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2016 (7) TMI 950

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..... ed in favour of assessee. - ITA No. 2464/Del/2013 - - - Dated:- 13-6-2016 - SHRI H. S. SIDHU, JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER For The Assessee : Sh. V.N. Marwah, FCA For The Revenue : Sh. Shravan Gotru, Sr. DR ORDER PER PRASHANT MAHARISHI, A. M. 1. This is appeal filed by the assessee against the order of the LD. CIT (A)-II, New Delhi dated 20.03.2013 for the 2009-10 where in following solitary ground of appeal was raised. The learned CIT(A) erred in fact and in law confirming the addition of ₹ 46,00,000/- which is not only bad in law but also against the facts and circumstances of the case. 2. Assessee appellant company is a private limited company engaged in the business of trading of supply of empty bottles in the beginning the business. However, this business was discontinued after 91-92 and thereafter in the FY 2003- 2004, trading business is stated to be carried out and thereafter no business was carried out by this company. One Sh. Avinash Setia in FY 2005 06, acquired the shares of this company. It filed its return of income, declaring total loss of ₹ 31870/- on 26/09/2009. This company along with three .....

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..... alance sheet, ld. CIT (A) held that it is a sham buildup of capital and therefore, he confirmed the action of the Ld. assessing officer of adding the sum to the total income of the assessee under section 68 of the Income Tax Act, 1961. Against this, assessee is in appeal before us. 4. Ld. authorized representative of the assessee submitted that Stalwart Realtors private Ltd is regularly assessed to income tax and during the course of assessment proceedings, submitted following documents:- a. The copy of assessment order under section 143 (3) of the act for assessment year 1990 -91 passed on 18/11/1992 of appellant. b. Copy of Sales tax assessment order of appellant. c. Copy of bank account maintained with South Indian bank of the assessee in respect of business carried on by the assessee. d. Annual accounts of Stalwarts realtors private limited. having invested in share capital by way of share application money of ₹ 46 lakhs. e. Copy of income tax returns filed by Stalwarts realtor Ltd for AY 2008-09 f. confirmation of stalwarts realtors private limited 5. In view of these documents, it was submitted that that appellant has discharged its initial onus .....

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..... of the Income Tax Dept has carried on investigation, which shows that this company belong to the Pradeep Sharma group, and B K Dhingra who are engaged in the business of providing accommodation entries to various parties and therefore the genuineness of the transaction is not established and hence the addition has rightly been made by the Ld. assessing officer and rightly confirmed by the CIT (Appeal). 7. We have carefully considered the rival contentions. We have also perused the relevant paper book filed by the Ld. AR of the appellant, which is part of the record before the lower authorities. During the course of assessment proceedings assessee received a Cheque of ₹ 46 lakhs by cheque No. 795738 of Corp bank, which was cleared in the bank account of stalwarts realtors private limited on 13/12/2008 and for the satisfaction of the assessing officer, assessee submitted confirmation showing address, as well as the permanent account number of the lender. It also submitted a copy of the income tax return filed by Stalwarts Realtors private limited for assessment year 2008 09, along with copy of the bank account of stalwarts realtors private limited with Corp bank from 1st D .....

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..... n 20/10/2008 at the business premises of Mr. Pradeep Sharma, wherein certain play pay slips were impounded and these pay in slip shows that the amount received from various bogus companies floated by Shri B K Dhingra into M/s Starwood realtors private limited as proceeds from sale and such sales were not the actual sales. 8. We failed to understand that when ld. AO has so much of the information why the assessee was not confronted by this evidence by providing the copies of such statements, copies of inquiry report and giving assessee an opportunity to rebut theses evidences. Ld AO has not done this basic exercise. Further, when the sales are stated to be bogus , the cases of the Stalwarts Realtors has not been reopened / reexamined under any of the section of the Income tax Act. Further, though the sales of the lender were found to be bogus, however, the profit derived from such bogus sales has been taxed by the revenue authorities. Therefore, the ld. AO has made this addition without adducing any evidence on which he strongly relies. The Ld. assessing officer, Ld. CIT (A) and Ld. departmental representative before us did not controverted that profits of Stalwarts Realtors from .....

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