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Income Tax Appellate Tribunal, DELHI BENCHES “B” : DELHI
Before: SHRI R.K. PANDA & SHRI ANUBHAV SHARMA
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES “B” : DELHI BEFORE SHRI R.K. PANDA, ACCOUNTANT MEMBER AND SHRI ANUBHAV SHARMA, JUDICIAL MEMBER ITA.No.1407/Del./2018 Assessment Year 2009-2010 M/s. Saran Flexible The Income Tax Officer, Laminates Pvt. Ltd., Ward – 22(3), 173, LGF, Kailash Hills, vs. East of Kailash, New Delhi. New Delhi - 110065. PAN AAHCS9148M (Appellant) (Respondent) For Assessee : -None- For Revenue : Shri Vivek Vardhan, Sr. D.R. Date of Hearing : 26.04.2022 Date of Pronouncement : 26.04.2022 ORDER PER R.K. PANDA, A.M.
This appeal filed by the assessee is directed against the order dated 15.12.2017 of the Ld. CIT(A)-28, New Delhi, relating to the A.Y. 2009-10.
Addition of Rs.62,75,000/- made by the A.O. under section 68 of the I.T. Act, 1961 and upheld by the Ld.
2 ITA.No.1407/Del./2018 M/s. Saran Flexible Laminates Pvt. Ltd., New Delhi. CIT(A) is the only issue raised by the assessee in the grounds of appeal.
None appeared on behalf of the assessee at the time of hearing when the name of the assessee was called. A perusal of the order sheet entries shows that the assessee was not appearing on the earlier occasions. As many as three letters issued by the Registry through RPAD were returned by the postal authorities with the remark “Left”. Therefore, we deem it proper to decide the appeal on the basis of the material available on record and after hearing the Ld. D.R.
Facts of the case, in brief, are that the assessee is a company and filed its return of income on 28.03.2010 declaring total income of Rs.5,04,000/-. Subsequently, on the basis of AIR information received that assessee has sold vacant residential plot of land for Rs.57.75 lakhs and the same has not been reported in the I.T. return, the case of the assessee was reopened and accordingly notice under section 148 of the I.T. Act, 1961 was issued and served on the assessee. During the course of assessment proceedings,
3 ITA.No.1407/Del./2018 M/s. Saran Flexible Laminates Pvt. Ltd., New Delhi. the A.O. confronted the same to the assessee. Rejecting the various explanations given by the assessee, the A.O. made addition of Rs.57,75,000/- by invoking the provisions of Section 68 of the I.T. Act, 1961. The A.O. also made addition of Rs.5 lakhs on account of bogus loan/liability.
4.1. In appeal, the Ld. CIT(A) upheld both the additions made by the A.O. by observing as under :
“4. I have considered the facts of the case, basis of additions made by AO and submissions of the appellant. The Ground No. 1 taken by appellant is general in nature, hence, needs no adjudication. The Ground No. 2 pertains to the addition of Rs. 57,75,000/- on account of sale of immovable property. On the basis of AIR information that the assessee company has transferred the immovable property during the year under consideration but the transactions are not disclosed in the return of income, AO initiated the reassessment proceedings in its case and computed the capital gain by invoking of provisions of section 50C of the Act. Against it, appellant contended that no such 4 ITA.No.1407/Del./2018 M/s. Saran Flexible Laminates Pvt. Ltd., New Delhi. property wa£ transferred by it during the year and the alleged sale of industrial plot at Noida was made fraudulently by the general power of attorney holder, Mr. Vinod Kumar Tomar, therefore, no capital gain arises in its hands. However, the facts as emerged during the assessment proceedings as well as appellate proceedings, narrate the different story and substantiate the stand taken by AO. As per the copy of General Power of Attorney dated 10.02.2005, filed during the appellate proceedings, it appears that the appellant company had given all the rights and authority, inter-alia, to Shri Tomar to enter into any agreement to sell/transfer the aforesaid property with/to anyone and to receive the money on behalf of appellant company and to present the same for registration before the Sub-Registrar (Clause 8, 9 & 10). Thus, by exercising this power, Shri Tomar, as a representative of appellant company, entered into agreement with Mrs. Sushma Tomar, purchaser on 02.09.2008 for transferring the lease hold rights of the 5 ITA.No.1407/Del./2018 M/s. Saran Flexible Laminates Pvt. Ltd., New Delhi. said property. The sale consideration of Rs. 10,00,000/- was already paid by the transferee through postal order of Rs. 6,25,000/- dated 07.02.2006 drawn on HDFC Bank Ltd and Rs. 3,75,000/- directly to Noida Authority as its due. However, in the transfer deed itself the value as per circle rate was shown at Rs. 57,75,000/-. In view of these facts, it is clear that the appellant company had given all the authorities to Shri Tomar to execute the sale agreements or transfer the lease hold rights to anyone and to receive the consideration, on its behalf. As per the said agreement, the transferee has made the payment also against the said property. The plea taken by appellant that the said transfer of property has taken pl&ce fraudulently by Shri Tomar and without its knowledge, is not believable as the appellant company itself had given all the powers through general power of attorney dated 10.02.2005 to Shri Tomar to carry out all the agreements/transfers and receive the money on its behalf. Secondly, if the transaction by Shri Tomar were made fraudulently, the 6 ITA.No.1407/Del./2018 M/s. Saran Flexible Laminates Pvt. Ltd., New Delhi. appellant could have taken legal recourse against Shri Tomar but the same has not been done. Even when the facts came in the knowledge of appellant company during the assessment proceedings after a long gap of many years, no action was taken by it against Shri Tomar. Only after filing the appeal as on 08.02.2017, a complaint letter dated 01.08.2017, not even FIR, was filed to the SHO, Police Station, Amar Colony, New Delhi mentioning the facts with the request to take action against Shri Tomar. This letter is nothing but an eye wash only just to show that the appellant company is trying to take legal action against Shri Tomar in connection with aforesaid alleged transactions. However, no follow up action has been taken by it in respect of this complaint letter and the transactions have been accepted by appellant company as such. In such situation, it is clear that the transfer of property has taken place by the appellant company through Shri Tomar during the year under consideration and also that the transactions are covered by the provisions of 7 ITA.No.1407/Del./2018 M/s. Saran Flexible Laminates Pvt. Ltd., New Delhi. section 50C of IT Act. As per the lease agreement only, the value of the property as per circle rate is shown at 57,75,000/- and, therefore, same has to be taken as full value of consideration as per provisions of section 50C of IT Act for the purpose of computing the capital gain in the hands of appellant. In view of this, the addition of Rs.57,75,000/- made by AO is being confirmed and ground taken by appellant is dismissed.
The Third Ground taken by appellant relates to the unexplained cash credit of Rs.5,00,000/- in the name of Shri Suraj Bharwadwaj. During the assessment proceedings, appellant could not give any details to explain the nature and source of the said cash credit. During the appellate proceedings also though, the appellant has claimed that the aforesaid loan is old loan, but failed to give details/evidence to support its claim. Only a copy of unconfirmed ledger account showing the said amount as opening balance as on 01.04.2008 and copy of acknowledgment of return with computation of income has been filed but no where it
8 ITA.No.1407/Del./2018 M/s. Saran Flexible Laminates Pvt. Ltd., New Delhi. shows that the said loan was given by creditor in earlier years and has continued as opening balance in this year. Thus, in absence of any conclusive evidence on behalf of appellant, I uphold the addition made by AO and dismiss the ground taken by appellant.”
5. Aggrieved with such order of the Ld. CIT(A), the assessee is in appeal before the Tribunal.
We have heard the Learned D.R. and perused the record. We find the A.O. in the instant case has made addition of Rs.57,75,000/- being the addition on account of sale of immovable property not disclosed to the Department. Similarly, the A.O. has made addition of Rs.5 lakhs being the unexplained cash credit in the name of Shri Suraj Bharwadwaj. We find the Ld. CIT(A) upheld the action of the A.O. the reasons of which have already been reproduced in the preceding paragraph. We find the Ld. CIT(A) has passed a very reasonable order justifying both the additions made by the A.O. In absence of any other material brought before us to take a contrary view than the view taken by the Ld. CIT(A), we find no infirmity in the order of the Ld. CIT(A)
9 ITA.No.1407/Del./2018 M/s. Saran Flexible Laminates Pvt. Ltd., New Delhi. upholding both the additions. Accordingly, the order of the Ld. CIT(A) is upheld and the grounds raised by the assessee are dismissed.
In the result, appeal of the Assessee is dismissed.
Order pronounced in the open Court at the time of hearing i.e., on 26.04.2022.