Itta/79/2013 Of Commissioner Of Income Tax - Ii v. M/S. Rusmi Distilleries Pvt. Ltd

IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH ATHYDERABAD THE HON’BLE THE CHIEF JUSTICE SRI KALYAN JYOTI SENGUPTAANDTHE HON’BLE MS. JUSTICE G. ROHINI I.T.T.A. No.79 of 2013 DATE: 25.06.2013 Between: Commissioner of Income Tax-II,Hyderabad. … Appellant And M/s. Rusmi Distilleries Pvt., Ltd.,Hyderabad. … Respondent This Court made the following: THE HON’BLE THE CHIEF JUSTICE SRI KALYAN JYOTI SENGUPTAANDTHE HON’BLE MS. JUSTICE G. ROHINI I.T.T.A No.79 of 2013 JUDGMENT:(Per the Hon’ble the Chief Justice Sri Kalyan Jyoti Sengupta) This appeal is sought to be admitted on the following suggested substantial questions of law. “1. Whether in the given facts and circumstances of the case, the ITAT is justified in deleting the addition of Rs.43,24,600/- made towardsunexplained share applications u/s.68-such deletion being totallycontrary to the facts and evidence brought on record by the AO, in respect ofeach of the component of the aggregate figure i.e., Rs.43,24,600/-? 2. Whether the Appellate Tribunal is justified in holding that the assessee discharged primary onus cast on it by mere establishing theidentity of the creditors by furnishing their permanent account number andthe creditors filing their income tax returns? 3. Whether the finding of the appellate Tribunal that the primary onus in connection with the above was discharged by the assessee canbe said to be based on material on record?” After hearing the learned counsel for the appellant and after going through the impugned order of the learned Tribunal it appears to us that noquestion of law is involved in the matter, as the learned Tribunal decided thematter on appreciation of fact. How the appreciation of fact was recorded by the learned Tribunal is set out hereunder: “We find that the aforesaid amount was received by theassessee company towards share application money. For instance,with regard to the investment of Rs.2,20,000/- made by Shri SaiVenkata Kumar, we find that the share-applicant categorically statedthat he has invested such amount in the assessee company in thestatement recorded under Section 131 of the Act. We also find thatthe identity and creditworthiness of the share-applicant was provedby way of filing the income-tax returns and employee identity proofissued by the Indian Air Force. Similarly we find that all the share-applicants are income-tax assesses and all were presented beforethe assessing officer except the share-applicant of J. Ankineedu. It is pertinent to note that the initial burden is upon the assessee toexplain the nature and sources of share application money receivedby it. In order to discharge its burden, the assessee company has toprove the identity of shareholders, creditworthiness of theshareholders and the genuineness of the transaction. In the caseunder consideration, the assessee company had produced beforethe assessing officer all the share applicants except one personcalled Sri J. Ankineedu. The CIT(A) clearly observed in his order thatall the 13 share-applicants are existing. Once the CIT(A) observedthat the shareholders are existing, the identity is proved. Hence, inour considered view, the assessee company satisfactorilydischarged its onus caste upon it.” The above fact-finding of the learned Tribunal is so compact that thisCourt, in any circumstances, cannot touch the same. Once the identity isestablished, it is heavy burden on the part of the revenue asking theadjudicating authority concerned to disbelieve it. The Commissioner ofIncome Tax (Appeals) as well as the learned Tribunal have correctlyaccepted the factual position and granted relief. Therefore, we do not findany error in the order impugned to interfere with the same. The appeal is accordingly dismissed. No costs. _____________________ K.J. SENGUPTA, CJ ______________G. ROHINI, J