TaxTMI 
TaxTMI 
2015 (4) TMI 755
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....has taken following grounds of appeal: "1. On the facts and circumstances of the case and in law, the order of the CIT(A) is wrong, perverse, illegal and against the provisions of law which is liable to be set aside. 2. On the facts and circumstances, whether Ld. CIT(A) was justified on facts of the case and in law in deleting the addition of Rs. 80,00,000/- made on account of unexplained share application money ignoring the fact that the assessee has failed to discharge its onus of providing identity, credit worthiness and transaction made by the assessee of the said amount. 3. On the facts and circumstances, whether Ld. CIT(A) was justified on facts of the case and in law in treating the profit of Rs. 30,05,599/- derived from share trading as short term capital gain whereby the AO has rightly treated the same as the business income of the assessee. 4. The appellant craves to leave, to add, alter or amend any ground of appeal raised above at the time of the hearing." Ground no. 1 is general in nature and requires no adjudication. 4. Brief facts apropos ground no. 2 are that in course of assessment proceedings AO noticed that assessee had introduced share application money amou....
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....heir identity and genuineness of the transaction which was submitted before the Id. AO via post. a) Acknowledgement of Return of Income. b) Balance sheet & Profit and Loss A/c c) Affidavit from the Directors d) Confirmation e) PAN Details 7. The assessee had further submitted that since assessee had filed all the details it was for the AO to conduct some inquiry to support his claim with regard to a transaction being ingenuine, being names/ addresses/ PAN details/ tax returns of creditors had been produced before him. If the assessee was not able to produce any of the creditor, the AO was required to issue notice u/s 131 of the Act and call the concerned parties for examination. The assessee relied on various decisions noted in the submissions made before ld. CIT(A) and submitted that AO cannot draw adverse inference in cases where he has not issued notice u/s 131 or had not made any inquiry. As regards creditworthiness, it was submitted that the fact that all the parties were carrying on business was not in doubt; all were maintaining regular books of a/c as well as bank account. The money had come to the assessee's account from regular bank account of both the companies. Al....
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.... deal with the matter in depth after the affidavit/ confirmation along with bank accounts were filed, then the assessment order cannot be sustained. 12. Ld. counsel further submitted that the decision in the case of CIT Vs. Nova Promoters and 342 ITR 169 (Del.) is not applicable to the facts of the case as in para 39 of the said judgment the Hon'ble Delhi High Court has observed as under: "39. The case of Orissa Corporation (1986) 159 ITR exemplifies the category of cases where no action is taken by the Assessing Officer to verify or conduct an enquiry into the particulars about the creditors furnished by the assessee, including their income-tax file numbers. In the same category fall cases decided by this court in Dolphin Canpack (2006) 283 ITR 190, CIT v Makhni and Tyagi P. Ltd. (2004) 267 ITR 433, CIT v Antartica Investment P. Ltd. (2003) 262 ITR 493 and CIT v Achal Investment Ltd. (2004) 268 ITR 211. To put it simply, in these cases the decision was based on the fundamental rule of law that evidence or material adduced by the assessee cannot be thrown out without any enquiry. The ratio does not extend beyond that. The boundaries of the ratio cannot be, and should not be, wide....
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....the facts of the present case, wherein in paras 2 & 3 it has been observed as under: "2. Learned counsel for the appellant submits that the order passed by the Tribunal is perverse and in fact one S.H. Mallick had given a statement, which is re-produced in the assessment order saying that he had provided accommodation entries and the said statement conclusively proves that share money of' 30,00,000/- allegedly received by the respondent-assessee from 5 companies are sham and bogus transactions . 3. We have examined the said contention and find that the assessee during the course of assessment proceedings has filed confirmation letters from the companies, their PAN number, copy of bank statements, affidavits and balance sheet. Thereafter the Assessing Officer had asked the assessee to produce the said Directors/ parties. Assessee expressed its inability to produce them. The Assessing Officer did not consequent thereto conduct any inquiry and closed the proceedings. This is a case where the Assessing Officer has failed to conduct necessary inquiry, verification and deal with the matter in depth specially after the affidavit/ confirmation along with the bank statements etc. were....