THE ITO 19(3)(1), MUMBAI v. M/S. AYUB MANSURI, MUMBAI

ITA 4977/MUM/2008 | 2004-2005
Pronouncement Date: 30-04-2010 | Result: Dismissed

Appeal Details

RSA Number 497719914 RSA 2008
Assessee PAN AAJPM7956N
Bench Mumbai
Appeal Number ITA 4977/MUM/2008
Duration Of Justice 1 year(s) 8 month(s) 23 day(s)
Appellant THE ITO 19(3)(1), MUMBAI
Respondent M/S. AYUB MANSURI, MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 30-04-2010
Appeal Filed By Department
Order Result Dismissed
Bench Allotted A
Tribunal Order Date 30-04-2010
Date Of Final Hearing 20-04-2010
Next Hearing Date 20-04-2010
Assessment Year 2004-2005
Appeal Filed On 07-08-2008
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH A MUMBAI. BEFORE SHRI R.V. EASWAR SENIOR VICE-PRESIDENT AND SHRI J. SUDHAKAR REDDY ACCOUNTANT MEMBER. I.T.A. NO. 4 977/MUM/2008. ASSESSMENT YEARS : 2004-05 THE INCOME TAX OFFICER MR. AYUB MANSURI 19(3)(1) MUMBAI. VS. NOVELTY FURNISHING 249 NAVAL KUNJ LINKING RD. OFF NATIONAL COLLEGE BANDRA (W) MUMBAI-50. PAN AAJPM7956N. APPELLANT RESPONDENT APPELLANT BY : SHRI SANDEEP DAHIYA. RESPONDENT BY : SHRI SANJAY JAIN. O R D E R PER J. SUDHAKAR REDDY A.M. THIS IS AN APPEAL FILED BY THE REVENUE DIRECTED A GAINST THE ORDER OF THE CIT(APPEALS)-XIX MUMBAI DATED 22 ND MAY 2008 FOR THE ASSESSMENT YEAR 2004-05. 2. THE ASSESSEE IS A PARTNER DERIVING INCOME FROM THE FIRM AS ALSO INCOME FROM LONG TERM CAPITAL GAINS. THE ASSES SEE DURING THE YEAR SOLD SHARES OF M/S SURYADEEP SALT & CHEMICALS A LI STED COMPANY ACQUIRED IN NOVEMBER-DECEMBER 2002 AND THE INCOME WAS OFFERED AS LONG TERM CAPITAL GAINS. THE AO HAD HELD THAT THE T RANSACTION IN THE SHARES OF THE AFORESAID COMPANY IS PENNY STOCK AND HENCE T HE SHARE TRANSACTIONS ARE NOT GENUINE BUT MERELY ACCOMMODATION ENTRIES. H E ASSESSED THE CREDIT IN THE BANK ACCOUNT U/S 68 OF THE INCOME TAX ACT. H E FURTHER ADDED 15% 2 OF THE CASH CREDIT AS CONSIDERATION PAID FOR ACCOMM ODATION TRANSACTION. ON APPEAL THE FIRST APPELLATE AUTHORITY DECIDED TH E ISSUE IN FAVOUR OF THE ASSESSEE AND DELETED THE ADDITION. AGGRIEVED THE R EVENUE FILED THIS APPEAL ON THE FOLLOWING GROUNDS : 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN L AW THE LEARNED CIT(A) ERRED : (A) IN HOLDING THAT THE LONG TERM CAPITAL GAIN RECEIVED BY THE ASSESSEE IN THE SCRIPT SURYADEEP SALT & CHEMICAL WA S A GENUINE TRANSACTION ESPECIALLY WHEN THE CIT(A) HAS NOT COUNTERED THE DEEP INVESTIGATION DONE BY THE A.O. (B) IN DELETING THE ADDITION MADE BY A.O. ESPECIALLY WH EN SOME OF THE FACTUAL ASPECT HAS BEEN WRONGLY INTERPRETED BY CIT(A). (C) IN CONCLUDING THAT THE TRANSACTION WAS GENUINE WITH OUT APPRECIATING THE FACTS OF THE CASE UNDER CONSIDERAT ION. (D) IN CONCLUDING THAT THE TRANSACTION OF SURYADEEP SAL T IS GENUINE ONE WHEN THE RATIO OF THE CASE OF SONMATH MANI (100 TTJ 917) CLEARLY SAYS IF FACTS AND CIRCUMSTANCES SO WA RRANT THAT IT DOES NOT ACCORD WITH THE TEST OF HUMAN PROBABILITIE S TRANSACTIONS HAVE BEEN HELD TO BE NON-GENUINE. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW THE LEARNED CIT(A) ERRED IN HOLDING THAT THE ADDITION O F 15% OF CAPITAL GAIN AS COMMISSION FOR ARRANGING THE GIFT IS UNWARR ANTED IN THE SITUATION WHEN THERE IS A CONFESSIONAL STATEMENT OF MR. SHAH TO RECEIVE THE COMMISSION AND OPPORTUNITY TO CROSS EXA MINE HAS BEEN GIVEN TO ASSESSEE. 3. THE APPELLANT PRAYS THAT THE ORDER OF THE CIT(A) ON THE ABOVE GROUNDS BE SET ASIDE AND THAT OF THE A.O. BE RESTOR ED. 4. THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER ANY GR OUND OR ADD A NEW GROUND WHICH MAY BE NECESSARY. 3. WE HAVE HEARD SHRI SANDEEP DAHIYA LEARNED DR A ND SHRI SANJAY JAIN LEARNED COUNSEL FOR THE ASSESSEE. 4. BOTH THE PARTIES SUBMITTED THAT THE ISSUE IN QU ESTION IS IDENTICAL WITH THE ISSUE CONSIDERED BY MUMBAI I-BEN CH OF THE TRIBUNAL IN ITA NO. 5050/MUM/2008 IN THE CASE OF ACIT VS. SHRI ISLAMUDDIN 3 MANSURI AND IN ITA NO. 5051/MUM/2008 IN THE CASE OF ACIT VS. IQBAL HUSSEIN MANSURI ORDER DATED 23 RD FEB. 2009 WHEREIN THE TRIBUNAL UPHELD THE FINDINGS OF THE CIT(APPEALS) THAT THE TR ANSACTION IN QUESTION WAS A GENUINE TRANSACTION. IT ALSO UPHELD THE CIT(A PPEALS) ORDER HOLDING THAT THE ADDITION OF 15% OF CAPITAL GAINS AS COMMIS SION FOR ARRANGING GIFT IS UNWARRANTED. RESPECTFULLY FOLLOWING THE AFORESAI D ORDER OF THIS BENCH OF THE TRIBUNAL WE UPHOLD THE ORDER OF THE CIT(APP EALS). 5. IN THE RESULT THE APPEAL OF THE REVENUE IS DIS MISSED. ORDER PRONOUNCED ON THIS 30 TH DAY OF APRIL 2010. SD/- SD/- (R.V. EASWAR) (J. SUDHAKAR REDDY) SENIOR VICE-PRESIDENT. ACCOUNTANT MEMBER. MUMBAI DATED : 30 TH APRIL 2010. WAKODE COPY FORWARDED TO : 1. APPELLANT. 2. RESPONDENT 3. C.I.T. 4. CIT(A) 5. DR A-BENCH. (TRUE COPY) BY ORDER ASSTT. REGISTRAR ITAT MUMBAI BENCHES MUMBAI.