SMT. PRIYA AGGARWAL,DELHI vs. ITO, NEW DELHI

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ITA 3235/DEL/2015Status: DisposedITAT Delhi06 November 2015AY 2006-073 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the AO failed to discharge the burden of proving the correctness of the information regarding the investment. Since the assessee denied the investment and the revenue did not provide evidence, the addition was deleted.

What were the facts?

The assessee declared income from share trading. The AO added Rs. 9,91,520/- as unexplained investment under Section 69A, based on information that the assessee invested with M/s Orbis Securities Pvt. Ltd. The assessee denied making any such investment.

What were the issues?

Whether the addition of unexplained investment under Section 69A is sustainable when the assessee denies the investment and the revenue fails to provide corroborating evidence.

Which sections of the Income-tax Act were involved?

Section 69A,Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH ‘SMC-2’, NEW DELHI

Before: SHRI J. SUDHAKAR REDDYSmt. Priya Aggarwal vs.

For Appellant: Shri Ajay Wadhwa, F.C.A

This is an appeal filed by the Assessee directed against the order dated 18.3.2015 of Ld.CIT(A)-13, New Delhi pertaining to the Assessment Year (A.Y.) 2006-07.

2.

Facts in brief:- The facts as brought out by the Ld.CIT(A), to the extent relevant, are extracted for ready reference. “The assessee has shown income from sale and purchase of shares. The return of income for the A.Y. 2006-07 was filed on 20.10.2006 declaring a taxable income of Rs.4,15,880/-. This return was processed initially u/s 143(1) and subsequently selected for scrutiny and the assessment was completed on 26.12.2008 u/s 143(3) fo the Act at an income of Rs.14,07,400/- which inter-alia includes Rs.9,91,520/- u/s 69A as unaccounted investment. The AO received information about investment of Rs.9,91,520/- by the assessee with M/s Orbis Securities Pvt.Ltd. Before the AO, the assessee submitted ignorance about investment made, hwoever, mentioned that the Smt.Priya Aggarwal assessee traded in shares through M/s India Bulls Securities and M/s Orbis Securities Pvt.Ltd. is a subsidiary of India Bulls Securities. Since the assessee did not offer any other explanation, the AO considered the amount as unexplained investment u/s 69A of the Act and added to total income.”

3.

The assessee contended that she has made no investment whatsoever with M/s Orbis Securities P.Ltd. and the information obtained by the A.O., was factually incorrect. Further, the assessee made every attempt to collect information on the company called M/s Orbis Securities P.Ltd. but she failed to get any information. The A.O. made an addition u/s 69 of the Income Tax Act, 1961 (the Act). The First Appellate Authority confirmed the same. Aggrieved the assessee is in appeal before me.

4.

After hearing rival contentions, I find that the A.O. has not discharged the burden that lay on him that the information obtained by him that the assessee has made an investment in M/s Orbis Securities P.Ltd. is factually correct. When the assessee denies that she has ever invested in Orbis Securities P.Ltd. the question of making an addition does not arise, unless the revenue confronts the assessee with the evidence of the investment in question. The assessee filed affidavit denying the investments in question. Under such circumstances the burden is on the Revenue which it failed to discharge. Even before me, no evidence is produced by the revenue in support of this addition. Thus the addition is deleted and the appeal of the assessee is allowed.

5.

In the result the appeal of the assessee is allowed.

Order pronounced in the Open Court on 06th November,2015.

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