D.b. Income Tax Appeal v. Per Hon’ble Jhaveri, J

HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH ATJAIPUR D.B. Income Tax Appeal No. 608 / 2009COMMISSIONER OF INCOME TAX, JAIPUR-II ,JAIPUR. ----Appellant Versus M/s HOTEL GAUDAVAN PVT. LTD., C-22, VISHALI NAGAR, JAIPUR.----Respondent _____________________________________________________ For Appellant(s) : Mr. K.D. Mathur on behalf of Mr. R.B. MathurFor Respondent(s) : Mr. Mahendra Gargieya _____________________________________________________ HON'BLE MR. JUSTICE K.S. JHAVERIHON'BLE MR. JUSTICE VIJAY KUMAR VYASJudgment Per Hon’ble Jhaveri, J. 25/04/2017 1.By way of this appeal, the appellant has challenged thejudgment and order of the Tribunal whereby the Tribunal hasdismissed the appeal of the assessee as well as department. 2.This Court while admitting the appeal on 30.11.2009 hasframed the following substantial question of law: “Whether in the facts and circumstances ofthe case the ITAT has not acted perverselyand illegally in deleting addition of Rs.1.89crore made by AO u/s 68 of the IT Actinspite of the fact that genuineness oftransaction could not be proved?” 3.Counsel for the respondent has strongly relied on thedecision of this Court in the case of Commissioner of Income Tax vs. M/s VTC Leasing & Finance Ltd. in DB Income TaxAppeal No.551/2008, decided on 27.01.2017 where the identical issue was answered as under: “2. This Court while admitting the matterframed the following question of law:-“i) Whether the Tribunal was justified indeleting the addition of Rs. 85,00,000/-made by the Assessing Officer on accountof unexplained share capital under Section68 of the Act, even when the assesseefailed to discharge the primary onus castedupon it to prove the identify, genuinenessand creditworthiness of the investors?” 3. However, in view of the judgment of theHon’ble Supreme Court in the case ofCommissioner of Income Tax vs. LovelyExports (P) Ltd., reported in (2008) 299ITR 268 (SC), wherein it has been held asunder: “If the share application money isreceived by the assessee-company fromalleged bogus shareholders, whose namesare given to the Assessing Officer, then thedepartment is free to proceed to re-opentheir individual assessments in accordancewith law. Hence, we find no infirmity withthe impugned judgment.” 4.In that view of the matter, the issue is answered in favour of the assessee and against the department. 5.The appeal stands dismissed. (VIJAY KUMAR VYAS),J. (K.S. JHAVERI),J. Asheesh Kr. Yadav/107