TaxTMI 
TaxTMI 
2017 (11) TMI 672
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.... the laptops impounded under the survey, it was noticed that a large amount of cash was deposited and cheque are issued on various parties on the same day or within a few days. In view of the admission of Sh. S.K.Gupta that he has been providing accommodation entries through various conduct companies, and on the application filed before the Income Tax Settlement Commission (in short "ITSC"), the ITSC directed computation of the total undisclosed income in relation to various conduct companies controlled by Sh. S.K.Gupta, in the hands of Sh. S.K.Gupta only. AO initiated action in the case of all 34 companies including the assessee and passed orders in all the cases making additions. In case on hand, the AO made an addition of Rs. 1,44,23,220/- as against the returned income of Rs. 8,104/-. When nine out of such 34 conduit companies carried the matter in appeal which reached the level of Income Tax Appellate Tribunal, a Bench of the Tribunal by way of order dated 21.01.2015 in a batch of cases in ITA No.3477/Del/2013 passed an order holding that since credit entries in the case of conduit companies have been considered in the hands of Sh. S.K.Gupta, no separate addition u/s 68 of the....
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....ief of deletion of the addition. He submitted a copy of the order dated 28.01.2015 in ITA No.3477/Del/2013. 5. Ld. DR heavily relied upon the authorities below. 6. We have gone through the record. It is an admitted fact that the assessee is also one of the group concerns of Sh. S.K.Gupta and on the application of the Sh. S.K.Gupta before the ITSC, ITSC was pleased to direct the computation of the entire undisclosed income relating to various conduct companies controlled by Sh. S.K.Gupta shall be in the hands of Sh. S.K.Gupta. This fact is recorded by a Coordinate Bench of this Tribunal in the order dated 28.01.2015. Relevant portion of the order dated 28.01.2015 of the Co-ordinate Bench in the case of Nine companies in M/s Omni Farms Pvt. Ltd. is as follows:- 11. "We have carefully considered the arguments of both the sides and perused relevant material placed before us. The facts in the case of all the companies are similar. Therefore, they are being taken up together for adjudication. For the sake of brevity, we shall discuss the facts in the case of M/s Omni Farms Pvt. Ltd. instead of all the nine companies. 12. In the case of M/s Omni Farms Pvt.Ltd., the Assessing Office....
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.... him. The Settlement Commission also has recorded the similar finding that Shri S.K. Gupta was providing entries to various beneficiaries by using various firms/companies. Admittedly, the companies under appeal before us are the part of companies which were utilized by Shri S.K. Gupta for providing accommodation entries. In paragraph 26, the Settlement Commission has recorded the finding "It is further observed that the paper books give complete details as to how and when cash was received from the mediators, the cash was deposited in the bank accounts of intermediatories and cheques were issued to the beneficiaries of almost the same amounts". Thus, after examining the facts, the Settlement Commission has recorded the finding that the cash deposited in the bank account of the intermediary companies was the cash received from mediators on behalf of the beneficiaries who wanted to avail the accommodation entries. It is further observed by the Settlement Commission "It is further noted that there are overwhelming evidence in the impounded material as enclosed by the applicant in the paper book which show that the applicant is only entry provider and he had issued cheques after receiv....
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.... light on material that had been suppressed from the Commission. If such is the case, it would be only logical that the Commission itself should be approached for a declaration that its order of 17th March, 2008 is a nullity. Allowing any other authority, even by way of a notice under s. 153C, would be to permit multiple jurisdictions which can result in chaos. After all non-disclosure or suppression of information in respect of what is required to be revealed to the concerned authorities is akin to fraud and if it has a material bearing on the outcome of the assessment, it would most certainly be misrepresentation." 15. Thus, Hon'ble Jurisdictional High Court has held that the order of the Settlement Commission is final and conclusive as to the matter stated therein for the assessment year decided by the Settlement Commission. Admittedly, the order of the Settlement Commission in the case of Shri S.K. Gupta is for AY 2008-09 and all the appeals under consideration before us are for AY 2008-09. The CIT(A) denied to follow the order of the Settlement Commission remarking that all the relevant facts might not have been produced before the Settlement Commission. However, learne....
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....all for and examine the record of any proceeding in which an assessment is pending and, if he considers that, having regard to the nature of the case or the amount involved or for any other reason, it is necessary or expedient so to do, he may issue such directions as he thinks fit for the guidance of the Assessing Officer to enable him to complete the assessment and such directions shall be binding on the Assessing Officer : Provided that no directions which are prejudicial to the assessee shall be issued before an opportunity is given to the assessee to be heard. Explanation. - For the purposes of this section no direction as to the lines on which an investigation connected with the assessment should be made, shall be deemed to be a direction prejudicial to the assessee." (emphasis by underlining supplied by us) 17. Thus, there is an order of the Settlement Commission as well as the Additional Commissioner of Income Tax under Section 144A holding that Shri S.K. Gupta was providing accommodation entries, he used various companies as conduit for providing the accommodation entries, cash was received through mediators from the persons who wanted to avail the accommodatio....