTACHED AT THE END OF THIS FILE) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 5.8.14 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S.. 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 5. DATE ON WHICH FAIR ORDER PLACED BEFORE OTHER MEMBER 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S.8.8.14 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 8.8.14 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ..8.8.14 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER