Sri. Ramesh Kumar Shah , Bangalore V. The Assistant Commissioner of Income Tax, Circle-5(2)(1), BAngalore

SA 205/BANG/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 6047 (ITAT-BANGALORE)
• Duration Of Justice: 8 month(s) 23 day(s)
• Appeal Type: Income Tax (Transfer Pricing) Appeal
• Pronouncement Date: 01-05-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2014-2015
• Appeal Filed On: 09-08-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SIDDAPPAJI BENGALURU
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : BANGALORE BEFORE SHRI N.V. VASUDEVAN, JUDICIAL MEMBER AND SHRI A.K. GARODIA , ACCOUNTANT MEMBER S.P. NO.205/BANG/2018 [IN I TA NO. 595/BANG/2018] ASSESSMENT YEAR : 2014 - 15 SHRI RAMESH KUMAR SHAH, # 1/1, 3 RD FLOOR, VINAYAKA TOWERS, 1 ST MAIN, 1 ST CROSS, GANDHI NAGAR, BENGALURU 560 002. PAN: AOIPS 4203F VS. THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 5(2)(1), BENGALURU. APPLIC ANT RESPONDENT APPLICANT BY : SMT. SUMAN LUNKAR, CA RE SPONDE NT BY : SHRI SIDDAPPAJI, ADDL. CIT(DR)(ITAT), BENGALURU. DATE OF HEARING : 24 .08 .201 8 DATE OF PRONOUNCEMENT : 24 .08.2018 O R D E R PER N.V. VASUDEVAN, JUDICIAL MEMBER THIS IS AN APPLICATION FILED BY THE ASSESSEE PRAY ING FOR AN ORDER OF STAY OF RECOVERY OF OUTSTANDING DEMAND OF A SUM OF RS.76,01,775 FOR THE ASSESSMENT YEAR 2014-15. 2. THE OUTSTANDING DEMAND ARISES OUT OF AN ORDER O F ASSESSMENT, WHEREIN THE AO TREATED THE LONG TERM CAPITAL GAIN D ECLARED BY THE ASSESSEE ON SALE OF SHARES OF A COMPANY BY NAME, M/S. NCL RE SEARCH & FINANCIAL SERVICES LTD. AS BOGUS AND MADE THE ADDITION OF RS. 1,96,13,981 TO THE TOTAL S.P. NO.205/BANG/2018 PAGE 2 OF 3 INCOME OF THE ASSESSEE. THE ACTION OF THE AO WAS C ONFIRMED BY THE CIT(APPEALS). 3. IT IS THE PLEA OF THE ASSESSEE THAT PURSUANT TO THE ORDER OF CIT(APPEALS) DISMISSING THE ASSESSEES APPEAL, THE AO HAS ISSUED A LETTER DATED 27.07.2018 ASKING THE ASSESSEE TO PAY THE OUT STANDING DEMAND. IN THESE CIRCUMSTANCES, THE ASSESSEE HAS FILED THE PRE SENT APPLICATION PRAYING FOR AN ORDER OF STAY OF RECOVERY OF OUTSTAN DING DEMAND. IT IS THE PLEA OF THE ASSESSEE THAT HE DOES NOT HAVE LIQUID F UNDS TO PAY THE OUTSTANDING DEMAND. IT IS ALSO THE PLEA OF THE ASS ESSEE THAT HE HAS A PRIMA FACIE CASE INASMUCH AS THE ENTIRE BASIS ON WHICH THE REV ENUE AUTHORITIES CAME TO THE CONCLUSION THAT THE LONG TE RM CAPITAL GAIN DECLARED BY THE ASSESSEE WAS BOGUS IS CONTRARY TO THE SETTLE D LEGAL POSITION WITH REGARD TO USE OF MATERIAL AGAINST THE ASSESSEE WITH OUT RIGHT TO CROSS- EXAMINATION AND BASED ON ASSUMPTIONS AND SURMISES. 4. THE LD. DR OPPOSED THE PRAYER OF THE ASSESSEE FO R GRANT OF AN ORDER OF STAY. ACCORDING TO HIM, THE LONG TERM CAPITAL G AIN DECLARED BY THE ASSESSEE WAS BOGUS AND WAS RIGHTLY TREATED AS UNEXP LAINED CASH CREDIT U/S. 68 OF THE ACT BY THE REVENUE AUTHORITIES. WE HAVE GIVEN A CAREFUL CONSIDERATION TO THE RIVAL SUBMISSIONS. IN OUR VIE W, THE SUBMISSIONS ON BEHALF OF THE ASSESSEE REQUIRES A RELOOK BY THE TRI BUNAL. KEEPING IN MIND THE EXISTENCE OF A PRIMA FACIE CASE, BALANCE OF CONVENIENCE AND RELATIVE HARDSHIP, WE ARE OF THE VIEW THAT IT WOULD BE JUST AND APPROPRIATE TO DIRECT THE ASSESSEE TO PAY A SUM OF RS.25 LAKHS IN THE FOL LOWING MANNER:- (I) ON OR BEFORE 31.08.2018 RS.12.5 LAKHS (II) ON OR BEFORE 15.09.2018 RS.12.5 LAKHS 5. THERE SHALL BE AN ORDER OF STAY OF RECOVERY OF O UTSTANDING DEMAND FOR A PERIOD OF SIX MONTHS FROM THE DATE OF THIS OR DER, OR TILL THE DISPOSAL OF THE APPEAL; WHICHEVER IS EARLIER. THE APPEAL IS A LREADY FIXED FOR HEARING ON S.P. NO.205/BANG/2018 PAGE 3 OF 3 27.09.2018. THE STAY PETITION IS ACCORDINGLY ALLOW ED IN THE TERMS INDICATED ABOVE. PRONOUNCED IN THE OPEN COURT ON THIS 24 TH DAY OF AUGUST, 2018. SD/- SD/- ( A.K. GARODIA ) ( N.V. VASUDEVAN ) ACCOUNTANT MEMBER JUDICIAL MEMBER BANGALORE, DATED, THE 24 TH AUGUST, 2018. / D ESAI S MURTHY / COPY TO: 1. THE APP LIC ANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR, ITAT, BANGALORE. 6. GUARD FILE BY ORDER SENIOR PRIVATE SECRETARY ITAT, BANGALORE.