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Income Tax Appellate Tribunal, MUMBAI BENCH “D” MUMBAI
Before: SHRI MAHAVIR SINGH & SHRI S. RIFAUR RAHMAN
ORDER PER S. RIFAUR RAHMAN, A.M. The captioned appeals filed by the assessee are directed against the respective orders passed by the CIT(A)-48, Mumbai for AY 2010-11. As the issue involved in the captioned appeals are inextricably interlinked or in fact interwoven and having common issue, the same are therefore being taken up and disposed off by way of a consolidated order. Facts being identical we begin with the ITA No. 2867/M/2019.
At the time of hearing, the Ld. AR submitted that the case of the assessee was reopened based on the information received from DCIT, Central Circle-2(2), Mumbai that the assessee has taken accommodation entries from M/s Advance Technologies Ltd. The Assessing Officer completed the assessment u/s 147 by treating the share capital and share premium as bogus. The Ld. AR brought to our notice the decision of the Co-ordinate Bench in the case of Seth Carbon and Alloys Private Ltd. (in dated 17.05.2021, in which the Co-ordinate Bench considered the similar issue and decided the same in favour of the assessee by adjudicating the share capital and share premium are not accommodation entries since the assessee furnished all the relevant ITA No. 2867, 7553 & Ors/M/2019 3 Beetal Trading Pvt. Ltd. & Ors. documents and duly explained the nature and source of the credit in the form of share capital and share premium. He brought to our notice the page 42 of the Paper Book, in which the same shares of Advance Technologies Ltd. were involved except with variance in the number of shares and figures. He submitted that the similar issue is already considered in favour of the assessee and the similar and identical grounds are raised by the assessee.
On the other hand, the Ld. Departmental Representative (DR) agreed that this issue is already covered in favour of the assessee.
Considered the rival submissions and material on record. The similar issue is already considered by the Co-ordinate Bench in the case of Seth Carbon and Alloys Private Ltd. (supra) and for the sake of clarity the relevant ground and decision of the Bench is reproduced below: [“ITA No.2828/Mum/2019 (A.Y.2010-11)] “9. Assessee has raised the following grounds :-
1. The Hon’ble CIT(A) has erred in confirming the order of learned assessing officer in respect of the re-opening of the assessment while issuing notice u/s.148 of the Income Tax Act, 1961 inspite of the fact that original assessment was completed u/s.143(3) of Income Tax Act, 1961. The assessment u/s.143 (3) r.w.s. 147 of the Income Tax Act, 1961 was completed merely on the basis of information received from DCIT Central Circle-2(2). In view of the above, the said order passed should be squashed and necessary direction should be given in this regard.
2. Without prejudice to above, on the facts and circumstances of the case and in law, the Hon’ble CIT(A) has erred in confirming the addition of Rs.5,00,00,000/- u/s.68 of the Income Tax Act, 1961. The Hon’ble CIT(A) has erred in considering the share capital issued by the Appellant as unexplained cash credit for the year under consideration. It is submitted that appellant has submitted relevant documents to prove the genuineness of transactions 7553 & Ors/M/2019 4 Beetal Trading Pvt. Ltd. & Ors. and creditworthiness of the party. It is therefore prayed that addition made on account of unexplained cash credit shall be deleted and necessary direction shall be given in this regard.
3. Without prejudice to above, on the facts and circumstances of the case and in law, the Hon’ble CIT(A) has erred in confirming the addition of Rs.7,50,000/- (1.5% of Rs.5,00,00,000/-) being unaccounted commission expenditure on the above share capital issued by the Appellant for the year under consideration. It is therefore prayed that above addition shall be deleted and necessary direction shall be given in this regard.
4. Your appellant craves to add, alter, or amend any of the grounds of appeal on or before the date of hearing of appeal.
The relevant decision: 10. We have heard rival submissions and perused the materials available on record. We find that assessee has received share capital and share premium from the following parties:- Name of the No. of Amount Share Total Party Shares paid up premium Amount received Yantra 12500 5,00,000/- 2,45,00,000/ 2,50,00,000/ Natural - - Resources (Earlier known as Shri Ganesh Spinners Ltd) Advance 62500 4,00,000/- 1,96,00,000/ 2,00,00,000/ Technologie - - s Limited Mahan 50000 1,00,000/- 49,00,000- 50,00,000/- Industries Ltd., Total 12500 10,00,000/ 4,90,00,000 5,00,00,000/ 0 - - 10.1. Both the parties before us mutually agreed that the facts of the case prevailing in the case of this assessee are exactly identical to the facts prevailing in the case of Seth 7553 & Ors/M/2019 5 Beetal Trading Pvt. Ltd. & Ors. Carbon And Alloys Pvt. Ltd., for A.Y.2010-11 except with variance in the name of the shareholders and figures. The addition has been made u/s.68 of the Act for the same reasons of Seth Carbon And Alloys Pvt. Ltd. Hence, the decision rendered thereon would apply with equal force for this assessee also except with name of the shareholders and figures.” Respectfully following the above decision, we are inclined to allow the grounds of appeal raised by the assessee.
Facts being identical, our decision for applies mutatis mutandis to ITA Nos. 7553/M/2019 & 514/M/2020.
In the result, the appeals filed by the assessees are allowed.
Order pronounced in the open Court on 31/08/2021.