Commissioner Of Income Tax, Udaipur v. Shri Chandresh Kumar Maheshwari

IN THE HIGH COURT OF JUDICATURE FOR RAJASTHAN ATJODHPUR D.B.INCOME TAX APPEAL NO.37/2009 COMMISSIONER OF INCOME TAX, UDAIPURVs.SHRI CHANDRESH KUMAR MAHESHWARI Date of Order : : 02.12.2010 HON’BLE THE CHIEF JUSTICE MR.ARUN MISHRAHON’BLE MR.JUSTICE KAILASH CHANDRA JOSHI Mr.KK Bissa for the appellantMr.Vikas Balia for the respondent. ***** The instant appeal has been preferred under Section 260-A ofthe Income Tax Act, 1961 questioning the legality of the order passedby the CIT (A), Udaipur affirmed by the I.T.A.T., Jodhpur Bench,Jodhpur deleting the addition of Rs.66,90,330 on account ofunexplained cash credit under Section 68 and deleting the addtion ofRs.3,35,000/- on account of unaccounted commission paid to thebroker to fetch the accommodation entries of long term capital gain onshares. On due consideration of the evidence on record, the CIT(A) Udaipur has deleted the aforesaid amount which has beenaffirmed by the I.T.A.T, Jodhpur Bench, Jodhpur. Mr.K.K. Bissa, learned counsel appearing on behalf ofRevenue submitted that the deletion made by the CIT, Udaipur asaffirmed by the Tribunal is bad in eye of law. He further submits in lightof that the statement of the asessee respondent recorded underSection 131 of the Income Tax Act the amount was on account ofunexplained cash credit and unaccounted commision was rightlycomputed and assessed by the Assessing Officer. Mr.Vikas Balia, learned counsel for the respondent supportedthe orders passed by the CIT (A), Udaipur as well as the Tribunalsubmitting that both the courts have reached to the concurrent findingsof fact. He further submits that CIT and ITAT have rightly deleted theadditions on due consideration of evidence and material on record.Hence no substantial question of law arsises in the instant appeal. After hearing both the learned counsel for the parties, we are ofthe opinion that in view of the order passed by the Tribunal it isapparent that on due consideration of the various documentssubmitted on record, the orders have been passed. The ITAT, Jodhpur gave reasons in Paragraph 5 of the orderwhich is quoted as Under:- Mr.Vikas Balia, learned counsel for the respondent supportedthe orders passed by the CIT (A), Udaipur as well as the Tribunalsubmitting that both the courts have reached to the concurrent findingsof fact. He further submits that CIT and ITAT have rightly deleted theadditions on due consideration of evidence and material on record.Hence no substantial question of law arsises in the instant appeal. After hearing both the learned counsel for the parties, we are ofthe opinion that in view of the order passed by the Tribunal it isapparent that on due consideration of the various documentssubmitted on record, the orders have been passed. The ITAT, Jodhpur gave reasons in Paragraph 5 of the orderwhich is quoted as Under:- “On careful analysis of the material made availablebefore the Tribunal in the light of rival submissions ofboth parties as well as the order passed by thedepartmental, it is found that the Assessing Officer hascome to the conclusion that the amount ofRs.66,90,330/- found credited in the bank account ofthe assessee as unexplained credit simply on theground that the assessee is not able to produce thebroker before him for examination and basing on thestatement of the assessee recorded u/s 131 of the Actand the purchase price was paid by the assessee in 8installments spreading over a period of two months butthe assessee has produced the share certificate number132011 Regd. Folio No.G 03019 and distinctivenumbers 132501 to 1350000 issued by Cure SpectsLazer Ltd. Of Ahmedabad for acquisition of 3,50,000/-equity shares by producing the letter dated 08.09.2003issued by the said company. These shares were soldby the assessee for consideration of Rs.70,40,365.97through stock broker M/s Rajesh and Jhaveri andthereby earned long term capital gain of Rs.66,90,331/-.The said company cure Spects Lazer Ltd. OfAhmedabad is a public limited company where publicare substantially interested. Its shares are listed in theAhmedabad Stock Exchange. The said company isregularly filing statutory return as required under theCompanies Act to the Registrar of Companies,Ahmedabad. If really the Assessing Officer doubted thegenuiness of transaction, he ought to have obtained thelist of share holders coupled with the holding of the saidshare holders together with the share certificatenumbers and folio numbers of the shares held by eachshare holder. This is cogent evidence, which goes tothe root of the matter to find as to the genuineness ofthe purchase and sale of shares by the assessee, butthis was not done by the Assessing Offficer though he is having abundant powers under Section 131 of the ITAct. The Assessing Officer simply makingassumptions and presumptions from the evidenceproduced by the assessee and taking ship shot extractsof the statement of the assessee, but not consideringthe statement as a whole. The Assessing Officer hasalso not written to the stock exchange of Ahmedabad asto the trading of these shares by the said broker in theStock Exchange. In the absence of all these materialfacts, it can never be said that the transactions ofpurchase and sale conducted by assessee throughbroker are not genuine. Therefore, we are of theconsidered view that under the facts and circumstancesof the case the Assessing Officer is not able to make outany material except for presumptions and assumptionsto come to the conclusion that the purchase and sale ofshares claimed by the assessee are not genuine. Moreso, in the presence of letter communicated by the brokergiving the details of the shares purchased and sold onbehalf of assessee, mentioning therein the commissioncharged by him as well as proceeds available with himfor purchase of shares as well as realization of saleproceeds and crediting the same to the bank account ofthe assessee. Hence we find that the ld. CIT (A)’s orderin deleting the additiions made by the Assessing Officeris not infirm in any way requiring any intereference. Thesame is hereby upheld by dismissing the appeal of thedepartment as not meritorious.” In view of the order passed by the Tribunal, it is apparent thatTribunal has taken into consideration various documents and materialon record. The question basically is of facts and the CIT(A) Udaipurhas also recorded the reasons on facts while considering the factualmatrix in the instant case. In the facts and circumstances of the instantcase, we find that no substantial question of law has arisen in thefinding of the CIT as well as ITAT, and the findings have not beenshown to be perverse or unreasonable. Hence, there is no force in thisincome tax appeal and the same is hereby dismissed. (KAILASH CHANDRA JOSHI), J. (ARUN MISHRA), CJ mamta