TaxTMI 
TaxTMI 
2016 (5) TMI 852
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.... deserves to be hold void-ab-initio. 2. On the facts and in the circumstances of the case the Ld. CIT(A) has grossly erred in confirming the addition of Rs. 76,00,000/- made on account of undisclosed income u/s 69 in arbitrary manner without properly considering the submission made and evidence adduced and has further ignored the effective compliance made by the assessee by submitting the all possible details, thus the addition of Rs. 76,00,000/- uphold by the Ld. CIT(A) deserves to be deleted. 2.1 That the Ld. CIT(A) has further erred in not appreciating the fact that Ld. AO has not allowed the opportunity to cross examine Shri Gajendra Porwal and further hold that the assessee has not discharged his initial onus when the assessee has furnished all the necessary details to prove the genuineness of cash credit, thus the addition uphold by the Ld. CIT(A) deserves to be deleted. 3. On the facts and in the circumstances of the case the Ld. CIT(A) has grossly erred in upholding the addition of Rs. 76,000/- made by alleging the same as commission paid for obtaining the alleged entry of Rs. 76.00 lacs arbitrarily." 2. Ground Nos. 1 and 3 of the appeal are not pressed by the ld AR....
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....esident Engineer Rajasthan State Road Development Corp.. He also filed affidavit before the Assessing Officer and claimed that the copy of the seized material was provided late and whatever copy of deposit slip and withdrawal cheques found during the course of search were not pertained to his firm and no partner/employee has signed on it. Whatever admission made by Shri Gajendra Porwal had been used against the assessee on surmises and conjecture. Copy of the search material had been provided by the Assessing Officer after repeated requests and copy provided of the statement of Shri Gajendra Porwal was also not legible. There also copy of account of Shri Gajendra Porwal has not been provided and no inspection was allowed to the assessee. He was also not allowed cross examination of Shri Gajendra Porwal including bank manager of Karnataka Bank, which is not as per law. After considering the assessee's reply, the ld Assessing Officer held that whatever objection raised by the assessee are not correct. There was a delay from the side of the assessee to get the copy of seized material in completing the formality. When formality has been completed, the copy of search material was provid....
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....us, he confirmed the addition. 5. Now the assessee is in appeal before us. The ld AR of the assessee has submitted that third party statement and material gathered during the search had been used in making addition by the Assessing Officer and confirming addition by the ld CIT(A). The assessee had taken loan of Rs. 76.00 lacs from M/s Abhaya Investment Pvt. Ltd. on 01/07/2003 through payees account cheque duly deposited in the bank account of the assessee, which evidence had been admitted by the ld Assessing Officer in the assessment order itself. This amount was utilized by the assessee in its business activity and thereafter on 09/09/2003, the loan so taken by the assessee was repaid by it vide 8 demand drafts totaling to Rs. 76.00 lacs. This amount was repaid back by the assessee out of the maturity receipts of FDRs of assessee maintained with PNB bank of Rs. 80.25 lacs in the name of Resident Engineer Rajasthan State Road Development Corporation matured in the month of July, 2003. Thus, once the assessee had repaid the loan, the account of the aforementioned company i.e. M/s Abhaya Investment Pvt. Ltd. got squared up in the books of account of assessee. It has been alleged by ....
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....), has been decided in favour of the assessee by the ITAT. The operative portion of the Coordinate Bench is as under:- "Under the facts and circumstances in totality, we come to the conclusion that the admission made by Shri Porwal admitting that the transaction in question was managed by him for beneficiaries on charging of commission are not worth relying in absence of his being cross examined by the assesses and in absence of any supporting evidence especially when those admissions by Shri Porwal were suitable to his own interest. It is also surprising that no incriminating document was found during the course of search at the premises of Shri Gajendra Porwal to corroborate his statements about indulging in arranging accommodating entries which are being done at large scale in a systematic manner, as claimed. We thus hold that in the present case there was no sufficient material/evidence on record to come to the conclusion that transactions in question are bogus. Under this background, we are of the view that the ld. CIT (A) has rightly deleted the addition. For a ready reference the relevant para at pages 6 to 8 in the case of Shri Megh Raj Singh Shekhawat which is also common....
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....ceived by Sh. Porwal from the appellant for this transaction. No such entry for receipt of commission was found in the case of Sh. Gajendra Porwal nor any addition or an accounted payment of commission was made by the AO in the case of the appellant. The appellant company asked for cross examination of Sh. Porwal which was though admitted by the AO but as Sh. Porwal did not remain present before his own AO, the opportunity of cross examination could not be availed by the appellant. Absence of Sh. Porwal for cross examination was justified by the AO on some assumptions. The AO has given weightage to the fact that Sh. Porwal in his affidavit filed much after the search action has confirmed his earlier statement recorded u/s 132(4). Thus the entire addition is based on the statement of Sh. Porwal recorded u/s 132(4). Not providing the opportunity of cross examination of Sh. Porwal is not justified. No material was borne out from the statement of Sh. Gajendra Porwal which justifies the additions. /Except statement there is no other material to support that the transaction was an accommodation entry. The possession of shares in the hands of the appellant has not been doubted. To come....