DEPUTY COMMISSIONER OF INCOME TAX-4(3)(1), MUMBAI V. QMAX SYNTHETICS PRIVATE LIMITED, MUMBAI

MA 309/MUM/2019

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 7052 (ITAT-MUMBAI)
• Duration Of Justice: 2 month(s) 23 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 31-07-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2007-2008
• Appeal Filed On: 08-05-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: CHAUDHARY ARUN KUMAR SINGH LD
• Assessee Lawyers: A K GHOSH LD
• Keywords: Accommodation entries; Tax effect; Reassessment proceedings
• Section: 132

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, MUMBAI , !' & , !' !( BEFORE HONBLE SHRI SAKTIJIT DEY, JM AND HONBLE SHRI MANOJ KUMAR AGGARWAL, AM M.A. NO. 309/MUM/2019 [ARISING OUT OF I.T.A. NO.4377/MUM/2017] ( )*) )*) )*) )*) / ASSESSMENT YEAR: 2007-08) D CIT CIRCLE - 4 (3)1 ROOM NO.649, 6 TH FLOOR, AAYKAR BHAVAN, M.K. ROAD MUMBAI-400 020. / VS. M/S. QMAX SYNTHET ICS P RIVATE LIMI TED 5-B/174, SANJAY BUILDING MITTAL INDUSTRIAL ESTATE ANDHERI KURLA ROAD ANDHERI (E), MUMBAI-400 059. '+ '+ '+ '+ , ,, , , ,, , ! !! ! ./ PAN : AAACQ-0206- D ( +- /APPELLANT ) : ( ./+- / RESPONDENT ) ASSESSEE BY : SHRI A.K. GHOSH LD. AR DEPARTMENT BY : CHAUDHARY ARUN KUMAR SINGH-LD. DR !0 / DATE OF HEARING : 26/07/2019 1*0 / DATE OF PRONOUNCEMENT : 31/07/2019 / O R D E R MANOJ KUMAR AGGARWAL (ACCOUNTANT MEMBER): - 1. BY WAY OF THIS APPLICATION, THE REVENUE SEEKS RE CALL OF TRIBUNAL ORDER ITA NO.4377/MUM/2017 PASSED IN BUNCH OF REVENUES A PPEAL VIDE COMMON ORDER DATED 03/08/2018. 2 2. DRAWING OUR ATTENTION TO THE APPLICATION, LD. DE PARTMENTAL REPRESENTATIVE [DR], SUBMITTED THAT THE REVENUES A PPEAL WAS DISMISSED KEEPING IN VIEW LOW-TAX EFFECT CIRCULAR NO. 03/2018 ISSUED BY CBDT ON 11/07/2018. 3. IN THE ABOVE BACKGROUND, OUR ATTENTION HAS BEEN DRAWN TO THE FACT THAT REASSESSMENT PROCEEDINGS WERE INITIATED AGAINST THE ASSESSEE UPON RECEIPT OF CERTAIN INFORMATION FROM INVESTIGATION WING OF T HE DEPARTMENT PURSUANT TO SEARCH OPERATIONS U/S 132 IN THE CASE OF SHRI PRAVI N KUMAR JAIN GROUP, THE PERUSAL OF WHICH ESTABLISHED THAT THE ASSESSEE WAS ONE OF THE BENEFICIARY OF THE ACCOMMODATION ENTRIES BEING PROVIDED BY ENTI TIES CONTROLLED BY SHRI PRAVIN KUMAR JAIN IN THE FORM OF UNSECURED LOANS AM OUNTING TO RS.46 LACS. 4. THE LD. DR FURTHER SUBMITTED THAT CLAUSE 10 OF C IRCULAR NO. 03/2018 DATED 11/07/2018 STOOD AMENDED BY THE SAME AUTHORIT Y ON 20/08/2018 WHEREIN NEW EXCEPTIONS (E) & (F) WERE ADDED. THEREF ORE, THE FACTS OF THE CASE WERE COVERED BY EXCEPTION (E) OF CLAUSE 10 OF THE SAID CIRCULAR AS AMENDED W.E.F 20/08/2018, WHICH READ AS UNDER: - 10. ADVERSE JUDGMENTS RELATING TO THE FOLLOWING ISS UES SHOULD BE CONTESTED ON MERITS NOTWITHSTANDING THAT THE TAX EFFECT ENTAILED IS LESS THAN THE MONETARY LIMITS SPECIFIED IN PARA 3 ABOVE OR THERE IS NO TAX EFFECT : - . (E) WHERE ADDITION IS BASED ON INFORMATION RECEIVED FROM EXTERNAL SOURCES IN THE NATURE OF LAW ENFORCEMENT AGENCIES SUCH AS CBI / ED / DRI / SFIO / DIRECTORATE GENERAL OF GST INTELLIGENCE (DGGI). . IN THE AFORESAID BACKGROUND, LD. DR PLEADED FOR REC ALL OF THE STATED ORDER. 3 5. ON THE OTHER HAND, LD. AUTHORIZED REPRESENTATIVE FOR ASSESSEE, SUBMITTED THAT THE SAID AMENDMENT CAME INTO OPERATI ON ONLY WITH EFFECT FROM 20/08/2018 AND THEREFORE, THERE COULD BE NO OC CASION TO CONSIDER THE SAME. HENCE, NON-CONSIDERATION OF THE SUBSEQUENT CI RCULAR COULD NOT BE THE BASIS TO CONCLUDE THAT THERE WAS MISTAKE APPARENT F ROM RECORD IN THE ORDER WITHIN THE MEANING OF SECTION 254(2) OF THE INCOME TAX ACT, 1961. 6. UPON CAREFUL CONSIDERATION, WE FIND THAT THE BUN CH OF APPEALS WAS HEARD ON 03/08/2018 AND THE COMMON ORDER WAS PRONOU NCED ON THE SAME VERY DAY RELYING UPON LOW TAX EFFECT CIRCULAR NO. 0 3/2018. UNDISPUTEDLY, THE FACTUAL MATRIX OF THE CASE WAS NOT COVERED BY ANY O F THE EXCEPTION PROVIDED IN THIS CIRCULAR. THE NEW EXCEPTIONS (E) & (F) WERE ADDED IN CLAUSE 10 VIDE LETTER DATED 20/08/2018 ONLY WITH EFFECT FROM THAT DATE WHICH IS EVIDENT FROM PARA-4 OF THE LETTER DATED 20/08/2018. THEREFORE, T HERE COULD BE NO OCCASION TO CONSIDER THE SAME AND THE NEW EXCEPTION S WERE NOT APPLICABLE ON THE DATE OF HEARING OF APPEALS. 7. THEREFORE, FINDING NO MERIT IN THE APPLICATION, WE DISMISS THE SAME. RESULTANTLY, THE APPLICATION STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 31 ST JULY, 2019 SD/- SD/- (SAKTIJIT DEY) (MANOJ KUMAR AGGARWAL) , ,, , / JUDICIAL MEMBER , ,, , / ACCOUNTANT MEMBER , MUMBAI; DATED : 31/07/2019 SR.PS:-JAISY VARGHESE 4 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ( ) / THE CIT(A) 4. / CIT CONCERNED 5. , , / DR, ITAT, MUMBAI 6. '#$ / GUARD FILE / BY ORDER, / (DY./ASSTT.REGISTRAR) , / ITAT, MUMBAI.