Income Tax Appellate Tribunal - Mumbai
Salim Akhtar, Mumbai vs Assessee on 25 November, 2011
आयकर अपीलीय अिधकरण "ई" Ûयायपीठ मुंबई मɅ।
IN THE INCOME TAX APPELLATE TRIBUNAL "E" BENCH, MUMBAI ौी संजय अरोड़ा, लेखा सदःय एवं ौी ǒवजय पाल राव, Ûयाियक सदःय के सम¢ ।
BEFORE SHRI SANJAY ARORA, A. M. AND SHRI VIJAY PAL RAO, J. M.
आयकर अपील सं./I.T.A. No.907/Mum/2012
िनधा[रण वष[ / Assessment Year: 2001-02)
(िनधा[
Salim Akhtar Asstt. CIT-11(1),
2, Linkway, 14th Road, Khar (West), बनाम/ 4th Floor, Aayakar Bhavan,
बनाम
Mumbai-400 052 Vs. M. K. Road, Mumbai-400 020
ःथायी ले खा सं . /जीआइआर सं . /PAN/GIR No. AAAPA 5481 D
(अपीलाथȸ /Appellant) : (ू×यथȸ / Respondent)
अपीलाथȸ ओर से / Appellant by : Shri A. L. Sharma
ू×यथȸ कȧ ओर से/Respondent by : Shri O. P. Meena
सुनवाई कȧ तारȣख /
: 12.02.2013
Date of Hearing
घोषणा कȧ तारȣख /
: 03 .05.2013
Date of Pronouncement
आदे श / O R D E R
Per Sanjay Arora, A. M.:
This is an Appeal by the Assessee agitating the Order by the Commissioner of Income Tax (Appeals)-3, Mumbai ('CIT(A)' for short) dated 25.11.2011, confirming the levy of penalty u/s.271(1)(c) of the Income Tax Act, 1961 ('the Act' hereinafter) by the Assessing Officer (A.O.), vide order dated 23.03.2004 in respect of the assessment year (A.Y.) 2001-02.
2 ITA No.907/Mum/2012 (A.Y. 2001-02)Salim Akhtar vs. Asstt. CIT
2. At the very outset, it was observed by the Bench that the assessee's appeal is delayed by a period of nine (9) days. The same stands however suitably explained per an Affidavit dated 13/2/2012 accompanying the assessee's condonation petition dated 14/2/2012. We, accordingly, were of the opinion that the said delay is liable to be condoned, and the hearing in the matter was proceeded with. The only issue arising in the instant case, thus, is the sustainable of the penalty levied u/s. 271(1)(c) in the sum of Rs.9,98,500/- in the facts and circumstances of the case.
The background facts 3.1 The relevant facts are that the assessee, an individual, claimed a loss of Rs.102.36 lakhs on the distribution of a Bengali film 'Haar Jeet' per his return of income filed on 31.10.2001 at an income of Rs.62.67 lakhs, including business income at Rs.46.95 lakhs. The said loss was found by the Assessing Officer (A.O.) to be primarily on account of the acquisition cost of the distribution rights of the said film at Rs.111 lakhs on minimum guarantee (MG) basis from a sister concern, M/s. Aftab Pictures Pvt. Ltd. (APPL). The assessee, thereafter, entered into an agreement for exhibition of the said film with M/s. Aftab Group (AG), again a firm in which the assessee was interested in terms of section 40A(2)(b) of the Act. The two agreements were dated 05.12.2000 and 11.12.2000. The entire receipt for the approximately 100 days over which the said film was exhibited during the relevant previous year (22.12.2000 to 31.03.2001) was only at Rs.20.88 lakhs. The assessee had apart from acquiring the exhibition rights also incurred publicity expenditure. The total expenditure, at Rs.123.24 lakhs, on the set off against such receipt, led to the claimed loss of Rs.102.36 lakhs. The assessee had also earned Rs.166.44 lakhs on the sale of non-theatrical rights, i.e., TV, video, cable, internet, etc. of a Hindi film 'Baadal' produced by him, vide an agreement dated 03.04.2000 (for a consideration of Rs.160 lakhs), which stood received by him up to June, 2000. The assessee was, thus, only well aware of his profits from that film and the concomitant tax liability. The Assessing Officer (AO), therefore, inferred that the assessee had, by design, interposed himself between his two other related concerns, APPL and AG, i.e., by the purchase of 3 ITA No.907/Mum/2012 (A.Y. 2001-02) Salim Akhtar vs. Asstt. CIT distribution rights (for the eastern circuit) on MG basis from the former, and then entering into a sub-distribution agreement with the latter on a commission basis of 15% of the net realization. This according to him was done to set off the loss against the confirmed profit from the production business (Rs.166.44 lakhs). He, therefore, restricted the claimed loss to Rs.12.24 lakhs (i.e., the expenses other than on the cost of the distribution rights), disallowing the balance (loss of) Rs.90.12 lakhs. This was done by him by restricting the claim of expenditure of Rs.111 lakhs to Rs.20.88 lakhs, i.e., the receipt during the year on the exhibition of the said film, u/s. 40A(2)(a) of the Act.
3.2 The assessee was successful in first appeal. The Revenue carried the matter to the tribunal, which, while confirming the disallowance, restricted it by treating the purchase cost at 75% of the cost of production of the film ('Har Jeet') - claimed to be at Rs.1,07,65,654/- - as reasonable. The disallowance was, thus, restricted to 25% of the cost of acquisition, which amount, i.e., Rs.30,25,760/- (Rs.111 lakhs - Rs.80.74 lakhs), was confirmed for disallowance u/s.40A(2)(a) of the Act. The present penalty proceedings are in respect of the levy of penalty on the disallowance as finally sustained.
The respective cases 4.1 The whole premise of the assessee's case before us, as well as the Revenue authorities, was that the disallowance as finally sustained is on an estimate basis. The acquisition cost of Rs.111 lakhs, given the cost of production of the film at Rs.107.66 lakhs, cannot be considered as unreasonable. The transaction has to be viewed from a businessman's point of view, rather than in a legalistic manner. Would the cost still to be considered as unreasonable, if the assessee had, instead, earned some profit? It is after all a question of assessment by one person as against another. The genuineness of the transaction had not been doubted. On an enquiry by the Bench as to the price at which the distribution rights were sold in other markets, it was submitted by the ld. AR that the film being a Bengali film, was sold only for the eastern circuit. On a further enquiry as to the price at which the non-theatrical rights of the film were sold, viz., TV, cable, satellite, etc., he was unable to furnish any specific reply, further submitting that the disallowance 4 ITA No.907/Mum/2012 (A.Y. 2001-02) Salim Akhtar vs. Asstt. CIT as sustained by the tribunal is purely on an estimate basis, without any data, as in fact stands noted by it in its order, and which cannot by itself form the basis of the levy of penalty. Reliance was placed by him on the decisions in the case of Dilip N. Shroff vs. Jt. CIT [2007] 291 ITR 519 (SC) and Jhavar Properties P. Ltd. vs. ACIT [2009] 317 ITR (AT) 278 (Mum.).
4.2 The Revenue, on the other hand, claims that the assessee had wholly failed to substantiate its claim of the distribution price of the film being arrived at on an arm's length basis, i.e., of the reasonableness of the expenditure incurred. The onus to prove the same as well as its bona fides is on the assessee, failing which the provision of Explanation 1 to section 271(1)(c) would stand attracted, and the assessee, accordingly, deemed to have concealed or furnished inaccurate particulars of income. Reliance was placed on the decision in the case of Union of India and Anr. v. Dharmendra Textile Processors and Ors. (2008) 306 ITR 277 (SC); and Madanlal Kishorilal v. CIT (2005) 277 ITR 209 (All.) [197 CTR 144].
Findings
5. We have heard the parties, and perused the material on record as well as the case law cited.
5.1 Our first observation in that matter is that the issue under reference is primarily factual, i.e., whether the assessee has a reasonable explanation for having made the purchase of the distribution rights (of the Bengali film 'Haar Jeet') on 05.12.2000 at Rs.111 lakhs. If he has, being made bona fide, as a businessman in the ordinary course of his business, no penalty would be exigible despite the fact that it finally led to a loss, or the said price was found unjustified or in excess by Rs.30.26 lakhs, on which sum, therefore, penalty has been levied. This is for the simple reason that the loss is a matter subsequent, which could not presumably have been foreseen earlier and, therefore, incurring the same (loss) by itself cannot lead to the conclusion of the assessee having no valid basis for purchasing at the stated price. The standard of proof required to sustain a 5 ITA No.907/Mum/2012 (A.Y. 2001-02) Salim Akhtar vs. Asstt. CIT penalty, it is trite, is higher than that for a disallowance in its respect per se. What is reasonable under the circumstances would vary from person to person, and a certain amount of subjectiveness is inherent in any valuation exercise, particularly one which concerns, at least in part, expectation of profits that are likely to arise in future from the commercial exploitation of the rights purchased.
The two parameters, thus, that emanate are 'bona fides' and 'reasonableness', on the touch stone of which the assessee's explanation would stand to be adjudged. This is manifest and follows directly from the clear language of Explanation 1(A) and 1(B) to section 271(1)(c) of the Act, which we reproduce for ready reference:-
"271 (1) If the Assessing Officer or the Commissioner (Appeals) is satisfied that any person -
(a) .............
(b) .............
(c) has concealed the particulars of his income or furnished inaccurate
particulars of such income, or
(d) ..............
he may direct that such person shall pay by way of penalty,-
(i) ..........
(ii) ..........
(iii) in cases referred to in clause (c) or clause (d), in addition to tax, ...........
Explanation 1.-Where in respect of any facts material to the computation of the total income of any person under this Act,-
(A) such person fails to offer an explanation or offers an explanation which is found by the Assessing Officer or the Commissioner (Appeals) or the Commissioner to be false, or (B) such person offers an explanation which he is not able to substantiate and fails to prove that such explanation is bona fide and that all the facts relation to the same and material to the computation of his total income have been disclosed by him, then, the amount added or disallowed in computing the total income of such person as a result thereof shall, for the purposes of clause (c) of this sub-section, be deemed to represent the income in respect of which particulars have been concealed."
6 ITA No.907/Mum/2012 (A.Y. 2001-02)Salim Akhtar vs. Asstt. CIT No doubt, the matter has at all times to be viewed from a businessman's point of view and, besides, in totality. This is as the transaction is a real life transaction, so that all the incident facts and circumstances that may have a bearing in the matter have to be taken into account. The onus, however, to establish the transactions on the two parameters aforesaid is squarely on the assessee. This is again for two reasons. Firstly, is the legal mandate, i.e., the requirement of law, as sought to be projected per the relevant provision. Secondly, it is only the assessee who has undertaken the impugned transaction and is, therefore, in the know of all the relevant and incidental facts. Why and under what circumstances he has done what he has could only be explained by him. Thirdly, which is only an adjunct to the second, is that the fact as to the cost being excessive to that extent having been determined by the tribunal, the final fact finding body, it is for the assessee to show the grounds on which the said fact is to be reviewed, leading to the conclusion of the assessee having, nevertheless, a reasonable explanation. The purview of the Revenue in the matter is only to examine the same from the stand point of the bona fides (of the conduct) and the reasonableness (of the expenditure) with reference to some material or corroborative facts. This follows, apart from the express provision of law, the well settled legal principles of jurisprudence on penalty, for which we may refer to the decisions by the apex court, clarifying and elucidating the same, viz. Dharmendra Textile Processors and Ors. (supra); K.P. Madhusudhanan vs. CIT [2001] 251 ITR 99 (SC); B.A. Balasubramaniam & Bros. Co. vs. CIT [1999] 236 ITR 977 (SC); Addl. CIT vs. Jeevan Lal Shah [1994] 205 ITR 244 (SC).
5.2 We, next, proceed to examine the facts of the case. The assessee, as per his tax audit report forming part of his return (PB pages 9-17), is a producer of motion pictures and a dealer in audio cassettes. His balance-sheet (PB pages 6-8) also does not bear any advance to any producer, even as it does bear advances from distributors (as a producer), as well as stock (as also receipt) of audio cassettes. That is, there is nothing on record to say of any distribution activity having been undertaken, much less in a regular manner, with the record being consistent to the stated position of him being a producer and a 7 ITA No.907/Mum/2012 (A.Y. 2001-02) Salim Akhtar vs. Asstt. CIT dealer in audio cassettes. We do observe that the first appellate authority in the quantum proceedings states of the assessee having distributed films. That, however, is not supported by any material on record, nor do we find any such plea raised by the assessee. No details of any distribution business undertaken in the past stand furnished. A producer may occasionally distribute his films for some territory/s. That, however, would not make him a regular distributor. Besides, this would rather be where he expects to gain more than that by distributing it through others, to capitalize on the profit expectation, and normally after recovering the cost of the film through distribution of its exhibition rights for other territories. The assessee, thus, is not in the business of distribution of films, and the impugned transaction accordingly was not one carried out by him in the regular course of his business.
The purchase of the distribution rights in the instant case is only from his own sister concern, APPL, in which company the assesee is a director (PB page-2), and which has produced the said film. This is surprising, as the same, even where desired to be self- distributed and not through the regular distributor/s, would be done by APPL - the producer - itself. Further, even if the distribution is to be off-loaded by APPL within the group, the obvious choice for the same would be AG, which is in this business and, in fact, even in the instant case has actually distributed the film through exhibitors, paying the assessee 15% of the net realization. This is precisely what the AO means when he states that the assessee has interposed himself in the transaction for a tax advantage, being well aware of having earned Rs. 1.66 crs. (and of the concomitant tax liability) on the sale of the film 'Badal'. Coupled with the fact that the assessee is not in the distribution business, the whole transaction does become suspect indeed, leading us to examine the same further.
The distribution rights were acquired vide agreement dated 05.12.2000, while the movie was released in the market (theatres) on 22.12.2000. That is, even up to about 15 days before the release date, the distribution of the film itself had not matured or been decided upon. The one thing that, therefore, can be reasonably inferred is that there were no takers for the film in the market. We have already observed the assessee to have 8 ITA No.907/Mum/2012 (A.Y. 2001-02) Salim Akhtar vs. Asstt. CIT received advances from the distributors as a producer. This in fact agrees with the common knowledge and observation, as the distributors, in case of demand and anticipated hype for the film, would vie with each other and want to book the film (for the given territory), even extending advance for the purpose, thus securing what in their perception is a profitable business. Also, it is the distributor/s who would make arrangements for the release of the film in his territory, finalizing and closing the deals with the exhibitors, recovering, at least, a part of his cost. Besides, the pre-release publicity campaign has also to be planned and launched, and which could not be if the film itself remains unsold. All this takes time and resources. The arrangement makes ample business sense for the producer as well, reducing if not eliminating the business risk involved, as he would prefer to sell the rights on a minimum guarantee basis, and while assuring recovery of cost ( if not a reasonable margin as well), secures him rights in any surpluses on sharing basis. Coming back to the facts of the case, the film apparently failed to elicit interest or response from the distribution market. No doubt, APPL would prefer to sell to an outsider, as purchase by a related party would imply continuing to bear the risk and no 'profit' in the commercial sense. In the absence of any buyers, quoting a reasonable price, the obvious choice would be to self-distribute, or through AG, who is in this business. The assessee's, who is not in this business, entry into the transaction at this juncture, against the popular market perception, does therefore raise considerable doubt with regard to the bona fides thereof as a genuine business transaction. Then, again, the assessee does nothing apart from entering into two agreements with sisters concerns, one for acquisition of distribution rights and the other for exhibition through exhibitors for the entire eastern circle, one after the other, with both the corresponding parties not sharing, or undertaking hardly, any business risk, which is entirely by the assessee. APPL has been paid an amount in excess of its production cost on MG basis, while AG is to pay the assessee, without any guarantee as to the minimum, 15% of the net realization. In fact, it is not even clear if the entire price stands paid; the assessee's balance sheet reflecting creditors at Rs.64 lacs. Viewed in context of the confirmed profits with the assessee from his production business, the entire exercise, including its timing, leads to an impression of 9 ITA No.907/Mum/2012 (A.Y. 2001-02) Salim Akhtar vs. Asstt. CIT being a device set up to save on the tax liability, even as inferred by the Revenue. In this regard, it may be relevant to note that the first two installments of advance tax, which fell prior to the release of the film (or incurring the loss), are at amounts corresponding with the returned income (PB pgs. 2-5). What, one may ask, does that suggest?
Most importantly, the assessee has not at any stage rebutted or met any of the primary facts, leading to the charge of the said interposition in the assessment order, indicting the bona fides of the transaction, and on the basis of which the satisfaction for the imposition of the penalty was drawn by the AO, either in the quantum or in the penalty proceedings. Our inferences are based on these uncontroverted facts, on which no explanation has been offered, reinforcing the interferences drawn. The assessee's claim of the genuineness of the transaction having been not doubted by the Revenue cannot be accepted. The assessee has clearly failed to prove the bona fides of the impugned transaction.
5.3 Next, we examine the case from the stand point of reasonableness of the cost of acquisition. This assumes significance as even if the business rationale of the transaction remains unexplained, where it is shown that the price agreed was an arm's length price, no disallowance, much less penalty in its respect, would follow. The assessee's case is again conspicuous by an absence of any explanation qua the reasonableness aspect of the price paid (Rs.111 lakhs). The only 'fact' or 'explanation' he offers is of the cost of production of the film being at Rs. 107.66 lakhs. This information in fact would not be available to the opposite transacting party in the normal course. The price to be paid and, thus, correspondingly, to be realized, is, to our mind, as in the case of any other product, only partly and loosely related to its cost, which is only exceptionally known, and governed largely by market forces, at least in a free market. The buyer, if a final consumer, is only concerned with the price of the comparable product/s. And if an intermediary, as a trader or distributer, with the price it would fetch on resale (and its terms), which again depends on market forces of supply and demand. There is no explanation in terms of similar past experience on distribution, or of distribution rights of 10 ITA No.907/Mum/2012 (A.Y. 2001-02) Salim Akhtar vs. Asstt. CIT similar movies, i.e., of the same genre or with the same principal cast or by the same director, etc., or any other business consideration that prevailed with the assessee to settle for the agreed purchase price. The explanation could also be in terms of the expected yield or the revenue the film was expected to fetch. As afore-noted, an intermediary, as the distributor, would quote on the basis of the price he expects to realize on release. The price at which the film is 'resold' or the exhibition rates it fetches from the exhibitors, is a strong indicator of the market sentiment in this regard. That the film may subsequently not run, proving the market players wrong, is another matter. In fact, we have already found of the prevailing circumstances as indicating of the market response as being luke warm. It is only any such explanation, supported by some materials, so as inform the basis of the decision making in arriving at the agreed purchase price, that the assessee's case can be considered. The assessee, however, has failed offer any explanation in this regard. His claim that the cost could not be considered as excessive if it had resulted in some profit is, firstly, a negative explanation and, secondly, misconceived in the absence of, and his failure to furnish any basis on which the estimated profit is based. It needs to be realized that the loss suffered (Rs.102.36 lakhs) is almost at par with the cost of the distribution rights (Rs.111 lakhs), so that it is not a case of a marginal error, and the ground realities were far removed from the assessee's estimate, if any, and in consonance with the market perception. Without doubt, a higher gap places that much more onus to explain the price purchase price paid inasmuch as a good profit would confirm the business realities as perceived. The expectation of profits is only the assessee's explanation, who, therefore, only could support or substantiate the same. In fact, where so, no disallowance would stand to be effected in first place; a degree of variation being intrinsic to any estimation exercise. It, again, needs to be noted that the tribunal by restricting disallowance to Rs. 30.26 lakhs, has acted, given the vagaries of the business, in a liberal manner, allowing thus loss to the extent of Rs. 72.10 lacs (102.36-30.26). However, despite this the unexplained loss (Rs.30.26 lacs) works to a significant proportion (over 27%) of the price paid or over 37% of the price considered reasonable. As such, merely stating that the disallowance arises out of an estimate, would not be of 11 ITA No.907/Mum/2012 (A.Y. 2001-02) Salim Akhtar vs. Asstt. CIT much assistance to the assessee; it having completely failed to furnish an explanation qua reasonableness of the price paid, much less substantiate the same. As such, despite a broad and liberal approach by the tribunal, the price to that extent, which still represents a considerable proportion of the price agreed, remains unexplained in terms of any justification.
In conclusion
6. The burden to prove that the price paid is not excessive or unreasonable, particularly where made to a person specified u/s.40A(2)(b), and more so once a prima facie case is made out by the Revenue, as in the instant case, is on the assessee. Reference in this regard may be made to the decision in the case of CIT vs. Shatrunjay Diamonds [2003] 261 ITR 258 (Bom). The assessee having been unable to do so, the disallowance was confirmed by the tribunal albeit at a lower amount. The law is clear and the burden to explain his case, substantiating it [CIT vs. Lal Chand Tirath Ram [1997] 225 ITR 675 (P & H)], as well as the bona fides of his conduct (in acting in the manner he does), is on the assessee; penalty being a civil and strict liability. The assessee in the penalty proceedings was, therefore, required to show the basis for having decided on the stated purchase price, which was on a minimum guarantee basis, so that he assumed the risk up to that amount, while any receipt in excess thereof was required to be shared by him with the producer at a defined percentage basis. This assumes all the more significance as the assessee, by doing so, had assumed the entire risk for the commercial exploitation of the film; the purchase price exceeding the cost of the production of the film, the revenue from which could admittedly be generated from only a part of the country. The assessee failed to show any basis. At the minimum, he was required to show of having undertaken the transaction in the normal course of his business. This is as a bad judgment cannot by itself be assailed and assumption of a calculated risk is a part of any business. This is relevant as it cannot be presumed that he had made a wild guess and the loss was self- inflicted, which in any case would only defeat the assessee's case. Rather, the fact that he furnishes the figure of the cost of the production of the film, and which is only excepted 12 ITA No.907/Mum/2012 (A.Y. 2001-02) Salim Akhtar vs. Asstt. CIT inasmuch as the transaction is between related parties, itself shows that he was better informed than would be the outside distributors (also refer para 5.2, 5.3 of the order).
The assessee's only defense is that the disallowance as finally sustained by the tribunal is on an estimate basis. There is no law that penalty cannot be levied where the income or the disallowance under reference involves estimation. The argument thus lays down no rule for universal application, so that it has to be examined in the facts and circumstances of each case. The tribunal in the instant case made the estimation in the absence of any specific data or information being led by the assessee in explanation of his case. The said argument, thus, does not lie in the mouth of the assessee. Would that, therefore, imply that the assessee concedes to having himself made the purchase on an estimate basis? In fact, the tribunal made a very liberal estimation, as would be apparent from the fact that it thereby allows loss equivalent to 70% of that sustained on the transaction. Continuing further, an examination of the facts and circumstances of the case shows that there was a valid basis with the Revenue for stating of the transaction to be device, and the loss, thus, self inflicted. To begin with, the assessee is not in this trade, at least not on a regular basis. Then the period when he enters the agreements, i.e., just a few days before the release of the film, would also suggest so or lead to that inference. The assessee's balance-sheet (PB pg.6-8), being a producer, bears advances from distributors, confirming that the arrangements therewith are made well in advance, and which is only understandable and cannot but be otherwise. Even if for argument sake, it is presumed that the assessee entered the distribution arrangement as there were no takers for distribution, that itself would be reason enough for him to become guarded and make an informed decision on a proper consideration of all the facts, i.e., acting independent of APPL, the producer, in which he is a director. In fact, as observed earlier, being a part of APPL, he would only be well aware of the market rates being quoted for the film. The assessee, has been clearly unable to make out any case in this regard. He, in fact, enters the agreement on MG basis, rather than on a revenue sharing basis, assuming all the risk. That the assessee had earned confirmed profits from another project/business, further indicts his case qua bona fides, vindicating the Revenue's stand. The assessee has thus 13 ITA No.907/Mum/2012 (A.Y. 2001-02) Salim Akhtar vs. Asstt. CIT failed to make a case on both the parameters afore-stated (refer para 5.1). Under the circumstances, we, therefore, confirm the levy of penalty, upholding the impugned order.
Finally, coming to the assessee's reliance on the decision in the case of Jhavar Properties P. Ltd. vs. ACIT (supra). Our understanding of the jurisprudence on the penalty in civil matters, even given the context of the disallowance being u/s.40A(2)(a), is no different from that expressed by the tribunal in that case (refer para 5.1, 5.3 of this order). A plausible or reasonable explanation, even establishing bona fides as to a genuine mistake, saves penalty. This, in fact, is trite law [refer: Cement Marketing Co. of India vs. Asstt. CST [1980] 124 ITR 15 (SC)]. The matter of furnishing an explanation, or of it being reasonable and cogent, is quintessentially a matter of fact. Our decision in the instant case, based on the well settled jurisprudence in the matter, rests on the finding of the fact of the assessee having not furnished any explanation, much less a valid one, qua the reasonableness of the purchase price in the facts and circumstances of the case. Further, he has also not explained his conduct, which clearly, given the surrounding facts and circumstances, indicts the bona fides of the transaction. The said decision by the tribunal would thus be of no assistance to the assessee. The decision in the case of Dilip N. Shroff (supra), also relied upon, stands since disapproved by the apex court per Dharmendra Textile Processors and Ors. (supra).
7. In the result, the assessee's appeal is dismissed.
पǐरणामतः िनधा[ǐरती कȧ अपील खाǐरज कȧ जाती है ।
Order pronounced in the open court on 03rd May, 2013
आदे श कȧ घोषणा खुले Ûयायालय मɅ Ǒदनांकः को कȧ गई ।
Sd/- Sd/-
(VIJAY PAL RAO) (SANJAY ARORA)
Ûयाियक सदःय / JUDICIAL MEMBER लेखा सदःय / ACCOUNTANT MEMBER
मुंबई Mumbai; ǑदनांकDated : 03.05.2013
व.िन.स./Roshani , Sr. PS & Shashi Kumar, PS
14
ITA No.907/Mum/2012 (A.Y. 2001-02)
Salim Akhtar vs. Asstt. CIT
आदे श कȧ ूितिलǒप अमेǒषत/
षत Copy of the Order forwarded to :
1. अपीलाथȸ / The Appellant
2. ू×यथȸ / The Respondent
3. आयकर आयुƠ(अपील) / The CIT(A)
4. आयकर आयुƠ / CIT - concerned
5. ǒवभागीय ूितिनिध, आयकर अपीलीय अिधकरण, मुंबई /
DR, ITAT, Mumbai
6. गाड[ फाईल / Guard file
आदे शानुसार/
ार BY ORDER,
उप/
उप/सहायक पंजीकार (Dy./Asstt. Registrar)
आयकर अपीलीय अिधकरण,
अिधकरण, मुंबई / ITAT, Mumbai