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Income Tax Appellate Tribunal, KOLKATA ‘B’ BENCH, KOLKATA
Before: Sri J. Sudhakar Reddy, Hon’ble & Sri Aby T. Varkey, Hon’ble
Vs. Deputy Commissioner of Income Tax, Circle-2(2), Kolkata……………………………......Respondent Appearances by: Shri Soumitro Choudhury, Adv. & Shri Joydeep Chakraborty, Adv., appeared on behalf of the assessee. Smt. Ranu Biswas, JCIT, D/R, appearing on behalf of the Revenue. Date of concluding the hearing : April 22nd, 2021 Date of pronouncing the order : May 5th, 2021 ORDER Per J. Sudhakar Reddy, AM :- These are cross-appeals filed by the assessee and are directed against the order of the Learned Commissioner of Income Tax (Appeals) - 1, (hereinafter the “ld. CIT(A)”), passed u/s. 250 of the Income Tax Act, 1961 (the ‘Act’), dt. 28/03/2019, for the Assessment Year 2013-14.
There is a delay of 1 day in filing of this appeal by the assessee. The assessee has filed a condonation petition. On perusal of the same, we are convinced that the assessee Assessment Year: 2013-14 Assessment Year:- 2013-14 M/s. Srijan Cements Ltd. was prevented by sufficient cause from filing of the appeal in time. Hence, we condone was prevented by sufficient cause from filing of the appeal in time. Hence, we condone was prevented by sufficient cause from filing of the appeal in time. Hence, we condone the delay and admit this appeal of the assessee. the delay and admit this appeal of the assessee. First we take up the assessee’s appeal in ITA No. First we take up the assessee’s appeal in ITA No. 1541/Kol/2019 3. Ground Nos. 1, 2 and 5 a Ground Nos. 1, 2 and 5 are not pressed and are dismissed as such. re not pressed and are dismissed as such.
The effective grounds of appeal
are as follows: The effective grounds of appeal are as follows:- “3. The Honorable Appellate Commissioner has not allowed a sum of The Honorable Appellate Commissioner has not allowed a sum of The Honorable Appellate Commissioner has not allowed a sum of Rs.25,887/- on the ground that delay in ESIC payment has not taken as a ground. on the ground that delay in ESIC payment has not taken as a ground. on the ground that delay in ESIC payment has not taken as a ground. the same may kindly be allowed. same may kindly be allowed.
4. The Honorable Appellate Commissioner erred in both in law and in fact by The Honorable Appellate Commissioner erred in both in law and in fact by The Honorable Appellate Commissioner erred in both in law and in fact by upholding the impugned addition made by the Ld.A.O. amounting to upholding the impugned addition made by the Ld.A.O. amounting to upholding the impugned addition made by the Ld.A.O. amounting to Rs.2,06,20,200/- u/s. 68 on account of unsecured loan taken from directors, share u/s. 68 on account of unsecured loan taken from directors, share u/s. 68 on account of unsecured loan taken from directors, share holders and related companies, which is bad in law and against the principles of ers and related companies, which is bad in law and against the principles of ers and related companies, which is bad in law and against the principles of natural justice.”
5. Ground No. 3 is on the issue of delay in payment of ESI. The ld. CIT(A) did not Ground No. 3 is on the issue of delay in payment of ESI. The ld. CIT(A) did not Ground No. 3 is on the issue of delay in payment of ESI. The ld. CIT(A) did not allow this claim of the assessee on the ground that the assessee has not taken allow this claim of the assessee on the ground that the assessee has not taken allow this claim of the assessee on the ground that the assessee has not taken a specific ground. The assessee’s case is that the amount in question, was paid much prior to the he assessee’s case is that the amount in question, was paid much prior to the he assessee’s case is that the amount in question, was paid much prior to the due date of filing of the return of income and has to be allowed. We find merit in this due date of filing of the return of income and has to be allowed. We find merit in this due date of filing of the return of income and has to be allowed. We find merit in this contentions of the assessee as the facts are not disputed by the ld. contentions of the assessee as the facts are not disputed by the ld. D/R. Thus, applying D/R. Thus, applying the propositions of law laid by the Hon’ble Jurisdictional High Court in the case of the propositions of law laid by the Hon’ble Jurisdictional High Court in the case of the propositions of law laid by the Hon’ble Jurisdictional High Court in the case of CIT vs. Vijay Shree Limited reported in 224 Taxman 12 (Cal.), Vijay Shree Limited reported in 224 Taxman 12 (Cal.), this ground of the assessee is this ground of the assessee is allowed.
6. Ground No. 4 is against the addition of Rs.2,0 Ground No. 4 is against the addition of Rs.2,06,20,200/- These are unsecured These are unsecured loans taken by the assessee company from directors, shareholders and related loans taken by the assessee company from directors, shareholders and related loans taken by the assessee company from directors, shareholders and related companies. It is seen that all these loan creditors have advanced money to the assessee companies. It is seen that all these loan creditors have advanced money to the assessee companies. It is seen that all these loan creditors have advanced money to the assessee in the earlier years and had opening balances. A perusal of in the earlier years and had opening balances. A perusal of the ledger accounts also the ledger accounts also demonstrate that some of the amounts were returned during the year by the assessee demonstrate that some of the amounts were returned during the year by the assessee demonstrate that some of the amounts were returned during the year by the assessee company. The loans in question are Rs.76,49,700/ company. The loans in question are Rs.76,49,700/- from Mr. Ashoke Agarwal, Mr. Ashoke Agarwal, Assessment Year: 2013-14 Assessment Year:- 2013-14 M/s. Srijan Cements Ltd. Rs.89,44,000/- from Mr. Aditya Agarwal, Rs.19,49,500/ from Mr. Aditya Agarwal, Rs.19,49,500/- from M/s. Elegant from M/s. Elegant Tie-up (P) Ltd. and Rs.20,77,000/- from M/s. New High Silk House (P) Ltd. The assessee has from M/s. New High Silk House (P) Ltd. The assessee has from M/s. New High Silk House (P) Ltd. The assessee has furnished the names and addresses of all these loan creditors, their PAN Nos., furnished the names and addresses of all these loan creditors, their PAN Nos., furnished the names and addresses of all these loan creditors, their PAN Nos., confirmation letters, details of the transactions and evidence to prove the identity a confirmation letters, details of the transactions and evidence to prove the identity a confirmation letters, details of the transactions and evidence to prove the identity and creditworthiness of these parties. The Assessing Officer had issued notices u/s 133(6) of creditworthiness of these parties. The Assessing Officer had issued notices u/s 133(6) of creditworthiness of these parties. The Assessing Officer had issued notices u/s 133(6) of the Act to all these loan creditors and replies were received by the Assessing Officer. In the Act to all these loan creditors and replies were received by the Assessing Officer. In the Act to all these loan creditors and replies were received by the Assessing Officer. In these replies, the loan creditors have filed the confirmations, copy of these replies, the loan creditors have filed the confirmations, copy of these replies, the loan creditors have filed the confirmations, copy of bank statements, copy of returns of income filed by them to prove that they are regular tax payers. returns of income filed by them to prove that they are regular tax payers. returns of income filed by them to prove that they are regular tax payers. No adverse material is brought on record by the Assessing Officer or the ld. CIT(A). adverse material is brought on record by the Assessing Officer or the ld. CIT(A). adverse material is brought on record by the Assessing Officer or the ld. CIT(A). 6.1. We find that the ld. CIT(A) has drawn a wrong presumption, that th We find that the ld. CIT(A) has drawn a wrong presumption, that th We find that the ld. CIT(A) has drawn a wrong presumption, that these credit entries are share capital received by the assessee company. This is factually incorrect. entries are share capital received by the assessee company. This is factually incorrect. entries are share capital received by the assessee company. This is factually incorrect. These are loans received by the assessee company which was repaid. These are loans received by the assessee company which was repaid. Loan transactions were added as share capital subscribed. were added as share capital subscribed. On these facts, we delete the a On these facts, we delete the addition of Rs. 2,06,20,200/- made u/s 68 of the Act as the assessee has proved the identity and made u/s 68 of the Act as the assessee has proved the identity and made u/s 68 of the Act as the assessee has proved the identity and creditworthiness of all these loan creditors as well as the genuineness of the creditworthiness of all these loan creditors as well as the genuineness of the creditworthiness of all these loan creditors as well as the genuineness of the transactions.
7. In the result, appeal of the assessee is allowed in part. In the result, appeal of the assessee is allowed in part. Now we take up the revenue revenue’s appeal in ITA No. 1444/Kol/2019 /Kol/2019 8. Ground No. 1 raised by the revenue, is covered in favour of the assessee by the Ground No. 1 raised by the revenue, is covered in favour of the assessee by the Ground No. 1 raised by the revenue, is covered in favour of the assessee by the judgment of the Hon’ble Jurisdictional High Court in the case of judgment of the Hon’ble Jurisdictional High Court in the case of CIT vs. Vijay Shree CIT vs. Vijay Shree Limited reported in 224 Taxman Limited reported in 224 Taxman 12 (Cal.) as discussed by us while disposing off Ground while disposing off Ground no. 3 of the assessee’s appeal no. 3 of the assessee’s appeal. Hence we dismiss this ground of the revenue. . Hence we dismiss this ground of the revenue.
9. Ground No. 2 is against the deletion of an addition of unexplained cash deposit of Ground No. 2 is against the deletion of an addition of unexplained cash deposit of Ground No. 2 is against the deletion of an addition of unexplained cash deposit of Rs.89,02,328/-, by the ld. CIT(A). Af , by the ld. CIT(A). After hearing rival contentions, we find that the ter hearing rival contentions, we find that the assessee had recorded cash sales in its assessee had recorded cash sales in its regular cash book and that and that this cash amount received on sale was deposited in the bank account. When all these transactions are s deposited in the bank account. When all these transactions are s deposited in the bank account. When all these transactions are recorded in the regular books of account recorded in the regular books of accounts and when the assessee has declared these s and when the assessee has declared these cash deposits as income from sales, the question of making an addition once again, does cash deposits as income from sales, the question of making an addition once again, does cash deposits as income from sales, the question of making an addition once again, does Assessment Year: 2013-14 Assessment Year:- 2013-14 M/s. Srijan Cements Ltd. not arise. This will result in double addition. The ld. CIT(A), in our view has rightly not arise. This will result in double addition. The ld. CIT(A), in our view has rightly not arise. This will result in double addition. The ld. CIT(A), in our view has rightly deleted this addition. We uphold the deleted this addition. We uphold the same and dismiss this ground of the revenue. same and dismiss this ground of the revenue.
10. Ground No. 3 is general in nature. Ground No. 3 is general in nature.
In the result appeal of the assessee is allowed in part and the appeal of the In the result appeal of the assessee is allowed in part and the appeal of the In the result appeal of the assessee is allowed in part and the appeal of the revenue is dismissed.
Kolkata, the Kolkata, the 5th day of May, 2021.
Sd/- Sd/- J. Sudhakar Reddy] [Aby T. Varkey] [J. Sudhakar Reddy Judicial Member Accountant Member Accountant Member Dated: 05.05.2021 {SC SPS} Copy of the order forwarded to:
1. 1. M/s. Srijan Cements Ltd AMP Vaisaakhi Room No. 702 AG-112 Sector-II Salt Lake Kolkata -700 091 2. Deputy Commissioner of Income Tax, Circle Deputy Commissioner of Income Tax, Circle-2(2), Kolkata 3. CIT(A)- 4. CIT- , 5. CIT(DR), Kolkata Benches, Kolkata.
5. CIT(DR), Kolkata Benches, Kolkata.