The Pr. Commissioner Of Income Tax-3, Ludhiana v. M/S Incitek Homecare P. Ltd

[TA-465-2018 © 102 IN THE HIGH COURT OF PUNJAB & HARYANA|AT CHANDIGARH [TTA-465-2018Date of Decision: 16.01.2020 THE PR. COMMISSIONER OF INCOME TAX-3, LUDHIANA ..APPELLANT VERSUS M/S INCITEK HOMECARE P. LTD. .RESPONDENT CORAM: HON'BLE MR. JUSTICE AJAY TEWARIHON'BLE MR. JUSTICE AVNEESH JHINGAN Present:Mr. Amrinder Singh, Advocatefor the appellant, KK O AJAY TEWARI, J (Oral) 1]The appeal has been filed against the order of the CIT (A) and IncomeTax Appellate Tribunal ( for short ‘the Tribunal’) whereby two additions made by theAssessing Officer (AQ) were deleted. The issue relates to disallowance undersection 36 (1) (iii) of the Income Tax Act, 1961. Admittedly, the assessee has onebank account which consists of mixed funds. The AO held that the assessee was notable to satisfy that the advances which were made tor the purchase of land andinvestment in construction of the godown were entitled to the benefit of Section 36(1) (a1) of the Act. The findings were reversed by the Appellate Authorities (exceptthat the CIT (A)) added sum of Rs. 4,80,000/- and deleted the balance additions).The CIT(A) gave a categoric finding that the funds used for purchase of land andconstruction were interest free funds and were not those which were obtained as loanfrom the bank. This finding on fact has been upheld by the Tribunal. Learned counsel for the petitioner is not in a position to deny that thematter is squarely covered by the judgments of|S.A. Builders Limited Versus CIT(Appeals) and another; 2007 (15) SCC 147and.Bright Enterprises (P) Ltd. VersusCommissioner ofIncome Tax; 2016 G81) ITR 107 inIn view of the above, the first question is answered in negative.2 As regard question No. 2, the argument is Rs.3,87,50,000/- which wasreceived as share capital from two companies were accommodation entries. Theground taken by the AO was that those investors had sufficient funds yet they havebeen showing meagre profit from their business. The Appellate Authorities noticedthat on the asking of the AO, not only all the financers but even the directors of thecompany were produced. Moreover, the returns of those assessees had beenaccepted by the revenue and held that in these circumstances the share moneyinvestment could not be deemed to have been a paper transaction or anaccommodation entry. Therefore, we find no reason to give a different view and both thequestions are answered in negative. Consequently, the appeal is dismissed. JIAJAY TEWARIJUDGE JIAVNEESH JHINGANJUDGE 16[th]January, 2020shabha Whether speaking/ reasonedYes /NoWhether reportableYes /No