Delhi High Court
Commissioner Of Income Tax-Ii vs Moonlight Exim P. Ltd on 27 August, 2010
Author: Manmohan
7
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* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ ITA 1243/2010
COMMISSIONER OF INCOME TAX-II ..... Appellant
Through: Mr. Sanjeev Sabharwal, Advocate
versus
MOONLIGHT EXIM P. LTD . ..... Respondent
Through: None.
% Date of Decision: 27th 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?No.
2. To be referred to the Reporter or not? No.
3. Whether the judgment should be reported in the Digest? No.
JUDGMENT
MANMOHAN, J
CM 15020/2010
For the reasons stated in the application, delay in re-filing the
appeal is condoned.
Application stands disposed of.
ITA 1243/2010
1. The present appeal by the Income Tax Department has been filed
under Section 260A of the Income Tax Act,1961 (for brevity "Act
1961") challenging the order dated 28th November, 2008 passed by
Income Tax Appellate Tribunal (in short "Tribunal") in ITA No.
475/Del/2006 for the Assessment Year 2002-2003.
2. Mr. Sanjeev Sabharwal, learned counsel for the Revenue
submitted that the Tribunal had erred in deleting the addition of
`12,50,000 /- on account of unexplained credit under Section 68 of the
Act, 1961. Mr. Sabharwal further submitted that the Tribunal had erred
in restoring the matter for fresh adjudication to the Assessing Officer
(in short "AO") in respect of addition of ` 5,00,000/- as unexplained
credit under Section 68 of the Act, 1961.
3. It is pertinent to mention that AO did not dispute either the
identity or the creditworthiness of the Directors/shareholders in
advancing the loan amount of ` 12,50,000/- to the respondent-assessee
company. However, AO made the addition on the ground that the
genuineness of loan transaction of ` 12,50,000/- did not stand proved
by the respondent-assessee. The AO, in fact, made the addition as he
was of the view that unaccounted money of the respondent-assessee
company had been deposited in the bank account of the
Directors/shareholders and the same then taken as loan from them.
4. However, the Tribunal in the impugned order has deleted the
aforesaid addition of ` 12,50,000/- by observing as under:-
"We are of the opinion that there is no rule of law that any
person withdrawing cash from his own a/c about 1 or 2
months back cannot keep the same with them at their
residence. The statement of one of the directors was
recorded wherein he has stated on oath the purpose for
which it was withdrawn and since that purpose could not
materialize, the same was again deposited in bank and
given to the assessee as loan. Against the statement the tax
authorities below have not brought on record any evidence
to show that this withdrawal of cash was spent by the
directors and the unaccounted money of the assessee was
deposited in bank accounts of these directors/shareholders
and then taken as loan from them and hence merely on
these presumption the tax authorities below are not
justified in treating the loan transactions as non genuine
and making the impugned addition and accordingly we are
of the opinion that in the existing facts and circumstances
this impugned addition of Rs.12.5 lakhs made by the AO
and sustained by CIT cannot be upheld and so the order of
CIT sustaining the impugned addition is hereby set aside.
5. We are of the opinion that the issue raised in the present appeal is
a pure question of fact and the final fact finding authority has rightly
deleted the addition. In fact, the aforesaid conclusion of the Tribunal
on facts is neither perverse nor arbitrary.
6. As far as the second addition of ` 5,00,000/- is concerned, we are
of the view that as the Tribunal has merely remanded the matter back to
the AO so as to give the respondent-assessee an opportunity to furnish
confirmation duly signed either by the official liquidator or by a person
authorised by it, consequently, no prejudice has been caused to the
Revenue. Also, the said finding by no stretch of imagination can be
called perverse.
7. Consequently, as no substantial question of law arises in the
present appeal, the same, being bereft of merit, is dismissed in limine.
MANMOHAN, J
CHIEF JUSTICE
AUGUST 27, 2010
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