Income Tax Appellate Tribunal - Delhi
M/S Takshila Distributers Pvt. Ltd.,, ... vs Acit, New Delhi on 1 February, 2018
IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCHES "C" : DELHI
BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER
AND
SHRI L.P. SAHU, ACCOUNTANT MEMBER
ITA.No.4351/Del./2015
Assessment Year 2005-2006
Takshila Distributers Pvt.
The ACIT, Central Circle-23
Ltd., 48, Friends Colony
New Delhi.
(East), New Delhi. vs.
PAN AAACT0269K
(Appellant) (Respondent)
ITA.No.4375/Del./2015
Assessment Year 2005-2006
Rancho Place Estate Pvt.
The ACIT, Central Circle-23
Ltd., 48, Friends Colony
New Delhi.
(East), New Delhi. vs.
PAN AAACR5883P
(Appellant) (Respondent)
For Assessee : Shri S.K. Tulsiyan, Advocate &
Ms. Bhumija Verma, Advocate
For Revenue : Shri S.R. Senapati, Sr.D.R.
Date of Hearing : 18.01.2018
Date of Pronouncement : 01.02.2018
ORDER
PER BHAVNESH SAINI, J.M.
Both the appeals by different assessees are directed against different orders of the Ld. CIT(A)-30, New Delhi, dated 10th February, 2015, for the A.Y. 2005-2006.
2
ITA.Nos.4351/D/2015 & Takshila Distributers Pvt. Ltd., New Delhi. ITA.No.4375/Del./2015 Rancho Place Estate Pvt. Ltd., New Delhi.
2. We have heard the learned Representatives of both the parties and perused the material on record. The Learned Representatives of both the parties mainly argued in the case of Takshila Distributers Pvt. Ltd., and submitted that issue is same in other appeal. Therefore, the same order may be followed in other case. The appeal of Takshila Distributers Pvt. Ltd., is decided as under.
ITA.No.4351/Del./2015 - Takshila Distributers Pvt. Ltd., A.Y. 2005-2006 :
3. Briefly, the facts of the case are that assessment was reopened by issuing notice us 148 of the I.T. Act. Search and seizure operation was carried-out at various premises of M/s. Today Homes and Infrastructure Pvt. Ltd. The assessee- company is one of the Associated Companies of M/s. Today Homes and Infrastructure Pvt. Ltd. It was noticed that during the F.Y. 2004-2005, the assessee has received Rs.1,01,00,000 from M/s. Golden Technobuild Pvt. Ltd., Survey under section 133A was conducted on 26.11.2009 at the registered office of this company. The person available at the registered office has 3 ITA.Nos.4351/D/2015 & Takshila Distributers Pvt. Ltd., New Delhi. ITA.No.4375/Del./2015 Rancho Place Estate Pvt. Ltd., New Delhi. categorically stated that neither books of account are maintained nor any business activities are carried out by this company from this premises. It has been stated that this company is controlled by the Today Group of companies having office at Statesman House, Connaught Place, New Delhi. It has been noted that M/s. Golden Technobuild Pvt. Ltd., had received entry from Jain brother. A search action was carried- out at the premises of Jain Brothers and it was found that Jain Brothers had been providing accommodation entry to various parties after charging some commission for the same. It has been noted that assessee-company was the beneficiary in this transaction. Further, it was noticed that the assessee was owner of 29.40% of property at 48-Friends Colony East, New Delhi and this property was being used by Gambhir brothers as their residence. The A.O. asked the explanation of assessee on the accommodation entry received of Rs.1,01,00,000 and Rs.12,25,897 being 29.4% of annual value of the property should not be added to its income as income from house property as against Rs.1,05,000 declared by assessee for 05 4 ITA.Nos.4351/D/2015 & Takshila Distributers Pvt. Ltd., New Delhi. ITA.No.4375/Del./2015 Rancho Place Estate Pvt. Ltd., New Delhi. months. The assessee submitted before the A.O. that it has received amount of Rs.1,01,00,000 from M/s. Golden Technobuild Pvt. Ltd., and in order to establish identity, creditworthiness and genuineness of the amount as received from the said company, assessee had filed its audited financial statements as on 31st March, 2005, copy of acknowledgment of I.T. Return filed by the creditor for assessment year under appeal, copy of PAN card and copy of the bank statement of the creditor from where cheques received by the assessee-company. The assessee relied upon several case law in support of the contention. It was also submitted that registered office of the assessee is at 48-Friends Colony and same premises are used to carry-out of its business activities whatever they are from the same premises.
4. The A.O. however, did not accept the contention of assessee. It is noted that assessee received amount in question from M/s. Golden Technobuild Pvt. Ltd. The concern namely M/s. Double Star Builders Pvt. Ltd., also belong to Today Group of cases in turn, has transferred/given this money to assessee 5 ITA.Nos.4351/D/2015 & Takshila Distributers Pvt. Ltd., New Delhi. ITA.No.4375/Del./2015 Rancho Place Estate Pvt. Ltd., New Delhi. relevant to assessment year under appeal. The survey was conducted at the premises of this company. The person available there denied maintenance of any books of account or carrying out any business activities. No company was found to have done any business from the premises. The person present there has deposed on oath that he was directly or indirectly acting at the behest of Today Group. The statement of Shri Jagdish Prasad Vohra recorded on 26.11.2009 is referred to in the assessment order. The action us 132 of the I.T. Act was conducted at the residential premises of some of the Directors of abovementioned companies namely Shri Vinay Subhikhi on 26.11.2009. All these Directors have admitted in their statements us 132(4) that all the affairs of these companies are controlled by Shri G.K. Gambhir and Shri R.K. Gambhir. The statement of Shri Vinay Subhikhi and Shri Gulshan Kumar Gambhir recorded on 27.11.2009 are referred to in the assessment order. Pages-134, 135, and 143 of Annexure-A1, Party H-2 seized from the office at 8th Floor, Statesman House, Barakhamba Road, New Delhi, which is registered office of M/s. 6
ITA.Nos.4351/D/2015 & Takshila Distributers Pvt. Ltd., New Delhi. ITA.No.4375/Del./2015 Rancho Place Estate Pvt. Ltd., New Delhi. Today Homes and Infrastructure Pvt. Ltd., are with respect to Din No. and digital signature along with pass word of various persons through whom assessee group has floated and controlled various companies, by appointing them as Directors etc., These companies, in turn, are used as conduit to transfer the unaccounted money received in the form of accommodation entries from various entry operators, into the main companies including flagship company namely M/s. Today Homes and Infrastructure Pvt. Ltd. Availability of these documents in the O/o. M/s. Today Homes and Infrastructure Pvt. Ltd. Further, strengthening the fact that Directors of the above said companies are merely employees of Today Group and controlled by Gambhir brothers who are having the similar pass words. With the help of digital signatures most of the compliance including filing of the I.T. returns, filing papers before ROC etc., can be done by one person. During search and survey action conducted in the premises of Shri S.K. Jain and Shri Virendra Jain, it was found that they are entry provider on commission to the parties. They have provided accommodation entries in the 7 ITA.Nos.4351/D/2015 & Takshila Distributers Pvt. Ltd., New Delhi. ITA.No.4375/Del./2015 Rancho Place Estate Pvt. Ltd., New Delhi. from of share application money, capital gain on shares, expenditure entries etc., in lieu of commission. During the course of search and seizure proceedings at the residential and business premises of Jain brothers on 14th September, 2010, daily cash book, balance sheet and cheque/bank books were found and seized wherein date-wise details of cash received from different parties/concerns through various mediators and the date-wise details of accommodation entries given to the beneficiaries concern through mediators with their particulars have been found. On perusal of these details, it was seen that M/s. Golden Technobuild Pvt. Ltd., from which M/s. Mission Viejo Agro Pvt. Ltd., i.e., the assessee has received various amounts during financial year relevant to assessment year under appeal. The details of documents/books seized during the search and seizure action at the residential and business premises of Jain brothers showing the receipt of cash and providing accommodation entries to M/s. Golden Technobuild Pvt. Ltd., including the name of the concern of the Jain brothers giving entry/name of the bank account etc., are noted in para- 8
ITA.Nos.4351/D/2015 & Takshila Distributers Pvt. Ltd., New Delhi. ITA.No.4375/Del./2015 Rancho Place Estate Pvt. Ltd., New Delhi. 4 of the assessment order that M/s. Golden Technobuild has received the amount from other companies and then made investment in assessee-company. The A.O, therefore, noted that M/s. Golden Technobuild Pvt. Ltd., from where funds have been transferred to the assessee belongs to Today Group of cases which is paper company controlled by dummy Directors have been used as conduit to transfer money to assessee. The A.O, therefore, made addition of Rs.1,01,00,000 in the hands of assessee because assessee failed to pass test of genuineness within the meaning of Section 68 of the I.T. Act. 4.1. Further, during the course of assessment proceedings for A.Y. 2009-2010, it was seen that assessee is joint owner of property No.48, Friends Colony (East), New Delhi along with other group companies namely M/s. Mission Viejo Agro Pvt. Ltd., and others having 29.40% of the share in the property which is used by Gambhir brothers for their residence. No business activity is conducted by assessee. The A.O, therefore, computed annual letting value of the property at 9 ITA.Nos.4351/D/2015 & Takshila Distributers Pvt. Ltd., New Delhi. ITA.No.4375/Del./2015 Rancho Place Estate Pvt. Ltd., New Delhi. Rs.12,25,897 and after giving deduction of Rs.1,05,000 declared by assessee, made the addition of Rs.10,20,897.
5. The assessee challenged both the additions before Ld. CIT(A) and reiterated the submissions made before the authorities A.O. The written submissions of the assessee were reproduced in the impugned order of the Ld. CIT(A) in which the assessee submitted that various Courts have held that once the assessee have filed confirmation, evidence in support of the identity of the creditors in the form of PAN/GIR No, onus caste upon assessee have been discharged. The assessee relied upon several decisions in support of the contention including the decision in the case of CIT vs. Sophia Finance Ltd., 205 ITR 98, ITO vs. Stellar Investment Ltd., Divine Leasing and Finance Ltd., 299 ITR 268, CIT vs. Lovely Exports 319 (Statute) 5, CIT vs. Winstral Petro Chemicals Pvt. Ltd., 330 ITR 603 etc. The assessee also argued that onus is on the department to prove that apparent is not real and relied upon the decision of the Supreme Court in the case of CIT vs. Doulatram 87 ITR 349 etc., It was submitted that once assessee filed the documentary 10 ITA.Nos.4351/D/2015 & Takshila Distributers Pvt. Ltd., New Delhi. ITA.No.4375/Del./2015 Rancho Place Estate Pvt. Ltd., New Delhi. evidences, initial onus upon assessee has been discharged. The creditor M/s. Golden Technobuild Pvt. Ltd., is a regular assessee, filing return of income. Whatever statements were recorded as referred in the assessment order are at the back of the same, the same were not confronted to assessee, therefore, cannot be read in evidence against the assessee. Even if the group companies are controlled by Gambhir brothers, no conclusion could be drawn that assessee received unaccounted/ undisclosed entry or represent that cash of assessee routed through paper companies. The companies are separate legal entity having independent Directors and shareholders. None of the person have admitted to have involve in giving accommodation entry. No corroborative evidence have been found against the assessee. The assessee relied upon the decision of the Delhi High Court in the case of CIT vs. Oasis Hospitalities Pvt. Ltd., 333 ITR 119 and decision of Delhi High Court in the case of CIT vs. Value Capital Services Pvt. Ltd., 307 ITR 337 and submitted that burden is upon Revenue to prove 11 ITA.Nos.4351/D/2015 & Takshila Distributers Pvt. Ltd., New Delhi. ITA.No.4375/Del./2015 Rancho Place Estate Pvt. Ltd., New Delhi. that investments made in the assessee-company actually emanated from the coffers of the assessee-company. 5.1. Ld. CIT(A), however, reproduced the observations of the A.O. in his findings that entire group is controlled by Today Group from the same premises and all concerned persons are having same pass word and the statements recorded reveal that the persons were dummy Directors and one person operating all the group. Therefore, the appeal of the assessee was dismissed with regard to addition made under section 68 of the I.T. Act.
6. As regards annual letting value of the property at 48, Friends Colony, New Delhi, the assessee contended that the property is used by the assessee for its business and profession and has shown the address of the same. Small partition of 675 sq. ft in property was let out for 05 months to M/s. Today Hotels Pvt. Ltd. Therefore, ratable value should be restricted to Rs.1,47,814 and assessee has already offered Rs.1,50,000. Addition is unjustified.
12
ITA.Nos.4351/D/2015 & Takshila Distributers Pvt. Ltd., New Delhi. ITA.No.4375/Del./2015 Rancho Place Estate Pvt. Ltd., New Delhi. 6.1. The Ld. CIT(A) did not accept the contention of the assessee and noted that during the course of search, statement of Shri Vinay Subhikhi, Vice President of the group was recorded in which he has admitted that property in question have been used by Gambhir brothers for their residence only. Therefore, the addition was confirmed and appeal of assessee has been dismissed.
7. We have heard the learned Representatives of both the parties. Learned Counsel for the Assessee reiterated the submissions made before the authorities below and submitted that assessee filed all the documentary evidences to prove identity of the creditor, its creditworthiness and genuineness of the transaction in the matter. The A.O. wanted assessee to prove the source of the source. He has submitted that proviso to Section 68 of the I.T. Act has been introduced by Finance Act, 2012, w.e.f. 1st April, 2013 which is effective from A.Y. 2013- 2014 only. He has relied upon the decisions of jurisdictional High Court in the case of Divine Leasing and Finance Ltd., (supra), Oasis Hospitalities Pvt. Ltd., (supra), CIT vs. 13 ITA.Nos.4351/D/2015 & Takshila Distributers Pvt. Ltd., New Delhi. ITA.No.4375/Del./2015 Rancho Place Estate Pvt. Ltd., New Delhi. Dwarakadheesh Investment Pvt. Ltd., 194 taxman 43 and decision of M.P. High Court in the case of CIT vs. STL Extrusion 11 taxman.com 125. He has also relied upon order of the ITAT, Delhi Bench in the case of M/s. Mission Verdes Estate Pvt. Ltd., in ITA.No.4236/Del./2015 for A.Y. 2005-2006 dated 16th December, 2016 in which same facts have been considered with regard to credit received from M/s. Golden Technobuild Pvt. Ltd., and similar addition have been deleted, particularly, when same addition have been made in Assessment order dated 28th March, 2013 for the A.Y. 2005-2006 in the hands of M/s. Golden Technobuild Pvt. Ltd. Copy of the assessment orders in the case of M/s. Golden Technobuild Pvt. Ltd., is also filed with bifurcation. In the same order the issue of annual letting value have been decided in favour of the assessee. He has also relied upon the order of the ITAT, Delhi Bench in the case of M/s. Palos Verdes Estate Pvt. Ltd., vs. ACIT ITA.No.4235/Del./2015 for the A.Y. 2005-2006 dated 16th December, 2016 in which the Tribunal on the issue of annual letting value, reopening of the 14 ITA.Nos.4351/D/2015 & Takshila Distributers Pvt. Ltd., New Delhi. ITA.No.4375/Del./2015 Rancho Place Estate Pvt. Ltd., New Delhi. assessment, have been quashed. He, therefore, submitted that both the additions are unjustified.
8. The Ld. D.R. on the other hand relied upon the orders of the authorities below.
9. We have considered the rival submissions. In this case, assessee received credit of Rs.1,01,00,000 from M/s. Golden Technobuild Pvt. Ltd., The assessee filed copies of the acknowledgments of I.T.returns, audited accounts, bank statements, ROC Certificate, PAN of the creditor, confirmation of the accounts of the creditor, copy of the bank statement with ledger account of the creditor before the authorities below. Copies of the same are filed in the paper book. The documents filed on record have not been disputed by the authorities below. The credit have been taken through banking channel and creditor was having sufficient amount with them to make investment in assessee-company. The assessee, therefore, discharged its initial onus to prove identity of the creditor, creditworthiness of the creditor, genuineness of the transaction in the matter.
15
ITA.Nos.4351/D/2015 & Takshila Distributers Pvt. Ltd., New Delhi. ITA.No.4375/Del./2015 Rancho Place Estate Pvt. Ltd., New Delhi. 9.1. Hon'ble jurisdictional High Court in the case of CIT vs. Kamdhenu Steel and Alloys Ltd., & Ors. 361 ITR 220 (Del.) held as under :
"Once adequate evidence/material is given, which would prima facie discharge the burden of the assessee in proving the identity of shareholders, genuineness of the transaction and creditworthiness of the shareholders, thereafter in case such evidence is to be discarded or it is proved that it has "created" evidence, the Revenue is supposed to make thorough probe before it could nail the assessee and fasten the assessee with such a liability under s.68; AO failed to carry his suspicion to logical conclusion by further investigation and therefore addition under s.68 was not sustainable."
9.2. Hon'ble jurisdictional Delhi High Court in the case of CIT vs. Laxman Industrial Resources Pvt. Ltd., ITA.No.169 of 2017 dated 14th March, 2017, held as under :
"The CIT(A) took note of the material filed by the assessee and provided opportunity to the AO in Remand proceedings. 16
ITA.Nos.4351/D/2015 & Takshila Distributers Pvt. Ltd., New Delhi. ITA.No.4375/Del./2015 Rancho Place Estate Pvt. Ltd., New Delhi. The AO merely objected to the material furnished but did not undertake any verification. The CIT(A) deleted the addition by relying upon the decision of the Hon'ble Apex Court in the case of Lovely Exports Pvt.Ltd. (supra) and judgement of Delhi High Court in the case of CIT vs Divine Leasing & Finance Ltd. [2008] 299 ITR 268. The ITAT confirmed the opinion of the Ld. CIT(A). Hon'ble High Court in view of the above findings noted that the assessee had provided several documents that could have showed light into whether truly the transactions were genuine. The assessee provided details of share applicants i.e. copy of the PAN, Assessment particulars, mode of amount invested through banking channel, copy of resolution and copies of the balance sheet. The AO failed to conduct any scrutiny of the document, the departmental appeal was accordingly dismissed.
9.3. Hon'ble jurisdictional Delhi High Court in the case of CIT vs. (i) Dwarakadhish Investment P. Ltd., (ITA.No. 911 of 17 ITA.Nos.4351/D/2015 & Takshila Distributers Pvt. Ltd., New Delhi. ITA.No.4375/Del./2015 Rancho Place Estate Pvt. Ltd., New Delhi. 2010) and (ii) Dwarkadhish Capital P. Ltd., (ITA.No.913 of 2010) (2011) 330 ITR 298 (Del.) (HC), in which it was held as under :
"In any matter, the onus of proof is not a static one. Though in section 68 of the Income Tax Act, 1961, the initial burden of proof lies on the assesses yet once he proves the identity of the creditors/share applicants by either furnishing their PAN number or income-tax assessment number and shows the genuineness of transaction by showing money in his books either by account payee cheque or by draft or by any other mode, then the onus of proof would shift to the Revenue. Just because the creditors/share applicants could not be found at the address given, it would not give the Revenue the right to invoke section 68. One must not lose sight of the fact that it is the Revenue which has all the power and wherewithal to trace any person. Moreover, it is settled law that the assessee need not to prove the "source of source". The assessee-company was engaged in the business of financing and trading of shares. For the assessment year 2001-02 on scrutiny of accounts, the 18 ITA.Nos.4351/D/2015 & Takshila Distributers Pvt. Ltd., New Delhi. ITA.No.4375/Del./2015 Rancho Place Estate Pvt. Ltd., New Delhi. Assessing Officer found an addition of Rs.71,75,000 in the share capital of the assessee. The Assessing Officer sought an explanation of the assessee about this addition in the share capital. The assessee offered a detailed explanation. However, according to the Assessing Officer, the assessee failed to explain the addition of share application money from five of its subscribers. Accordingly, the Assessing Officer made an addition of Rs.35,50,000/- with the aid of section 68 of the Act, 1961 on account of unexplained cash credits appearing in the books of the assessee. However, in appeal, the Commissioner of Income-tax (Appeals) deleted the addition on the ground that the assessee had proved the existence of the shareholders and the genuineness of the transaction. The Income-tax Appellate Tribunal confirmed the order of the Commissioner of Income-tax (Appeals) as it was also of the opinion that the assessee had been able to prove the identity of the share applicants and the share application money had been received by way of account payee cheques. On appeal to the High Court: 19
ITA.Nos.4351/D/2015 & Takshila Distributers Pvt. Ltd., New Delhi. ITA.No.4375/Del./2015 Rancho Place Estate Pvt. Ltd., New Delhi. Held, dismissing the appeals, that the deletion of addition was justified."
9.4. Hon'ble jurisdictional Delhi High Court in the case of CIT vs. Winstral Petrochemicals P. Ltd., 330 ITR 603, held as under :
"Dismissing the appeal, that it had not been disputed that the share application money was received by the assessee- company by way of account payee cheques, through normal banking channels. Admittedly, copies of application for allotment of shares were also provided to the Assessing Officer. Since the applicant companies were duly incorporated, were issued PAN cards and had bank accounts from which money was transferred to the assessee by way of account payee cheques, they could not be said to be non-existent, even if they, after submitting the share applications had changed their addresses or had stopped functioning. Therefore, the Commissioner (Appeals) and the Tribunal were justified in holding that the 20 ITA.Nos.4351/D/2015 & Takshila Distributers Pvt. Ltd., New Delhi. ITA.No.4375/Del./2015 Rancho Place Estate Pvt. Ltd., New Delhi. genuineness of the transactions had been duly established by the assessee."
9.5. Hon'ble jurisdictional Delhi High Court in the case of CIT vs. Value Capital Services Pvt. Ltd., (2008) 307 ITR 334 (Del.) (HC), in which it was held as under :
"Dismissing the appeal, that the additional burden was on the Department to show that even if the share applicants did not have the means to make the investment, the investment made by them actually emanated from the coffers of the assessee so as to enable it to be treated as the undisclosed income of the assessee. No substantial question of law arose."
10. The A.O. in order to disbelieve the explanation of assessee has referred to statements of certain persons which were recorded during the course of search in November, 2009, but, it appears that none of these statements have been confronted to the assessee or subject to cross-examination on behalf of assessee. Therefore, the same cannot be read in evidence against the assessee. We, rely upon the decision of the 21 ITA.Nos.4351/D/2015 & Takshila Distributers Pvt. Ltd., New Delhi. ITA.No.4375/Del./2015 Rancho Place Estate Pvt. Ltd., New Delhi. Hon'ble Supreme Court in the case of Kishanchand Chelaram 125 ITR 713. The A.O. also referred to certain seized papers to show that Today Group of Company are controlled by Gambhir brothers and there are certain digital signatures having common pass word so as to make compliance before income tax authorities or the ROC. It is also noted that the creditor M/s. Golden Technobuild Pvt. Ltd., received entry from other group company and then gave it to the assessee. However, none of these evidences on record prove that assessee received any bogus credit into the matter. If the creditor has received some entry from some other person, assessee could not be liable for the same. The assessee has to explain source of its amount received from the creditor. If the creditor has received some amount from Jain brothers it could not be linked with the assessee-company. In the group case of M/s. Mission Verdes Estate Pvt. Ltd. (supra), the ITAT, Delhi Bench, considered identical issue in which also credit was received from the same creditor M/s. Golden Technobuild Pvt. Ltd., who in turn, has taken credit from other group company and the Tribunal has 22 ITA.Nos.4351/D/2015 & Takshila Distributers Pvt. Ltd., New Delhi. ITA.No.4375/Del./2015 Rancho Place Estate Pvt. Ltd., New Delhi. deleted the addition based on the similar documents produced on record. The Tribunal also noted that since addition of the similar amount have been made by the Income Tax Department in regular assessment of the creditor M/s. Golden Technobuild Pvt. Ltd., therefore, no addition could be made against the assessee. Learned Counsel for the Assessee filed a chart to demonstrate that same amount is added in the hands of the creditor, therefore, it would amount to double addition if the same amount is added in the hands of the assessee-company. The A.O. suspected the transaction between the assessee and the creditor because the creditor has received the credits from Company controlled by Jain brothers but it would not prove that credit received by assessee was not genuine. A.O. cannot ask the assessee to prove the source of the source. None of the statements recorded during the course of search as are referred to in assessment order prove that assessee has received any accommodation entry from any person despite the fact that same were not confronted to the assessee at assessment stage. Therefore, it is proved on record that assessee has been able to 23 ITA.Nos.4351/D/2015 & Takshila Distributers Pvt. Ltd., New Delhi. ITA.No.4375/Del./2015 Rancho Place Estate Pvt. Ltd., New Delhi. explain the identity of the creditor, its creditworthiness and genuineness of the transaction in the matter. We, accordingly, set aside the orders of the authorities below and delete the addition of Rs.1,01,00,000.
11. As regards annual letting value of property No.48- Friends Colony (East), New Delhi, is concerned, the assessee submitted that it is co-owner with others and that the same is used for the purpose of business for the assessee and for part period it was let-out for which rental income has already been shown. However, the A.O. did not accept the contention of assessee and referred to statement of Shri Vinay Subhikhi who has stated that property in question used by Gambhir brothers for residence. In the case of the co-owners namely M/s. Mission Verdes Estate Pvt. Ltd., (supra) and M/s. Palos Verdes Estate Pvt. Ltd., (supra), the Tribunal has considered identical issue and in the case of M/s. Palos Verdes Estate Pvt. Ltd., reopening of the assessment quashed resulting the similar addition have been deleted on quashing of the re-assessment proceedings and in the case of M/s. Mission Verdes Estate Pvt. Ltd., (supra), the 24 ITA.Nos.4351/D/2015 & Takshila Distributers Pvt. Ltd., New Delhi. ITA.No.4375/Del./2015 Rancho Place Estate Pvt. Ltd., New Delhi. Tribunal found that property in question is used by the assessee for its own business and that copy of the ROC reveal that it is registered office of the assessee, therefore, addition has been deleted. It is, therefore, clear that in the case of other co-owners similar addition have been deleted when allegation have been made that it is used by Gambhir brothers for residence only. The statement of Shri Vinay Subhikhi (supra), was recorded at the back of the assessee without confronting the same to the assessee. Therefore, it cannot be read in evidence against the assessee. The A.O. in present case initiated the re-assessment proceedings under section 148 of the I.T. Act at the same address in dispute i.e., 48-Friends Colony (East), New Delhi and all the other documents also have the same address. Even the assessment order has been passed at the same address. Therefore, the contention of assessee is acceptable that the property in question have been used by the assessee for its business purpose, therefore, no annual letting value to be computed for same property. Since similar addition have been deleted by the Coordinate Bench of the Tribunal in the cases of 25 ITA.Nos.4351/D/2015 & Takshila Distributers Pvt. Ltd., New Delhi. ITA.No.4375/Del./2015 Rancho Place Estate Pvt. Ltd., New Delhi. other co-owners (supra), therefore, there is no justification to enhance the annual letting value, the addition is therefore, liable to be deleted. We, accordingly, set aside the orders of the authorities below and delete the addition of Rs.10,20,897.
12. In the result, ITA.No.4351/Del./2015 of the assessee is allowed.
ITA.No.4375/Del./2015 Rancho Place Estate Pvt. Ltd., -
A.Y. 2005-2006.
13. In this appeal the assessee challenged the addition of Rs.51 lakhs made under section 68 of the I.T. Act for credit received from M/s. Golden Technobuild Pvt. Ltd., and addition of Rs.5,88,764 on account of income from house property in respect of property at 48- Friends Colony (East), New Delhi.
14. Learned Representatives of both the parties submitted that both the issues are same as have been considered in the case of Takshila Distributers Pvt. Ltd., (supra).
26
ITA.Nos.4351/D/2015 & Takshila Distributers Pvt. Ltd., New Delhi. ITA.No.4375/Del./2015 Rancho Place Estate Pvt. Ltd., New Delhi.
15. Following the reasons for the decision in that case, we set aside the orders of the authorities below and delete both the additions.
16. In the result, ITA.No.4375/Del./2015 of the assessee is allowed.
17. To sum-up, both the appeals of the assessees are allowed.
Order pronounced in the open Court.
Sd/- Sd/-
(L.P. SAHU) (BHAVNESH SAINI)
ACCOUNTANT MEMBER JUDICIAL MEMBER
Delhi, Dated 01st February, 2018
VBP/-
Copy to
1. The appellant
2. The respondent
3. CIT(A) concerned
4. CIT concerned
5. D.R. ITAT 'C' Bench, Delhi
6. Guard File.
// BY Order //
Assistant Registrar : ITAT Delhi Benches :
Delhi.