Ita/253/2024 Of Principal Commissioner Of Income Tax v. M/S. Evermore Stocks Brokers Private Limited

$~5 *IN THE HIGH COURT OF DELHI AT NEW DELHI+ITA 253/2024 & CM No.25681/2024PRINCIPAL COMMISSIONER OF INCOME TAX.....AppellantThrough:Mr. Debesh Panda, Mr. VikramadityaSingh,Ms.ZehraKhan,Mr.SA.Kumar&Mr.KanishkAggrawal,Advs.Versus M/S. EVERMORE STOCKS BROKERS PVT. LTD......RespondentThrough:Ms. Ananya Kapoor & Mr. SumitLalchandani, Advs. CORAM:HON'BLE MR. JUSTICE VIBHU BAKHRUHON'BLE MS. JUSTICE SWARANA KANTA SHARMAO R D E R %22.10.2024 1.The Revenue has filed the present appeal impugning an order dated19.09.2023 (hereafter the impugned order) passed by the Income Tax AppellateTribunal (hereafter the ITAT) in ITA No.5152/Del/2018 for the assessment year2015-16. 2.The said proceeding arises from an assessment order dated 30.12.2017passed under Section 143(3) of the Income Tax Act, 1961 (hereafter the Act). 3.The controversy entailed in the present appeal essentially relates to theaddition of a sum of ₹47,72,95,676/- made by the Assessing Officer (hereafter the AO) on account of unexplained credit under Section 68 of the Act. The AOhad not accepted the assessee’s explanation that the said amount was therepayment of a loan of ₹2.06 crores. 4.The assessee’s contention that the entries in the books of accountrepresent undisclosed income which are taxable under Section 68 of the Act was concurrently rejected by the Commissioner of Income Tax (Appeals)[CIT(A)], by an appellate order dated 04.05.2018 in an appeal preferred by theassessee under Section 250(6) of the Act, and the learned ITAT, by the orderdated 19.09.2023 which is impugned in the present appeal. 5.It is the Revenue’s case that the orders passed by the learned CIT(A) aswell as the ITAT are perverse as assessee has not established the genuinenessof the transactions including the creditworthiness and the identity of thecounterparties with whom the assessee had entered into the transactions. 6.It is relevant to note that the learned ITAT had faulted the AO formaking high pitched assessment as there was no dispute that the transactionswere reflected as repayment of the loan of ₹2.06 crores. The learned ITAT also found that the AO had made high pitched addition on misplaced assumptions.Although, the learned counsel for the Revenue seeks to argue that the findingof the CIT and ITAT are perverse inasmuch as, according to him, thecreditworthiness and identity of the counterparties with whom the assessee hadtransactions was not established; he does not dispute that the quantum of thetransaction in quarter was ₹2.06 crores as observed by the learned ITAT. Thus, there is no dispute that no addition above the said amount could have beenmade and the AO’s decision to make a high pitched addition of ₹47,72,95,676/- crores, is unsustainable. 7.In the given facts, since it is accepted that the quantum of transaction is₹2.06 crores, it is not necessary for this Court to examine the Revenue’s challenge to the concerned findings accepting the genuineness of thetransaction(s) in question, as it is apparent that the tax effect is below thethreshold as specified by CBDT in its Circular dated 17.09.2024. 8.In view of the above, the present appeal is rejected on account of lowtax effect. Pending application also stands disposed of. VIBHU BAKHRU, J OCTOBER 22, 2024‘gsr’ SWARANA KANTA SHARMA, J Click here to check corrigendum, if any