ITO, New Delhi v. M/s Om Space Build Pvt. Ltd., New Delhi

ITA 1989/DEL/2010 | 2006-2007
Pronouncement Date: 01-07-2010 | Result: Dismissed

Appeal Details

RSA Number 198920114 RSA 2010
Assessee PAN AAACO8621G
Bench Delhi
Appeal Number ITA 1989/DEL/2010
Duration Of Justice 2 month(s) 1 day(s)
Appellant ITO, New Delhi
Respondent M/s Om Space Build Pvt. Ltd., New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 01-07-2010
Appeal Filed By Department
Order Result Dismissed
Bench Allotted F
Tribunal Order Date 01-07-2010
Date Of Final Hearing 01-07-2010
Next Hearing Date 01-07-2010
Assessment Year 2006-2007
Appeal Filed On 30-04-2010
Judgment Text
I.T.A. NO.1989 /DEL/2010 1/4 IN THE INCOME TAX APPELLATE TRIBUNAL NEW DELHI BENCH F BEFORE SHRI C. L. SETHI JUDICIAL MEMBER AND SHRI A K GARODIA ACCOUTANT MEMBER ITA NO. 1989/DEL/2010 (ASSESSMENT YEAR 2006-07) ITO WARD 13(4) VS. M/S. OM SPACE BUILD PVT. LTD . NEW DELHI. H-1342 DSIDC INDL. AREA NARELA DELHI-110 040 (APPELLANTS) (RESPONDENTS) PAN / GIR NO. AAACO8621G APPELLANT BY: SHRI AMRENDER KUMAR SR. DR & SMT. BANITA DEVI NEROEM SR. DR RESPONDENT BY: NONE ORDER PER A. K. GARODIA AM: 1. THIS IS THE REVENUES APPEAL DIRECTED AGAINST THE O RDER OF LD. CIT(A)-XVIII NEW DELHI DATED 03.02.2010 FOR THE AS SESSMENT YEAR 2006-07. THE GROUND RAISED BY THE REVENUE REA D AS UNDER: THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AN D IN LAW THE LD. CIT(A) ERRED IN DELETING THE PENALTY OFRS.2 92 000/- IMPOSED BY THE A.O. UNDER SECTION 271(1)(C) OF I. T . ACT 1961. THAT THE LD. CIT(A) FAILED TO APPRECIATE THE FACT T HAT THE ASSESSEE COMPANY SURRENDERED THE UNPROVED SHARE APPLICATION MONEY OF RS.8.70 LACS FOR TAXATION. IT WAS ONLY BECAUSE THE CASE WAS SELECTED FOR SCRUTINY THAT THE BOGUS SHARE APPLICATION MONEY WAS DETECTED. IF THE CASE WAS NOT PICKED UP FOR SCRUTINY THE ASSESSEES INCOME FROM UNDISCLOSED SOURCES INTRODUCED IN THE SHAPE OF SHAR E APPLICATION MONEY OF RS.8.70 LACS WOULD HAVE GONE UNDETECTED. I.T.A. NO.1989 /DEL/2010 2/4 2. THE BRIEF FACTS OF THE CASE ARE THAT IT IS NOTED BY THE A.O. IN THE ASSESSMENT ORDER THE ASSESSEE HAS RECEIVED SHARE AP PLICATION MONEY OF RS.8.70 LACS IN CASH FORM SMT. KAUSHALYA D EVI ON 02.01.2006. THE A.O. ASKED THE ASSESSEE TO SUBSTAN TIATE ITS CLAIM REGARDING THE SHARE APPLICATION MONEY IN CASH FORM SMT. KAUSHALYA DEVI. THEREAFTER IT IS NOTED BY THE A.O . THAT ON 18.11.2008 THE LD. A.R. HAS FILED A LETTER SIGNED BY THE DIRECTOR OF THE ASSESSEE COMPANY IN WHICH THE COMPANY SURREN DERED THE AMOUNT OF RS.8.70 LACS ALLEGEDLY RECEIVED FORM SMT. KAUSHALYA DEVI AS SHARE APPLICATION MONEY. IT IS FURTHER NO TED BY THE A.O. THAT THE ASSESSEE COMPANY HAS ALSO DEPOSITED T AX ON THIS SURRENDER ON 14.11.2008. THE A.O. COMPLETED THE AS SESSMENT ON 05.12.2008 BY MAKING ADDITION OF RS.8.70 LACS ON THE BASIS OF THIS SURRENDER BY THE ASSESSEE COMPANY. IN THE MEANTIME THE A.O. INITIATED PENALTY PROCEEDINGS U/S 271(1)(C) AN D IMPOSED A PENALTY OF RS.2.92 LACS ON THIS AMOUNT OF ADDITION OF RS.8.70 LACS. THE ASSESSEE CARRIED THE PENALTY MATTER IN A PPEAL BEFORE LD. CIT(A) WITH REGARD TO THE PENALTY IMPOSED BY TH E A.O. AND CIT(A) HAS DELETED THE PENALTY AND NOW THE REVENUE IS IN APPEAL BEFORE US. 3. THE LD. D.R. SUPPORTED THE PENALTY ORDER. THERE IS NONE PRESENT ON BEHALF OF THE ASSESSEE AND HENCE WE DECI DE THIS APPEAL EX-PARTE QUA THE ASSESSEE. 4. WE HAVE CONSIDERED THE SUBMISSIONS OF THE LD. D.R. FOR THE REVENUE AND HAVE ONE THROUGH THE ORDERS OF AUTHORIT IES BELOW. WE FIND THAT IN THE ASSESSMENT ORDER THE ADDITION WAS MADE BY THE A.O. MERELY ON THE BASIS OF SURRENDER BY THE AS SESSEE I.T.A. NO.1989 /DEL/2010 3/4 COMPANY AND NO ADVERSE MATERIAL HAS BEEN BROUGHT OU T ON RECORD BY THE A.O. SUGGESTING ANY CONCEALMENT OF IN COME BY THE ASSESSEE. IT IS NOTED BY THE CIT(A) IN PARA 6 OF HIS ORDER THAT IN THE COURSE OF ASSESSMENT PROCEEDINGS THE A SSESSEE COMPANY HAS FILED COPIES OF SHARE APPLICATION FORMS CONFIRMATION LETTERS FROM THE SHARE HOLDER PAN CAR D AND INCOME TAX RETURNS OF THE SHAREHOLDERS BUT THE A.O. REQUIRED THE ASSESSEE TO PRODUCE THE SHARE HOLDER SMT. KAUSHALYA DEVI. THE ASSESSEE VIDE LETTER DATED 128.11.2008 SUBMITTED BE FORE THE A.O. THAT THE SHARE HOLDER BEING AN OLD LADY OF 63 YEARS OF AGE THEY WERE NOT ABLE TO PRODUCE HER BEFORE THE A.O. A ND THE ASSESSEE SURRENDERED THE AMOUNT TO BUY PEACE OF MIN D AND PAID THE TAX ON THAT AMOUNT. LD. CIT(A) HAS REPRODUCED THE SUBMISSIONS OF THE ASSESSEE BEFORE THE A.O. VIDE LE TTER DATED 13.11.2008 ON THE BASIS OF WHICH ADDITION WAS MADE BY THE A.O. THIS IS BY NOW A SETTLED POSITION AS PER THE JUDGEMENT OF HONBLE APEX COURT RENDERED IN THE CASE OF CIT VS L OVELY EXPORTS PVT. LTD. AS REPORTED IN 216 CTR 195 THAT I F THE IDENTITY OF SHARE HOLDER IS BROUGHT OUT ON RECORD NO ADDITI ON CAN BE MADE IN THE HANDS OF THE COMPANY WHO HAVE RECEIVED THE SHARE APPLICATION MONEY AND THE REVENUE IS FREE TO INITIA TE PROCEEDINGS IN THE HANDS OF INVESTORS. ALTHOUGH IN THE PRESENT CASE THE ASSESSEE ITSELF HAS SURRENDERED THE AMOUN T OF SHARE APPLICATION MONEY AS ITS INCOME IN THE COURSE OF TH E ASSESSMENT PROCEEDINGS BUT IT IS NOTED BY THE CIT(A) THAT SUCH SURRENDER IS TO BUY PEACE OF MIND WITH THE DEPARTMENT. IN ADDIT ION TO SURRENDER BY THE ASSESSEE COMPANY NO ADVERSE MATER IAL COULD BE BROUGHT OUT ON RECORD BY THE A.O. SUGGESTING THA T THERE WAS I.T.A. NO.1989 /DEL/2010 4/4 ANY CONCEALMENT OF INCOME BY THE ASSESSEE COMPANY. CONSIDERING ALL THESE FACTS IN THE PRESENT CASE AND THE LEGAL POSITION AS PER THE JUDGEMENT OF HONBLE APEX COURT RENDERED IN THE CASE OF LOVELY EXPORTS PVT. LTD. (SUPRA) WE ARE OF THE CONSIDERED OPINION THAT PENALTY IS NOT IMPOSABLE IN SUCH CASES WHERE NO POSITIVE MATERIAL COULD BE BROUGHT OUT ON RECORD BY THE A.O. SUGGESTING ANY CONCEALMENT OF INCOME OR FU RNISHING OF INACCURATE PARTICULARS OF INCOME. HENCE WE DO NOT FIND ANY REASON TO INTERFERE IN THE ORDER OF LD. CIT(A). 5. IN THE RESULT THE APPEAL OF THE REVENUE IS DISMISS ED. 6. THIS DECISION WAS PRONOUNCED IN THE OPEN COURT ON 0 1 ST JULY 2010. SD./- SD./- (C. L. SETHI) (A K GARODIA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED:01 ST JULY 2010 SP. COPY FORWARDED TO 1. APPELLANT 2. RESPONDENT 3. CIT TRUE COPY: BY ORDER 4. CIT(A) 5. DR DY. REGISTRAR ITAT NEW DELHI