Delhi High Court
The Commissioner Of Income Tax vs Evergrowing Iron & Finvest Ltd. on 1 October, 2010
Author: Manmohan
#13
$~
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ ITA 1511/2010
THE COMMISSIONER OF
INCOME TAX ..... Appellant
Through: Mr. Sanjeev Sabharwal, , Advocate
versus
EVERGROWING IRON & FINVEST LTD. ..... Respondent
Through: None.
% Date of Decision: 01st October, 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.
MANMOHAN, J
1. The present appeal has been filed under Section 260A of Income
Tax Act, 1961 (for brevity, "Act") challenging the order dated 25th
September, 2009 passed by the Income Tax Appellate Tribunal (in short
"Tribunal") in ITA No. 1493/Del/2008, for the Assessment Year 2001-
2002.
2. Mr. Sanjeev Sabharwal, learned counsel for the revenue
submitted that the Tribunal had erred in law in deleting the addition of
` 30,47,601/- made by the Assessing Officer (in short, "AO") on
account of income from undisclosed sources. Mr. Sabharwal
submitted that the addition made by the AO under Section 68 of the Act
was justified as the respondent-assessee had failed to discharge the
primary onus.
3. However, upon a perusal of the papers, we find that the aforesaid
amount was brought forwarded balance and did not relate to the year in
question. Moreover, the revenue had already accepted the aforesaid
amount as income of the respondent-assessee in the earlier year.
4. In fact, the Tribunal in its impugned order has observed as
under:-
"7. We have carefully considered the rival contentions
in the light of the material placed before us. A finding has
been recorded by the Ld. CIT(A) that a sum of
Rs.30,47,600.50 was outstanding in the books of the
assessee in the name of MKM Finsec P. Ltd. and that
amount represented the income shown by the assessee on
account sale of shares which was received during the year
under consideration. The said income was shown by the
assessee in earlier year. The assessee had not been
granted any opportunity to cross examine or rebuttal of
evidence collected by Investigation Wing. Considering all
these facts the Ld. CIT(A) has deleted the addition. In our
view if the amount is received by the assessee during the
year on account of opening balance in respect of items
which was already considered as income in earlier year,
the same cannot be added to the income of the year simply
on the ground that assessee has received the amount due
from the party. It has not been shown by the department
that the claim of the assessee that the amount which
represented sale proceeds of shares, in respect of which
income was already shown in earlier year, is incorrect.
The claim of the assessee that the amount which is added
to its income represented sale proceeds of share sold in
immediate preceding year has not been shown to be false
or incorrect by the revenue. It is also not shown by the
revenue that the said amount was not assessed as income
(capital gain) in immediate preceding year. If the amount
represents the sale proceeds of shares in respect of which
income has already been assessed by the revenue in
preceding year then the said amount cannotbe assessed in
the year under consideration simply on the ground that it
was received in the year under consideration. Therefore,
we find no infirmity in the order of Ld. CIT(A) vide which
impugned addition has been deleted. We declined to
interfere."
5. Keeping in view the aforesaid factual finding arrived at by the
final fact finding authority, we are of the opinion that the addition made
by the AO was unwarranted and unsustainable and accordingly, the
present appeal is dismissed in limine.
MANMOHAN, J
CHIEF JUSTICE
OCTOBER 01, 2010
js
