TaxTMI 
TaxTMI 
2016 (7) TMI 664
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....who is the controlling person of the assessee was critically ill; confined to bed and finally passed away. On account of remaining pre-occupied with the above tragedy the appeals it was stated could not be filed on time. Inviting attention to the copy of the order dated 14.02.2014 in ITA Nos.-3213, 3214 & 3856/Del/2012 & 1080/Del/2013 in the case of Konichiva Builders Ltd. it was submitted that on identical facts delay of 43 days had been condoned by the Co-ordinate Bench. Relying on the same it was submitted that the delay may be condoned. The Ld. DR considering the order of the Tribunal and the petition of the assessee had no objection if the appeal is decided on merits by condoning the delay in each of the appeals. 3. Considering the facts on record and the submission of the parties we are of the view that the delay pointed out by the Registry deserves to be condoned. Respectfully following the order of the Co-ordinate Bench the delay in the appeals is condoned. 4. Ld. AR inviting attention to the assessment order under consideration submitted that the assessee who is found mentioned at Sl. No.-17 in the list of companies where Konichiva Builders Ltd. is found mentioned in....
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....ies is as under:- 1. Konichiva Builders Ltd. 2. B.T.Technet Ltd. 3. Swen Television Ltd. 4. T & G Quality management consultants Ltd. 5. Hitech Computech Pvt. Ltd. 6. Centenary software pvt. Ltd 7. Trump and Gates 8. T & G Quality Servrces 9. GTM Konichiva Builders 10. Gupta Rakesh Associates 11. Era Advertising and Marketing Coy Pvt Ltd 12. PG Travels Hindustan Com 13. Shark Communication Pvt Ltd 14. Spg Finvest Pvt Ltd. 15. Krishna Informedia 16. Bolni Exim India Ltd 17. Bharti Properties Pvt Ltd 18. Marketing Insurance Brokers Pvt Ltd 19. Cam Soft (lndia) Pvt Ltd 20. Ours Trading Pvt. Ltd 21. Pawar Estates Pvt Ltd 22. Rajdhani Leasing Ltd 23.DMC Vaults Ltd 24. Sigma Farms Ltd 25. North India securities Pvt Ltd 26. Hamara Samay TV News Network Pvt Ltd 27.Cel Cel Technologies Ltd 28. Chip Set Solutions Pvt Ltd 29. Trump & Gates 30. Servel Technology System Pvt. Ltd. 31. PG Travels Hindustan Com Pvt Ltd ....
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....ves or friends of Sh. S.K.Gupta. (vii) The Assessing Officer has given elaborate and adequate opportunities to the appellant company to explain their matter during the assessment proceedings and to counter the findings of the Assessing Officer. (viii) The Assessing Officer himself has repeatedly recorded statements of Shri S.K.Gupta and has confronted him in detail about the findings." 6.2. On the basis of the above facts the AO arrived at the following conclusions. These are extracted from the assessment order:- 4. "Inferences:- i. It is proved beyond doubt on the basis of documentary evidences, confessional statement of Shri. S.K.Gupta, the main person controlling the state of affairs of the assessee. Husband of Smt. Saroj Gupta, director of the assessee company and results of the assessment that assessee is engaged in the accommodation entry business and not doing any genuine sale & purchase as claimed in the final account statements annexed with return of income. ii. Since assessee has failed to produce any regular books of account, sale & purchase and expenses vouchers the book results shown by the assessee are liable to be re....
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....his is the net rate. 5. With these remarks, the total income is computed as under: With these remarks income of the assessee is computed as under: (i) Total income as per 153 A return Rs. 3396/- Add:- Income earned from Accommodation entry Business (a) On the Accommodation Sale Bills/Turnover @ 2% of Rs. 1501913/- Rs.30038/- (b) On account of bogus fresh investment entries @2% of Rs. 83,95,000/- Rs. 167900 Rs. 201334 6.3. In appeal before the First Appellate Authority the CIT(A) held as under:- "2.3.5. Taking into consideration the totality of facts and circumstances of the case as discussed hereinabove, it is held that the addition made by the AO on account of net income earned from accommodation entry business to the tune of Rs. 197938/- is justified and is, therefore, confirmed. Since the AO has given a categorical finding that the appellant had only indulged in accommodation entries business and had not done any genuine business and rejected the books results on that ground, the net profit shown in the return has lost its relevance and should not be given any credence. The AO is, therefore, directed to recomputed ....
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....ectors of the assessee company and other companies (which were found to be employees, relatives or friends of Sh. SK Gupta) from Shri S.K. Gupta's premises. From the above, AO observed that it became abundantly clear that the assessee company, in fact, indulged in accommodation entries business and did not do any genuine business. All the sale and purchases etc. booked in these companies were found to be bogus. Proper books of accounts were not found to have been maintained. In these circumstances, the books of accounts of the assessee were rejected and additions were made on estimate basis, the same were affirmed by the Ld. CIT(A) in appeal." 8.1. The issue pertaining to books of accounts etc. was considered by the Coordinate Bench in the following manner:- 6. "The first issue pertains to rejection of books of accounts. Ld. Counsel of the assessee in this regard submitted that he is not vehemently pressing this issue. We find that in the search and on the basis of material recovered and statements obtained it has been duly established that assessee was indulging in bogus accommodation entries. No actual sale and purchase was done by the assessee. Proper books of accoun....
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....ommon law maxim of approbate and reprobate. 11. In this case the assessee company's Director has agreed that the commission was to the tune of 1.5% to 2%. Hence, estimation of commission income @ 2% cannot be disputed. However, at the same time it has also been submitted in the same statement that the assessee has to incur the expenditure on account of salary, rent bank charges, conveyers, telephone, water and electricity. However, it is also settled that mere submission that expenditure has been incurred cannot lead to allowance of expenditure. Assessee has to prove with cogent material that the expenditure has been incurred to earn the income. In these circumstances we remit the issue to the file of the AO. The Assessing Officer shall examine the aspect of allowance of expenditure on the basis of cogent materials to be submitted by the assessee. 9. In the afore-mentioned peculiar facts and circumstances addressing the limited plea of the assessee in the light of the arguments advanced by the parties before us wherein Ld. AR has placed reliance upon the order of the Division Bench in the case of Konichiva Builders Ltd. and the Ld. DR has not opposed it. In the facts be....