PRINCIPAL COMMISSIONER OF INCOME TAX 1 KOLKATA vs. M/S AJANTA MERCHANTS PVT LTD

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ITAT/285/2023HC CalcuttaWBCHCO005815202331 January 2024Bench: THE HON'BLE THE CHIEF JUSTICE T.S SIVAGNANAM,HON'BLE JUSTICE SUPRATIM BHATTACHARYA3 pages
AI SummaryDismissed

What did the High Court hold?

The High Court held that no substantial question of law arises for consideration. The Court found that the ITAT had elaborately examined the factual position and concluded that the assessee had fully explained the deposits in its bank accounts. These deposits were attributed to rent receipts, interest on FDR, sale of shares, and reduction in loans and advances. The ITAT had also noted that the Commissioner of Income Tax (Appeals) had overlooked the documents, statements, and explanations provided by the assessee. Therefore, the High Court found no error in the ITAT's decision. The appeal filed by the revenue was dismissed.

What were the facts?

The appeal by the revenue (Principal Commissioner of Income Tax 1 Kolkata) is against the order dated March 28, 2023, passed by the Income Tax Appellate Tribunal (ITAT), C-Bench, Kolkata. The assessment year in question is 2011-12. The ITAT had deleted an addition of Rs. 2,87,43,923/- made under Section 69C of the Income Tax Act, 1961. The revenue contends that the assessee, M/s. Ajanta Merchants Pvt. Ltd., failed to provide documentary evidence for its share trading claim. The High Court reviewed the materials, including the assessee's paper book before the ITAT, and noted the ITAT's finding that the assessee had explained bank deposits as rent receipts, interest on FDR, sale of shares, and reduction in loans and advances.

What were the issues?

1. Whether, on the facts and in the circumstances of the case, the Learned Income Tax Appellate Tribunal erred in deleting the addition of Rs. 2,87,43,923/- under Section 69C of the Income Tax Act, 1961, without considering that the assessee failed to furnish any documentary evidence in support of its claim of trading of shares? Assessee's Contention: The judgment does not record any specific contentions made by the assessee before the High Court. However, the High Court's observation implies that the assessee had provided explanations and documents to the ITAT. Revenue's Contention: The revenue argued that the ITAT erred in deleting the addition under Section 69C because the assessee failed to provide documentary evidence to substantiate its share trading activities.

Which sections of the Income-tax Act were involved?

Section 260A,Section 69C

AI-generated summary — verify with the full judgment below

OD – 30 IN THE HIGH COURT AT CALCUTTA Special Jurisdiction [Income Tax] ORIGINAL SIDE ITAT/285/2023 IA NO: GA/2/2023

PRINCIPAL COMMISSIONER OF INCOME TAX 1 KOLKATA VS M/S. AJANTA MERCHANTS PVT. LTD.

BEFORE : THE HON’BLE CHIEF JUSTICE T.S. SIVAGNANAM

And THE HON’BLE JUSTICE SUPRATIM BHATTACHARYA Date : 31st January, 2024

Appearance : Mr.Om Narayan Rai, Adv. Mr.Prithu Dudheria, Adv. ...for the appellant.

Mr.S.M. Surana, Adv. Mr.Bhaskar Sengupta, Adv. ...for the respondent.

The Court : This appeal filed by the revenue under Section 260A of the Income Tax Act, 1961 (the Act) is directed against the order dated 28th March, 2023 passed by the Income Tax Appellate Tribunal, C-Bench, Kolkata (the Tribunal) in ITA No.608/Kol/2022 for the assessment year 2011-12. The revenue has raised the following substantial question of law for consideration : “Whether on the facts and in the circumstances of the case the Learned Income Tax Appellate Tribunal wa erred in deleting the addition of Rs.2,87,43,923/- under Section 69C of the Income Tax Act, 1961 without considering the fact that the assessee failed to

furnish any documentary evidences in support of its claim of trading of shares?

After elaborately hearing the learned advocates for the parties and carefully perusing the materials placed before us including the paper book which was filed by the assessee before the learned Tribunal, we find that the learned Tribunal has examined the factual position and found that the deposits in the bank accounts are apparent from the receipts as shown in the books of accounts which were either on account of rent receipt or interest on FDR, sale of shares and reduction in loan and advances. The learned Tribunal on facts found that the assessee has fully explained the deposits in the bank accounts and also pointed that the Commissioner of Income Tax (Appeals) has overlooked the documents, statements and the explanation offered by the assessee. Thus, we find that no question of law much less substantial question of law arises for consideration. Hence, the appeal fails and the same is dismissed. The connected application stands closed.

(T.S. SIVAGNANAM)

(CHIEF JUSTICE)

(SUPRATIM BHATTACHARYA, J.) S.Das/

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