Loading judgment…
No AI summary yet for this case.
Income Tax Appellate Tribunal, “D” BENCH, MUMBAI
Before: HON’BLE SHRI MAHAVIR SINGH, JM & HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM
Per Manoj Kumar Aggarwal (Accountant Member) 1. Aforesaid appeal by revenue for Assessment Year [in short referred to as ‘AY’] 2014-15 contest the order of Ld. Commissioner of Income- Tax (Appeals)-2, Mumbai, [in short referred to as ‘CIT(A)’], Appeal No. CIT(A)-2/IT-10017(OL)/2016-17 dated 29/06/2017 on following grounds of appeal: - On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in deleting the addition of Rs.1,31,43,945/- as unexplained investment made by the AO
Assessment Year: 2014-15 M/s. MBP Technologies P.Ltd. without appreciating the fact that assessee failed to prove the identity of parties who repaid the alleged loan and the genuineness of the investment made.”
The assessment for impugned AY was framed by Ld. Income Tax Officer-1(2)(3) u/s 143(3) on 28/12/2016 wherein the income of the assessee was determined at Rs.311.61 Lacs after certain additions as against returned loss of Rs.1.05 Lacs e-filed by the assessee on 30/09/2014. The assessee being resident corporate entity was stated to be engaged in the business of research, development, marketing and consulting technologies etc. As evident from grounds of appeal
, the sole subject matter of present appeal before us is certain addition u/s 69 for Rs.131.43 Lacs.
2. During assessment proceedings, it transpired that the assessee’s non-current investment stood at Rs.345.55 Lacs as against Rs.214.11 Lacs in the immediately preceding year. Accordingly, the assessee was directed to furnish the details of investments and sources thereof. Since the assessee failed to make any submissions against the same, Ld. AO, treating the same as unexplained investment, added the differential amount of Rs.131.43 Lacs to the income of the assessee.
3. Aggrieved, the assessee agitated the same with success before Ld. first appellate authority vide impugned order dated 29/06/2017 wherein the matter was concluded in assessee’s favor by making following observations: - The AO has added a sum of Rs.1,31,22,980/- para 5 of the assessment order u/s 69 of the act stating the reason that the appellant company has shown current investment of Rs.345,55,699/- as against Rs.214,11,754/- of the preceding year. The AO has also stated that neither the appellant company nor the AR attended hearing or filed details. During the course of hearing, the Director Shri Vishwajit Dahanukar appeared and explained that out of the long-term loans and advances of Rs.2,95,23,006/- as on Assessment Year: 2014-15 M/s. MBP Technologies P.Ltd. 31.03.2103, a sum of Rs.1,25,00,000/- has been converted into non-current in the form of equity shares of Heritage Agro Products Pvt. Ltd. and balance of Rs.5,90,000/- has been returned as loans. Accordingly, the long-term loans and advances has reduced to Rs.1,64,00,026/- as on 31.03.2014 and therefore there is no fresh money introduced from outside or borrowed from anybody. I am in agreement with the Director of the company as the facts are very clear; it is only transfer from one head to another head and no money received from outside. Accordingly, I direct the AO to delete the above addition of Rs.1,31,22,980/-. This ground of appeal is allowed.
Aggrieved, the revenue is in further appeal before us.
The Ld. Departmental Representative supported the stand of Ld. AO and submitted that the assessee failed to provide the requisite information during assessment proceedings. Per contra, Ld. Authorised Representative for assessee, drawing our attention to the financial statements as placed on record, submitted that requisite explanation / details was already furnished before Ld. first appellate authority who, with due application of mind, rightly deleted the impugned additions.
We have carefully heard the rival submissions and perused relevant material on record. At the outset, it is noted that the correct amount under dispute is Rs.1,31,43,945/- and not Rs.1,31,22,980/- as wrongly noted by Ld. CIT(A). Nevertheless, we proceed to adjudicate the same as argued before us.
Upon perusal Note No. 6 of financial statements, we find that the major increase in non-current investments arise from the fact that the assessee has acquired shares of an entity namely Heritage Agro Products Private Limited for Rs.125 Lacs. The complete details of non- current investments including scrips held by the assessee during impugned AY has already been provided on page no. 22 of the paper- book. The assessee has placed on record ledger confirmation account of M/s Heritage Agro Products Private Limited for the period 01/04/2010 to Assessment Year: 2014-15 M/s. MBP Technologies P.Ltd. 31/03/2014, the perusal of which reveal that the assessee has acquired the shares worth Rs.125 Lacs from the said entity on 21/03/2014. The aforesaid facts lend certain credence to the observation of first appellate authority that there was no fresh investment but change of amount from one head to another head. This being the case, we find no infirmity in the impugned order.
Resultantly, the appeal stands dismissed. Order pronounced in the open court on 22nd March, 2019. Sd/- Sd/- (Mahavir Singh) (Manoj Kumar Aggarwal) �ाियक सद� / Judicial Member लेखा सद� / Accountant Member मुंबई Mumbai; िदनांक Dated : 22/03/2019 Sr.PS, Jaisy Varghese आदेशकी�ितिलिपअ�ेिषत/Copy of the Order forwarded to : अपीलाथ�/ The Appellant 1. ��थ�/ The Respondent 2. आयकरआयु�(अपील) / The CIT(A) 3. आयकरआयु�/ CIT– concerned 4. िवभागीय�ितिनिध, आयकरअपीलीयअिधकरण, मुंबई/ DR, ITAT, Mumbai 5. गाड�फाईल / Guard File 6.