Delhi High Court
Commissioner Of Income Tax vs M/S. Vishal Holding & Capital (P) ... on 9 August, 2010
Author: Manmohan
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* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ ITA 1031/2010
COMMISSIONER OF INCOME TAX ..... Appellant
Through: Ms. Prem Lata Bansal, Advocate
versus
M/s. VISHAL HOLDING & CAPITAL (P) LTD. ..... Respondent
Through: None
% Date of Decision: 9th August, 2010
CORAM:
HON'BLE THE CHIEF JUSTICE
HON'BLE MR. JUSTICE MANMOHAN
1. Whether the Reporters of local papers may be allowed to see the judgment?
2. To be referred to the Reporter or not? No
3. Whether the judgment should be reported in the Digest? No
JUDGMENT
MANMOHAN, J
1. The present appeal has been filed by the Revenue under Section
260A of the Income Tax Act,1961 (for brevity "Act 1961") challenging
the order dated 30th July, 2009 of the Income Tax Appellate Tribunal
(in short "ITAT") in ITA No. 1788/DEL/2007 for the Assessment Year
2000-2001. By virtue of the impugned order, ITAT has deleted the
addition of Rs. 49, 55,300/- made by the Assessing Officer (hereinafter
referred to as "AO") on account of income from undisclosed sources.
2. Briefly stated the relevant facts of this case are that a return
declaring income of Rs. 4,024/- was filed by respondent-assessee. The
same was processed u/s 143 (1) of Act, 1961. Subsequently, on the
basis of information received from the Investigation Wing of the
Department that M/s MKM Finsec (P) Ltd. was involved in providing
accommodation entries of Rs. 49,55,300/-, AO issued notice u/s 148 to
the respondent-assessee. The respondent-assessee submitted that
during the relevant assessment year, the respondent-assessee had
purchased and sold certain shares through M/s MKM Finsec (P) Ltd., a
share broker and earned a profit of Rs.49, 55,300/- which was received
by the respondent-assessee through account payee cheques.
3. An appeal was filed by the respondent-assessee against the order
of the AO before the Commissioner of Income Tax (Appeals)
[hereinafter referred to as "CIT (A)"] and the same was allowed in
favour of the assessee.
4. The Revenue appealed against the order of CIT (A). By the
impugned order, ITAT dismissed the Revenue's appeal by observing
that assessee had produced all details in respect of its transactions
including copies of bills and contract notes issued by M/s MKM Finsec
Pvt. Ltd. ITAT further observed that the AO had not verified these
details and in respect of the material, which had been relied upon by
him, he had not provided any finding of the investigations. Hence,
ITAT held that the addition made by the AO could not be said to be on
the basis of some evidence. Accordingly, ITAT confirmed the deletion
made by CIT (A).
5. Ms. Prem Lata Bansal, learned counsel for the Revenue
submitted that ITAT had erred in law in deleting the addition of Rs
49,33,500/- by holding that the assessee had discharged the onus of
proof especially when the genuineness of the transaction, identity and
creditworthiness of the parties had not been established
6. We are of the view that the assessee had produced copies of
accounts, bills and contract notes issued by M/s. MKM Finsec Pvt. Ltd.
and had been maintaining books of account as per Companies Act. The
assessee had also demonstrated the purchase and sale of shares over a
period of time as seen from the balance sheet/s. In our opinion, the AO
has simply acted on the information received from the Investigation
Wing without verifying the details furnished by the assessee. The
assessee has also produced best possible evidence to support its claim.
Consequently the addition made by the AO cannot be sustained.
7. In any event, the factual findings of the final fact finding
authority are neither perverse nor contrary to record. Accordingly, we
find that no substantial question of law arises in the present appeal
which, being bereft of merit, is dismissed in limine but with no order as
to costs.
MANMOHAN, J
CHIEF JUSTICE
AUGUST 09, 2010
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