Shiv Vanijay Capsec Pvt. Ltd., New Delhi v. ITO, New Delhi

ITA 2124/DEL/2010 | 2001-2002
Pronouncement Date: 10-02-2012 | Result: Allowed

Appeal Details

RSA Number 212420114 RSA 2010
Assessee PAN AABCS2773E
Bench Delhi
Appeal Number ITA 2124/DEL/2010
Duration Of Justice 1 year(s) 9 month(s) 3 day(s)
Appellant Shiv Vanijay Capsec Pvt. Ltd., New Delhi
Respondent ITO, New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 10-02-2012
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted G
Tribunal Order Date 10-02-2012
Date Of Final Hearing 06-02-2012
Next Hearing Date 06-02-2012
Assessment Year 2001-2002
Appeal Filed On 07-05-2010
Judgment Text
ITA NO. 2124/DEL/2010 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH G NEW DELHI BEFORE SHRI I.P. BANSAL JUDICIAL MEMBER AND SHRI SHAMIM YAHYA ACCOUNTANT MEMBER I.T.A. NO. 2124/DEL/2010 A.Y. : 2001-02 SHIV VANIJAY CAPSEC PVT. LTD. IV/928 CHHOTTA CHIPPIWARA CHAWRI BAZAR DELHI 110 006 (PAN: AABCS2773E) VS. ITO WARD 8(2) NEW DELHI (APPELLANT ) (APPELLANT ) (APPELLANT ) (APPELLANT ) (RESPONDENT ) (RESPONDENT ) (RESPONDENT ) (RESPONDENT ) ASSESSEE BY : SH. AJAY WADHWA CA DEPARTMENT BY : S. MOHANTY D.R. ORDER ORDER ORDER ORDER PER SHAMIM YAHYA: AM PER SHAMIM YAHYA: AM PER SHAMIM YAHYA: AM PER SHAMIM YAHYA: AM THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST T HE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) DATED 03.3.2 010 PERTAINING TO ASSESSMENT YEAR 2001-02. 2. THE GROUNDS RAISED READ AS UNDER:- (I) ON THE BASIS OF FACTS AND CIRCUMSTANCES OF THE CASE AND PROVISIONS OF LAW THE ASSESSING OFFICER IS W RONG AND UNJUSTIFIED IN REOPENING THE ASSESSMENT WITHOUT ANY VALID REASON OR MATERIAL AGAINST THE ASSESSEE ON RECORD AND THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN CONFIRMING THE SAME. (II) ON THE BASIS OF FACTS AND CIRCUMSTANCES OF THE CASE AND PROVISIONS OF LAW THE ASSESSING OFFICER IS WR ONG ITA NO. 2124/DEL/2010 2 AND UNJUSTIFIED IN HOLDING THAT ASSESSEE HAS FAILED TO DISCLOSE FULLY OR TRULY ALL THE MATERIAL FACTS NECES SARY FOR THE ASSESSMENT AND THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN CONFIRMING THE SAME. (III) THAT THE ASSESSING OFFICER HAS ERRED IN PASS ING THE ORDER WITHOUT GIVING PROPER OPPORTUNITY TO EXPLAIN THE MATERIAL COLLECTED BY ASSESSING OFFICER DURING THE COURSE OF ASSESSMENT PROCEEDINGS AND THEREFORE THE FINDINGS OF THE ASSESSING OFFICER ARE INCORRECT. (IV) ON THE BASIS OF FACTS AND CIRCUMSTANCES OF THE CASE AND PROVISIONS OF LAW THE ASSESSING OFFICER IS WR ONG AND UNJUSTIFIED IN ADDING AN AMOUNT OF ` 200000/- BEING CAPITAL RECEIPT ON ACCOUNT OF ACCOUNT OF SHAR E APPLICATION MONEY IN THE TAXABLE INCOME OF THE APPELLANT AS INCOME FROM UNDISCLOSED SOURCES UNDER SECTION 68 OF THE INCOME TAX ACT AND THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN CONFIRMING THE SAME. (V) ANY OTHER GROUND AT THE TIME OF HEARING. 3. THE ASSESSEE AN NBFC WAS ENGAGED IN THE BUSINESS OF LOAN AND FINANCING DURING THE PERIOD UNDER CONSIDERATION. T HE ASSESSEE FILED ITS ORIGINAL RETURN OF INCOME ON 31.10.01 DECLARING T OTAL INCOME AT ` 80 850/-. THE RETURN WAS PROCESSED U/S 143(1) ON 1 1.6.2002 OF THE ACT. THE ASSESSMENT WAS COMPLETED U/S. 143(3) OF THE ACT ON 26.3.2003 COMPUTING TOTAL INCOME AT ` 1 29 720/-. T HE CASE WAS SUBSEQUENTLY REOPENED U/S. 147 AND ASSESSMENT WAS FR AMED U/S ITA NO. 2124/DEL/2010 3 147/143(3) OF THE ACT ON 21.11.2008 COMPUTING TOTAL INCOME AT ` 3 29 720/- AS AGAINST RETURNED INCOME OF ` 80 850/-. THE ADDITIONS INTER-ALIA INCLUDES ` 2 00 000/- U/S. 68 ON SHARE A PPLICATION MONEY RECEIVED FROM SHRI SUNIL KUMAR VERMA. DURING THE PE RIOD UNDER CONSIDERATION IT WAS REVEALED THAT ASSESSEE HAD RE CEIVED ` 2 00 000/- FROM SHRI SUNIL KUMAR VERMA. INFORMATION WAS RECEI VED FROM ACIT CC-3 JAIPUR TO THIS EFFECT. THE DETAILS OF THE IN FORMATION AS RECEIVED SHOWN THAT THE ASSESSEE HAS RECEIVED ENTRY AS GIVEN BELOW:- BENEFICIARY NAME BENEFICIARY BANK NAME AND BRANCH VALUE OF ENTRY INSTRUMENT NO. DATE NAME OF ACCOUNT / PERSON GIVING ENTRY BANK & BRANCH OF ENTRY GIVING A/C A/C NO. OF ENTRY SHIV VANIJAY CAPSEC P LTD. SIKAR KENDRIYA SEHKARI BANK LTD. AJITGARH A/C NO. 01190035971 2 00 000 - 29/11/00 SUNIL KUMAR VERMA - - 3.1 ASSESSING OFFICER FURTHER OBSERVED THAT ASSES SEE HAS FAILED TO PRODUCE SUNIL KUMAR VERMA AND FILED THE COPY OF RETU RN FOR ALLOTMENT OF SHARES NAME AND ADDRESS OF THE PARTIES TO WHOM TH E SHARES WERE ALLOTTED REGISTER OF MEMBERSHIP AND COPY OF THE BAN K ACCOUNT IN WHICH THE MONEY WAS DEPOSITED. TO VERIFY THE GENUINENESS OF THE TRANSACTIONS AN INFORMATION U/S. 133(6) WAS CALLED FOR FROM SBBJ INDIRA BAZAR JAIPUR CALLING FOR THE BANK STATEMENT OF SH. SUNIL KUMAR VERMA. A PERUSAL THEREOF REVEALS THAT CASH AMOUNTING TO ` 2 00 000/- WAS DEPOSITED ON 28.11.2000 I.E. PREVIOUS DAY BEFORE THE CHEQUE WAS ISSUED TO THE ASSESSEE WHICH WAS DEBITED TO HIS AC COUNT ON 29.11.2000. ON THIS BASIS ASSESSING OFFICER CONC LUDED THAT THE CREDIT WAS A BOGUS ENTRY AND ADDED THE AMOUNT OF ` 2 00 000 /- AS UNEXPLAINED CASH CREDIT. ITA NO. 2124/DEL/2010 4 4. ASSESSEE APPEALED BEFORE THE LD. COMMISSIONER OF INCOME TAX (APPEALS). ASSESSEE AGITATED ON THE ISSUE OF REOP ENING AS WELL AS ON THE MERITS OF THE CASE. LD. COMMISSIONER OF INCOME TAX (APPEALS) DECIDED THE ISSUE AGAINST THE ASSESSEE. HENCE THE ASSESSEE IS IN APPEAL BEFORE US. 5. AFTER NARRATING THE FACTS IT WAS PLEADED BY THE LD. AUTHORISED REPRESENTATIVE THAT THE NOTICE U/S 148 WAS ISSUED ON 20.3.2008. IN RESPONSE TO WHICH IMPUGNED ASSESSMENT HAS BEEN FRAM ED. HE SUBMITTED THAT THERE IS AMPLE EVIDENCE PLACED IN THE PAPER BOOK ACCORDING TO WHICH THE ISSUE REGARDING SHARE APPLIC ATION MONEY EXAMINED BY THE ASSESSING OFFICER DURING THE COURSE OF ORIGINAL ASSESSMENT PROCEEDINGS AT LENGTH AND THEREFORE THE RE IS NO FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRUL Y ALL MATERIAL FACTS NECESSARY FOR ITS ASSESSMENT. HENCE THE INITIATIO N OF REASSESSMENT PROCEEDINGS IS WITHOUT JURISDICTION AS PER PROVIS O TO 147. HE INVITED OUR ATTENTION TOWARDS THE FOLLOWING EVIDENCES PLACE D IN THE PAPER BOOK TO SHOW THAT THE ISSUE REGARDING SHARE APPLICATION MONEY WAS DISCUSSED AT LENGTH DURING THE COURSE OF ORIGINAL ASSESSMENT PROCEEDINGS. - COPY OF QUESTIONNAIRE RECEIVED DATED 18.11.2002 REGARDING SHARE APPLICATION MONEY. (PAGE 18-19 OF PAPER BOOK.) - COPY OF QUESTIONNAIRE RECEIVED ALONG WITH NOTICE U/S 143(2) DATED 29.11.2002 REGARDING SHARE APPLICATION MONEY. (PAGE 20-21 OF PAPER BOOK). - COPY OF LETTER TO ITO REGARDING SHARE APPLICATION MONEY DATED 16.12.2002 (PAGE 22-23 OF PAPER BOOK). ITA NO. 2124/DEL/2010 5 DATED 16.1.2003 DETAIL OF SHARES ALLOTTED DURING THE RELEVANT ASSESSMENT YEAR. (PAGE 24 OF PAPER BOOK). DATED 03.3.2003 (PAGE 25-26 OF PAPER BOOK). DATED 17.3.2003 (PAGE 27-29 OF PAPER BOOK). 5.1 HE FURTHER PLEADED THAT THE ISSUE REGARDING SH ARE APPLICATION MONEY PARTICULARLY AFOREMENTIONED A SUM OF ` 2 LACS AL SO WAS DISCUSSED AT LENGTH IN ORIGINAL ASSESSMENT PROCEEDI NGS THEREFORE THE ISSUE OF NOTICE U/S 148 WILL BE MERELY ON THE BASIS OF CHANGE OF OPINION ALSO. HE SUBMITTED THAT ACCORDING TO WELL SETTLED L AW ESTABLISHED AS PER THE DECISION OF THE HONBLE APEX COURT IN THE CASE OF FORAMER FRANCE : 264 ITR 566 (SC) REASSESSMENT CANNOT BE INI TIATED ON THE BASIS OF CHANGE OF OPINION. HE SUBMITTED THAT LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS COMMITTED A MISTAKE IN NOT AC CEPTING SUCH SUBMISSIONS OF THE ASSESSEE. THE CASE OF THE ASS ESSEE IS COVERED BY THE PROVISO TO 147 AS WELL AS AFOREMENTIONED DECISIO N OF THE HONBLE APEX COURT. 5.2 ON THE OTHER HAND LD. DEPARTMENTAL REPRESENTATI VE RELIED UPON THE ORDER OF THE ASSESSING OFFICER AND LD. COMMISSIO NER OF INCOME TAX (APPEALS) AND PLEADED THAT REASSESSMENT WERE VALIDL Y INITIATED. SHE FURTHER REFERRED TO THE DECISION OF THE HONBLE DEL HI HIGH COURT IN THE CASE OF DALMIA PVT. LTD. VS. C.I.T. WHICH IS DATED 2 6.9.2011 IN CIVIL WRIT PETITION (CIVIL) NO. 6205 OF 2010 ORDER DATED 26 TH SEPTEMBER 2011. ITA NO. 2124/DEL/2010 6 5.3 WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSI ONS IN LIGHT OF THE MATERIAL PLACED BEFORE US. THE ASSESSMENT YEAR INV OLVED IS ASSESSMENT YEAR 2001-02. ACCORDING TO THE PROVISO TO SECTION 147 WHERE AN ASSESSMENT IS MADE U/S 143(3) NO ACTION SHALL BE TAKEN U/S 147 AFTER EXPIRY OF THE 4 YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR UNLESS ANY INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT FOR THAT ASSESSMENT YEAR BY REASON OF FAI LURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY ALL MATERIA L FACTS NECESSARY FOR HIS ASSESSMENT FOR THAT ASSESSMENT YEAR. IF THERE IS FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY OR TRULY ALL MATERIAL FACTS NECESSARY FOR HIS ASSESSMENT IN THE YEAR UNDER CONSI DERATION THEN PROCEEDINGS U/S 147 CANNOT BE INITIATED AFTER THE E XPIRY OF THE 4 YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR. THE RELEVANT ASSESSMENT YEAR IN THE PRESENT YEAR WILL END ON 31. 3.2002 AND 4 YEARS THEREFROM WILL EXPIRE ON 31.3.2006. THE NOTICE U/ S 148 IS ISSUED ON 20.3.2008. THUS THE NOTICE IS ISSUED BEYOND 4 YEA RS FROM THE END OF THE RELEVANT ASSESSMENT YEAR. THEREFORE IT HAS TO BE EXAMINED THAT WHETHER OR NOT THERE WAS ANY FAILURE ON THE PA RT OF THE ASSESSEE TO DISCLOSE FULLY OR TRULY ALL MATERIAL FACTS NECESSAR Y FOR THE ASSESSMENT OF THE ASSESSEE FOR THIS YEAR. THE RELEVANT MATERI AL POINTED OUT BY LD. A.R. AND DESCRIBED IN THE ABOVE PART OF THE OR DER CLEARLY DEPICTS THAT THE ISSUE REGARDING SHARE APPLICATION INCLUDI NG AFOREMENTIONED AMOUNT OF ` 2 LACS WAS CONSIDERED BY THE ASSESSING OFFICER AT LENGTH DURING THE COURSE OF ORIGINAL ASSESSMENT PROCEEDIN GS. A REFERENCE HAS BEEN MADE TO THE VARIOUS QUESTIONNAIRE ISSUED BY THE ASSESSING OFFICER AND ANSWERS GIVEN BY THE ASSESSEE. THE DETAILS OF THESE ARE CONTAINED IN THE PAPER BOOK AND IT HAS BEEN FOUND T HAT THIS ISSUE WAS ENQUIRED INTO BY THE ASSESSING OFFICER AND REPLI ES WERE GIVEN BY THE ITA NO. 2124/DEL/2010 7 ASSESSEE. IF IT IS SO THEN IT CANNOT BE SAID TH AT THERE WAS ANY FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND T RULY ALL MATERIAL FACTS NECESSARY FOR THE ASSESSMENT OF THE ASSESSEE IN RE SPECT OF THE AFOREMENTIONED AMOUNT OF ` 2 LACS. THEREFORE THE PROCEEDINGS IN THE PRESENT CASE IS CLEARLY BARRED BY PROVISO TO 147. HENCE THE REASSESSMENT HAS TO BE HELD TO BE INVALID. 5.4 SO FAR AS IT RELATES TO THE DECISION RELIE D UPON BY THE LD. DEPARTMENTAL REPRESENTATIVE ON THE CASE OF DALMIA PVT. LTD. VS. C.I.T. (SUPRA) WE FOUND THAT IN THAT CASE ON FACTS IT WAS FOUND THAT THE ASSESSING OFFICER REQUIRED THE ASSESSEE TO SUBMIT D ETAILS IN RESPECT OF SUNDRY CREDITORS AMOUNTING TO ` 1 66 37 402/- AND DESPITE VARIOUS QUERIES RAISED BY THE ASSESSING OFFICER DURING THE COURSE OF ORIGINAL ASSESSMENT PROCEEDINGS THE ASSESSEE SUBMITTED DETAI LS OR CONFIRMATIONS ONLY TO THE EXTENT OF ` 1 13 53 344/ - AND IT WAS HELD BY THE HONBLE HIGH COURT THAT IN RESPECT OF SUNDRY CR EDITORS REGARDING WHICH NO DETAILS OR CONFIRMATIONS WERE FILED THE RE OPENING WAS VALID. HOWEVER IN THE PRESENT CASE THE FACTS ARE ENTIRELY DIFFERENT. THE ASSESSEE HAS SUBMITTED ALL THE REQUIRED DETAILS. H ENCE THIS DECISION CANNOT BE APPLIED TO THE FACTS OF THE ASSESSEES CA SE. 5.5 THE REASSESSMENT PROCEEDINGS IN THE PRESENT CAS E ALSO TO BE HELD INVALID ON THE GROUND THAT IT IS BASED ON MERE CHANGE OF OPINION. THE ASSESSING OFFICER MADE DETAILED ENQUIRIES IN R EGARD TO SHARE APPLICATION MONEY WHICH INCLUDED THE AFOREMENTIONED S UM OF ` 2 LACS. AFTER OBTAINING THE DETAILS FROM THE ASSESSEE HE W AS SATISFIED AND DID NOT MAKE ANY ADDITION OF THE AFOREMENTIONED AMOUNT OF ` 2 LACS AND THUS AGAIN CONSIDERING THE SAME AMOUNT WILL BE BA SED MERE ON CHANGE OF OPINION. THEREFORE ALSO INITIATION OF RE ASSESSMENT ITA NO. 2124/DEL/2010 8 PROCEEDINGS IS HELD TO BE INVALIDLY CARRIED OUT. CONSEQUENTLY THE ASSESSMENT IS QUASHED. 6. SINCE THE ASSESSMENT IS QUASHED ON ACCOUNT OF J URISDICTION ITSELF THE MERITS OF THE CASE HAVE BECOME ACADEMIC AND AR E NOT REQUIRED TO BE ADJUDICATED. 7. IN VIEW OF THE ABOVE DISCUSSIONS THE APPEAL FIL ED BY THE ASSESSEE IS ALLOWED IN THE MANNER AFORESAID. ORDER PRONOUNCED IN THE OPEN COURT ON 10/2/2012. SD/ SD/ SD/ SD/- -- - SD/ SD/ SD/ SD/- -- - [ [[ [I.P. BANSAL] I.P. BANSAL] I.P. BANSAL] I.P. BANSAL] [SHAMIM YAHYA] [SHAMIM YAHYA] [SHAMIM YAHYA] [SHAMIM YAHYA] JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER DATE 10/2/2012 SRBHATNAGAR SRBHATNAGAR SRBHATNAGAR SRBHATNAGAR COPY FORWARDED TO: COPY FORWARDED TO: COPY FORWARDED TO: COPY FORWARDED TO: - -- - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR ITAT TRUE COPY BY ORDER ASSISTANT REGISTRAR ITAT DELHI BENCHES