TaxTMI 
TaxTMI 
2019 (9) TMI 383
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....s of the both the lower authorities' action disallowing donation / subscription as well as entertainment expenses of Rs.1,445/- and Rs.12,075/-; respectively. These two substantive grounds are dismissed as not pressed. 3. Next comes the assessee's third substantive grievance that the Assessing Officer as well as the CIT(A) have erred in adding his loan amount from M/s Chakra Infrastructure Ltd. (hereinafter referred to as CIL) as unexplained cash credits u/s. 68 of the Act. 4. We advert to relevant facts as per para-6 pages 2 and 3 in assessment order dated 26.12.2016. The Assessing Officer had issued section 133(6) notice to CIL which stood returned back by the Postal Authority "left". He then required the assessee to profile photo id , supportive documents, profit and loss account, balance sheet and return relating to the relevant previous year creditworthiness and the corresponding bank statement thereof. 5. Case file suggests that CIL's director Shri, Pranab KR. Roy appeared before the Assessing Officer on 19.12.2016 alongwith voter ID card, muster data, director's signatory details and unsigned confirmation of account in assessee's name. He stated that CIL profit and ....
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....2. The addition was made regarding loan &advance taken from M/s Chakra Infrastructure Ltd. amount of outstanding loan as on 31.03.2014 was Rs. 6,44,96,068/- 3. In this regard, to verify the loan transaction, u/s. 133(6) notice was issued on 9.11.2016 which was returned back by the postal authority with the remark 'that the loan creditor was not found" on the given address at M/s Chakra Infrastructure Ltd., Chakramadhumati, 40D North Purbachal, Haltu, Kalitala Link Road, Kolkat-700078. 4. The assessee was asked to produce the party. As per order sheet noting dated 19.12.2016, Sri Pranab KR. Roy, Director of M/s Chakra Infrastructure Ltd., submitted a photocopy of his ID card and one unsigned confirmation of account. 5. The documents which were called by 133(6) notice were not submitted by him like profit & loss account. Balance-sheet and bank statement of M/s Chakra Infrastructure Ltd. This proves that genuineness of transaction is not proved for which onus is on the assessee. 6. He also stated that the company has not filed return of income for AY : 2014-15. This also proves that genuineness of transaction is not proved for whic....
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....nnexed herewith and marked as Annexure 'H'). The said signed confirmation is nothing but a clarificatory evidence and cannot be said to be additional evidence since the corroborative material is already on record. Thus, the Ld. AO should have considered that the assessee produced the director of CIL before him on his request who confirmed the transactions with the assessee. Comments of A.O 11. Mere statement without corroboratory evidences are not valid. The documents which were called by 133(6) notice were not submitted by Director like Profit & Loss Account, Balance-sheet and bank statement of M/s Chakra Infrastructure Ltd. He also stated that the Company has not filed return of income for Assessment Year: 2014-15. This proves that genuineness of transaction is not proved for which onus is on the assessee. 12. Further, it is stated by assessee that- (c) In the relevant year, the assessee received only sum of Rs. 8,52,000/- from CIL. However, the AO wrongly added the closing balance of Rs. 6,44,95,068/- to the income of the assessee without considering that the said amount also included brought forward balance. The details of the transactions wi....
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....0000.00 8176000.00 68385968.73 It is clarified here that in the earlier years, pursuant to the above mentioned agreement for sale dated 24.11.2011, the assessee was receiving the payments from CIL in his different proprietary concern M/.s Chakra Narayantara Hotel and the closing balance of Rs. 6,44,95,068/- was reflected in the balance-sheet as on 31.03.2014 of the said concern (Annexure-A)." 14. The perusal of submission as verified from balance sheet, the whole transaction is found to be accommodated entries shown under the head 'loan from, others" and "loan from, friends and relatives" and balance Rs. 6,44,95,068/- is shown as outstanding. No transaction directly from Chakra Infrastructure Ltd is appearing in the books of account. Further the identity of the loan creditors is not established on this fact and as return of income was not file by Chakra Infrastructure Ltd., genuineness of the transaction is not established. Further, profit & loss account, balance-sheet and bank statement were not filed by M/s Chakra Infrastructure Ltd., therefore, creditworthiness is not established. Therefore, the balance appe....
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....cess of winding up of the company. The directions would come into force with immediate effect. 2. Further, SEBI has passed order no.WPM/PS/09/ERO/APR/2016 dated 22.04.2016 restraining the Chakra Infrastructure Ltd along with its Directors from accessing the security market and a further prohibited from buying selling or dealing in securities. In the said order name of assessee also appeared as a director. 3. Further, Dy. Commissioner of Police(II), Detective Department, 18, Lal Bazar Street, Kolkata forwarded its Memo No.22/SIT/DD dated 29.05.2017 stating that the case was filed against the assessee with Ref No.Garfa PS.DD/SIT, Case No.227 dated 09.07.2014 u/s. 120B/420/406/409 IPC and had started the investigation. Comments 1. The amount estimated by SEBI in its order and the amount shown as sale of Chakranarayan hotel is same of Rs. 10 crores. 2. Circumstantial evidence proves that the agreement filed by assessee is nothing but created document to accommodate illegal fund and might be tainted money. 3. It is further strengthened on the basis of Report of Inspector, who was deputed and in his report dated 25.8.2017, he....
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....s units and that ten of said units stood sold leaving behind forty of them with kitchens, store and other specified emanated of flow rooms reception rooms bath rooms. There is further no issue regarding assessee's cost of construction met out from loans availed from PSU bank. This above stated agreement stated on 24.04.2011 in paper book pages 46 to 57 reveals that CIL had agreed to purchase thirty out of assessee's forty remaining units for Rs.10 crores including all movable assets and emanated attached bathrooms. It had paid Rs.20,000/- as advance and balance figure(s) of Rs.99,980,000/- had to be transferred not later than 31.03.2014. the assessee and his vendee further agreed that the later would be entitled to use the above said thirty rooms units upon paid of 25% of the consideration money. We re-emphasis that department has not doubted assessee's ownership as well as possession all these foregoing assets. 11. We now deal with the registration aspect of the above stated agreement. The Revenue's case as per the lower authorities finding is that the impugned agreement does not deserve to be accepted as genuine since an un-registered document. We find that the very issue h....
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....accrue to the parties to the agreement. If no rights would accrue, then it will be construed that the possession was not delivered by the assessee vide agreement dated 4.4.2008 and 2.3.2009, meaning thereby, no transfer has taken place. The ld.First Appellate Authority further put reliance upon the judgment of the Hon'ble Supreme Court in the case of Suraj Lamp & Industries Pvt. Ltd. Vs. State of Haryana, 14 taxmann.com 103. 24. On due consideration of the above reasoning, we are of the view that as far as the judgment of the Hon'ble Supreme Court in the case of Suraj Lamp & Industries (supra) is concerned, it is altogether in different context. There is no dispute with regard to the proposition that transfer of an immovable property having value of more than Rs. 100/- can only be completed by way of registered sale deed, as contemplated in section 17 of the Registration Act. This judgment deals with the concept of power of attorney, lease, licence etc. Definition of expression "transfer" provided in section 2(47) is more wider than in the general law. As observed earlier, while dealing with the issue no.(ii), the expression "transfer" employed in section 2(47) includes (a....
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....ssion on execution of agreement as referred to in section 53A may not be able to protect his possession on account of non-registration of the agreement, but for all other collateral purposes, i.e. for tendering the agreement into evidence for suit for specific performance, etc. it is to be treated as valid agreement. A controversy in this aspect had arisen whether such non-registered agreement can be entertained in evidence or not in a suit for specific performance. A reference was made before the Division Bench of Punjab & Haryana High Court in regular Second appeal No.4946 of 2011 in the case of Ram Kishan Vs. Bijeder Mann. The Hon'ble High Court has resolved the controversy and held that such unregistered agreement can be produced as evidence in suit for specific performance. It can be made basis of suit for specific performance. The finding recorded by the Hon'ble Punjab & Haryana High Court in this case reported in (2013) 1 PLR 195 as under: "11. A conjoint appraisal of sections 53A of the Transfer of Property Act, 1882, sections 17(1A) and 49 of the Indian Registration Act, 1908, particularly the proviso to section 49 of the Indian Registration Act, in our considered....
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....he sale deed in favour of SDS by virtue of this agreement. The validity of this agreement under general law viz. Specific Relief Act as well as Indian Registration Act has not been effected. This aspect has not been appreciated by the ld.CIT(A) while holding that since the agreements are unregistered, therefore, they are non-genuine." We observe in the light of foregoing detailed discussion that the learned lower authorities have erred in not accepting genuineness of the assessee's owned registered agreement to sale. We wish to make it clear that the assessee has further proved all uncollateral circumstances n his favour since the above stated unregistered agreement followed the vendees multiple payments of transfers made former name as well as his proprietory concern M/s Chakra Nayantara Hotel, M/s Nayantara Appliances and M/s B.N. as on 31.03.2013 (supra). The relevant ledger account to this effect from 01.04.2013 indicates all these payments instances. The assessee's opening balance as on 01.04.2013 including these payments indication that a figure of Rs.6,83,85,969/-. 12. The Revenue's stand that all these are accommodation entries in the name of assessee's three concern,....
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.... assessee company from the share subscriber companies and found that the entire share capital along with share premium amounting to Rs. 54.35 crores was actually received by the assessee company during the F.Y. 1999-2000 relevant to A.Y. 2000-01. Keeping in view this categorical finding given by the Assessing Officer in his remand report after verifying the claim of the assessee company from the relevant documentary evidence as well as from the share subscriber companies, the Ld. CIT(A) held that the amount in question towards share capital and share premium having been received by the assessee company in the earlier year, the same could not be treated as unexplained cash credit for the year under consideration. To arrive at this conclusion, the Ld. CIT(A) relied on the following judicial pronouncements: "i. In CIT v. Usha Stud Agricultural Farms Ltd. 301 ITR 384 (Delhi) it was held in para (6) of the order: '(6) Here, the CIT(A) has deleted the addition of Rs. 15 lacs mainly on the ground that this credit balance of Rs. 15 lacs is being reflected in the accounts of the assessee over the past four to five years or so and hence this was not a fresh credit entry of ....
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....Farms Ltd. (supra) as well as by the Hon'ble Rajasthan High Court in the case of Parmeshwar Bohra (supra), the amount received by the assessee in the earlier year and not in the year under consideration and duly credited in the books of account of the assessee for such earlier year cannot be added under section 68 as unexplained cash credit for the year under consideration. In our opinion, the ratio of the said two judicial pronouncements is squarely applicable to the facts of the present case and the Ld. CIT(A) was fully justified in deleting the addition made by the A.O. under section 68 during the year under consideration by treating the amount in question towards share capital and share premium which was received by the assessee company in the earlier year and not in the year under consideration. At the time of hearing before us, the learned DR has not disputed this factual position or even the applicability of the ratio of the said two judicial pronouncements relied upon by the Ld. CIT(A) while deleting the addition made by the A.O. under section 68. 10. It is also observed that the similar issue involving identical facts and circumstances has been decided by the coor....
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....03.2000 and on 01.04.2000 it was an opening balance. Therefore, the Ld. CIT(A) concluded that what was already credited in the books of account ending on 31.03.2000 for A.Y. 1999-2000 relevant to A.Y. 2000-01 cannot be an unexplained cash credit in the books of account maintained for the F.Y. 2004-05 relevant to A.Y. 2005-06 so as to warrant this consideration as unexplained cash credit for relevant A.Y. 2005-06." 11. Respectfully following the decision of the coordinate bench of this Tribunal in the case of Geoletic Supply Pvt. Ltd. (supra) as well as that of Hon'ble Delhi High Court in the case of Usha Stud Agricultural Farms Ltd. (supra) and Hon'ble Rajasthan High Court in the case Parmeshwar Bohra (supra), we uphold the impugned order of the Ld. CIT(A) deleting the addition made by the A.O. under section 68 by treating the amount of share capital and share premium received during the earlier year as unexplained cash credits for the year under consideration." 14. Coming to the Revenue's vehement arguments that CIL has been facing both the SEBI and criminal proceedings (supra), we observe that same has no bar on the issue before us as all these are subsequent....