The Assistant Commissioner of Income Tax, Central Circle-2, RAJKOT-GUJARAT V. M/s. Jay Enterprises, RAJKOT-GUJARAT

ITSSA 24/RJT/2017

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 9869 (ITAT-RAJKOT)
• Duration Of Justice: 2 year(s) 2 month(s) 8 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 30-04-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 20-02-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit
• Section: 143(3); 153A; 131; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNA L RAJKOT BENCH, RAJKOT [CONDUCTED THROUGH E-COURT AT AH MEDABAD] (BEFORE SHRI MAHAVIR PRASAD, JUDICIAL MEMBER & SHRI WASEEM AHMED, ACCOUNTANT MEMBER) IT(SS)A. NO: 24/RJT/2017 (ASSESSMENT YEAR: 2009-10) ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-2, RAJKOT V/S M/S. JAY ENTERPRISE C/O PAREKH COMPLEX, MEENA GALI, MANDVI CHOWK,SONI BAZAR, RAKOT (APPELLANT) (RESPONDENT) PAN: AACFJ 6355K APPELLANT BY : SHRI JITENDRA KUMAR,CIT/D R RESPONDENT BY : SHRI GAURANG SANGHVI ( )/ ORDER DATE OF HEARING : 28 -02-201 9 DATE OF PRONOUNCEMENT : 30-04-2019 PER MAHAVIR PRASAD, JUDICIAL MEMBER 1. THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAINS T THE ORDER OF THE LD. CIT(A)-11, AHMEDABAD DATED 25.11.2016 PERTAINING TO A.Y. 2009-10 AND FOLLOWING GROUNDS HAVE BEEN TAKEN: IT(SS)A NO. 24/RJT/2017 . A.Y. 2009-10 2 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LD'. CIT(A) HAS ERRED IN LAW AND/OR ON FACTS IN NOT APPRECIATING TH E PROVISIONS OF SECTION 153A OF THE IT. ACT WHICH REQUIRES THE TOTAL INCOME TO BE B ROUGHT UNDER TAX WITHOUT ANY RESTRICTIONS. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN LAW AND/OR ON FACTS IN HOLDING THAT SU CH ASSESSMENT OR RE- ASSESSMENT U/S 153A IS TO BE RESTRICTED ONLY TO THE INCRIMINATING MATERIALS FOUND DURING THE SEARCH. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN HOLDING THAT AS THE GROUND ON LEGALITY OF ADDITIONS IS ALLOWED, THE OTHER GROUNDS ON MERITS ARE CONSIDERED NOT NECESSAR Y TO BE ADJUDICATED AS THE SAME ARE PURELY ACADEMIC. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN LAW AND/OR ON FACTS IN DELETING THE AD DITION MADE ON. ACCOUNT OF UNEXPLAINED CASH CREDIT U/S 68 OF THE ACT OF RS.7,9 3,94,849/-. 2. FACTS OF THE CASE ARE THAT THE ASSESSEE HAD FILED R ETURN OF INCOME U/S 153 A FOR A.Y. 2009-10 AS ON 28/10/2015 DECLARING TOTAL INCOM E AT RS. 429100/-. THE ASSESSMENT WAS MADE BY ASST. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 2, RAJKOT (HEREIN AFTER REFERRED AS A.O.) U/S 143(3) R .W.S. 153A VIDE ORDER DATED 12/02/2016 WHEREIN ADDITIONS / DISALLOWANCES WERE M ADE WITHOUT PROPERLY APPRECIATING THE FACTS AND PREVALENT LEGAL DECISION S. IN THE SAID ASSESSMENT ORDER A.O. MADE ADDITION OF RS. 7,93,94,849/- ON AC COUNT OF UNEXPLAINED CASH CREDIT U/S 68. IN THIS MATTER IT IS STATED THAT THE RE WAS LOAN RECEIVED FROM M/S MANAKSIA TREXIM PVT. LTD. .THE LOAN WAS TAKEN THROU GH CHEQUE / RTGS, THE SAME IS TAKEN THROUGH PROPER BANKING CHANNEL. IT IS FURTHER STATED THAT DUE TO FINANCIAL CRISIS THE LOAN COULD NOT BE REPAID BY TH E APPELLANT IN THAT YEAR . IT IS ALSO STATED THAT IN REPLY OF SUMMONS U/S 131 OF THE I.T.ACT M/S MANAKSIA TREXIM PVT. LTD. ALSO CONFIRMED THAT THEY HAD GIVEN LOAN TO US AND SUBMITTED ALL THE REQUIRED PAPERS. WE THEREFORE STATE THAT TH E APPELLANT HAD FURNISHED ALL THE DETAILS REGARDING LOAN TAKEN AND HAD PROVED IDE NTITY, CREDITWORTHINESS AND GENUINENESS OF THE TRANSACTIONS AND THEREFORE THE T RANSACTION STANDS EXPLAINED IT(SS)A NO. 24/RJT/2017 . A.Y. 2009-10 3 AND ACCORDINGLY NO ADDITION CAN BE MADE ON PRESUMPT ION BASIS. HERE THE ADDITION HAS BEEN MADE MERE ON ASSUMPTION BASIS. WH EN ALL THE CRITERIA OF SEC 68 WHICH INCLUDED IDENTITY, CREDITWORTHINESS AND GE NUINENESS WERE PROVED AND THE PARTY HAD ALSO APPEARED AND CONFIRMED THE TRANS ACTION AND INTEREST WAS ALSO PAID DURING THE YEAR, THEN THE AO SHOULD NOT HAVE D OUBTED THE TRANSACTION. 3. BUT LD. A.O. WAS NOT CONVINCED WITH THE PLEA OF THE ASSESSEE AND MADE ADDITION OF RS. 7,93, 94,849/-. 4. THEREAFTER, ASSESSEE PREFERRED FIRST STATUTORY APPE AL BEFORE THE LD. CIT(A) WHO PARTLY ALLOWED THE APPEAL OF THE ASSESSEE. 5. WE HAVE GONE THROUGH THE RELEVANT RECORD AND IMPUGN ED ORDER. IN THIS CASE, A SEARCH WAS CONDUCTED ON 20.05.2013 AND PROCEEDINGS WERE INITIATED U/S. 153A AND DURING THE SEARCH NO INCRIMINATING DOCUMENT WAS FOUND AND SEIZED AND DURING THE ASSESSMENT PROCEEDING, A.O. NOTICED THAT ASSESSEE HAS TAKEN A LOAN OF RS. 7.30 CRORE FROM MANAKSIA TREXIM PVT. LTD., C ALCUTTA. HE MADE DETAILED INQUIRIES THROUGH INVESTIGATION WING OF CALCUTTA AN D CONCERNED PERSON OF MANAKSIA TREXIM PVT. LTD. IN SHORT MTPL CLEARLY STA TED THAT IT HAD ADVANCED LOAN TO THE APPELLANT AND SOURCE OF THE LOAN WAS AL SO EXPLAINED. AND IT WAS ALSO SUBMITTED THAT CREDITOR RECEIVED FUNDS FROM MANAKSI A TREXIM PVT. LTD. ITS OWN GROUP CONCERNED AND SOURCE OF SOURCE WAS ALSO EXPLA INED. 6. IN SUPPORT OF ITS CONTENTION, LD. A.R. CITED A JUDG MENT OF JURISDICTIONAL HIGH COURT IN THE MATTER OF ROHINI BUILDERS 256 ITR 360 WHEREIN IT IS HELD IF THE ASSESSEE HAS GIVEN THE ABOVE MENTIONED DOCUMENTS TH EN IT IS THE ONUS OF THE A.O. TO VERIFY THE FACTS. AS STATED BY THE HON'BLE SUPREME COURT MEREL Y ISSUING NOTICES TO THE CREDITORS AND THEN IT(SS)A NO. 24/RJT/2017 . A.Y. 2009-10 4 NOT PURSUING THE SAME CANNOT BE HELD AGAINST THE AS SESSEE. FURTHER, AS STATED BY THE HON'BLE GUJARAT HIGH COURT IN THE ABOVE MENTIONED CASE THE ASSESSEE IS NOT REQUIRED TO PROVE HOW THE MONEY WAS DEPOSITED IN THE BANKS OF THE CREDITORS A ND, THEREFORE, IT IS NOT FOR THE ASSESSEE TO GIVE THE BANK STATEMENT BUT FOR THE A.O, TO OBTAIN THEM EITHER FROM THE BANK OR FROM THE CREDITORS IF HE CONSIDERS IT TO BE NECESSARY. ONCE THE ONUS IS FULFILLED BY THE ASSESSEE IT IS FOR THE A.O. TO EXAMINE AND BRING ANY MATERIAL ON RECORD WH ICH MAY HELP IN REBUTTING THE ONUS OF THE ASSESSEE . 7. A CO-ORDINATE BENCH IN THE MATTER OF ITO VS. APEX T HERM PACKAGING PVT. LTD. IN ITA NO. 1151/AHD/2010 WHEREIN IT IS HELD TH AT WHEN THE APPELLANT HAD SUBMITTED ALL THE DOCUMENTS INCLUDING CONFIRMAT ION, NAME, ADDRESS PAN NO., COPY OF LEDGER, COPY OF BALANCE SHEET, COPY OF PROFIT AND LOSS ACCOUNT, COPY OF INCOME TAX RETURNS THEN NO ADDITION CAN BE MADE U/S 68 AS THE ONUS WAS FULFILLED BY THE ASSESSEE AND IT WAS FOR THE AO TO EXAMINE AND BRING ANY MATERIAL ON RECORD WHICH MAY HELP IN REBUTTING THE ONUS OF ASSESSEE. 8. SINCE NOTHING INCRIMINATING DOCUMENT WAS FOUND AND SEIZED FROM THE PREMISES OF THE ASSESSEE AND DURING THE ASSESSMENT PROCEEDIN G, IT WAS NOTICED BY THE LD.A.O. THAT ASSESSEE HAS TAKEN LOAN FROM MTPL AND ASSESSEE HAS SATISFACTORILY EXPLAINED THE REASON OF THE SAID TRANSACTION GENUIN ENESS AND RATHER SOURCE OF THE SOURCE WAS ALSO EXPLAINED. 9. IN VIEW OF THE AFORESAID JUDICIAL PRONOUNCEMENTS AN D FACTS OF THE CASE, WE DISMISS THIS APPEAL OF THE REVENUE. IT(SS)A NO. 24/RJT/2017 . A.Y. 2009-10 5 10. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISS ED. ORDER PRONOUNCED IN OPEN COURT ON 30 - 04- 2019 SD/- SD/- (WASEEM AHMED) (MAHAVIR PRASAD) ACCOUNTANT MEMBER TRUE COPY JUDICIAL MEMBER AHMEDABAD: DATED 30/04/2019 RAJESH COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AHME DABAD