2018-VIL-770-DEL-DT

DELHI HIGH COURT

ITA 130/2018

Date: 06.02.2018

PRINCIPAL COMMISSIONER OF INCOME TAX (CENTRAL) -1

Vs

M/s . ADAMINE CONSTRUCTION PVT. LTD.

Appellant Through: Mr. Rahul Chaudhary, Sr. Standing Counsel with Mr. Sanjay Kumar, Jr. Standing Counsel for Income Tax Deptt.  
Respondent Through: None.  

BENCH

MR. S. RAVINDRA BHAT AND MR. JUSTICE A. K. CHAWLA JJ.

JUDGMENT

3. The Revenue in its appeal urges that the lower appellate authorities fell into error in not placing much emphasis on the report obtained by the AO during the course of the proceedings in the form of replies to queries received from the concerned Commissioners. It was submitted that these materials clearly pointed to the entities who were shown as share applicants, in fact, did not exist and their financial transactions were dubious. It was submitted that the CIT(A)’s conclusions with respect to the assessee having discharged its onus were anomalous.  

4. The material on record in the form of the orders of the lower appellate authorities disclosed that both the assessee and later the share applicants (upon receiving notice under Section 131 of the Act) had produced documentary proof. These included the assessments and income-tax returns filed by the share applicants as well as confirmation and acknowledgment documents. If the AO wished to pursue the matter, there were sufficient clues for him to have proceeded – for instance, it could have issued notices and obtained statements from the bankers of the share applicants or even the balance sheets which existed in the income-tax records of their Assessing Officers. He did not choose to pursue both but instead rested his conclusions entirely on the basis of remarks received from the Commissioner. These remarks can at best be considered opinion but not primary evidence to displace the inferences that had to be drawn with respect to the genuineness of the transaction and the creditworthiness of the parties.

5. In these circumstances, no question of law arises; the appeal is, therefore, dismissed.

 

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