TaxTMI 
TaxTMI 
2016 (1) TMI 1092
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.... of leasing, finance and investments. It belongs to the Minda Group of Companies. For the A.Y. 2004-05, it filed a return of income on 30.7.2004 declaring total income of Rs. 45,57,170/-. The A.O. passed an order u/s 143(3) of the Income Tax Act 1961 (the Act) on 28.12.2006, assessing the total income at Rs. 4,01,36,258/- inter alia making an addition u/s 14A as well as u/s 68 of the Act. 2.1. The assessee has received share application money of Rs. 3,50,88,000/- (i.e. Rs. 3,51,00,000 (-) 12,000/- refund) with premium from 54 companies. The A.O. has given details in his order. When asked to substantiate the genuineness of this share application money, the assessee filed certain details such as copies of confirmation from the companies, Pan....
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....n money of Rs. 3,51,000/- is same. Cash is handed over by the assessee to the accommodation entry providers, who deposited in bank accounts of the persons/firms being operated by them and from those accounts, the money is transferred to the bank accounts of the companies who used to provide or issue cheques/DD or pay order in favour of the beneficiaries. It is very much clear from the above that the money received by the assessee company by way of share application money, is its own money but rooted through the bank accounts of various persons/firms/companies." 2.3. Thereafter the AO referred to the information received from DIT (Investigations), New Delhi and the statements of the alleged Directors of these companies recorded u/s 131 ....
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.... alleged share applicants. d) that the purchase of stamp papers from the respective stamp vendors remained to be proved. e) that the said additions were made by Assessing Officer on the basis of definite information from investigation wing that the said amounts were accommodation entries. f) that in respect of many involved entities, their key persons have admitted on oath before the investigation Wing of the Deptt. as reproduced in the assessment order that the said entities merely functioned as entry operators and not carried out any actual business. g) that the inspector also reported on local enquiries that all the said companies are either not existing at the given address or the impugned premises found locked. h) that t....
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....ng the proportionate disallowance is also in consonance with amendments made to section 14A w.e.f. 01.04.2007. f) the ratio of the decision in the case of CIT Vs. HR Sugar Factory (P) Ltd. 187 ITR 363, where it has been held that if parts of the funds have been utilized for non business purposes, part disallowances of interest is justified. g) the ratio of the decision in the case of India Metals & Ferro Alloys Ltd. Vs. CIT 193 ITR 344, where it was held that it is for the assessee to prove that the borrowed fund has been utilized for business purposes. 4. The appellant craves leave to add, to alter, or amend any grounds of the appeal raised above at the time of hearing." 5. We have heard Shri Pradeep Dinodia, the Ld.Counsel for the....
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....that these evidences were not confronted to the assessee, was not proper. When the inspection report can be put to the assessee by the Ld.CIT(A), other evidences should have also been put to the assessee by the Ld.CIT(A). The assessee contends that all the information and material obtained by the A.O. has to be put to him before coming to a conclusion. He further contends that the assessee has furnished whatever material it could, and as considerable time has elapsed no further burden should be put on the assessee to furnish any further evidences. We find force in these submissions of the assessee. The A.O. in our view should not put further burden on the assessee. 9. In view of the above discussion, we are of the considered opinion that t....