Income Tax Appellate Tribunal - Delhi
Shri Bhagwanti Cooperative Group ... vs Dcit, New Delhi on 26 February, 2019
IN THE INCOME TAX APPELLATE TRIBUNAL
(DELHI BENCH 'C' : NEW DELHI)
BEFORE SHRI KULDIP SINGH, JUDICIAL MEMBER
AND
SHRI B.R.R. KUMAR, ACCOUNTANT MEMBER
ITA No.5668/Del./2010, A.Y. 2006-07
DCIT Vs. Bhagwanti Cooperative Group
Central Circle -12, Housing Society
Room No. 330, Plot No. GH-83,
ARA Centre, Jhandewalan Extn. Sector-56
New Delhi Gurgaon
(PAN : AAAAB3888J)
Cross Objection 17/ Del/2011
(Arising appeal no. 5668/Del/2010)
Assessment Year 2006-07
Bhagwanti Cooperative Group Vs. DCIT
Housing Society Central Circle -12,
Plot No. GH-83, Room No. 330,
Sector-56 ARA Centre, Jhandewalan
Extn New Delhi
Gurgaon
(PAN : AAAAB3888J)
(APPELLANT) (RESPONDENT)
ASSESSEE BY : Sh. P.D.Mittal, CA
REVENUE BY : Shri Amit Katoch, Sr. DR
Date of Hearing : 23.01.2019
Date of Order : 26 .02.2019
ORDER
PER KULDIP SINGH, JUDICIAL MEMBER :
Aforesaid appeal as well as cross objections filed by revenue as well as assessee respectively are being disposed of with composite order 2 ITA No. 5668/Del./2010 C.O. No. 17/Del/2011 having been emanated from same impugned order dated 03.09.2010 passed by Ld. CIT(A), to avoid repetition of discussion.
2. The appellant Dy. Commissioner of Income Tax, New Delhi (hereinafter referred to as 'the revenue') by filing the aforesaid appeal, sought to set aside the impugned order dated 30/09/2010 passed by Ld. Commissioner of Income Tax(Appeals), New Delhi qua the Assessment Year 2006-07 on the grounds inter alia that :
"1. The order of the Ld. CIT(Appeals) is not correct in law and facts.
2. On the facts and in the circumstances of the case, the Ld. CIT(A) has erred in law and facts in deleting the addition of Rs. 1,92,00,000/- made by the AO on account of undisclosed income f the assessee, as well as the substantive addition in the hands of GTM Builders and Promoters (P) Ltd.
3. The appellant craves leave to add, alter or amend any/all of the grounds of appeal before or during the course of the hearing of the appeal."
Cross Objection 17/Del/2011, A.Y. 2006-07
3. Appellant Bhagwanti Cooperative Group Housing Society (hereinafter referred to as the 'assessee') by filing cross objections sought to challenge the impugned order passed by the Ld. CIT(A)-1 New Delhi by raising grounds of cross objections as under :-
"1. That the Ld. A.O. has failed to make out any case against the assessee society in view of the fact that there is no material even for name sake.3 ITA No. 5668/Del./2010 C.O. No. 17/Del/2011
2. That the Ld. A.O. has failed to appreciate the evidence in the form of statement of one of the flat owner Shri Ramesh Kumar recorded wherein Shri Ramesh Kumar has categorically denied any payment made to the society in excess of the recorded price. Unfortunately, this part of the evidence though available with the Ld. A.O. was not considered as evident from the assessment order.
3. That even in the concluding para 37 it has been categorically held that M/s. GTM Builders is the beneficiary of the alleged additional sale price if any."
4. Briefly stated that facts necessary for adjudication of the controversy at hand are : assessee is into the business of construction of flats for the members of society. A survey was conducted u/s 133A of the Act at the premises of assessee society on 21.03.2007. On the basis of search and seizure operation conducted in case of GTM Builders and Promoters P. Ltd. as well as residence of Shri Mohit Vohra. It is the case of assessing officers that during the course of search at the residence of Sh. Mohit Vohra various documents relating to assessee's society were found. From the statement of Sh. Mohit Vohra, Sh. Vidyasagar Vishnoi, Sh. Rajesh Chabra, Sh. Ramesh Kumar Vadhawan, Sh. Ashok Kumar and Sh. Tushar Kumar, AO proceeded to conclude that assessee society was managed and controlled by GTM Group and the main contract person was Sh. Tushar Kumar and that for each of the 48 flats, GTM / Tushar Kumar received sum of Rs. 4,00,000/-, total amounting to Rs.1,92,00,000/- which represents the undisclosed income of the group and thereby made protective assessment of 1,92,00,000/- in the hands of the assessee's society u/s 153(c) of the Act.
4 ITA No. 5668/Del./2010 C.O. No. 17/Del/20115. Assessee carried the matter before the Ld. CIT(A) by way of filing the appeal who has deleted the addition by accepting the appeal.
6. We have heard the ld. DR for the revenue, gone through the order passed by the lower revenue authorities and documents relied upon by the parties to the appeal.
7. Undisputedly assessee society is an independent legal entity. It is also not in dispute that in case of GTM Builders and Promoters Pvt. Ltd. for A.Y. 2006-07 the issue in controversy in the present appeal was considered and consequently assessment was made on substantive basis. Ld. CIT(A) during the appellate proceedings in case of GTM Builders and Promoters Pvt. Ltd. for A.Y. 2006-07 vide order no. 88/08-09 dated 28.05.2010 proceeded to hold that, the assessee society is an independent legal entity and is not a benami concern Mr. Tushar Kr. / GTM Builders and Promoters P. Ltd. and the AO has no evidence to show that any money has passed from the members of the society to the assessee society qua the sale of flats.
8. When we examine para 39 of the assessment order, AO proceeded on the basis of the fact that for each of 48 flats, GTM Builders and Promoters P. Ltd. / Sh. Tushar Kr. Received a sum of Rs. 4,00,000/- total amounting to Rs. 1,92,00,000/- which represents the undisclosed income of the group and made protective addition thereof in the hands of the assessee society. We are of the considered view that in any case the addition was to be made it was required to be made in the hands of individual flat owners, who alleged to have made the payment of Rs. 4,00,000/- each in cash. Merely because of the fact that some documents relating to membership etc. were found at the premises of GTM Builders and Promoters P. Ltd. / Mr. Tushar Kumar protective addition cannot be made on the basis of assumption and surmises. Moreover, Ld. 5 ITA No. 5668/Del./2010 C.O. No. 17/Del/2011 CIT(A) has rightly observed that Sh. Ramesh Kumar Vadhawan, owner of flat no. 604 recorded during the survey proceedings denied to have made any payments in cash either to the society or to Mr. Tushar Kumar. Question no. 5 and its answer given by Mr. Ramesh Kr. is extracted in para 4.4 of the impugned order.
9. In view of what has been discussed above, we are of the considered view that the Ld. CIT(A) has rightly reached the conclusion that there is no material on record before the AO to make even protective addition against the assessee society particularly when substantive addition have already made in the hands of GTM Builders and Promoters P. Ltd. and in that case issue was decided that the assessee society is not a Benami concern of GTM group as its activities, objectives are governed by its memorandum of articles of association. So, finding no illegality or perversity in the impugned orders passed by Ld. CIT(A) . Present appeal filed by the revenue is hereby dismissed.
10. Cross objection filed by assessee society stands dismissed having not been pressed at the time of argument.
Order pronounced in open court on this 26th February, 2019.
Sd/- Sd/-
(B.R.R.KUMAR) (KULDIP SINGH)
ACCOUNTANT MEMBER JUDICIAL MEMBER
Dated : 26/02/ 2019
BR
Copy forwarded to:
1. Appellant
2. Respondent
3. CIT
4. CIT(A)-XXVI, New Delhi.
5. CIT(ITAT), New Delhi.
6 ITA No. 5668/Del./2010
C.O. No. 17/Del/2011
AR, ITAT
NEW DELHI
Date of dictation 18.02.2019
Date on which the typed draft is placed before 18.02.2019 the dictating Member Date on which the typed draft is placed before the Other Member Date on which the approved draft comes to the Sr. PS/PS Date on which the fair order is placed before the Dictating Member for pronouncement Date on which the fair order comes back to the Sr. PS/PS Date on which the final order is uploaded on the website of ITAT Date on which the file goes to the Bench Clerk Date on which the file goes to the Head Clerk The date on which the file goes to the Assistant Registrar for signature on the order Date of dispatch of the Order