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2017 (8) TMI 1309 - RAJASTHAN HIGH COURTGenuineness of share loss claimed - disallowance of claim as numerous discrepancies were pointed out by the AO and the broker itself admitted to have provided accommodation entries - questions for the opinion of the court - whether the contracts with the brokers were genuine ? - Held that:- We were of the opinion that the issue is covered by the decision of Supreme Court in the case of Jiyajeerao Cotton Mills. Ltd. vs. Commissioner of Income tax and Excess Profits Tax Bombay [1958 (5) TMI 3 - SUPREME Court] as held the obvious intention behind this order, read as a whole, was that persons connected with the several links in the chain of contracts and series of payments concerned in these transactions should be examined with a view to elucidate the true position, and the managing director was mentioned as the person who was likely to have entered into these transactions. Durgaprasad Mandalia was the manager of the appellant company, and he gave evidence that he put the present transactions through the brokers, and that has been considered. If Birlas wanted themselves to give evidence, there was nothing to prevent them from doing so, and indeed, no complaint was made in the court below that their evidence had not been taken. There is no substance in this contention. We have considered all the contentions urged on behalf of the appellant at some length. We would like to make it clear that we are not sitting here as a court of appeal on facts. We have examined the record only with a view to see whether there is any misdirection or non-direction, such as is likely to have affected the result, and we have come to the conclusion that there is none, and that the finding of the Tribunal is not therefore open to attack. It was finally urged that even assuming that the contracts with the brokers were sham, the result would only be to substitute J. R. Pillani, Gwalior, in their place, and even then, the contracts would have been concluded at Gwalior. But that is not the case put forward by the appellant. Far from pleading that the brokers were nominal parties and that the contracts were with J. R. Pillani, Gwalior, the appellant contended that it had no privity of contract with J. R. Pillani, Gwalior, and the evidence adduced by it was to the effect that its contracts were only with the brokers. Another point which was sought to be raised was that the contracts must be taken to have been concluded at Bombay by the Birlas and not by the appellant. This again is a plea which was not taken by the appellant, and is directly opposed to its contention that it entered into these contracts with the brokers at Gwalior. In view of the fact that the profits were actually received by the appellant, this contention is, in our opinion, wholly preposterous. Issue is answered in favour of the assessee and against the department.
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