Pr. Commissioner Of Income Tax vs M/S Manoj Kumar Vipin Kumar
2021 Latest Caselaw 16948 Raj

HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR

D.B. Income Tax Appeal No. 22/2021

Pr. Commissioner of Income Tax - Central, Jaipur

----Appellant Versus

M/s Manoj Kumar Vipin Kumar, 118, New Dhan Mandi, Bikaner

----Respondent

For Appellant(s) : Mr. K.K. Bissa, Mr. Gajendra Singh Chouhan

HON'BLE MR. JUSTICE VIJAY BISHNOI HON'BLE MR. JUSTICE ANOOP KUMAR DHAND

Judgment / Order

15/11/2021

This appeal is preferred by the Revenue being

aggrieved with the order dated 29.8.2018 passed by the

Commissioner of Income Tax (Appeals) - 4, Jaipur (for

short 'the CIT(A)') as well as the order dated 1.2.2021

passed by the Income Tax Appellate Tribunal, Jodhpur

Bench, Jodhpur (for short 'the ITAT').

Brief facts of the case are that the assessee filed

income tax returns for the assessment year 2012-13 on

14.9.2012 disclosing a total income of Rs.79,98,920/-.

(2 of 6) [ITA-22/2021]

The return was processed under Section 143(1) of the

Income Tax Act, 1961 (for short 'the Act of 1961')

accepting the income disclosed. Later on, a notice under

Section 148 of the Act of 1961 was issued on 16.3.2016.

In response to the said notice, the assessee filed written

submissions stating therein that the original return filed

by it may be treated as the return filed in compliance of

the said notice. The Assessing Officer has completed the

assessment on 29.12.2016 by making addition to the

income disclosed by the assessee and determining the

total income of the assessee at Rs.4,10,70,730/-. The

following additions were made by the Assessing Officer :-

Sr. No.            Issues involved                                Amount
1         Bogus business transaction with                       2,43,59,629/-
          M/s Swift Tieup P. Ltd.
2         Addition made u/s 68 of the Act                       75,00,000/-
3         Disallowance of loss NCDEX/MCX                        11,75,857/-
4         Disallowance of Donation expenses                       11,020/-
5         Disallowance of expenses claimed                        25,300/-
          in P & L account
          Total                                                 3,30,71,810/-

Aggrieved by the assessment order, the assessee

preferred an appeal before the CIT(A), which vide order

dated 29.8.2018 has deleted the following additions

made by the Assessing Officer :-

(3 of 6) [ITA-22/2021]

S.N Nature of addition made in Addition Amount Relief allowed by order u/s 143(3) r.w.s. 147 the CIT(A) of the Act

1. Bogus business transaction Rs.2,43,59,629/- Rs.2,43,59,629/-

with M/s Swift Tieup P. Ltd.

2. Addition made u/s 68 of the Rs.75,00,000/- Rs.75,00,000/-

Act

3. Disallowance of loss Rs.11,75,857/- Rs.11,75,857/-

NCDEX/MC

4. Disallowance of Donation Rs.11,020/- Rs.5500/-

expenses

5. Disallowance of expenses Rs.25,300/- Rs.11,800/-

claimed in P & L account

Being aggrieved with the same, the Revenue has

filed appeal before the ITAT, which vide impugned order

dated 1.2.2021 has dismissed the said appeal of the

Department.

Challenging the impugned order, Mr. K.K. Bissa

appearing for the Revenue has argued that the CIT(A) as

well as the ITAT have not examined the matter in its

entirety, objectivity and in correct perspective. It is urged

that the findings recorded by both the appellate

authorities ex facie contrary to the facts and law. It is

further argued that the AO has rightly made addition of

Rs.2,43,59,629/- while treating it as bogus business

transactions with M/s Swift Tie Up Pvt. Ltd. It is also

urged that the addition made by the Assessing Officer

under Section 68 of the Act of 1961 on account of

unexplained cash received of Rs.75,00,000/- from M/s

(4 of 6) [ITA-22/2021]

Swift Tie Up Pvt. Ltd. by the assessee has wrongly been

deleted by the appellate authorities, though from the

order of the Assessing Officer, it is clear that the said

amount has been received by the assessee through

various layers of bank accounts of non-operational

Kolkata based companies, which on verification were

found to be not existing at the registered addresses.

Learned counsel Mr. Bissa has further argued that the

Assessing Officer has rightly disallowed loss of

Rs.11,75,857/- to the assessee on account of trading in

NCDEX/MCX. It is submitted that as the activity of

hedging is a speculative transaction and the resultant

loss of Rs.11,75,857/- is not eligible for set off against

income from business and profession. Learned counsel

for the appellant, thus, argued that several substantial

questions of law arise in this case, which have been

proposed in the present appeal.

Having heard learned counsel for the Revenue and

after going through the impugned orders passed by the

appellate authorities, we are of the view that no

substantial question of law is involved in the instant

appeal.

The ITAT has observed that the transaction recorded

in the books of accounts in the regular course of business

(5 of 6) [ITA-22/2021]

is to be accepted as true and correct unless there is a

strong evidence to rebut the same and the burden of

proof that the transaction is not genuine is on the person

who alleges so. The ITAT has further held that the

existence of M/s Swift Tie Up Pvt. Ltd. is not disputed. It

has filed the return of income for the assessment year in

consideration, confirmed the transaction, made payment

by cheque and income of Rs.5,86,612/- earned from this

transaction by the assessee is declared in the return. The

Assessing Officer without bringing any adverse evidence

on record, simply on assumptions and presumptions, has

held that the transactions of the assessee with M/s Swift

Tie Up Pvt. Ltd. are bogus. The ITAT has also observed

that the determination of income of Rs.2,43,59,629/-

made by the Assessing Officer is hypothetical and there is

no basis for the said determination. The ITAT has held

that the Assessing Officer has erred in not allowing the

loss of Rs.11,75,857/- to the assessee as of NCDEX/MCX

loss. It was held that the CIT(A) has rightly allowed the

said loss to the assessee in the facts and circumstances

of the case. The ITAT has further observed that the

CIT(A) has rightly deleted the addition of Rs.75,00,000/-

to the assessee made under Section 68 of the ACT of

1961 as transaction between the assessee and M/s Swift

(6 of 6) [ITA-22/2021]

Tie Up Pvt. Ltd. is clearly evident from the documentary

evidence produced by the assessee. The ITAT has also

upheld the deletion of disallowance donation expenses

and disallowance expenses claimed in the P & L account

by the CIT(A).

On a careful scrutiny of the material available on

record, the findings recorded by the appellate authorities,

we are of the opinion that in the facts and circumstance

of the case, the evidence has properly been appreciated

by the CIT(A) as well as the ITAT and in the absence of

any clinching adverse evidence on record, the said finding

of facts are not liable to be interfered with.

As we have already observed above that no

substantial question of law is arising in the matter and

the impugned orders passed passed by the appellate

authorities are essentially based on the finding of facts,

we are not inclined to interfere in the instant appeal.

Resultantly, the appeal being devoid of merit, is

hereby dismissed.

(ANOOP KUMAR DHAND),J (VIJAY BISHNOI),J

16 - ms rathore

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