IN THE INCOME TAX APPELLATE TRIBUNAL
(DELHI BENCH `G' : NEW DELHI)
BEFORE SHRI N.K. SAINI, ACCOUNTANT MEMBER
and
SHRI GEORGE GEORGE K, JUDICIAL MEMBER
ITA No.4232/Del./2013
(ASSESSMENT YEAR : 2008-09)
Shri Govind Kripa Builders and Promoters vs. ITO, Ward 8 (3),
Pvt. Ltd., New Delhi.
9239, Gali No.7, West Rohtash Nagar,
Shahdara,
Delhi 110 032.
(PAN : AAICS4365H)
(APPELLANT) (RESPONDENT)
ASSESSEE BY : Shri R.S. Singhvi, Advocate
REVENUE BY : Shri Vijay Chaddha, Addl. CIT DR
Date of Hearing : 25.06.2015
Date of Pronouncement : 25.06.2015
ORDER
PER GEORGE GEORGE K., JUDICIAL MEMBER :
This appeal, at the instance of the assessee, is directed against the
order of the Commissioner of Income-tax (Appeals)-IX, New Delhi dated
29.05.2013. The relevant assessment year is 2008-09.
2. The grounds raised by the assessee read as follows :-
"l. That on the facts and in the circumstances of the
case, CIT (A) was not justified in passing appellate order
without giving proper and reasonable opportunity or
proper appreciation of facts.
2 ITA Nos.4232/Del./2013
2(i). That further CIT (A) was not justified in confirming
penalty order passed u/s 271(1)(c) on account of addition
made u/s 68 of the Income-tax Act, 1961.
2(ii). That there is no case of any concealment or
furnishing of inaccurate particulars and merely on
account of addition made by the Assessing Officer, there
cannot be any case of penalty u/s 271(1)(c).
3. That even otherwise there is no justification for any
addition even on merits and appeal of the assessee is
pending before Income Tax Appellate Tribunal, New
Delhi.
4. That orders of the lower authorities are not justified
on facts and same are bad in law."
3. Briefly stated, the facts of the case are as follows.
The return of income was filed on 23.09.2008 declaring income of
Rs.8,867/-. Assessment proceedings were initiated by the Assessing
Officer by issuing notice u/s 148 of the Act on 30.03.2010 on the basis of
information received from the DIT (Inv.), New Delhi that the assessee had
received accommodation entry of Rs.24 lacs during the year. The
Assessing Officer observed that the genuineness of the transaction and
sources of the same were required to be examined. Accordingly, after
going through the reply and details submitted by the assessee, Assessing
Officer was of the view that there was a failure on the part of the assessee
to produce the Principal Officer of the share applicant companies and also
on account of failure of share applicants to appear personally and confirm
transaction made with the assessee company, the share transaction cannot
3 ITA Nos.4232/Del./2013
be treated as genuine. Therefore, an addition of Rs.15 lacs made u/s 68 of
the Act as unexplained credits in the books of the assessee. Against the
order of the Assessing Officer, assessee appealed before the CIT (A), who
vide impugned order dated 23.11.2012 had dismissed the appeal of the
assessee.
4. The Assessing Officer initiated the penalty proceedings u/s
271(1)(c) for furnishing inaccurate particulars of its income with a view to
concealment of income and made a penalty of Rs.12,69,639/-. The CIT
(A) confirmed the action of the Assessing Officer.
5. At the outset of the hearing, the learned AR submitted that the
Assessing Officer made an addition of Rs.15 lacs as unexplained credits in
the books of accounts of the assessee. The quantum appeal went up to the
ITAT and the ITAT has quashed the reassessment proceedings u/s 148 of
the Act. In view of this fact, he pleaded that the assessee should not be
visited by penalty u/s 271(1)(c) of the Act and no penalty can be sustained.
6. On the other hand, learned DR relied on the orders of the authorities
below.
7. We have heard both the sides. We find that the Tribunal had
quashed the reassessment proceedings u/s 148 of the Act in the quantum
assessment in ITA No.304/Del/2013 order dated19.12.2014. The relevant
finding of the Tribunal's aforesaid order reads as follows :
4 ITA Nos.4232/Del./2013
"7. We have heard both the counsel and perused the
records, specially the Paper Books filed by the assessee,
orders of the Revenue authorities. As regards the effective
ground in this appeal relating to reassessment proceedings
u/s. 148 of the I.T. Act is concerned, the Assessee has
reiterated that reassessment proceedings are illegal and
without jurisdiction in the absence of any tangible evidence
or material in respect of any undisclosed income and
recording of requisite satisfaction in respect of any such
undisclosed income. After hearing both the parties on the
issue in dispute as well as after going through the orders
passed by the Revenue Authorities alongwith order dated
21.7.2011 passed by the Hon'ble Jurisdictional High Court
in the case of Signature Hotels P. Ltd. vs. Income Tax
Officer [2011] 338 ITR 0051 wherein the Hon'ble High
Court has held matter as under:-
"Held, allowing the petition, that the reassessment
proceeding were initiated on the basis of information
received from the Director of Income Tax
(Investigation) that the petitioner had introduced
money amounting to Rs. 5 lacs during the financial
year 2002-03 as stated in the Annexure. According to
the information, the amount received from a
company, S, was nothing but an accommodation
entry and the assessee was the beneficiary. The
reasons did not satisfy the requirements of Section
147 of the Act. There was no reference to any
document or statement, except the annexure. The
annexure could not be regarded as a material or
evidence that prima facie showed or established
nexus or link which disclosed escapement of income.
The annexure was not a pointer and did not indicate
escapement of income. Further, the Assessing Officer
did not apply his own mind to the information and
examine the basis and material of the information.
There was no dispute that the company, S, had a
paid-up capital of Rs. 90 lakhs and was incorporated
on January 4, 1989, and was also allotted a
permanent account number in September, 2001.
Thus, it could not be held to be a fictitious person.
The reassessment proceedings were not valid and
were liable to be quashed."
5 ITA Nos.4232/Del./2013
7.1 In view of above, we are of the considered view that
above issue is exactly the similar to the issue involved in the
present appeal and squarely covered by the aforesaid
decision of the Hon'ble High Court of Delhi. Hence,
respectfully following the above precedent, we decide the
legal issue in dispute in favor of the Assessee and against
the Revenue and accordingly quash the reassessment
proceedings. The other issues are not dealt with as the same
have become academic in nature."
Since the Tribunal has quashed the quantum assessment, the penalty
imposed on the same has lost it substratum and penalty is, therefore,
deleted. It is ordered accordingly.
9. In the result, the appeal filed by the assessee is allowed.
Order pronounced in open court on this 25th day of June, 2015.
Sd/- sd/-
(N.K. SAINI) (GEORGE GEORGE K)
ACCOUNTANT MEMBER JUDICIAL MEMBER
Dated the 25th day of June, 2015
TS
Copy forwarded to:
1.Appellant
2.Respondent
3.CIT
4.CIT(A)-IX, New Delhi.
5.CIT(ITAT), New Delhi.
AR, ITAT
NEW DELHI.
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