Income Tax Appellate Tribunal - Chandigarh
M/S Oasis Distilleries Ltd., Indore vs Dcit, Cc-Ii, Ludhiana on 11 May, 2018
I N TH E I N CO M E T A X A P PE L L A T E T RI BU N A L
D I VISI O N B E NC H , C H AN DI GA R H
BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER
AND Ms. ANNAPURNA GUPTA, ACCOUNTANT MEMBER
ITA No. 1349/CHD/2017
Assessment Year : 2009-10
M/s Oasis Distilleries Ltd., Vs. The DCIT, Central Circle-II,
H.102, B-2, Metro Tower, Ludhiana
Vijay Nagar, Scheme No. 54,
Indore,
PAN No. AAAC03509R
(Appellant) (Respondent)
Appellant by : Shri Ashok Goyal, CA
Respondent by : Sh. Ashish Kumar Gupta, CIT DR
Date of Hearing : 11.05.2018
Date of Pronouncement: 11.05.2018
ORDER
Per Sanjay Garg, Judicial Member:
The present appeal has been preferred by the assessee against the order dated 19/06/2017 of the Commissioner of Income Tax (Appeals)-5, Ludhiana [hereinafter referred to as CIT(A)].
2. The assessee has raised the following grounds:-
1. That the Ld. CIT(A) has erred in confirming the addition of Rs. 10,00,000/- in respect of share capital u/s 68 as per para 4.2 of the order.
2. That the Ld. CIT(A) has failed to adjudicate the legal ground of appeal as taken before him during the course of hearing that since no incriminating ITA No.1349/Chd/2017- M/s Oasis Distilleries Ltd., Indore 2 material had been found during the course of search conducted on 21/22 October, 2010 and, as such, the addition of Rs. 10 lacs as confirmed on account of unsecured loan is not called for.
3. That the Ld. CIT has failed to appreciate the judgement of the jurisdictional ITAT, Chandigarh Bench and of the various High Courts including the case of Kabul Chawla and others and if no incriminating material found during the course of search, then, the addition cannot be made. \
4. Notwithstanding the above said ground of appeal, the ld CIT(A) has erred in confirming the addition of Rs. 10 lacs as per para 4.2 of the order.
5. That the confirmation of addition as made by the CIT(A) is against the facts and circumstances of the case.
3. At the outset, the Ld. Counsel for the assessee has submitted that the facts and issue involved in this appeal are relating to the additions made which were not based on any incriminating material found during the search are squarely covered by the decision of the Tribunal in the own case of the assessee relating to assessment year 2007-08 in ITA No. 643/Chd/2015 & others.
4. The Ld. Counsel for the assessee has submitted that the original return in this case was processed u/s 143(1) of the Act. Thereafter, a search action was carried out at the premises of the assessee u/s 132 of the Income-tax Act, 1961 (in short 'the Act') on 21.10.2010 but no incriminating material was found during the search. Thereafter, the assessment proceedings were ITA No.1349/Chd/2017- M/s Oasis Distilleries Ltd., Indore 3 carried out u/s 153A of the Act and the Assessing officer has made the impugned additions but not based on any incriminating material found during the search action. The Ld. counsel, has submitted that since the original assessment proceedings already stood completed in this case on the date of search and that since no incriminating material was found during the search action, the Assessing officer was precluded from making any addition or opening up an issue, in relation to already concluded assessment proceedings and, hence, no additions were warranted i n t h e ye a r u n d e r c o n s i d e r a t i o n i n t h e a s s e s s m e n t p r o c e e d i n g s carried out u/s 153A of the Act. He in this respect has relied upon various judicial decisions including the decision of the in the Hon'ble Bombay High Court in the case of 'CIT Vs. Murli Agro Products Pvt Ltd', (2014) 49 taxman.com 172 (Bom.), ITA No.36 of 2009 and in the case of 'CIT Vs. Continental Warehousing Corporation' ITA No. 523 of 2013 reported in ( 2 0 1 5 ) 2 7 9 C T R 0 3 8 9 ( B o m b a y) a n d o f t h e H o n ' b l e D e l h i H i g h Court in the case of 'CIT Vs. Kabul Chawla' 234 Taxman 300 (Delhi) and subsequent decision of the Delhi High Court in the case of 'Principal CIT Vs. Meeta Gutgutia Prop M/s Ferns 'N' Petals", ITA 306/2017 and others decided vide order dated 25.5.2017.
5. The Ld. DR has also been fair enough to admit that no incriminating material was found in the case during the search ITA No.1349/Chd/2017- M/s Oasis Distilleries Ltd., Indore 4 action and that the facts and issue involved are squarely covered by the aforesaid decisions.
6. We find force in the contention of the Ld. AR. A d m i t t e d l y, t h e a s s e s s m e n t f o r t h e ye a r u n d e r c o n s i d e r a t i o n stood completed on the date of search. No incriminating material whatsoever in relation to the share application money was found. It has been time and again held by the various High Courts that if no incriminating material is found during the search action, the addition in the case of already concluded assessment cannot be made while framing assessment u/s 153A of the Act. Reliance in this respect can be placed in the case of 'CIT Vs. Continental Warehousing Corporation' ITA No. 523 of 2 0 1 3 r e p o r t e d i n ( 2 0 1 5 ) 2 7 9 C T R 0 3 8 9 ( B o m b a y) a n d o f t h e Hon'ble Delhi High Court in the case of 'CIT Vs. Kabul Chawla' 234 Taxman 300 (Delhi).
7. We find that the case of the assessee is squarely covered by the aforesaid decisions. The aforesaid decisions have been further affirmed by the decision of the Delhi High Court in the case of 'Principal CIT Vs. Meeta Gutgutia Prop M/s Ferns 'N' Petals", ITA 306/2017 and others decided vide order dated 25.5.2017. The aforesaid case laws can be well applied to the facts and circumstances of the case in hand. In view of this, we do not find any justification on the part of the lower authorities for making addition on account of share application money for t h e ye a r u n d e r c o n s i d e r a t i o n .
ITA No.1349/Chd/2017-
M/s Oasis Distilleries Ltd., Indore 5 In view of this, the appeal of the assessee is hereby allowed Order pronounced in the Open Court Sd/- Sd/-
(ANNAPURNA GUPTA) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated : 11.05.2018 Rkk Copy to: • The Appellant • The Respondent • The CIT • The CIT(A) • The DR