TMI Blog2012 (6) TMI 86X X X X Extracts X X X X X X X X Extracts X X X X ..... /s 68 of the Act. 2. During hearing of this appeal, we have heard Shri Arun Dewan, ld. Sr. DR who defended the assessment order on the plea that the assessee did not furnish the required details and source of funds of such share applicants. It was also pleaded that the details of the business of such share subscribers were not furnished by the assessee. On the other hand, the ld. Counsel for the assessee Shri Sumit Nema strongly defended the impugned order by submitting that even the Assessing Officer has not disputed the identity of shareholder as the details of tax returns along with PAN, copy of passport, NRE bank account and loans were confirmed by the shareholder. It was also pointed out that though the assessee is not required to prove the creditworthiness, still it was proved by filing the sale proceeds of retail business in Russia along with statement of account of Habib Bank, Zurich and Employment Agreement. The ld. Counsel for the assessee relied upon the following judicial pronouncements: - a. CIT v. Lovely Exports [2008] 6 DTR (SC) 308; b. CIT v. Samir Biotech (P.) Ltd. [2010] 325 ITR 294 (Del); c. CIT v. Victor Electrodes Ltd. [2010] 329 I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he identity of creditor cannot disputed and absolutely proved. As regards the capacity of the creditors and genuineness of such transaction, it is noticed that the amount has been received through cheque issued by the creditor from his NRI bank account with State Bank of India Friends Colony New Delhi. The appellant further filed the evidences as regards the source of amount credited in the account of the creditor with State Bank of India. The creditor has filed evidences to the effect that amount was remitted from the account of the creditor with Habib Bank AG Zurich. The appellant has also filed evidences to the effect that the current emoluments of the creditor were in excess of USD 4.50 lacs per annum (equivalent to Rs.2.16 crore). The employment agreement of the creditor dated 7.7.2005 with Retail International Company, WLL also prove the creditworthiness of the creditor. Further the during appellate proceedings the appellant was specifically required to furnish some certificate or document in respect of deposits in the account of creditor with Habib Bank AG Zurich. The appellant further filed a certificate of a bank dated 24.11.2010 stating here in that Shri Nand Ji Mehrotra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s unexplained cash credit u/s 68 of the Act on the plea that the genuineness of share application money remained unsubstantiated. On appeal, the learned Commissioner of Income Tax (Appeals) deleted the addition and his conclusion has been reproduced hereinabove. We further find that during first appellate stage, the submissions of the assessee were identical which have been reproduced in para 6.3 of the impugned order. 3.1 If the language used in Sec. 68 of the IT Act is analyzed, it speaks about offering of explanation of the sum found credited in the books and nature and source thereof to the satisfaction of the Assessing Officer. On perusal of totality of facts available on record, we are satisfied that the assessee has discharged its onus by establishing the identity of the share holder along with nature and source of the money. Confirmation letter was also filed by the assessee. Even the ld. Assessing Officer has accepted in the assessment order that identity of the share applicant is not in doubt, therefore, the decision from Hon'ble Apex Court in the case of Lovely Export Ltd. (2008) (216 CTR 195) (SC) clearly comes to the rescue of the assessee. The Hon'ble Court while ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he impugned order by submitting that the provision of sec. 50C will apply to the facts of the present appeal. 4.1 We have considered the rival submissions and perused the material available on the record. The facts, in brief, are that the assessee sold a flat at Vijay Stambh and showed the capital gain as under: Particulars Amount (Rs.) Vijay Stambh Flat Value 729585 Less: Depreciation (SLM) 183292 WDV Value 546293 Profit 303707 Sale Price 8,50,000 The ld. Assessing Officer examined the sale deed wherein for the purposes of stamp duty, the value was adopted at Rs.17,67,000/-. The assessee was asked to show cause as to why the sale consideration value may not be taken as per sec. 50C. The assessee claimed that since the flat is a depreciable asset, the provision of sec. 50 is not applicable. The ld. Assessing Officer opined that since sec. 50C of the IT Act applies to all capital asset, no distinction can be made between depreciable and non-depreciable asset, consequently, he computed the capital gain as under: Total sale consideration as per market value - Rs.17, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no exclusion of applicability of one fiction in a case where other fiction is applicable. There is no conflict in these two legal fictions which operates in different fields. Further, no distinction is made between a depreciable asset and a non-depreciable asset in the provisions of section 50C, therefore, it cannot be said that said provision is not applicable in a case of transferable asset which is covered by provisions of section 50 of the Act, therefore, provisions of section 50C were applicable to transfer of depreciable asset covered by section 50 and the capital gain arising from such transfer has to be computed by adopting the stamp duty valuation. Our view is fortified by the Special Bench of the Mumbai Tribunal in the case of United Marine Academy (2011) 138 TTJ (Mum) (SB) 129 and the decision from Hon'ble Apex Court in Common Wealth Trust Limited v. CIT ; 228 ITR 1 (SC). It is pertinent to mention here that while coming to a particular conclusion, the Special Bench considered the following judicial decisions :- a. ACIT v. Roger Pereira Communications (P) Limited; [2009] 34 SOT (Mum) b Chhatturam Holiram Limited v. CIT; 25 ITR 326(Pat) c. CIT v. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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