TaxTMI 
TaxTMI 
2013 (11) TMI 1496
X X X X Extracts X X X X
X X X X Extracts X X X X
..... The case pertains to the Assessment Year 2001-02. Return was filed on 31.10.2001 by the Assessee declaring total income of Rs. 1,42,508/-. Assessment was completed under Section 143(3) on 26.03.2004 at income of Rs. 8,90,160/-. 4. On giving appeal effect, vide order dated 10.02.2005, the revised income stood assessed at Rs.8,64,414/-. 5. Information was received from the Investigation Wing of the appellant that the Assessee was identified as one of the beneficiaries who had received bogus entries from the following parties:- Name Cheque No. Amount in Rs. Date M/s. Landmark Communication Pvt. Ltd. 494833 5,00,300 19.08.2000 M/s. Landmark Communication Pvt. Ltd. 494835 5,00,750 30.08.2000 M/s. Fair N. Square Exports Pvt. Ltd. 111077 4,50,360 16.06.2000 6. Notice under Section 148 of the Act was issued to the Assessee on 15.02.2007. In response to which the Assessee filed a letter dated 21.02.2007 stating that return originally filed may be treated as return in response to the notice under Section 148. 7. Notice under Sections 143(2) & 142(1) was issued on 21.06.2007 and the Assessee was required to furnish information in respect of persons who had been allotted ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....edings) was fabricated. The Assessing Officer prepared the following chart as a comparison between the fabricated entries and actual bank statement obtained from the bank. M/s. Landmark Communication Pvt. Ltd. (A/c No.3194 with Jai Laxmi Co-op. Bank) FABRICATED STATEMENT Date Narration Cheque No. Debit Credit Balance 28/08/2000 By Tr -- -- 5,01,500 5,03,050 cr. 29/08/2000 To Tr (to pay order) 494833 5,00,750 -- 2,300 cr 29/08/2000 By clearing 5,00,000 5,02,300 cr. 30/08/2000 To Tr (pay order) 494835 5,00,750 1,550 cr. ACTUAL STATEMENT as obtained from Bank by this office. Date Narration Cheque No. Debit Credit Balance 28/08/2000 By Cash -- -- 220,000 4,42,210 Cr. 28/08/2000 By Cash -- -- 60,000 5,02,210 Cr. 28/08/2000 To Tr (PAY ORDER) 494828 5,00,300 -- 1,910 Cr. 29/08/2000 By Cash -- -- 300000 3,01,910 Cr. 29/08/2000 By Cash -- -- 200000 5,01,910 Cr. 29/08/2000 By Cash -- -- 700 5,02,610 Cr. 29/08/2000 To Tr (PAY ORDER) 494833 5,00,300 -- 2,310 Cr. 30/08/2000 By Cash -- -- 300000 3,02,310 Cr. 30/08/2000 By Cash -- -- 500000 8,02....
X X X X Extracts X X X X
X X X X Extracts X X X X
....other to avoid direct reflection of deposit/withdrawal of cash. 14. The Assessing Officer held that the said companies had no creditworthiness, financial worth or regular resources to justify their subscription of share capital money in the Assessee company. The Assessing Officer held that the Assessee had failed to discharge the onus to prove the creditworthiness of the said investors in terms of Section 68 of the Act, more so, in view of the fact that the extracts of bank statements furnished by the Assessee were fabricated. 15. The Assessing Officer relying on the decision of the Delhi High Court in CIT VS. HIMALAYA INTERNATIONAL LTD. (2008) 214 CTR 437 (DEL.) vide order dated 28.12.2007 held that the Assessee had failed to discharge the onus in proving the Identify of the creditors/subscribers, genuineness of the transactions and the creditworthiness. The Assessing Officer accordingly made an addition of Rs.30,50,000/- in the hands of the Assessee. 16. On an appeal by the Assessee, the CIT (Appeals), vide order dated 03.03.2009, deleted the addition made by the Assessing Officer. The CIT (Appeals) accepted the contention of the Assessee that once the share applicants were id....
X X X X Extracts X X X X
X X X X Extracts X X X X
....0. Aggrieved by the order of the CIT (Appeals) as confirmed by the ITAT, the Revenue has filed the present appeal. 21. Learned Counsel for the Appellant/Revenue has submitted that the orders of the CIT (Appeals) and the ITAT are perverse in as much as they have failed to appreciate the fabrication in the bank statements of the share applicants that had been filed by the Assessee. The Assessee had failed to establish the creditworthiness of the investors and also the genuineness of the transaction. 22. The Learned counsel for the Respondent/Assessee submitted that by providing the PANs, account details , share application forms and confirmation letters the Assessee had discharged the onus and no addition could be made in the hands of the Assessee. Additions if any could be made in the hands of the applicants. In support of his contention learned Counsel relied upon the Judgment of this court in the case of CIT VS GANGESHWARI METALS PVT LTD. 2013 (2) A.D. (DELHI) 378. 23. We have heard the learned counsel for the parties. We are of the considered opinion that the orders of the CIT (Appeals) and the ITAT in deleting the additions made by the AO under Section 68 of the Act are perve....
X X X X Extracts X X X X
X X X X Extracts X X X X
....reated as sufficiently disclosing the identity of the individual. The mere filing of share application is not enough as the said application is not an unimpeachable document and does not on its own prove the genuineness or authenticity of the transaction. It can at best be treated as a corroborative document. Since the share application form is not an unimpeachable document, it cannot on its own be treated as sufficient for cross-verification of the transaction. We have already held that that mere production of PAN Number or assessment particulars does not establish the identity of a person. The identification of a person includes the place of work, the staff and the fact that it was actually carrying on business and further recognition of the said company/individual in the eyes of public. 28. The Assessing Officer had requisitioned the Bank Statements of the share applicants as there was a doubt about the correctness of the bank statements furnished by the Assessee during the original assessment proceedings. The bank statements requisitioned from the banks established that immediately before the issuance of cheques for the purpose of making pay order or demand draft, there was a ....