ITO, Ward- II(1), Faridabad V. Naina Agarwal, Delhi

MA 609/DEL/2019

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 9349 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 7 month(s) 14 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 24-02-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 10-07-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Documents seized; Capital Gains
• Section: 143(3); 254(2); 68; 69

Judgement Text

INCOME TAX APPELLATE TRIBUNAL DELHI BENCH FRIDAY: NEW DELHI BEFORE SHRI R.K.PANDA, ACCOUNTANT MEMBER MA NO. 609/DEL/2019 (IN ITA NO.2025/DEL/2018) ASSTT. YEAR: 2014-15 O R D E R PER R.K. PANDA, AM : THIS MISCELLANEOUS APPLICATION FILED BY THE REVENUE ARISES OUT OF THE ORDER OF THE TRIBUNAL DATED 25 TH SEPTEMBER, 2018. THE REVENUE THROUGH THIS MISCELLANEOUS APPLICATION HAS REQUESTED THE TRIBUNAL TO RECTIFY CERTAIN MISTAKES THAT HAVE CREPT IN THE ORDER OF THE TRIBUNAL. 2. LD. SR. DR REFERRING TO THE BRIEF FACTS OF THE CASE AND REASONS FOR FILING THE MISCELLANEOUS APPLICATION FILED BY THE REVENUE DREW THE ITO, WARD -2(1) FARIDABAD. VS. MS. NAINA AGGARWAL, H.NO. 1851, SECTOR -16, FARIDABAD. PAN APFPG6588K (APPELLANT) (RESPONDENT ) DEPARTMENT BY: SHRI KAPIL GOEL, ADVOCATE ASSESSEE BY : SHRI M. BARANWAL , SR. DR DATE OF HEARING 19/0 2 /20 2 1 DATE OF PRONOUNCEMENT 24/02/2021 2 ATTENTION OF THE BENCH TO THE CONTENTS OF THE SAME WHICH READ AS UNDER :- THE ITR-2 WAS FILED BY THE ASSESSEE ON 31.12.2014 `DECLARING TOTAL INCOME OF RS.3,95,760/- AFTER CLAIMING DEDUCTION UNDER CHAPTER VI-A AT RS. 1,02,875/-. 2. THE CASE OF THE ASSESSEE WAS ASSESSED U/S 143(3) VIDE ORDER DATED-27.12.2016 AT AN ASSESSED INCOME OF RS.26,60,280/-ON ACCOUNT OF ADDITION MADE U/S 68/69 OF RS.22,64,521/- DISALLOWING LONG TERM CAPITAL GAIN. 3. AGGRIEVED BY THE SAID ORDER, THE ASSESSEE FILED APPEAL BEFORE LD.CIT(A), FARIDABAD. THE LD.CIT(A), VIDE ITS ORDER DATED- 30.01.2018 DISMISS THE APPEAL OF THE ASSESSEE HOLDING THAT- 'THUS, IT IS PERTINENT TO ALSO EXAMINE THE FACTS OF THE CASE AND THE SUBMISSION OF THE APPELLANT FROM THE PERSPECTIVE OF HUMAN PROBABILITIES ALSO. AS PER THE APPELLANT, SHE HAD PURCHASED SHARED FOR RS. 1,00,000/- AND SOLD THE SAME AT RS.23,71,178/- I.E. AT PRICE 24 TIMES THE PURCHASE PRICE THAT TOO WITHIN A SHORT PERIOD OF 1.5 YEARS, THE SHARES OF COMPANY WITH NO CREDENTIALS. ONES THE ENTIRE TRANSACTION IS VIEWED PERSPECTIVE OF HUMAN PROBABILITIES IT DEFIANTLY FAILS ON ALL COUNTS. THUS, KEEPING IN VIEW THE ENTIRE FACTS OF THE 3 CASE WITH REASONING SET OUT ABOVE AND ON THE STRENGTH OF THE JUDICIAL DECISION DISCUSSED BY ME IN THE PREVIOUS PAGES, I HAVE NO HESITATION IN UPHOLDING THE ORDER OF THE A.O AND DISMISSING THE APPEAL OF THE APPELLANT' 4. AGGRIEVED BY THE ORDER OF LD.CIT(A), FARIDABAD, THE ASSESSEE FILED APPEAL BEFORE THE HON'BLE ITAT. THE FLON'BLE ITAT IN ITS ORDER DATED-25.09.2018 ALLOWED THE APPEAL OF THE ASSESSEE HOLDING THAT:- 'SINCE THE FACTS OF THE INSTANT CASE ARE IDENTICAL TO THE FACTS OF THE CASES DECIDED BY THE HON'BLE PUNJAB & HARYANA HIGH COURT AND THE DELHI AND KOIKATA BENCHES OF THE TRIBUNAL, THEREFORE, RESPECTFULLY FOLLOWING THE ABOVE DECISIONS, I SET-ASIDE THE ORDER OF THE ID.CIT(A) AND DIRECT THE ASSESSING OFFICER TO DELETE THE ADDITION MADE U/S 68 OF THE IT ACT. SO FAR AS THE DECISION RELIED ON BY ID. DR ARE CONCERNED, THEY ARE DISTINGUISHABLE AND NOT APPLICABLE TO THE FACTS OF THE PRESENT CASE. THE GROUNDS RAISED BY THE ASSESSEE IN THE IMPUGNED APPEAL ARE ACCORDINGLY ALLOWED. THE GROUNDS BY THE ASSESSEE IN OTHERS APPEALS I.E. IN ITA NO.2022 TO 2028/DEI/2018 ARE IDENTICAL TO THE FACTS OF THE PRESENT CASE. I HAVE ALREADY DECIDED THE ISSUE IN FAVOR OF 4 THE ASSESSEE. FOLLOWING SIMILAR REASONING, THE GROUNDS RAISED BY THE ASSESSEE IN THE APPEALS ARE ALSO ALLOWED' 4.1 THE DECISION OF HON'BLE ITAT IS NOT ACCEPTABLE IN VIEW OF THE FOLLOWING FACTS:- (I) IN THE INSTANT CASE THE EVIDENCE IS BASED ON STATEMENT RECORDED DURING SEARCH AND SURVEY ACTIONS AT THE PREMISES OF OPERATORS OF THE COMPANIES. IT WAS FOUND THAT M/S UNNO INDUSTRIES LIMITED WAS ENGAGED IN PROVIDING BOGUS LTCG IN THE SHAPE OF INCRIMINATING DOCUMENTS SEIZED/IMPOUNDED AND THEREAFTER STATEMENT OF OPERATORS OF THESE PAPER COMPANIES. THE SEARCH HELPED IN UNEARTHING A LARGE SCAM BEING RUN BY ITS OPERATORS FOR GIVING BOGUS LTCG TO THOUSANDS OF BENEFICIARIES. (II) HON'BLE ITAT HAS COMPLETELY OVERLOOKED THE FINDINGS OF INVESTIGATION WING OF THE DEPARTMENT, WHO UNEARTHED THE SCAM DURING SEARCH AND SURVEY ACTION ON THE OPERATORS OF THESES PENNY STOCK COMPANIES. (III) TOTAL DISREGARD HAS BEEN SHOWN TO THE STATEMENTS OF THE OPERATORS OF THE COMPANIES WHO WERE PROVIDING BOGUS ENTRIES OF LONG TERM CAPITAL GAINS INCLUDING M/S UNNO INDUSTRIES LIMITED, SHRI PAWAN DALMIA IN HIS STATEMENT RECORDED ON OATH HAS CLEARLY MENTIONED IN HIS STATEMENT THAT M/S UNNO INDUSTRIES LIMITED WAS A PAPER COMPANY AND WAS ENGAGED IN PROVIDING BOGUS LTCG TO VARIOUS BENEFICIARIES. 5 (IV) HON'BLE ITAT HAS REFLECTED ONLY THE EVIDENCE OF SALE, WHILE TOTALLY IGNORING THE CIRCUMSTANCES OF PURCHASE OF SHARES, FICTITIOUS INCREASE IN VALUE OF SHARES AND THE FINANCIAL FUNDAMENTALS OF THE COMPANY DURING THE PERIOD OF SALE OF SHARES. (V) THE STATEMENTS RECORDED UNDER OATH CANNOT BE WISHED AWAY SIMPLY BY RESORTING TO DIVERSIONARY TACTICS. THE SEARCHES AND SURVEY CONDUCTED BY INVESTIGATION WING, KOLKATA LIFTED THE VEIL FROM AN ORGANIZED RACKET OF CONVERTING BLACK MONEY AND IT CANNOT BE DISREGARDED ONLY FOR THE REASON THAT THE ASSESSEE WAS NOT CONFRONTED. (VI) THE FINDING OF THE HON'BLE ITAT THAT NO CASE SPECIFIC OR TRANSACTION SPECIFIC INFORMATION WAS GIVEN BY THE PERSONS WHOSE STATEMENT WAS RECORDED ARE FOR FROM THE FACTS OF THE CASE. THE PERSONS WHOSE STATEMENTS WERE RECORDED HAVE CLEARLY MENTIONED IN THEIR STATEMENT, THE COMPANY M/S UNNO INDUSTRIES LIMITED, IN WHICH THE ASSESSEE HAS TRADED. THEREFORE, THE MISTAKE IS CLEARLY APPARENT FROM RECORD. (VII) HON'BLE ITAT HAS TOTALLY DISREGARDED THE FINDINGS BY LD.CIT(A) WHO CONFIRMED THE ADDITION OF THE AO. THE CASE LAWS MENTIONED BY THE LD. CIT(A) HAS NOT EVEN BEEN DISCUSSED IN ORDER. (VIII) HON'BLE ITAT HAS NOT APPRECIATED THE FACTS THAT THE CAN BE HARDLY ANY DOCUMENTARY CLINCHING EVIDENCE TO PIERCE THE VEIL OF SUCH UNDER 6 HAND TRANSACTIONS. SUCH TYPE OF TRANSACTIONS CAN BE DISMANTLED ON THE BASIS OF CIRCUMSTANTIAL FACTS SURROUNDINGS EVIDENCES. (IX) THE RECENT JUDGMENT BY HON'BLE DELHI HIGH COURT IN THE CASE OF UDIT KALRA V/S ITO WARD 50(1) IN ITA 220/2019 & CM NO. 10774/2019 DATED 08.03.2019, HAS DECIDED THE ISSUE IN FAVOUR OF REVENUE BY RELYING UPON THE FINDINGS OF THE INVESTIGATION WING, ENQUIRES CONDUCTED IN THE CASE OF ASSESSEE BROKERS, OPERATORS & ENTRY PROVIDERS AND THE NATURE OF TRANSACTION, THE CASE LAW IS SQUARELY APPLICABLE IN THE INSTANT CASE. (X) IN THE RECENT JUDGMENT BY HON'BLE ITAT, SMC BENCH, NEW DELHI IN THE CASE OF SH. ANUP RASTOGI AND SMT. ANJU RASTOGI IN ITA NO.3809 AND 3810/DEL/2018 FOR THE A.Y. 2015-16 DATED 08,01.2019 HAS DECIDED THE ISSUE OF BOGUS LTCG ON SALE OF SHARES IN FAVOUR OF REVENUE BY GIVING CREDENCE TO THE STATEMENT RECORDED BY INVESTIGATION WING AND THE ABRUPT, UNREALISTIC MOVEMENT OF PRICE AND NO EXTRAORDINARY INCREASE IN THE PROFITS OF THE COMPANY TO JUSTIFY THE INCREASE IN VALUE OF SHARES. THIS LATEST DECISION OF JURISDICTIONAL ITAT DELHI IS SQUARELY APPLICABLE IN THE PRESENT CASE ON BOTH THE FACTS AND CIRCUMSTANCES OF THE CASE . IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES OF THE CASE, IT APPEARS TO BE APPARENT MISTAKE IN ORDER PASSED BY HON'BLE ITAT, NEW DELHI, AS THE DECISION IS BASED ON WRONG INFERENCES. 7 3. FURTHER, HE ALSO DREW THE ATTENTION OF THE BENCH TO THE GROUNDS OF APPEAL IN THE MISCELLANEOUS APPLICATION FILED BY THE REVENUE WHICH ARE AS UNDER :- 1. WHETHER ON FACTS AND CIRCUMSTANCES OF CASE HON'BLE ITAT WAS RIGHT IN DELETINGTHE ADDITION OF RS. 22,64,521/- ON ACCOUNT OF UNEXPLAINED CREDIT U/S 69 OF THE ACT ON ACCOUNT OF BOGUS LONG TERM CAPITAL GAIN MADE BY THE AO BASED ON WRONG INFERENCES DRAWN FROM CASE LAWS RELIED UPON. 2. WHETHER ON FACTS AND CIRCUMSTANCES OF CASE HON'BLE ITAT WAS RIGHT IN DELETING THE ADDITION MADE BY THE AO BY IGNORING THE ENQURIES CONDUCTED BY THE INVESTIGATION WING OF THE DEPARTMENT AND THE ENQURIES MADE BY AO. 3. WHETHER ON FACTS AND CIRCUMSTANCES OF CASE HON'BLE ITAT WAS RIGHT IN DELETING THE ADDITION MADE BY THE AO IN THE BACKGROUND OF DECISION OF HON'BLE DELHI HIGH COURT DECISION DATED 08.03.2019 IN THE CASE OF SH. UDIT KALRA V/S ITO WARD 50(1) NEW DELHI IN ITA 220/2019 & CM NO. 10774/2019, WHICH IS SQUARELY APPLICABLE IN THE CASE UNDER REFERENCE. 4. WHETHER ON FACTS AND CIRCUMSTANCES OF CASE HON'BLE ITAT WAS RIGHT IN DELETING THE ADDITION MADE BY THE AO AS IN THE RECENT JUDGMENT BY HON'BLE ITAT SMC BENCH, NEW DELHI IN THE CASE OF SH. ANUP RASTOGI AND SMT. ANJU RASTOGI IN ITA NO.3809 AND 8 3810/DEL/2018 DATED 08.01.2019, THE ISSUE WAS DECIDED IN FAVOUR OF REVENUE BY GIVING CREDENCE TO THE STATEMENT RECORDED BY INVESTIGATION WING AND THE ABRUPT, UNREALISTIC MOVEMENT OF PRICE AND NO EXTRAORDINARY INCREASE IN THE PROFITS OF THE COMPANY OF JUSTIFY THE INCREASE IN VALUE OF SHARES. 5. THAT THE APPELLANT CRAVES FOR THE PERMISSION TO ADD, DELETE OR AMEND THE GROUND OF APPEAL BEFORE OR AT THE TIME OF HEARING OF APPEAL. 4. THE LD. SR. DR REFERRING TO THE ABOVE SUBMITTED THAT THE REASONS FOR FILING THE MISCELLANEOUS APPLICATION IS SELF EXPLANATORY. HE SUBMITTED THAT SINCE THE TRIBUNAL HAS DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE DISREGARDING THE VARIOUS DECISIONS RELIED ON BY THE REVENUE, THEREFORE, CERTAIN MISTAKES HAVE CREPT IN THE ORDER OF THE TRIBUNAL AND, THEREFORE, THE ORDER SHOULD BE RECALLED/MODIFIED AND THE GROUNDS RAISED BY THE REVENUE IN THE MISCELLANEOUS APPLICATION SHOULD BE ALLOWED. 5. LD. COUNSEL FOR THE ASSESSEE ON THE OTHER HAND STRONGLY CHALLENGED THE MISCELLANEOUS APPLICATION FILED BY THE REVENUE. HE SUBMITTED THAT THE JURISDICTION OF THE ASSESSEE FALLS UNDER HONBLE PUNJAB & HARYANA HIGH COURT AND THE TRIBUNAL WHILE DECIDING THE ISSUE HAS FOLLOWED THE DECISION OF HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF SHRI PREM PAL GANDHI (SUPRA) AND DECIDED THE 9 ISSUE IN FAVOUR OF THE ASSESSEE. FURTHER THE REVENUE IS RELYING ON VARIOUS DECISIONS WHICH WERE DECIDED SUBSEQUENT TO THE ORDER PASSED BY THE TRIBUNAL ON 25 TH SEPTEMBER, 2018. HE SUBMITTED THAT THE REVENUE THROUGH THIS MISCELLANEOUS APPLICATION IS TRYING TO PERSUADE THE BENCH TO REVIEW ITS OWN ORDER WHICH IS NOT PERMISSIBLE IN LAW. HE ACCORDINGLY, SUBMITTED THAT THE MISCELLANEOUS APPLICATION FILED BY THE REVENUE SHOULD BE DISMISSED. 6. I HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BOTH THE SIDES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IN THIS CASE THE ORDER WAS PASSED ON 25 TH SEPTEMBER, 2018 WHEREIN APART FROM VARIOUS OTHER DECISIONS, THE DECISION OF HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF SHRI PREM PAL GANDHI (SUPRA) WAS FOLLOWED. THE JURISDICTION OF THE ASSESSEE FALLS UNDER HONBLE PUNJAB & HARYANA HIGH COURT. FURTHER THE VARIOUS DECISIONS RELIED ON BY THE REVENUE IN THE GROUNDS OF APPEAL WERE DECIDED SUBSEQUENT TO THE DECISION OF THE TRIBUNAL WHICH IS APPARENT FROM THE GROUNDS RAISED BY THE REVENUE IN THE MISCELLANEOUS APPLICATION. THE LD. SR. DR COULD NOT POINT OUT ANY APPARENT ERROR IN THE ORDER OF THE TRIBUNAL WHICH CONSTITUTES A MISTAKE SO AS TO INVOKE THE PROVISIONS OF SECTION 254(2) OF THE I.T. ACT. IN MY OPINION THE REVENUE THROUGH THIS MISCELLANEOUS APPLICATION IS TRYING TO REQUEST THE TRIBUNAL TO RECTIFY /RECALL OF THE ORDER OF THE TRIBUNAL WHICH AMOUNTS TO REVIEW OF ITS OWN ORDER BY THE TRIBUNAL 10 WHICH IS NOT PERMISSIBLE IN LAW. IN THIS VIEW OF THIS MATTER, I AM OF THE CONSIDERED OPINION THAT THERE IS NO APPARENT ERROR IN THE ORDER OF THE TRIBUNAL SO AS TO ENTERTAIN THE MISCELLANEOUS APPLICATION FILED BY THE REVENUE. THEREFORE, THE MISCELLANEOUS APPLICATION FILED BY THE REVENUE IS DISMISSED BEING DEVOID OF ANY MERIT. 7. IN THE RESULT THE MISCELLANEOUS APPLICATION FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 24/02/2021. SD/- (R.K. PANDA) ACCOUNTANT MEMBER DATED: 24/02/2021 VEENA COPY FORWARDED TO 1. APPLICANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR:ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI