Abhishek Estate Limited, Surat v. The Income tax Officer, Ward-1(1),, Surat

ITA 1585/AHD/2007 | 2004-2005
Pronouncement Date: 09-07-2010 | Result: Allowed

Appeal Details

RSA Number 158520514 RSA 2007
Bench Ahmedabad
Appeal Number ITA 1585/AHD/2007
Duration Of Justice 3 year(s) 2 month(s) 19 day(s)
Appellant Abhishek Estate Limited, Surat
Respondent The Income tax Officer, Ward-1(1),, Surat
Appeal Type Income Tax Appeal
Pronouncement Date 09-07-2010
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted D
Tribunal Order Date 09-07-2010
Date Of Final Hearing 06-07-2010
Next Hearing Date 06-07-2010
Assessment Year 2004-2005
Appeal Filed On 20-04-2007
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD AHMEDABAD D BENCH (BEFORE S/SHRI G.D. AGARWAL VICE-PRESIDENT AND MAHAVIR SINGH JUDICIAL MEMBER) ITA.NO.1585/AHD/2007 ASSTT.YEAR : 2004-2005 ABHISHEK ESTATE LTD. 9 AMBA NAGAR UDHNA MAGDALLA ROAD SURAT. VS. ITO WARD-1(1) SURAT. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI J.P. SHAH REVENUE BY : SHRI GAURAV BATHAN O R D E R PER G.D. AGARWAL VICE-PRESIDENT: THIS IS ASSESSEES APPEAL AGAINST THE ORDER OF THE CIT(A)-I SURAT DATED 12.0 2.2007 FOR A.Y.2004-2005 ARISING OUT OF THE ORDER OF THE ASSESSING OFFICER P ASSED UNDER SECTION 143(3) OF THE INCOME TAX ACT 1961. THIS APPEAL OF THE ASS ESSEE IS AGAINST THE ADDITION OF RS.17 74 813/- MADE BY THE AO ON ACCOUNT UNEXPLA INED CASH CREDIT UNDER SECTION 68 OF THE INCOME TAX ACT. 2. AT THE TIME OF HEARING BEFORE US IT IS SUBMITTE D BY THE LEARNED COUNSEL THAT DURING THE FINANCIAL YEAR 1-4-2001 TO 31-3-200 2 THE ASSESSEE HAD GIVEN ADVANCE OF RS.44 29 835/- TO BHARAT JARI WORKS (B JW FOR SHORT). MAJOR PART OF THE ADVANCE WAS RETURNED BY THEM DURING THE SAME YEAR. HOWEVER THE REPAYMENT OF THE ADVANCE TO THE EXTENT OF RS.24 25 052/- WAS CREDITED IN THE ACCOUNT OF BJW AND SOME REPAYMENT WAS BY MISTAKE CREDITED TO THE ACCOUNT OF SHRI SULTAN VIRANI. IT WAS EXPLAINED BY THE LEARNED COUNSEL THAT SINCE SOME CHEQUES WERE HANDED OVER BY SHRI SULTAN VIRANI THE ACCOUNTANT BY MISTAKE CREDITED THE AMOUNT OF SULTAN VIRANI INSTE AD OF BJW; THAT DURING THE ACCOUNTING YEAR RELEVANT TO THE ASSESSMENT YEAR UND ER CONSIDERATION A JOURNAL ENTRY WAS PASSED BY DEBITING THE ACCOUNT OF SULTAN VIRANI AND CREDITED TO THE ACCOUNT OF BJW. THUS DURING THE YEAR UNDER CON SIDERATION NO AMOUNT WAS ITA.NO.1585/AHD/2007 -2- RECEIVED FROM BJW. IN FACT THE PAYMENT AS WELL A S RECEIPT OF THE AMOUNT WAS ONLY DURING THE FINANCIAL YEAR 2001-2002. THE AO H IMSELF HAS MENTIONED IN THE ASSESSMENT ORDER ALL THESE FACTS AND HE HAS ALS O STATED THAT THE CREDIT IN THE ACCOUNT OF BJW IS THROUGH JOURNAL ENTRY. HE THER EFORE STATED THAT WHEN THERE IS NO ACTUAL CREDIT DURING THE ACCOUNTING YEAR RELE VANT TO THE ASSESSMENT YEAR UNDER CONSIDERATION NO ADDITION UNDER SECTION 68 C AN BE MADE. 3. THE LEARNED DR ON THE OTHER HAND RELIED UPON T HE ORDERS OF THE AUTHORITIES BELOW. HE HAS STATED THAT THERE WAS A CREDIT IN THE ACCOUNT OF BJW THOUGH IT WAS BY JOURNAL ENTRY. SINCE THERE WAS A CREDIT THE AO HAD RIGHTLY APPLIED SECTION 68 OF THE INCOME TAX ACT. 4. WE HAVE CAREFULLY CONSIDERED ARGUMENTS OF BOTH T HE SIDES AND PERUSED THE MATERIAL PLACED BEFORE US. IN OUR OPINION SE CTION 68 CAN BE APPLIED IF THERE IS AN ACTUAL RECEIPT OF MONEY BY THE ASSESSEE WHETHER BY CASH OR CHEQUE DURING THE ACCOUNTING YEAR RELEVANT TO THE ASSESSME NT YEAR UNDER CONSIDERATION. ADMITTEDLY DURING THE ACCOUNTING YEAR RELEVANT TO THE ASSESSMENT YEAR UNDER CONSIDERATION NO AMOUNT WAS RECEIVED FROM BJW. IN FACT THE TRANSACTION BETWEEN THE ASSESSEE AND BJW WAS DURING THE FINAN CIAL YEAR 20001-2002. EVEN IN THAT YEAR FIRST THE AMOUNT WAS ADVANCED BY THE ASSESSEE AND THEN THERE WAS REPAYMENT OF SUCH ADVANCES BY BJW. IF BY MIS TAKE PART OF THE REPAYMENT WAS CREDITED TO THE ACCOUNT OF SOME OTHER PARTY AND A JOURNAL ENTRY WAS MADE DURING THE ACCOUNTING YEAR RELEVANT TO ASS ESSMENT YEAR UNDER CONSIDERATION TO RECTIFY SUCH MISTAKE IN OUR OPINI ON SECTION 68 CANNOT BE APPLIED. WE THEREFORE DELETE THE ADDITION OF RS.17 74 913/- MADE BY THE AO. 5. IN THE RESULT THE ASSESSEES APPEAL IS ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 9 TH JULY 2010. SD/- SD/- (MAHAVIR SINGH) JUDICIAL MEMBER (G.D. AGARWAL) VICE-PRESIDENT ITA.NO.1585/AHD/2007 -3- PLACE : AHMEDABAD DATE : 09-07-2010 VK* COPY OF THE ORDER FORWARDED TO: 1) : APPELLANT 2) : RESPONDENT 3) : CIT(A) 4) : CIT CONCERNED 5) : DR ITAT. BY ORDER AR ITAT AHMEDABAD