Anil Kapoor Film Co. (P) Ltd. v. Pr. CIT

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The Tax Publishers2019 TaxPub(DT) 1908 (Mum-Trib)

INCOME TAX ACT, 1961

Section 263 Section 68

Genuineness and source of loan was not examined by AO and even there was no whisper in the assessment order therefore, it was a clear case that the assessment order was framed in a slip shot manner and without application of mind, hence, the assessment order was erroneous as well as prejudicial to the interest of revenue.

Revision under section 263 - Erroneous and prejudicial order - Lack of enquiry and verification by AO - Loan obtained by assessee held genuine without any enquiry

Pr. CIT observed that the assessee claimed to have obtained loan from one 'Anubhav Vinimay' amounting to Rs. 2 crores and the confirmation of the loan transactions were furnished on 27-12-2016 and the assessment order was passed on 29-12-2016 itself. It was observed by the Pr. CIT that creditworthiness/genuineness of transactions of the lender was never verified/examine by the AO and even in the loan confirmation documents, the address of the lender was not mentioned and further the assessee company neither filed the return of income of M/s. Anubhav Vinimay Pvt. Ltd. nor the bank statement. Therefore, the assessment was held to be erroneous and prejudicial to the interest of the revenue. Held: Pr. CIT observed that the AO should have made enquiries/verification, to satisfy himself with respect to the creditworthiness of the lender and genuineness of the transactions before framing the assessment,. Even in the direction by the Pr. CIT to the AO was not going to cause any prejudice to the assessee because the direction had been issued to the AO to examine the genuineness of the loan and after providing due opportunity of being heard to the assessee, the assessment be reframed. In the case of the assessee, the genuineness and source of loan was not examined by the AO and even there was no whisper in the assessment order with respect to issue in hand, therefore, it was a clear case that the assessment order was framed in a slip shot manner and without application of mind, hence, the assessment order was erroneous as well as prejudicial to the interest of revenue. Tribunal does not found any infirmity in the impugned order, resultantly, the appeal of the assessee was without any merit, consequently, dismissed.

Distinguished:CIT v. Kwality Steel Suppliers Complex (2017) 395 ITR 1 (SC) : 2017 TaxPub(DT) 1821 (SC), CIT v. Dwarkadhish Investment Pvt. Ltd. & Ors. (2011) 330 ITR 298 (Del.) : 2011 TaxPub(DT) 0374 (Del-HC), CIT v. Vikas Polymers [ITR 3/1991, Order dt. 16-8-2010] : 2010 TaxPub(DT) 2189 (Del-HC), Amira Enterprises Ltd. v. Pr. CIT [ITA No. 3206/Del./2017] : 2017 TaxPub(DT) 5411 (Del-Trib), Indus Best Hospitality v. Pr. CIT [ITA No. 3125/Mum/2017], CIT v. Nirav Modi (2017) 390 ITR 292 (Bom) : 2016 TaxPub(DT) 3506 (Bom-HC), Metacaps Engineering and Mahendra Construction Company (J.V.) (2017) 86 Taxman.com 128 (Mum.-ITAT) : 2017 TaxPub(DT) 4600 (Mum-Trib), Arvee International v. Addl. CIT (2006) 8 SOT 452 (Mum.-Trib.) : 2006 TaxPub(DT) 1198 (Mum-Trib), Horizon Investment Company Ltd. v. CIT [ITA No. 1593/Mum/2013], CIT v. ICI India Pvt. Ltd. (1983) 139 ITR 105 (Cal.) : 1983 TaxPub(DT) 0111 (Cal-HC), CIT v. Oxford University Press (1977) 108 ITR 166 (Bom) : 1977 TaxPub(DT) 353 (Bom-HC). Relied:Rajmandir Estate Pvt. Ltd. v. Pr. CIT (2016) 70 Taxman.com 124 (Cal.) : 2016 TaxPub(DT) 2834 (Cal-HC) order dt. 13-5-2016, Himachal Pradesh Financial Corp. (2010) 186 Taxman 105 (HP) : 2010 TaxPub(DT) 0111 (HP-HC), Bismillah Trading Co. (2001) 248 ITR 292 (Ker.) : 2001 TaxPub(DT) 350 (Ker-HC) and CIT v. Green World Corpn. (2009) 314 ITR 81 (SC) : 2009 TaxPub(DT) 1713 (SC), CIT v. G.K. Kabra (1995) 211 ITR 336 (AP) : 1995 TaxPub(DT) 0352 (AP-HC), CIT v. Infosys Technologies Ltd. (2012) 341 ITR 293 (Karn.) : 2012 TaxPub(DT) 910 (Karn-HC), CIT v. Jawahar Bhattacharyaji (2012) 341 ITR 434 (Guwahati) (FB) : 2012 TaxPub(DT) 911 (Gau-HC), CIT v. Leisure wear Exports Ltd. (2012) 341 ITR 166 (Del.) : 2010 TaxPub(DT) 2250 (Del-HC), CIT v. Triveni Engineering Works Ltd. (2011) 336 ITR 366 (Del.) : 2011 TaxPub(DT) 485 (Del-HC), R.A. Himmatsinghka & Company v. CIT (2012) 340 ITR 253 (Pat.) : 2012 TaxPub(DT) 0695 (Pat-Trib), CIT v. Rajeev Agnihotri (2011) 332 ITR 608 (P & H) : 2011 TaxPub(DT) 108 (P&H-HC), CIT v. DLF Ltd. (2013) 350 ITR 555 (Del.) : 2013 TaxPub(DT) 340 (Del-HC), CIT v. Gabreal India Ltd. (1993) 203 ITR 108, 114 (Bom.) : 1993 TaxPub(DT) 1357 (Bom-HC), Malabar Industrial Company Ltd. v. CIT (2000) 243 ITR 83 (SC) : 2000 TaxPub(DT) 1227 (SC), Nabha Investments Pvt. Ltd. v. UOI (2000) 246 ITR 41 (Del.) : 2000 TaxPub(DT) 1473 (Del-HC), Bismillah Trading Company Ltd. v. IO (2001) 248 ITR 292, 308 (Kerala) : 2001 TaxPub(DT) 350 (Ker-HC), Paul Mathews & Sons v. CIT (2003) 263 ITR 101, 113 (Kerala) : 2003 TaxPub(DT) 1040 (Ker-HC), CIT v. Seshasayee Paper & Boards Ltd. (2000) 242 ITR 490, 500 (Mad.) : 2000 TaxPub(DT) 243 (Mad-HC) and Rayon Silk Mills v. CIT (1996) 221 ITR 155 (Guj.) : 1996 TaxPub(DT) 598 (Guj-HC). Relied:Rajmandir Estate Pvt. Ltd. v. Pr. CIT (2016) 70 taxman.com 124 (Cal.) : 2016 TaxPub(DT) 2834 (Cal-HC) order dt. 13-5-2016, Himachal Pradesh Financial Corp. (2010) 186 Taxman 105 (HP) : 2010 TaxPub(DT) 0111 (HP-HC), Bismillah Trading Co. (2001) 248 ITR 292 (Ker.) : 2001 TaxPub(DT) 0350 (Ker-HC) and CIT v. Green World Corpn. (2009) 314 ITR 81 (SC) : 2009 TaxPub(DT) 1713 (SC), CIT v. G.K. Kabra (1995) 211 ITR 336 (AP) : 1995 TaxPub(DT) 0352 (AP-HC), CIT v. Infosys Technologies Ltd. (2012) 341 ITR 293 (Karn.) : 2012 TaxPub(DT) 0910 (Karn-HC), CIT v. Jawahar Bhattacharyaji (2012) 341 ITR 434 (Guwahati) (FB) : 2012 TaxPub(DT) 0911 (Gau-HC), CIT v. Leisure wear Exports Ltd. (2012) 341 ITR 166 (Del.) : 2010 TaxPub(DT) 2250 (Del-HC), CIT v. Triveni Engineering Works Ltd. (2011) 336 ITR 366 (Del.) : 2011 TaxPub(DT) 0485 (Del-HC), R.A. Himmatsinghka & Company v. CIT (2012) 340 ITR 253 (Pat.) : 2012 TaxPub(DT) 0695 (Pat-Trib), CIT v. Rajeev Agnihotri (2011) 332 ITR 608 (P & H) : 2011 TaxPub(DT) 0108 (P&H-HC), CIT v. DLF Ltd. (2013) 350 ITR 555 (Del.) : 2013 TaxPub(DT) 0340 (Del-HC), CIT v. Gabreal India Ltd. (1993) 203 ITR 108, 114 (Bom.) : 1993 TaxPub(DT) 1357 (Bom-HC), Malabar Industrial Company Ltd. v. CIT (2000) 243 ITR 83 (SC) : 2000 TaxPub(DT) 1227 (SC), Nabha Investments Pvt. Ltd. v. UOI (2000) 246 ITR 41 (Del.) : 2000 TaxPub(DT) 1473 (Del-HC), Bismillah Trading Company Ltd. v. IO (2001) 248 ITR 292, 308 (Kerala) : 2001 TaxPub(DT) 0350 (Ker-HC), Paul Mathews & Sons v. CIT (2003) 263 ITR 101, 113 (Kerala) : 2003 TaxPub(DT) 1040 (Ker-HC), CIT v. Seshasayee Paper & Boards Ltd. (2000) 242 ITR 490, 500 (Mad.) : 2000 TaxPub(DT) 0243 (Mad-HC), Rayon Silk Mills v. CIT (1996) 221 ITR 155 (Guj.) : 1996 TaxPub(DT) 0598 (Guj-HC), Indian Textile v. CIT (1986) 157 ITR 112 (Mad.) : 1986 TaxPub(DT) 0501 (Mad-HC), Gee Vee Enterprises v. Addl. CIT (1975) 99 ITR 375 (Del.) : 1975 TaxPub(DT) 0267 (Del-HC), Thalibai F Jain v. ITO (1975) 101 ITR 1 (Karn.) : 1975 TaxPub(DT) 0329 (Karn-HC), CIT v. HPFC (2010) 186 Taxman 105 (HP) : 2010 TaxPub(DT) 0111 (HP-HC) andf CIT v. Pushpa Devi (1987) 164 ITR 639 (Pat) : 1987 TaxPub(DT) 0609 (Pat-HC).