Appeal details
Counselvise Citation
[2025] 140 COUNSELVISE.COM (IT) 312314 (ITAT-CHENNAI)
Assessee PAN
Bench
Appeal Number
Appellant
Respondent
Appeal Type
Miscellaneous Application
Pronouncement Date
02-05-2025
Appeal Filed By
Assessee
Order Result
Dismissed
Bench Allotted
A
Assessment Year
2012-2013
Judgement Text
" आयकर अपीलीय अिधकरण “ए” \u000eा यपीठ चे\u0013ई म\u0016। IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, CHENNAI मा ननीय \u0019ी एबी टी. वक , \u000eा ियक सद एवं मा ननीय \u0019ी मनोज क ुमा र अ%वा ल ,लेखा सद क े सम'। BEFORE HON’BLE SHRI ABY T. VARKEY, JM AND HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM M.A. No.33/Chny/2025 [In ITA No.314/Chny/2020] (िनधा (रण वष( / Assessment Year: 2012-13) Shri T.M. Ramalingam No.113, Palani Road, Ganapathipalayam South Kolinjivadi Post, Dharapuram, Tiruppur-638 673. बना म / Vs. ACIT Central Circle-2 Coimbatore. \u0001थायीलेखासं./जीआइआरसं./PAN/GIR No. ADOPR-7424-C (अपीलाथ /Appellant) : ( थ / Respondent) अपीलाथ कीओरसे/ Appellant by : Shri Ravi Kannan (Advocate)- Ld. AR थ कीओरसे/Respondent by : Ms. Gauthami Manivasagam (JCIT) - Ld. Sr. DR सुनवाई की तारीख/Date of Hearing : 02-05-2025 घोषणा की तारीख /Date of Pronouncement : 02-05-2025 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. By way of this application, the assessee seeks our indulgence in Tribunal order passed in ITA No.314/Chny/2020 on 04-09-2024. The bench, in para-5 of the order, dismissed ground no.2 as raised by the assessee as under: - 5. From the facts, it clearly emerges that the Singapore entity is merely been used as a conduit entity to transfer the funds to Indian entity. Though Indian entity is separate corporate entity, the funds so obtained by the corporate entity has been withdrawn by the individual assessee and parked in his own name in fixed deposits. They continue to be parked as such and till date i.e., after lapse of more than 12 years, nothing has been shown to us that any repayment of the loan, has ever happened from assessee to Indian 2 entity and thereafter, to Singapore Entity who has ultimately funded the same from GBPL. This is despite the fact that the funds continue to be kept in Fixed Deposits. It is another aspect that GBPL has lodged a police complaint against assessee on allegation of fraud. On these facts, it could very well be concluded that the fixed deposits are nothing but for all practical purposes, has partaken the character of income of the individual assessee. Therefore, we do not find any fault in the adjudication of Ld. CIT(A). Ground No.2 stand dismissed. A finding was thus rendered by the bench that the Singapore entity was merely been used as a conduit entity to transfer the funds to Indian entity. Though Indian entity was a separate corporate entity, the funds so obtained by the corporate entity were withdrawn by the individual assessee and parked in his own name in fixed deposits. The bench further observed that nothing was shown that any repayment of the loan had ever happened to the ultimate lender i.e., GBPL. After due consideration of factual matrix, it was concluded that fixed deposits eventually had partaken the character of income of the individual assessee. Accordingly, the adjudication of Ld. CIT(A) was confirmed. 2. The Ld. AR, in the application, drew attention to amended agreement dated 01-03-2022 between M/s Bharneedhars Pte Ltd. and M/s Bharneedhars Refineries Pvt. Ltd. wherein the amount of Rs.54.50 Lacs is stated to have been set-off between the parties with the amount due to the borrower from Mrs. Hemalatha Sankar. Another argument is that the amounts of fixed deposits kept in the name of the assessee was only Rs.28 Lacs whereas the amount of Rs.155 Lacs was kept in the name of the company. The Ld. AR thus stated that the addition, to that extent alone, could have been made in the hands of the individual assessee. The Ld. Sr. DR, on the other hand, opposed any interference in the order. 3 3. Upon perusal of case records and the order of Tribunal, we find that the stated amended agreement was duly considered by the bench while adjudicating the matter. Upon cumulative consideration of factual matrix, the bench reached a conclusion that Singapore entity was merely been used as a conduit entity to transfer the funds to Indian entity. Though Indian entity was a separate corporate entity, the funds so obtained by the corporate entity were withdrawn by the individual assessee and parked in his own name in fixed deposits. The fact whether only a part of the funds was kept as fixed deposits or all funds were kept as fixed deposits would not materially alter the conclusion drawn by the bench. Another fact is that no repayment has ever happened to ultimate lender i.e., Gold GB Pte Ltd. (GBPL). Therefore, the conclusion that the funds had eventually partaken the character of income of the individual assessee, could not be faulted with. 4. In view of the above, no mistake apparent from record could be said to have occurred in the order of Tribunal which would require any indulgence in terms of Sec. 254(2) of the Act. 5. The application stand dismissed. Order pronounced on 02nd May, 2025. Sd/- Sd/- (ABY T. VARKEY) (MANOJ KUMAR AGGARWAL) \u000eा ियक सद /JUDICIAL MEMBER लेखा सद / ACCOUNTANT MEMBER चे1ई Chennai; िदनांक Dated : 02-05-2025 DS आदेशकी?ितिलिपअ%ेिषत/Copy of the Order forwarded to : 1. अपीलाथ /Appellant 2. थ /Respondent 3. आयकरआयु:/CIT Chennai/Coimbatore. 4. िवभागीय ितिनिध/DR 5. गाड?फाईल/GF "
AI Insights
The case revolves around the financial transactions involving a Singapore entity and an Indian corporate entity, where funds were transferred and subsequently parked in fixed deposits by the individual assessee, T.M. Ramalingam. The Income Tax Appellate Tribunal had previously concluded that these actions effectively treated the transferred funds as the personal income of the assessee, leading to tax implications. The assessee's application sought to challenge this conclusion, citing an amended agreement and discrepancies in the amounts involved. However, the Tribunal found that these arguments did not materially alter the facts or the legal conclusions previously drawn.
