Delhi High Court
Commissioner Of Income Tax vs Raghav Behl on 21 September, 2005
Equivalent citations: (2006) 201 CTR Del 488, 2006 286 ITR 134 Delhi
Bench: T Thakur, B D Ahmed
ORDER
1. The CIT has recorded a clear finding of fact to the effect that although there was no documentary evidence to support the claim made by the assessce that shares had boon purchased by Deopak Choudhary, HUF and Shri. P.S. Kalra, HUF on behalf of the assessed, yet the ciraimstaintial evidence sufficiently showed that such purchases were made and that since the assessed could not make the payment due to shortage of funds, the assessed was compelled to pay interest till the date the delivery of the shares was taken by him. This is evident from the following para from the said order of the CIT :
It is a fact that the assessed does not have any documentary evidence to support the claim but all the circumstantial evidences are there to prove that the shares were purchased by the two parties on behalf of the assessed and since the assessed could not make the payment due to shortage of funds the assessed was compelled to pay interest till the date of delivery taken by the assessed. Therefore, in my considered opinion, the claim of the appellant of payment of interest of Rs. 7.30,600 each to Deepak Choudhary. HUF and P.S. Kalra, HUF are to be allowed. Accordingly, the AO is directed to allow the same.
2. The above finding has been affirmed by the Tribunal in appeal in the following words :
After hearing both the parties on this issue, we find that there is no infirmity in the finding of CIT(A) as discussed above. The finding of CIT(A) that both the parties were share brokers could not be controverter by the learned Departmental Representative by filing any positive evidence, though the learned Departmental Representative has commented that it seems that both the parties were not share brokers, however, no evidence whatsoever was filed before the Bench. Therefore, we confirm the finding of the CIT(A) by holding that this is customary in the trade of share transactions that one person buys shares on behalf of others, and as per the understanding the interest was paid and charged. As stated above, there is no dispute that interest amount was paid and there is also no dispute that both the parties have shown the interest income as their income. Therefore, in view of these facts and circumstances and in view of the reasoning given by CIT(A), we confirm his order on this point.
3. In the light of the above concurrent finding of fact that purchase of shares by Deepak Choudhary and P.S. Kalra, HUF, was for and on behalf of the assessed and that the assessed had paid interest to the said purchasers who were working as share brokers, the CIT(A) as also the Tribunal were justified In directing the allowance of the amount paid as an allowable expenditure. No substantial question of law arises for consideration in this appeal, which fails and is hereby dismissed.
