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Golden Bottling Limited Versus Addl. CIT, Spl. Range, Alwar

2016 (7) TMI 324 - ITAT JAIPUR

Entitlment to depreciation on the written down value as per Section 32 for the entire period - asset put to use - Held that:- Admittedly the assessee has shown the production for an amount of ₹ 9900/- in the month of September 1996. (The records of central excise sales Range-1 on 28/09/1996, 29/09/1996 and 30/09/1996.) This register of excise was maintained by the assessee as mentioned by the Assessing Officer in the assessment order. Moreover, once it is submitted by the assessee that the .....

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180 days, then the assessee is entitled to depreciation on the written down value as prescribed by the Act. Since the assets were put to use for the period of more than180 days, therefore, the assessee is entitled to depreciation for full year. - Decided in favour of assessee - Addition U/s 68 - investment in shares and unsecured loans received by the assessee company - Held that:- Once the identity of the creditor has been established and there is no doubt about the genuineness of the tran .....

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as discharged the initial onus of disclosing the identity and address of the person, therefore, in our view the ingredients of Section 68 are met and the addition is required to be deleted. Accordingly, we delete the addition in respect of Shri Satish Kumar Bhayana. - The identity of the person has been roved by the assessee, address has been provided and the amounts invested by Smt. Bhagyawati and Mr. Rakesh Malhotra were ₹ 50,000/- and ₹ 40,000/-, in our view, this were small a .....

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share applicant nor applicant was found as mentioned in the report of the Inspector nor the confirmation has been given by this share allottee. In our view, the assessee has failed to discharge his initial onus to prove the identity of the person, genuineness of the transaction and creditworthiness, therefore, the addition of ₹ 50,000/- in respect of Shri K.K. Nangia is hereby confirmed. - Once the identity of the creditor has been established and there is no doubt about the genuinenes .....

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y the ld CIT(A), Alwar for the A.Y. 1997-98 wherein the following grounds of appeal have been raised. 1 Because the action is under challenge on facts and law for enhancement being disallowance of depreciation on the Plant & machinery amounting to ₹ 29,18,090/-. Even the quantum and rate of disallowance is disputed. 2. Because the action is under challenge on facts and law for sustaining the addition of ₹ 34,23,712/- U/s 68 as cash credit for shares and loans. 2. The brief facts .....

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d person was not available . Thereafter a letter was received from the assessee company seeking adjournment. Thereafter the case was fixed for 18/8/1999. However, on that date, no one attended the proceedings. Ultimately, a notice U/s 142(1) of the Act alongwith query letter was issued on 12/8/1999. The AR of the assessee appeared and the case was discussed with the Assessing Officer. It was noticed that during the year under reference, the assessee company allotted 635100 shares of ₹ 10 e .....

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nd unsecured loans received by the assessee company. Further the assessee has also claimed depreciation on plant and machinery installed by it. However, the ld Assessing Officer after discussing the factual matrix and the excise register maintained by the assessee have restricted the claim of the assessee to 3/4 of the claim. The relevant paragraph is reproduced at page No. 20 to 21 of the assessment order, which is reproduced as under:- During the course of proceedings the examination of accoun .....

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The assessee s AR has filed the list of machineries and the purpose for which these have been utilized. The month-wise details of sales as submitted by the assessee company is as under:- Name of month Amount September, 96 ₹ 9900/- October, 96 Nil. November, 96 Nil. December, 96 Nil. January, 97 ₹ 154500/- February, 97 ₹ 690195/- March, 97 ₹ 250756/- From the above, it is clear that the assessee company has not used its entire plant & machinery for production in the m .....

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aggrieved by the order of the Assessing Officer, the assessee preferred appeal before the ld CIT(A), who had restricted the claim of depreciation from 3/4th to 1/2 . The findings of the ld CIT(A) is as under:- 4.2 The AR contended that further we have to submit that the assessee company has started production on 28/09/1996 since there is no dispute on this order. For this purpose, he has verified the excise records. Once it has been verified that Plant and Machineries forming part of block has .....

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eptember, 1996 as no evidence has been filed before me that production had been started on 28/09/1996. The depreciation is allowable 1/2. Therefore, A.O. is directed to recalculate 1/2 depreciation and allow the same. On this ground of appeal the addition is enhanced. 4. Similarly, the ld CIT(A) after detailed discussions have sustained the addition of ₹ 34,23,715/- U/s 68 of the Act for cash credit of shares and loans. The finding of the ld CIT(A) is reproduced as under:- 5.3. I have gone .....

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firmation was filed. (on page-4). (v) Saroj Madan: There was no Saroj Madan on address given and also no further reply was given by the assessee. (on page-4) (vi) Pankaj Madan: There was no Pankaj Madan on address given and also no further reply was given by the assessee. (on page-4) (vii) M/S Sarna Int. P. Ltd.: No address has been given, (on page-4) (viii) V.J.S.Chawla: No confirmation, (on page-4). (ix) Chinki Chawala: No confirmation, (on page-4) (x) Mr. Azad: No address of shareholder given .....

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ment: No confirmation and not address had been provided. (on page-8) (xviii) Shekhar: No confirmation, on enquiry he refused to give any loan to the company and had salary income. (on page-9) (xiv) H.R.Tyagi: The balance sheet of the company shows loan ₹ 6,49,550/- whereas balance sheet of the H.R.Tyagi ₹ 20,09,269/-(on page-9) (xx) R.P.Tyagi: Not filing the income tax return and summons were not served, (on page-10) (xxi) Sunil Tyagi: The balances shown by the creditor and company w .....

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86 ITR 477 and Hon ble Delhi HC in case of CIT Vs. Divine Leasing and Finance Ltd. (2008) 299 ITR 268 has held that identity of the person, creditworthiness and genuineness of the transaction has to be established by the assessee in case of shares and loans u/s. 68 of the IT Act. Therefore, addition of ₹ 34,23,712/- is confirmed. The appeal on this ground is dismissed. ISSUE NO. 1 5. Now the assessee is in appeal before us. The ld AR of the assessee has submitted that the plant and machine .....

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clear from the chart given in the assessment order, therefore, it was submitted that the assessee is not entitled to the depreciation more than what has already been granted by the ld CIT(A). 7. We have heard the rival contentions of both the parties and perused the material available on the record as well as also perused the orders of the lower authorities. Admittedly the assessee has shown the production for an amount of ₹ 9900/- in the month of September 1996. (The records of central ex .....

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the usage of plant and machinery in the month of September, 1996, cannot be a ground to disallow the depreciation for the period of more than 180 days. As per Section 32 of the Act, if the asset is put to use for a period of more than 180 days, then the assessee is entitled to depreciation on the written down value as prescribed by the Act. Since the assets were put to use for the period of more than180 days, therefore, the assessee is entitled to depreciation for full year. Accordingly, we all .....

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ct of share applicable was made for an amount of ₹ 15,24,162/- for 16 cases and the addition of ₹ 18,99,550/- was made for unsecured loans for six cases, thus a total addition of ₹ 34,23,712/- was made. 9. The ld AR of the assessee has submitted before us that the assessee has given complete details of identity of the persons, creditworthiness and genuineness of the transactions and therefore he submitted that the addition made by the ld Assessing Officer and sustained ld CIT(A .....

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M/s Anu Industries v/s ACIT 19 DTR 465 (Del). (vi) Auatech International Ltd. v/s ITO 13 DTR 382(Del). (vii) Smart Capital Services Ltd V/S JCIT 10 DTR 593(Del). (viii) Meera Engineering & Commercial Industries Co. P. Ltd. v/s ACIT 58 TTJ 527(Jab). (ix) Allen Bradley India Ltd. v/s DCIT (2002) 80 ITD 43 (Del). (x) Uma Polymers Pvt. Ltd. v/s DCIT (2006) 101 TTJ 124 (JD) (TM) (xi) Progressive Ltd. v/s ITO (1991) 40 TTJ 595 (Cal) (xii) CIT v/s Gangour Investment Ltd. (2009) 18 DTR 242 (Del) - .....

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TA No364/JU/2005. (iv) Vijeta Cement Pvt. Ltd. v/s JCIT 24 TW 223 (JP). (v) Labhchand Bohra V/s ITO (2008) 8 DTR 44 (Raj.). (vi) Kanhaialal Jangid vs. ACIT (2008) 217 CTR 354 (Raj). (vii) Aravali Trading Co. v/s ITO (2008) 8 DTR 199 (viii) CIT v/s Lovely Exports (P) Ltd (2008) 216 CTR 195(SC). (ix) Vimal Chandra Golecha v/s ITO & Anr. (1982) 134 ITR 119 (Raj.). (x) Kishinchand Chellaram vs. CIT (1980) 125 ITR 713 (SC). 10. On the other hand, the ld DR has submitted that the order passed by t .....

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ach and every transaction separately and will be deciding the issue on merit. Smt. Premlata Madhok 11.1 First of all the addition was made by the ld Assessing Officer and sustained by the ld CIT(A) in respect of Smt. Premlata Madhok. In this regard, AR submitted that the shares were allotted by the assessee to Smt. Premlata Madhok and even from the report of Inspector, the identity of Smt. Premlata Madhok was proved and further she has admitted purchase of shares. However, the Assessing Officer .....

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this regard, Shri Satish Kumar Bhayana was allotted 4000 shares by the assessee company and the assessee has provided address of the allottee to the Assessing Officer as has been mentioned by the Assessing Officer in the order. However, no investigation was made by the Assessing Officer and therefore, the Assessing Officer has added a sum of ₹ 40,000/- on the pretext that the assessee has failed to give confirmation from the said Shri Satish Kumar Bhayana, in our view, once the shares hav .....

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Bhayana. 11.3 Smt. Bhagyawati and Mr. Rakesh Malhotra:- In both the cases, the shares were allotted by the assessee company and the assessee has provided address of the allottee of the shares namely C-88, Vikash Puri, New Delhi. However, the Inspector doubted the transcation and has given report , stating therein that As per Smt Bhagwati the details of the share application may be available with her son Mr. Rakesh Malhotra. On meeting of Mr. Rakesh Malhotra he submitted, , he told him that he wi .....

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r. Rakesh Malhotra were ₹ 50,000/- and ₹ 40,000/-, in our view, this were small amount and there is no positive evidence brought on record by the AO suggesting that these persons are not having means to file share application. In fact, the report suggests that Shri Rakesh Malhotra is a teacher in school, therefore, means of Shri Rakesh Malhotra cannot be doubted. Therefore, in our view the addition is required to be deleted. Accordingly, we delete the addition in respect of Smt. Bhag .....

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applications, therefore, the addition is required to be sustained. We have gone through the arguments made by both the parties as well as records placed before us, in our view neither the address have been given in respect of these share applicants nor these applicants were found on enquiry by the Inspector nor the confirmations were given by these share allottees. In our view, the assessee has failed to discharge its initial onus to prove the identity of the person, genuineness of the transact .....

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that the confirmation in respect of these two persons were not made by the assessee. We have gone through the submissions of both the parties and records placed on record. The ld Assessing Officer in the order has mentioned that the VJS Chawla is an Army Officer and posted at Mumbai. However, the contact could not have been established as the phone was being picked up by the P.A.. In our view, the more enquiry was required to be made by the Assessing Officer. In absence of thorough and proper en .....

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0/- each for V.J.S. Chawla and Chinki Chawla. 11.6 Shri K.K. Nangia:- Regarding Shri K.K. Nangia, the ld AR has submitted that the shares have been allotted to him. His identity is duly established as the Inspector visited the house but the said person was not available at that time. His daughter was present and she was not able to give desired details. The A.O. should have been made further enquiry in absence of the said person which he did not. Thus, the identity, genuineness of the person is .....

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has been given by this share allottee. In our view, the assessee has failed to discharge his initial onus to prove the identity of the person, genuineness of the transaction and creditworthiness, therefore, the addition of ₹ 50,000/- in respect of Shri K.K. Nangia is hereby confirmed. 11.7 Shri Ashok Solanki:- Regarding Shri Ashok Solanki the ld AR has submitted that his statements were recorded u/s 131. Identity is duly established. He admitted in his statements of investments made in th .....

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he hands of Assessee Company. On the other hand, the ld DR has admitted that neither the address has been given nor the confirmation have been submitted by the assessee in this share application, therefore, the addition is required to be sustained. In our view, once the identity of the creditor has been established and there is no doubt about the genuineness of the transaction, therefore, the source of source cannot be enquired by the Assessing Officer. Accordingly, the addition made with respec .....

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Basidarapur, N.D. 250000/- 6 Umesh Tyagi WZ- 13, Vikas Puri New delhi 150000/- The ld AR of the assessee has submitted that the assessee has received amount through cheques and repaid the amount through cheques, therefore, the ld Assessing Officer and ld CIT(A) has wrongly confirmed the addition of ₹ 18,99,000/-. It was also submitted that the amount appears in the ledger of the assessee and also in the ledger of the creditors. It is also the case that the loan amount of Shri Umesh Tyagi .....

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Assessing Officer. It is the case that the substantial amount was received by the old management and new management has repaid the amount. The assessee has requested the Assessing Officer to issue the summons U/s 131 to find out the correct nature of transaction and therefore, it was contended that out of the addition of ₹ 18.99 lacs, the addition of ₹ 17.49 lacs is required to be deleted being genuine and real. 13. On the other hand, the ld DR has drawn our attention to ld Assessing .....

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tment:- The assessee has not provided the address and confirmation of the Essaar Investment, therefore, the case of the assessee that the loan was taken, in our view, was not correct. In our view, the ld Assessing Officer and ld CIT(A) was right in confirming the addition, therefore, we uphold the order of the ld CIT(A) in the case of Essaar Investment. (ii) Shekhar:- Though the payment was received by cheque by the assessee, however, when the letter was written by the assessee as well as by the .....

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he conclusion drawn by the ld Assessing Officer, therefore, the order of the ld CIT(A) is required to be upheld and we uphold the order of the ld CIT(A) in the case of Shri Shekhar. (iii) H.R. Tyagi, R.P. Tyagi and Sunil Tyagi:- The Assessing Officer have examined the balance sheet of Shri H.R. Tyagi as well as the company, it was noticed by the ld Assessing Officer that there was a major difference in their accounts of both i.e. assessee as well as Shri H.R. Tyagi. We have gone through the reco .....

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P. Tyagi, though the confirmation was received on 17/12/1999 but however, when the Inspector was directed to verify from Shri R.P. Tyagi from its return of income, the Inspector has submitted a detailed report, which is as under:- R.P. Tyagi:- The assessee company has received ₹ 350000/- on account of unsecured loans in the year under consideration in the name of Shri R.P. Tyagi and ₹ 10,1,000/- was shown balance as on 31/3/196. The assessee company has also shown investment in the n .....

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egarding the investment of ₹ 724500/- in the case of assessee company. Thereafter the ld AR, after receipt of the report, has submitted a detailed reply on 21/2/2000. After receipt of reply, the summons were issued to the creditors through the assessee for service. However, none of the persons has attended the proceedings in response to the summons issued and further the assessee was not able to get the summons served upon them . In view thereof, the lower authorities have confirmed the ad .....

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