TaxTMI 
TaxTMI 
2017 (4) TMI 347
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....Objection was filed by the assessee. A request has been made to condone the delay. The reliance was placed on the following case laws: N. Balakrishan Vs M. Krishanmurthy (1998) 7 SCC 123 Collector, Land Acquisition Vs Mst. Katiji & Ors. 167 ITR 471 (SC) 2. The ld. DR submitted that the delay may not be condoned. 3. After considering the submissions of both the parties, we are of the view that the delay of 3 days may be condoned. In the present case, the assessee filed the Cross Objections on 14.01.2015 after receiving the memo of appeal of departmental appeal on 13.01.2015. Accordingly, the Cross Objections are admitted. 4. First we will deal with the appeal of the department in ITA No. 2015/Del/2014 and the Cross Objection in CO No. 05/Del/2015 by the assessee for the assessment year 2006- 07. The grounds raised by the department in its appeal read as under: "1. The order of Ld. CIT(A) is not correct in law and facts. 2. On the facts and the circumstances of the case the Ld. CIT(A) has erred in deleting the addition of Rs. 1,98,84,400/- on account of share capital. 3. On the facts and the circumstances of the case the Ld. CIT(A....
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....00/- Benco Finance & Investment Pvt. Ltd. AABCB9349R 8,00,000/- Bhagyaluxmi Fuits Pvt. Ltd. AACCB6957E 3,00,000/- K M Gandhi Exports Pvt. Ltd. AAACK4538J 5,55,400/- Khinoor Oil Mills Ltd. AABCK6763G 3,00,000/- Prime Capital Market Ltd. AABCP9313M 8,00,000/- Puri Milk & Food Ltd. AACCP3666L 1,50,000/- Purshottam Garg AAHPG8744N 1,50,000/- Rapid Impex Pvt. Ltd. AACCR5081P 1,50,000/- Rehka Sharma AZXPS4694Q 1,00,000/- Rohtas Kumar Aggarwal AAOPA3934F 1,00,000/- S K Bansal AGHPB8689H 2,00,000/- Warner Multimedia Ltd. AABCC0225H 7,00,000/- Total 1,96,85,400/- 8. The AO also noticed that the assessee had received unsecured loans of Rs. 35,70,740/-. He was of the view that the assessee company routed back its own undisclosed income to the books of accounts and failed to furnish any information in respect of share capital and unsecured loans. Therefore, the share application money and share premium was unaccounted income of the assessee. He accordingly, made the addition of Rs. 1,96,85,400/- (wrongly mentioned as Rs. 198,84,400/- in the grounds of a....
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....equire the appellant to produce the parties for verification. The relevant query in the questionnaire is reproduced below for reference. b) Share capital of Rs. 10460000/- and share application money of Rs. 9225400/- has been introduced in, the books of accounts of the company in the first year of operation of the company. In this regard submit complete details about the names and addresses of the persons contributing to the share capital of the company with complete details of source of funds introduced as share capital. Furnish complete address of Sh. Sanjay Bansal and Sh. Lachman Das who have signed the return of income filed for the assessment year 2006-07 with their PAN and assessment particulars. 4.2.7 Other than the questionnaire referred above, there is no other communication with the appellant seeking any details or asking him to produce any parties for verification. Therefore I do not find any merit in the remark of the AO that "no such documents were submitted nor any of the representatives of the entities mentioned as above had been produced." 4.2.8 It is also noted that the AO mentions that enquiries were conducted by his office in respect of....
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....h shares. In the only query raised during the assessment proceedings, as evidenced by the questionnaire of 18/07/2011 (note sheets being blank), the appellant has been asked to submit complete details about the names and addresses of the persons contributing the share capital of the company with complete details of source of funds introduces as share capital."The relevant query i.e. (b) of part III of the questionnaire is reproduced below for ready reference. (This query has been reproduced by the AO at page 1 of the assessment order.) Share capital of Rs. l,04,60,000/-and share application money of Rs. 92,25,400/- has been, introduced in the books of accounts of the company in the first year of operation of the company. In this regard submit complete details about the names and addresses of the persons contributing to the share capital of the company with complete details of source of funds introduced as share capital. Furnish complete address of Shri Sanjay Bansal and Shree Laxman Das who have signed the return of income filed for the assessment year 2006-07 with their PAN and assessment particulars. 4.2.12 Therefore I do not find that the AO has been mentioning the corr....
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....at which the Inspector visited the location. Whether there was any second attempt made to check the addresses. It is not known who all in the neighborhood were contacted by him nor is there any information as to whether he did any enquiries with the postal authorities. Further the enquiry mentioned by the AO in the assessment .order also does not establish that the companies were not in existence. He only mentions that no person was available at the given address to confirm the existence of the company. It is also not ascertainable as to why the .appellant was not confronted with any adverse findings about nonexistence of persons at the given addresses etc. 4.2.16 Cash deposits in one of the applicant's case and immediate transfer of funds in the bank statements in others cannot be taken to mean that these were entry operators. The AO has arrived at such conclusion without any material evidences on record. Therefore I do not find any merit-in holding that the appellant had not discharged its onus cast upon it in providing the details asked for by the AO during the assessment proceedings. Once the appellant had submitted the details as called for, it was for the AO to h....
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....any merit in such addition. The appellant has submitted confirmations, bank account statement and the return of income of Shri Sanjay Bansal in support of the unsecured loan received from him. He is also the Director of the appellant company. Facts being so, if the AO wanted examination of source of loans in the hands of Mr Bansal, he was well within his powers to do so. However it can't be ground to make an addition that too on a protective basis in the hands of the appellant. From the AO's remarks it looks like he wanted to examine the source of source which he is not called for in the assessment proceedings of the appellant. 4.3.2 In the assessment order, there is no mention of any order sheet noting or any letter issued by the AO requiring any other details other than those which were called for in the questionnaire dated 18/07/2011. The relevant query in the questionnaire dated 18/07/2011 is reproduced below. (d) Schedule to 3 to the balance sheet-details about the unsecured loans raised by the company. Please furnish detailed copies of accounts of all the persons with confirmation from them along with their complete address and PAN. 4.3.3 There is no....
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....d the orders of the authorities below and further submitted that the assessee could not prove the creditworthiness of the share applicant and the depositors. Therefore, the AO rightly made the addition and the ld. CIT(A) was not justified in deleting the same. It was further submitted that the assessment for the assessment year 2008-09 was not completed u/s 143(3) of the Act, so the assessment was not abated. Therefore, the AO rightly framed the assessment u/s 153A of the Act. 15. We have considered the submissions of both the parties and carefully gone through the material available on the record. In the present case, it is an admitted fact no incriminating material was found during the course of search and the time limit to frame the assessment u/s 143(3) of the Act lapsed much before the search which took place on 07.01.2010 while the time period to issue the notice u/s 143(2) of the Act was only upto 30.09.2009. In the instance case, it is an admitted fact that the AO while framing the assessment u/s 153A of the Act made the addition without any incriminating material found during the course of search. 16. On a similar issue the Hon'ble Jurisdictional High Court in the ca....