Case Number: ITA 1665/DEL/2019
Appellant: Preeti Bansal, New Delhi
Respondent: ITO Ward-40(5), New Delhi
Assessment Year: 2010-11
Case Filed On: 2019-02-28
Order Type: Final Tribunal Order
Date of Order: 2019-10-14
Pronounced On: 2019-10-14
The case of Preeti Bansal vs ITO Ward-40(5), New Delhi (ITA 1665/DEL/2019) revolves around the allegations of tax evasion by the misuse of the National Multi Commodity Exchange (NMCE) platform. Filed on 28th February 2019, the case pertains to the assessment year 2010-11 and was brought before the Income Tax Appellate Tribunal (ITAT) in New Delhi. The final tribunal order was issued on 14th October 2019, with the judgment pronounced on the same day.
Preeti Bansal, an individual deriving income from rent and interest, filed her return of income for the assessment year 2010-11 on 3rd February 2011, declaring a total income of INR 185,593. The crux of the case lies in the information received from the Deputy Director of Income Tax (Investigation), Kolkata, regarding systematic tax evasion by clients/members of the National Multi Commodity Exchange by misusing the platform to create artificial volumes and suspected tax evasion.
The information indicated that 85 entities were involved in booking contrived losses/profits in excess of INR 10 crores. Among these entities, 50 clients, including Preeti Bansal, were identified for verification to ascertain if the contrived losses booked on the NMCE platform were used to set off any income/profit available in the books.
The investigation revealed that Preeti Bansal allegedly booked profit/loss amounting to INR 198,000 through sub-broker Shivputra Vinimay Private Limited during the financial year 2009-10. However, this transaction was not accounted for in her income tax return for the assessment year in question. Consequently, a notice under Section 147 of the Income Tax Act was issued, indicating that an income of INR 198,000 had escaped assessment.
Preeti Bansal contested the allegations, stating that she did not earn any profit on the NMCE platform through the aforementioned broker and provided all relevant bank statements and taxable income statements to support her claim. She requested the assessing officer to provide details of the bank, branch, and account number in which the alleged profit was received, which the officer could not substantiate.
The tribunal, after carefully considering the rival contentions and perusing the lower authorities’ orders, found no substantial evidence linking Preeti Bansal to the alleged transactions. The reasons recorded for reopening the assessment were deemed unsustainable, as there was no credible material to support the claim that Preeti Bansal earned INR 198,000 by misusing the NMCE platform. The assessing officer could not point out any bank account where the income was credited, nor did the income appear in the computation of total income submitted with the return of income.
The tribunal allowed the appeal of Preeti Bansal, concluding that the reopening of the assessment was invalid and the addition of INR 198,000 to her total income was unwarranted. The final judgment stated:
Order pronounced in the open court on 14/10/2019.
-Sd/- (K.N.CHARY) JUDICIAL MEMBER
-Sd/- (PRASHANT MAHARISHI) ACCOUNTANT MEMBER
Similar conclusions were reached in the cases of Shruti Garg (ITA No. 1666/Del/2019) and Chand Kumar Goyal HUF (ITA No. 1667/Del/2019), where the tribunal allowed the appeals based on identical facts and findings.
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