Goel Die Cast Ltd, V. ACIT circle,

MA 122/DEL/2010

• Counselvise Citation: [2011] 111 COUNSELVISE.COM (IT) 0392 (ITAT-DELHI)
• Duration Of Justice: 11 month(s) 9 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 25-02-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2004-2005
• Appeal Filed On: 16-03-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MONA MOHANTY
• Assessee Lawyers: ASHWANI TANEJASHRI TARUN KUMAR
• Keywords: Bogus Share capital
• Section: 195; 68; 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH : FRIDAY NEW DELHI) BEFORE SHRI G.E. VEERABHADRAPPA, HONBLE VICE PRES IDENT AND SHRI A.D. JAIN, JUDICIAL MEMBER M.A. NO.122/DEL./2010 (IN ITA NO.216/DEL./2008) (ASSESSMENT YEAR : 2004-05) M/S GOEL DIE CAST LTD., `VS. ACIT, CIRCLE C/O M/S CORPORATE PROFESSIONAL, ROHTAK. D-28, SOUTH EXTENSION, PART I, NEW DELHI-110 049. (PAN/GIR NO.AAACG5344G) (APPLICANT) (RESPONDENT) ASSESSEE BY : SHRI ASHWANI TANEJA/SHRI TARUN KUMAR, ADV. REVENUE BY : SMT. MONA MOHANTY, SR.DR ORDER PER A.D. JAIN, JM THIS M.A. IS FILED BY THE ASSESSEE SEEKING RECALL O F THE EX-PARTE TRIBUNAL ORDER DATED 29.01.2010. 2. THE FACTS ARE THAT THE CIT(A), ROHTAK VIDE ORDER DATED 28.11.2007 IN THE ASSESSEES CASE FOR AY 2004-05, CONFIRMING THE ADDI TION OF RS.1,38,00,000/- MADE BY THE AO ON ACCOUNT OF SHARE CAPITAL U/S 68 OF THE I.T. A CT, TREATING THE SAME AS UNEXPLAINED. THE CIT(A) ALSO ENHANCED THE ASSESSEES INCOME BY A N AMOUNT OF RS.92 LAKH BY MAKING A FURTHER ADDITION ON ACCOUNT OF UNEXPLAINED CASH C REDIT REPRESENTING SHARE CAPITAL. THE ASSESSEE PREFERRED AN APPLICATION FOR RECTIFICATION U/S 154 OF THE ACT BEFORE THE CIT(A). 3. THE ASSESSEE ALSO FILED AN APPEAL AGAINST THE CI T(A)S ORDER BEFORE THE TRIBUNAL. AT THE TIME OF HEARING OF THE APPEAL BEFORE THE TRI BUNAL, THE ASSESSEE FILED AN APPLICATION CONTENDING THAT ALL THE ADDITIONS DISPUTED BY THE A SSESSEE IN THE APPEAL BEFORE THE TRIBUNAL HAD SINCE BEEN DELETED BY THE CIT(A), VIDE ORDER DATED 23.01.2009, DISPOSING OF THE AFORESAID APPLICATION FILED BY THE ASSESSEE U/S 154 OF THE ACT. THE ASSESSEE ALSO CONTENDED THAT THE ASSESSEE SUBMITTED THAT AS SUCH THE APPEAL FILED BY THE ASSESSEE BEFORE THE TRIBUNAL HAD VIRTUALLY BECOME IN FRUCTUOUS UNLE SS THE APPEAL WERE TO BE FILED BY THE MA NO.122/DEL./2010 (IN ITA NO.216/DEL./2008) AY : 2004-05 2 REVENUE AGAINST THE ORDER DATED 23.01.2009 PASSED B Y THE CIT(A) U/S 154 OF THE ACT AND THE SAID APPEAL WERE TO BE ALLOWED BY THE TRIBUNAL. THE ASSESSEE REQUESTED THAT, THEREFORE, THE ASSESSEES APPEAL BEFORE THE TRIBUNA L BE BLOCKED FOR A PERIOD OF SIX MONTHS IN ORDER TO ENABLE FURTHER DEVELOPMENT IN THE MATT ER TO BE ASCERTAINED SO THAT APPROPRIATE REPRESENTATION BASED THEREON CAN BE MADE AFTER THE SAID PERIOD OF SIX MONTHS. 4. VIDE ORDER DATED 16.02.2009, THE TRIBUNAL DISMIS SED THE ASSESSEES APPEAL AS IN FRUCTUOUS. THE ASSESSEE WAS GRANTED LIBERTY TO MOV E APPLICATION FOR REVIVAL OF ITS APPEAL, IF THE ORDER DATED 23.1.2009 PASSED BY THE CIT(A) U /S 154 OF THE ACT WAS TO BE DISTURBED BY THE TRIBUNAL. 5. THE DEPARTMENT FILED ITA NO.1247/DEL./2009 BEFOR E THE TRIBUNAL AGAINST THE CIT(A)S ORDER DATED 23.01.2009, PASSED U/S 154 OF THE ACT. THE TRIBUNAL, VIDE ORDER DATED 29.1.2010, ALLOWED THE DEPARTMENTS APPEAL, O BSERVING, INTER ALIA, THAT WHILE PASSING THE ORIGINAL FIRST APPELLATE ORDER DATED 28 .11.2007, THE CIT(A) CONFIRMED THE ADDITION MADE BY THE AO BY RECORDING A FINDING THAT THE IDENTITY OF THE ASSESSEES CREDITORS WERE SHAM, THE CREDITWORTHINESS OF THE CR EDITORS WAS NOT PROVED AND THE TRANSACTIONS WERE NOT GENUINE; THAT NOT ONLY WAS TH E ADDITION CONFIRMED BY THE CIT(A), THE CIT(A) ENHANCED THE SAME, THE WRIT PETITION FIL ED BY THE ASSESSEE AGAINST WHICH ENHANCEMENT WAS DISMISSED BY THE HONBLE HIGH COURT ; THAT WHILE ENHANCING THE ADDITION MADE ON ACCOUNT OF SHARE CAPITAL, THE CIT( A) HAD RELIED ON CIT VS. DIVINE LASING & FINANCE LTD. REPORTED IN 298 ITR 268 (DEL .); THAT VIDE ORDER DATED 23.01.2009 PASSED U/S 154 OF THE ACT, THE CIT(A) HAD REVERSED HIS EARLIER ORDER OF CONFIRMATION AND ENHANCEMENT OF THE ADDITION MADE BY THE AO ON ACCOU NT OF BOGUS SHARE CAPITAL THAT THE CIT(A) OBSERVED THAT DIVINE LEASING & FINANCE LTD. (SUPRA) HAD BEEN REVERSED BY THE HONBLE SUPREME COURT IN CIT VS. LOVELY EXPORT P. LTD. REPORTED IN 216 CTR 195 (SC); THAT THE TRIBUNAL, HOWEVER, FOUND THAT DIVIN E LEASING & FINANCE LTD. (SUPRA) HAD NOT BEEN REVERSED BY THE HONBLE SUPREME COURT IN LOVELY EXPORT (SUPRA), RATHER IT HAD BEEN CONFIRMED; AND THAT THEREFORE, THERE WAS NO ME RIT IN THE ASSESSEES CONTENTION THAT A MISTAKE HAD CREPT IN CIT(A)S ORIGINAL ORDER DATED 28.11.2007 SINCE THE HONBLE SUPREME COURT IN LOVELY EXPORT (SUPRA) HAD NOT BE EN CONSIDERED BY THE CIT(A) WHILE PASSING THE SAID ORDER; THAT THE ADDITION HAD BEEN CONFIRMED IN THE ORIGINAL ORDER OF THE CIT(A), NOT ONLY ON THE BASIS OF CREDITWORTHINESS H AVING NOT BEEN PROVED; THAT IN VIEW OF MA NO.122/DEL./2010 (IN ITA NO.216/DEL./2008) AY : 2004-05 3 LOVELY EXPORT (SUPRA), THE ADDITION AND ENHANCEME NT ON ACCOUNT OF LACK OF CREDITWORTHINESS OF THE SHARE APPLICANTS COULD NOT BE MADE IN THE HANDS OF THE ASSESSEE; THAT IN FACT THERE HAD BEEN NO CHANGE IN THE FACTS CONCERNING THE IDENTITY OF THE SHARE APPLICANTS AND THE GENUINENESS OF THE TRANSACTION, WHICH REMAINED NOT PROVED AS HELD BY THE CIT(A) WHILE PASSING THE ORIGINAL ORDER; THAT I N THE ORDER PASSED U/S 154 OF THE ACT, THE CIT(A) HAD NOT MADE ANY OBSERVATION OF THE IDEN TITY OF THE SHARE APPLICANT AND THE GENUINENESS OF THE TRANSACTION; THAT SINCE THE IDEN TITY OF THE SHARE APPLICANTS ITSELF HAD NOT BEEN ESTABLISHED, THERE WAS NO REASON TO APPLY LOV ELY EXPORT (SUPRA); THAT U/S 154 OF THE ACT, ONLY MISTAKES APPARENT ON RECORD CAN BE RE CTIFIED; THAT A CONSIDERED DECISION TAKEN ON FACTS CANNOT BE REVERSED U/S 154 OF THE AC T UNLESS FACTS ARE SUBSEQUENTLY FOUND TO HAVE BEEN WRONGLY RECORDED; AND THAT CHANGE IN T HE CONCLUSION AMOUNTS TO A REVIEW OF THE EARLIER ORDER, WHICH IS NOT PERMISSIBLE U/S 154 OF THE ACT. 6. LD.COUNSEL FOR THE ASSESSEE CONTENDS THAT IN THE TRIBUNALS ORDER DATED 16.02.2009 (SUPRA), PASSED IN THE ASSESSEE APPEAL, THE TRIBUNAL HAS GRANTED LIBERTY TO MOVE AN APPLICATION FOR REVIVAL OF THE ASSESSEES A PPEAL IF THE ORDER PASSED BY THE CIT(A) PASSED U/S 154 OF THE ACT WERE TO BE DISTURBED BY T HE TRIBUNAL; THAT THE CIT(A)S SAID ORDER PASSED ON 23.01.2009 U/S 154 OF THE ACT HAS N OW BEEN DISTURBED BY WAY OF THE TRIBUNAL ORDER DATED 29.01.2010 (SUPRA), ALLOWING T HE ASSESSEES APPEAL IN ITA NO.1247/DEL./09; THAT AS IS AVAILABLE FROM THE TRIB UNAL ORDER DATED 16.02.2009, THE ASSESSEES APPEAL HAD BECOME IN FRUCTUOUS UNLESS AN D UNTIL THE ORDER PASSED BY THE CIT(A) U/S 154 OF THE ACT WAS TO BE DISTURBED ON AP PEAL BY THE TRIBUNAL; THAT AS SUCH, SINCE THE TRIBUNAL HAS ALLOWED THE DEPARTMENTS APP EAL, THE ASSESSEES APPEAL IS NO LONGER INFRUCTUOUS AND IT STANDS REVIVED BY VIRTUE OF THE TRIBUNALS ORDER ALLOWING THE ASSESSEES APPEAL; THAT THE HONBLE HIGH COURT, VIDE ORDER DAT ED 10.11.2010 (COPY PLACED ON RECORD), HAS, WHILE DISMISSING THE ASSESSEES APPEA L IN ITA NO.223/DEL./10, PREFERRED AGAINST THE AFORESAID TRIBUNALS ORDER DATED 29.01. 10, PASSED IN ITA NO.1247/DEL./09, OBSERVED THAT THE PRESENT APPLICATION FILED BY THE ASSESSEE MAY BE CONSIDERED BY THE TRIBUNAL IN ACCORDANCE WITH THE LIBERTY GRANTED BY THE TRIBUNAL IN ITS ORDER DATED 16.02.09, TO MOVE AN APPLICATION FOR REVIVAL OF THE ASSESSEES APPEAL, IF THE ORDER PASSED BY THE CIT(A) U/S 154 WAS DISTURBED BY THE TRIBUNAL . MA NO.122/DEL./2010 (IN ITA NO.216/DEL./2008) AY : 2004-05 4 7. LD.DR OF THE REVENUE, ON THE OTHER HAND, HAS STR ONGLY OPPOSED THE APPLICATION FILED BY THE ASSESSEE. IT HAS BEEN CONTENDED THAT ONCE THE ASSESSEES APPEAL BEFORE THE TRIBUNAL STANDS DISMISSED AS IN FRUCTUOUS, THE SAME CANNOT BE REVIVED, AS WRONGLY REQUESTED TO BE DONE BY VIRTUE OF THE APPLICATION, AT HAND. SHE HAS CONTENDED THAT THE ORDER OF THE TRIBUNAL ALLOWING THE ASSESSEES APPEA L IS AN ENTIRELY INDEPENDENT ORDER AND THE REMEDY THERE AGAINST, IF AVAILABLE TO THE ASSES SEE IS NOT AVAILABLE BY WAY OF THE PRESENT APPLICATION. SHE HAS SUBMITTED THAT IN THE SE FACTS, THERE IS NO MERIT WHATSOEVER IN THE APPLICATION FILED BY THE ASSESSEE AND THAT THE SAME BE ORDERED TO BE DISMISSED. 8. WE HAVE HEARD BOTH THE PARTIES AND HAVE PERUSED THE MATERIAL ON RECORD. UNDISPUTEDLY, VIDE ORDER DATED 16.2.09, THE ASSESSE ES APPEAL WAS DISMISSED AS INFRUCTUOUS, WITH A LIBERTY TO THE ASSESSEE TO MOVE AN APPLICATION FOR ITS REVIVAL, IF THE ORDER PASSED BY THE CIT(A) U/S 154 OF THE I.T. ACT WERE TO BE DISTURBED BY THE TRIBUNAL. THE HONBLE HIGH COURT, VIDE ITS ORDER DATED 10.11. 2010 (SUPRA), HAS OBSERVED THAT THE APPLICATION OF THE ASSESSEE TO BE CONSIDERED IN ACC ORDANCE WITH THE SAID LIBERTY GRANTED TO THE ASSESSEE. IN ACCORDANCE TO ABOVE, THE REQUEST O F THE ASSESSEE BY WAY OF PRESENT APPLICATION IS ACCEPTED. THE APPEAL FILED BY THE A SSESSEE IN ITA NO.216/DEL./08 IS REVIVED IN SITU. THE SAME SHALL NOW COME UP FOR HE ARING ON MERITS UNDER NOTICE TO BOTH THE PARTIES. 9. IN THE RESULT, THE M.A. FILED BY THE ASSESSEE IS ALLOWED. 11. ORDER PRONOUNCED IN OPEN COURT ON 25.02.2011. SD/- SD/- (G.E. VEERABHADRAPPA) (A.D.JAIN) VICE PRESIDENT JUDICIAL MEMBER DELHI, DATED : 25.02.2011 SKB COPY FORWARDED TO: 1.APPLICANT 2.RESPONDENT 3.CIT, 4.CIT(A), ROHTAK. 5.CIT(ITAT), NEW DELHI. AR/ITAT MA NO.122/DEL./2010 (IN ITA NO.216/DEL./2008) AY : 2004-05 5