THE COMMISSIONER OF INCOME TAX vs. M/S RHISHI STEEL AND ALLOYS PVT. LTD.

Heard Shri Sharma, learned Advocate appearing on behalf of the appellant - Revenue.

The Revenue questions the order passed by the Income Tax Appellate Tribunal, Pune Bench, Pune dated 29.4.2008 upholding that of the Commissioner of Income Tax (Appeals), partly allowing the appeal of the assesee.

The Revenue was in appeal before the Income Tax Appellate Tribunal on two counts. Firstly, that the learned Commissioner of Income Tax (Appeals) erred in directing deletion of the addition made on account of excess burning loss and secondly addition of Rs.80,00,000/- made on account of raised share capital.

Shri Sharma submits that in so far as burning loss is concerned, the order of the Income Tax Appellate Tribunal need not be interfered with.

We have perused both the orders and namely, that of Commissioner of Income Tax (Appeals) and Income Tax Appellate Tribunal. The Income Tax Appellate Tribunal had before it the detailed material and from the assessment record. The Assessing Officer, according to the Income Tax Appellate Tribunal has failed to establish the identity and creditworthiness of the shareholders and the genuineness of the transactions as required under Section 68 of the IT Act. The Commissioner of Income Tax (Appeals) has discussed this and found that the assessment order is of 2004-05 and during that assessment year, fourteen corporate entities had invested in shares of the company. The details of fourteen corporate shareholders have been mentioned in the assessment order at page Nos. 6 & 7. The contention of the assesee is that various corporate shareholders of assesee company are all assessed to income tax and capital invested by them in share capital of the assesee are duly reflected in books of account as well as audited balance sheet submitted by them along with return of income. Even the Assessing Officer has not referred to the requisite details. The details were available with him because the investors were paying income tax. There is a TA/61/2011 3 compilation of confirmation, balance sheet of various corporate shareholders and to demonstrate that the paid up capital as well as reservation and surplus of such company is running into crores of rupees as against the investment made in assesee company is only at at average of Rs.5,00,000/- to Rs. 10,00,000/-. Therefore, the Income Tax Appellate Tribunal rightly relied upon the assessment and appreciation of the material by the Commissioner of Income Tax (Appeals). They found that there are confirmations, acknowledgment of income tax returns, balance sheet, bank account statements and relevant record, which show not only the identity but creditworthiness and genuineness of the transaction and dealings. This is not case where the Assessing Officer has, in any way disputed the bank accounts, or have termed them, as that of non-existent persons or are Benami. The Bank accounts are treated by him as genuine. In these circumstances, when overwhelming evidence points out to the creditworthiness of the shareholders and genuineness of the transactions, then, the findings of fact recorded by the Commissioner of Income Tax (Appeals) and their confirmation by the Income Tax Appellate Tribunal does not give rise to any substantial question of law. The Court, in the garb of an appeal cannot re appreciate and re- appraise the material on record. Once we are of the opinion that the entire exercise undertaken and concurrently by the Commissioner of Income Tax (Appeals) and the Income Tax Appellate Tribunal, does not give rise to any substantial question of law within the meaning of Section 260A of the Act, then, the appeal does not deserve to be entertained.

Shri Sharma's contention that the genuineness of the investments and TA/61/2011 4 the dealings has not been investigated at all need not detain us. We have carefully perused each and every finding recorded by the Commissioner of Income Tax (Appeals). These findings are based on the record before the Assessing Officer. It reflected that all three ingredients of Section 68 are satisfied. Hence, we cannot accept this contention of Shri Sharma.

The appeal is accordingly dismissed. No order as to costs. ( RAVINDRA V. GHUGE, J. ) ( S.C.DHARMADHIKARI, J. ) ... akl