TMI Blog2012 (12) TMI 94X X X X Extracts X X X X X X X X Extracts X X X X ..... rrectly deleted the addition - order of CIT(A) on the issue in question is upheld - In the result, revenue ‘s appeal is dismissed. - ITA No.4151/Del/2010 & C.O. No.16/Del/2011 - - - Dated:- 25-1-2012 - SHRI I.P. BANSAL AND SHRI SHAMIM YAHYA, JJ. Assessee by : Shri A.K. Jain, CA Revenue by : Shri Salil Mishra, Sr.DR ORDER PER I.P. BANSAL, JUDICIAL MEMBER The appeal is filed by the revenue and the C.O. by the assessee. They are directed against the order passed by the CIT (A) dated 28th July, 2010 in respect of Assessment Year 2002-03. The Grounds of appeal read as under:- 1. On the facts and circumstances of the case the CIT (A) has erred in deleting the addition of Rs.45,00,000/- on account of bogus credit u/s 68 of the IT Act received by the assessee during the year. 2. On the facts and circumstances of the case the CIT (A) has erred in deleting the addition of Rs.45,00,000/- made u/s 68 of the IT Act ignoring the fact that the assessee had failed to prove credit worthiness and genuineness of transaction thereby not discharging the onus cast on it by law. 3. The appellant craves to add, alter, amend, delete or withdraw any ground of appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elhi. 215445 Rs.5,00,000 05.12.2001 MKM Finsc Pvt. Ltd. (A/c No.6712 with SB Mysore, Karol Bagh, New Delhi. 215447 4. The aforementioned amount was credited in the bank account of the assessee maintained with OBC Bank, Pitam Pura, Delhi. The assessee sought copy of reasons which were communicated to him on 7th September, 2009. The objections were filed on 12th November, 2009. A speaking order rejecting the objections was passed by the Assessing Officer on 4th December, 2009 and communication was sent to the assessee by speed post on 5th December, 2009. As the correctness of the initiation of re-assessment proceedings was upheld by the Assessing Officer by rejecting the objection filed by the assessee, ld. Assessing Officer required the assessee to explain the transaction. Vide letter dated 23rd November, 2009, it was submitted that the assessee sold shares of M/s Youth Construction Pvt. Ltd. and Youth Builders Pvt. Ltd. of Rs. 45 lac to M/s MKM Finsec Pvt. Ltd. and received various cheques drawn on bank of Mysore, Karol Bagh, New Delhi and the Ratnakar Bank Ltd., Karol Bagh, New Delhi. Ld. Assessing Officer referred to the statement of Shri Mahesh Batra, Director ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld through M/s MKM Finsec Pvt. Ltd. (c) Copy of Confirmation Letter from M/s MKM Finsec Pvt. Ltd. (d) Copy of Cheques issued by the MKM Finsec Pvt. Ltd. (e) Copy of Acknowledgement of Income Tax Return M/s MKM Finsec Pvt. Ltd for A/Y. 2002/03 alongwith copy of Audited Annual Accounts (Balance Sheet, Profit Loss Account with Auditor Report). (f) Copy of Acknowledgement of Income Tax Return M/s MKM Finsec Pvt. Ltd for A/Y. 2007/08 alongwith copy of Audited Annual Accounts (Balance Sheet, Profit Loss Account with Auditor Report). (g) Certificate from M/s. Young Builders Pvt. Ltd. for shareholding of the assessee since F.Y 1999/2000 and its subsequent sale. (h) Certificate from M/s Youth Construction Pvt. Ltd. for shareholding of the assessee since F.Y 1999/2000 and its subsequent sale. (i) Copy of Audited balance Sheet of the assessee company for the Financial Year 1999-00 to 2001-02. 7. It was further submitted that the aforementioned evidence clearly proves the following facts:- It has been further submitted that evidence furnished by the assessee proves the following facts:- (i) That the M/s. MKM Finsec Private Limited (a member/broker of Delhi Stock Excha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... companies available in the opening stock under the head 'Investment' for this year are not shown to the extent sales claimed by the assessee in its books of accounts as closing stock at the end of the year. The investment to the extent of sales has been extinguished from the books of the assessee. (xiv) That the investment of the assessee company in the aforesaid shares of M/s. Young Builders Private Limited and M/s. Youth Construction Private Limited are not reflected in the audited balance sheet of the assessee as on 31/03/2002. (Refer Paper Book Page No. 59 to 64), which impliedly prove that the said investment has been sold by the assessee during the year under consideration and the same has not been disputed by the AO. 8. Referring to the aforementioned arguments, it was contended that the assessee has fulfilled all the three requirements to prove the genuineness of the cash credit, namely, identity of the creditor; credit worthiness of the creditor and genuineness of the transaction. Further, to establish the identity of the share broker, namely, M/s MKM Finsec. Pvt. Ltd., the assessee has placed reliance on the following evidences/facts:- (i) Registration with Registr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the decision of the Tribunal dated 11th December, 2009 in the case ITO vs. M/s Vaishali Financial Services Pvt. Ltd., ITA No.138/Del/2009, Assessment Year 2002-03. Ld. CIT (A) after considering all these submissions and referring to the evidence filed by the assessee has given a finding that the assessee had filed confirmation letter dated 8th April, 2002 from M/s MKM Finsec Pvt. Ltd. confirming the transaction of sale of shares. The confirmation was also filed by M/s Young Builders Pvt. Ltd. and M/s Youth Construction Pvt. Ltd. confirming the sale of shares held by the assessee company during financial year 2001-02 in favour of Shri Vinod Bansal. The Assessing Officer had not disputed the investment made by the assessee in both these companies which is evident from the return filed by the assessee for earlier years. The copies of cheques issued by MKM Finsec Pvt. Ltd. and also the PAN, copy of ITR of the said concern was also filed. The assessee had not earned any profit on the sale of shares since the sale was made at the cost price. The onus to prove cash credit in the books is rebuttable and the assessee having filed all the evidence had discharged its onus. The facts of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion. 14. We have carefully considered the rival submissions in the light of the material placed before us. In the present case, the assessee had submitted ample evidence which has already been discussed in the above part of this order to contend that the share transaction entered into by it with MKM Finsec Pvt. Ltd. was a genuine transaction. The shares which were subject matter of sale were standing in the balance sheet of the assessee which were subject matter of sale. The party to whom the sales have been made have confirmed the transactions and the transaction was supported by documentary evidence. It is also the case of the assessee that no material has been brought on record by the revenue that the share transaction of the assessee was not genuine. The addition has been made on the basis of information received by the Assessing Officer from the Investigation Wing. It is found that in respect of the very same party an addition of Rs. 49,55,300/- was made in the case of ITO vs. Vishal Holding and Capital Pvt. Ltd. (supra) and learned CIT (A) had deleted the addition and the said deletion was contested by the revenue before the Tribunal and it was decided by the Tribunal vide ..... X X X X Extracts X X X X X X X X Extracts X X X X
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