Elcon Exports Pvt.Ltd., Ahmedabad V. The Dy.CIT.,Circle-1(3), Ahmedabad

ITSSA 8/AHD/2008

• Counselvise Citation: [2010] 124 COUNSELVISE.COM (IT) 8762 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 10 month(s) 28 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 13-12-2010
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 13-12-2010
• Assessment Year: misc
• Appeal Filed On: 16-01-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R K DHANESTA SRDR
• Assessee Lawyers: S N SO
• Keywords: Unexplained cash credit; Block assessment
• Section: 143(3); 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD AHMEDABAD A BENCH BEFORE SHRI G.D. AGARWAL, VICE-PRESIDENT (AZ) AND SHRI MAHAVIR SINGH, JUDICIAL MEMBER IT(SS)A NO.8/AHD/2008 [BLOCK PERIOD FROM 1/4/85 TO 5/9/95] ELCON EXPORTS PVT. LTD. -VS- DCIT, CENTRAL CIRCLE- 1(3), AIRPORT CROSS ROAD, HANSOL AHMEDABAD AHMEDABAD PAN NO.AAACE2641J (APPELLANT) (RESPONDENT) REVENUE BY : SHRI R.K. DHANESTA, SR-DR ASSESSEE BY : SHRI S.N. SOPANKAR, SR-AR O R D E R PER MAHAVIR SINGH, JUDICIAL MEMBER:- THIS APPEAL BY THE ASSESSEE IS ARISING OUT OF THE ORDER OF DY. COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-1(3), AH MEDABAD U/S 158BC R.W.S. 143(3) OF THE INCOME-TAX ACT, 1961 (HEREINAF TER REFERRED TO AS THE ACT) VIDE HIS ORDER DATED 26-12-2007 FOR THE BLOCK PERIO D FROM 01-04-1985 TO 05- 09-1995. 2. THE ONLY ISSUE IN THIS APPEAL OF ASSESSEE IS AGA INST THE ORDER OF DCIT CONFIRMING THE ADDITION OF RS.43.72 LAKH AS UNDISCL OSED INCOME OF THE ASSESSEE FOR BLOCK PERIOD ON ACCOUNT OF REPAYMENT O F LOAN TO DIFFERENT PERSONS AS UNEXPLAINED CREDITS ON PROTECTIVE BASIS. 3. THE BRIEF FACTS LEADING TO THE ABOVE ISSUE ARE T HAT BLOCK RETURN IN FORM NO.2B WAS FILED FOR THE BLOCK PERIOD 01-04-1985 TO 05-09-1995 ON 01-03-1996 DECLARING UNDISCLOSED INCOME AT NIL. THE ORIGINAL BLOCK ASSESSMENT WAS COMPLETED U/S.158BC R.W.S. 143(3) OF THE ACT VIDE O RIGINAL BLOCK ASSESSMENT IT(SS)A NO.8/AHD/2008 B.P.1/4/85 TO 5/9/95 ELCON EXPORTS PVT. LTD. V. DCIT, CC-1(3), ABD PAGE 2 ORDER DATED 30-09-1996 DETERMINING UNDISCLOSED INCO ME AT RS 95,19,187/-. THE FIRST APPELLATE AUTHORITY BEING ITAT IN THIS CA SE, THE APPEAL WAS FILED AGAINST THE ORIGINAL BLOCK ASSESSMENT ORDER AND ITA T, VIDE ORDER DATED 19- 05-2000 SET ASIDE THIS ISSUE OF UNEXPLAINED CREDIT AMOUNTING TO RS.43.72 LAKH FOR FRESH ADJUDICATION TO THE FILE OF ASSESSING OFF ICER BY GIVING FOLLOWING FINDING IN PARA-3.2 OF HIS BLOCK ASSESSMENT ORDER:- 3.2 THUS, IT IS EVIDENT THAT AT THE FAG END OF THE YEAR ASSESSEE IS TRYING TO SHIFT ITS ONUS ON THE GROUND THAT THEY HAVE MADE COMMUNICATION TO THE RESPECTIVE PERSONS TO APPEAR. IT IS ALSO TO BE APPRECIATED THAT THESE PARTIES ARE STATIONED AT JOD HPUR AND IT APPEARS TO BUY A PLOT BY THE ASSESSEE TO DELIBERATELY SEEKI NG ADJOURNMENT AND PRODUCING THESE PERSONS AND THEN TO CHALK OUT AT TH E ELEVENTH HOUR THAT THEY HAVE MADE COMMUNICATION AND THAT THE UNDERSIGN ED SHOULD APPROACH THESE PERSONS FOR GETTING THE NECESSARY IN FORMATION. IT IS TO BE APPRECIATED THAT THE ONUS U/S.68 IS ON THE ASSESSEE WHICH IS DISCHARGED AND THE ASSESSEE HAS TO PRODUCE THE GENUINENESS OF THE TRANSACTION AND THE CREDITWORTHINESS AND MERE FILING OF CHEQUES NUMBER NAME OF THE BANK WILL NOT CONSTITUTE SUFFICIENT DISCHARGE O F THE ONUS BY THE ASSESSEE IN VIEW OF JUDGMENT OF CALCUTTA HIGH COURT IN THE CASE OF CIT V. PRECISION FINANCE LIMITED 121 CTR 20 (CAL) THE ASSESSING OFFICER AGAIN RE-CONFIRMED THE ABOVE ADDITION BY GIVING FOLLOWING FINDING IN PARA-3.3 & 4 OF HIS BLOCK ASSESSMENT ORDER:- 3.3 EVEN DURING THESE RE-ASSESSMENT PROCEEDINGS, T HE ASSESSEE DID NOT PRODUCE THE CREDITORS. AS THE ASSESSEE FAILED T O ADDUCE ANY FRESH EVIDENCES IN SUPPORT OF ITS CONTENTION DURING THE P RESENT PROCEEDINGS, THE ADDITIONS OF RS.43,72,000/- BEING UNEXPLAINED C ASH CREDIT IN THE NAME OF 26 PERSONS IS MADE AS UNDISCLOSED INCOME OF THE BLOCK PERIOD FOR THE REASONS AS DETAILED ABOVE. 4. SUBJECT TO ABOVE REMARKS, THE TOTAL UNDISCLOSED INCOME IS COMPUTED AS UNDER: UNDISCLOSED INCOME AS PER ORDER DATED 27.11.2006 RS . 1,790 ADD: (1) UNEXPLAINED CREDITS U/S 68 AS DISCUSSED ABOVE ON PROTECTIVE BASIS RS.43,72,000 TOTAL UNDISCLOSED INCOME RS.43,73,790 AGGRIEVED, NOW ASSESSEE IS IN APPEAL BEFORE US. IT(SS)A NO.8/AHD/2008 B.P.1/4/85 TO 5/9/95 ELCON EXPORTS PVT. LTD. V. DCIT, CC-1(3), ABD PAGE 3 4. BEFORE US LD. SR-COUNSEL FOR THE ASSESSEE, SHRI S.N.SOPARKAR REFERRED TO TRIBUNALS ORDER IN IT(SS)A NO.18/AHD.2007 IN THE CASE OF UMEDSINGH P CHAMPAWAT V. ACIT CIRCLE-3, AHMEDABAD DATED 29-02-2008 OF THE SAME BLOCK PERIOD 01-04-1985 TO 05-09-1995, WHEREIN THE SUBSTANTIVE ADDITION HAS BEEN DELETED ON MERITS BY THE TRIBUNAL. ON THE OTHE R HAND, THE LD. SR-DR, SHRI R.K.DHANESTA STATED THAT THE DETAILS OF THE TW ENTY SIX CREDITORS HAVE NOT BEEN PROVIDED IN THE ORDER OF ASSESSING OFFICER AND IT IS NOT POSSIBLE AT THIS STAGE TO VERIFY THESE UNEXPLAINED CREDITORS AND ACC ORDINGLY, HE REQUESTED THIS ISSUE TO BE EXAMINED BY THE ASSESSING OFFICER AND A FTER VERIFYING WHETHER SUBSTANTIVE ADDITION HAS BEEN DELETED ON MERITS BY TRIBUNAL IN THE CASE OF UMEDSINGH P CHAMAPAWAT (SUPRA), THE AO WILL DELETE THE ADDITION IN CASE, THE PARTIES ARE SAME THEN THE AO WILL DECIDE ACCORD INGLY. 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND GONE THR OUGH THE FACTS AND CIRCUMSTANCES OF THE CASE AND CONSIDERING THE TOTAL ITY OF THE FACTS, WE SET ASIDE THIS ISSUE TO THE FILE OF ASSESSING OFFICER A ND DIRECT HIM TO CONSIDER THE TRIBUNALS DECISION IN THE CASE OF UMEDSINGH P CHAMAPAWAT (SUPRA) AND FIND OUT THESE 26 CREDITORS WHETHER THE TRIBUNAL HAS DEL ETED THE ADDITION ON MERITS OR NOT AND ACCORDINGLY DECIDE THIS ISSUE. IN CASE, THE TRIBUNAL IN THE CASE OF UMEDSINGH P CHAMPAWAT (SUPRA) HAS DELETED THE ADDITION ON MERITS IN THE CASE OF THESE 26 CREDITORS, THE ASSESSING OFFICER W ILL DELETE THE SAME. 6. IN THE RESULT, ASSESSEES APPEAL IS ALLOWED FOR STA TISTICAL PURPOSES. ORDER PRONOUNCED ON THIS DAY OF 13 TH DEC,2010 SD/- SD/- ( G.D.AGARWAL ) ( MAHAVIR SINGH ) (VICE PRESIDENT) (JUDICIAL MEMBER) AHMEDABAD, DATED : 13/12/2010 *DKP COPY OF THE ORDER FORWARDED TO :- IT(SS)A NO.8/AHD/2008 B.P.1/4/85 TO 5/9/95 ELCON EXPORTS PVT. LTD. V. DCIT, CC-1(3), ABD PAGE 4 1. THE ASSESSEE. 2. THE REVENUE. 3. THE CIT CONCERNS. 4. THE DR, ITAT, AHMEDABAD 5. GUARD FILE. BY ORDER, /TRUE COPY/ DEPUTY / ASSTT.REGISTRAR ITAT, AHMEDABAD