TaxTMI 
TaxTMI 
TaxTMI 
2018 (4) TMI 178
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....ice us 148 of the I.T. Act. Search and seizure operation was carried-out at various premises of M/s. Today Homes and Infrastructure Pvt. Ltd. The assessee-company is one of the Associated Companies of M/s. Today Homes and Infrastructure Pvt. Ltd. It was noticed that during the F.Y. 2004-2005, the assessee has received Rs. 1,01,00,000 from M/s. Golden Technobuild Pvt. Ltd., Survey under section 133A was conducted on 26.11.2009 at the registered office of this company. The person available at the registered office has categorically stated that neither books of account are maintained nor any business activities are carried out by this company from this premises. It has been stated that this company is controlled by the Today Group of companies having office at Statesman House, Connaught Place, New Delhi. It has been noted that M/s. Golden Technobuild Pvt. Ltd., had received entry from Jain brother. A search action was carried-out at the premises of Jain Brothers and it was found that Jain Brothers had been providing accommodation entry to various parties after charging some commission for the same. It has been noted that assessee-company was the beneficiary in this transaction. Furthe....
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.... statement of Shri Vinay Subhikhi and Shri Gulshan Kumar Gambhir recorded on 27.11.2009 are referred to in the assessment order. Pages-134, 135, and 143 of Annexure-A1, Party H-2 seized from the office at 8th Floor, Statesman House, Barakhamba Road, New Delhi, which is registered office of M/s. Today Homes and Infrastructure Pvt. Ltd., are with respect to Din No. and digital signature along with pass word of various persons through whom assessee group has floated and controlled various companies, by appointing them as Directors etc., These companies, in turn, are used as conduit to transfer the unaccounted money received in the form of accommodation entries from various entry operators, into the main companies including flagship company namely M/s. Today Homes and Infrastructure Pvt. Ltd. Availability of these documents in the O/o. M/s. Today Homes and Infrastructure Pvt. Ltd. Further, strengthening the fact that Directors of the above said companies are merely employees of Today Group and controlled by Gambhir brothers who are having the similar pass words. With the help of digital signatures most of the compliance including filing of the I.T. returns, filing papers before ROC etc....
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....A.O, therefore, computed annual letting value of the property at Rs. 12,25,897 and after giving deduction of Rs. 1,05,000 declared by assessee, made the addition of Rs. 10,20,897. 5. The assessee challenged both the additions before Ld. CIT(A) and reiterated the submissions made before the authorities A.O. The written submissions of the assessee were reproduced in the impugned order of the Ld. CIT(A) in which the assessee submitted that various Courts have held that once the assessee have filed confirmation, evidence in support of the identity of the creditors in the form of PAN/GIR No, onus caste upon assessee have been discharged. The assessee relied upon several decisions in support of the contention including the decision in the case of CIT vs. Sophia Finance Ltd., 205 ITR 98, ITO vs. Stellar Investment Ltd., Divine Leasing and Finance Ltd., 299 ITR 268, CIT vs. Lovely Exports 319 (Statute) 5, CIT vs. Winstral Petro Chemicals Pvt. Ltd., 330 ITR 603 etc. The assessee also argued that onus is on the department to prove that apparent is not real and relied upon the decision of the Supreme Court in the case of CIT vs. Doulatram 87 ITR 349 etc., It was submitted that once assessee ....
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....efore, the addition was confirmed and appeal of assessee has been dismissed. 7. We have heard the learned Representatives of both the parties. Learned Counsel for the Assessee reiterated the submissions made before the authorities below and submitted that assessee filed all the documentary evidences to prove identity of the creditor, its creditworthiness and genuineness of the transaction in the matter. The A.O. wanted assessee to prove the source of the source. He has submitted that proviso to Section 68 of the I.T. Act has been introduced by Finance Act, 2012, w.e.f. 1st April, 2013 which is effective from A.Y. 2013- 2014 only. He has relied upon the decisions of jurisdictional High Court in the case of Divine Leasing and Finance Ltd., (supra), Oasis Hospitalities Pvt. Ltd., (supra), CIT vs. Dwarakadheesh Investment Pvt. Ltd., 194 taxman 43 and decision of M.P. High Court in the case of CIT vs. STL Extrusion 11 taxman.com 125. He has also relied upon order of the ITAT, Delhi Bench in the case of M/s. Mission Verdes Estate Pvt. Ltd., in ITA.No.4236/Del./2015 for A.Y. 2005-2006 dated 16th December, 2016 in which same facts have been considered with regard to credit received from M....
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....ion by further investigation and therefore addition under s.68 was not sustainable." 9.2. Hon'ble jurisdictional Delhi High Court in the case of CIT vs. Laxman Industrial Resources Pvt. Ltd., ITA.No.169 of 2017 dated 14th March, 2017, held as under : "The CIT(A) took note of the material filed by the assessee and provided opportunity to the AO in Remand proceedings. The AO merely objected to the material furnished but did not undertake any verification. The CIT(A) deleted the addition by relying upon the decision of the Hon'ble Apex Court in the case of Lovely Exports Pvt.Ltd. (supra) and judgement of Delhi High Court in the case of CIT vs Divine Leasing & Finance Ltd. [2008] 299 ITR 268. The ITAT confirmed the opinion of the Ld. CIT(A). Hon'ble High Court in view of the above findings noted that the assessee had provided several documents that could have showed light into whether truly the transactions were genuine. The assessee provided details of share applicants i.e. copy of the PAN, Assessment particulars, mode of amount invested through banking channel, copy of resolution and copies of the balance sheet. The AO failed to conduct any scrutiny of the document, the departmenta....
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....deletion of addition was justified." 9.4. Hon'ble jurisdictional Delhi High Court in the case of CIT vs. Winstral Petrochemicals P. Ltd., 330 ITR 603, held as under : "Dismissing the appeal, that it had not been disputed that the share application money was received by the assessee-company by way of account payee cheques, through normal banking channels. Admittedly, copies of application for allotment of shares were also provided to the Assessing Officer. Since the applicant companies were duly incorporated, were issued PAN cards and had bank accounts from which money was transferred to the assessee by way of account payee cheques, they could not be said to be non-existent, even if they, after submitting the share applications had changed their addresses or had stopped functioning. Therefore, the Commissioner (Appeals) and the Tribunal were justified in holding that the genuineness of the transactions had been duly established by the assessee." 9.5. Hon'ble jurisdictional Delhi High Court in the case of CIT vs. Value Capital Services Pvt. Ltd., (2008) 307 ITR 334 (Del.) (HC), in which it was held as under : "Dismissing the appeal, that the additional burden was on the Departmen....
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....he A.O. suspected the transaction between the assessee and the creditor because the creditor has received the credits from Company controlled by Jain brothers but it would not prove that credit received by assessee was not genuine. A.O. cannot ask the assessee to prove the source of the source. None of the statements recorded during the course of search as are referred to in assessment order prove that assessee has received any accommodation entry from any person despite the fact that same were not confronted to the assessee at assessment stage. Therefore, it is proved on record that assessee has been able to explain the identity of the creditor, its creditworthiness and genuineness of the transaction in the matter. We, accordingly, set aside the orders of the authorities below and delete the addition of Rs. 1,01,00,000. 11. As regards annual letting value of property No.48- Friends Colony (East), New Delhi, is concerned, the assessee submitted that it is co-owner with others and that the same is used for the purpose of business for the assessee and for part period it was let-out for which rental income has already been shown. However, the A.O. did not accept the contention of ass....