TaxTMI 
TaxTMI 
2018 (9) TMI 143
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....sp; xx JM AM 2. It is in this backdrop that the detailed order, setting out reasons for our conclusions, is being pronounced today. 3. By way of this appeal, the assessee appellant has challenged correctness of the order dated 24th June 2014 passed by the learned CIT(A) in the matter of assessment under section 143(....
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....sustainable on legal and factual grounds. 9. That the learned CIT(A) failed to appreciate that the AO had failed to follow the principles of natural justice. 5. In substance, thus, grievance of the assessee is that (a) learned CIT(A) erred in upholding the reopening the impugned assessment proceedings; and that (b) learned CIT(A) erred in upholding the addition of Rs. 80,00,000 as unexplained credit in respect of share application money received by the assessee from Geefcee Finance Investments Limited and Mahanivesh India Limited, and the addition of Rs. 2,00,000 as commission said to have been paid for arranging this alleged accommodation entry. 6. Let us take up grievance against the validity of reopening the assessment first. 7. Briefly stated, the relevant material facts are like this. It is a case of reopened assessment. Even though the assessee had filed the income tax return, disclosing an income of Rs. 22,66,970, on 31st October 2007, the reassessment notice was issued on 30th March 2012, on recording, inter alia, the following reasons of reopening the assessment: Subsequently, information has been received from Directorate of Income Tax (Investigation) of the Inco....
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....eedings, the ground of appeal take before the CIT(A) show the following grievances raised by the assessee: 1. The learned Assessing Officer erred in issue of notice under section 148 for reopening the assessment without having adequate grounds to come to the conclusion that there existed reasonable belief that due to failure of the assessee to furnish full and true particulars, income had escaped assessment. 2. The learned Assessing Officer had no information whether the notice was in respect of information collected by the investigation wing during the search or the information was collected during a survey. This is important as remedial action in search cases are covered under section 153A for assessment/ reassessment purposes, while section 148 will apply in respect of survey cases. 3. The learned Assessing Officer failed to furnish any material on record based on which reasons under section 148 was claimed to have been recorded, despite several requests by the appellant. 4. The learned Assessing Officer failed to confront any material information relied upon by him to draw conclusions adverse to the appellant. 9. Learned CIT(A), while dealing with the above grievan....
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....at the said notice states that "this notice is being issued after obtaining the necessary satisfaction of the Commissioner of Income Tax/ Additional Commissioner of Income Tax" but it does not strike off any of these two authorities. It is then pointed out that the said notice also states that "the copy of reasons recorded for initiating proceedings under section 147/148 are enclosed herewith" but no such attachment was furnished alongwith the notice. He submits that for these reasons, the initiation of reassessment proceedings must be held to be unsustainable in law. Learned counsel then submits that in this case the approval was required from the Additional Commissioner of Income Tax, but then it is an admitted position that the approval was obtained from the Commissioner of Income Tax. He submits that in a case in which the approval is required to be given by the Additional Commissioner of Income Tax, but approval is given by a higher authority i.e. Commissioner of Income Tax, the approval granted for reopening the assessment is vitiated in law. For this reason also, according to the learned counsel, the initiation of reassessment proceedings must be held to legally invalid. It ....
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....ing the assessment were not given alongwith the basis of reopening the assessment, for this reason also, the impugned reassessment proceedings are vitiated in law. It is not submitted that it is not only the reasons for reopening the assessment, but the material constituting basis for coming to this conclusion, must also be shared with the assessee. He then submits that even during inspection of record, no such basis was found by the assessee. Learned counsel then referred to, and extensively read out from, a large number of judicial precedents, including Pardesi Developers and Infrastructure Pvt Ltd Vs CIT [(2013) 351 ITR 8 (Del)], PCIT Vs Best Infrastruture Pvt Ltd [(2017) 397 ITR 82 (Del)], Dharmavir Singh Rao Vs ACIT [(2017) TIOL 2447 HC DEL IT], PCIT Vs N C Cables Limited [(2017) 88 taxmann.649 (Del)]. In addition to these judicial precedents addressed to in the course of arguments, learned counsel has also filed, and relied upon, certain other judicial precedents in the cases of CIT Vs SPLS Siddartha Limited (ITA No 836 of 2011; judgment dated 14th September 2011 from Hon'ble Delhi High Court) DSJ Communications Ltd Vs DCIT (WP No 722 of 2011; Hon'ble Bombay High Court's judg....
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....n of the Assessing Officer was a well considered decision and a right decision. It is not the requirement of law that at the stage of the reopening the assessment, the Assessing Officer must have conclusive evidence to establish escapement of income. A bonafide reasonable belief for holding the belief that income has escaped assessment is good enough for reopening the assessment, and the law is well settled on that aspect. Learned Departmental Representative took us through, and relied upon, the findings of, and judicial precedents relied upon by, learned CIT(A) on this aspect. Learned Departmental Representative also pointed out that the assessee had inspected the records at the assessment stage and even taken copies from the same. It cannot thus be said that the assessee was not provided with the reasons for reopening the assessment. As regards learned counsel's submission that the basis on which the reopening proceedings are initiated must also be shared with the assessee, learned Departmental Representative points out that it is not at all the requirement of law that all the inputs available to the Assessing Officer must also be shared with the assessee also. All that is requir....
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....tative further submits that the assessment was reopened on the basis of reasons recorded by the Assessing Officer, which constituted reasonable basis for coming to the conclusion that income has escaped assessment, and that it did not suffer from any legal infirmity. We are thus urged to confirm the action of the CIT(A) in this regard, and decline to interfere in the matter. In brief rejoinder, learned counsel for the assessee reiterated and relied upon his submissions recorded earlier. 11. We find that in the present case, the assessee appellant had not only taken the inspection of the file and also taken copies of the documents on the assessment file. It is not the case, therefore, of the assessee that he had no occasion to know the reasons for which the reassessment proceedings are initiated. As a matter of fact, as evident the letter dated 22nd February 2013, extracts from which have been extensively reproduced at page 3 onwards of the assessment order, the assessee had not only received the reasons for reopening the assessment but he was also aware of all the nuances thereof. When he states that "the reason (for reopening the assessment) recorded by predecessor is vague and w....
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....the legality and legal nuances about the material based on which such prima facie opinion is formed by the Assessing Officer. In any case, despite our several specific questions, learned counsel could not point out any legal support in response to this requisition. 12. Coming to the approval by the Commissioner, in the place of Additional Commissioner, we see merits in the plea of the learned Departmental Representative to the effect that there is a subtle difference between the situation in which the approval is granted by the Commissioner in the place of approval by the Additional Commissioner, and in the situation in which approval is granted by Commissioner in addition to the approval by the Additional Commissioner. There cannot be, and there is no, dispute about the proposition that in the former case, the reassessment proceedings will be legally unsustainable for want of approval by the appropriate authority, but, as to what happens in the later case, we find guidance from a coordinate bench decision in the case of Mayurbahi Mangaldas Patel vs ITO [(2018) 168 ITD 317 (Ahd)] wherein, speaking through one of us, the coordinate bench observed as follows: 5.1 Let us, in the li....
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....tual satisfaction of the Commissioner is actually seen, and we see that actual processing sheet for so called approval of the Commissioner, it is plain on facts that the satisfaction "on the reasons recorded by the Assessing Officer that it is a fit case for issuance of notice under section 148" is not only of the Commissioner but also of the Joint/Additional Commissioner concerned. 7. There is no doubt that in the present case the Joint/Additional Commissioner of Incometax has categorically expressed his satisfaction about the fact that on the reasons recorded by the Assessing Officer, it is fit case for issuance of notice under section 148. The requirements of approval under section 151 are thus clearly satisfied. Merely because an even higher authority has expressed similar satisfaction does not obliterate the satisfaction of appropriate authorities. What we have seen in this particular case appears to be a part of the standard operating procedure in the income tax department, and, if that be so, there can hardly be a case in which the Commissioner has granted the approval for reopening of assessment and the Joint/ Additional Commissioner of the range concerned has not record....
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....is expressed by the higher authority is also on record, requirements of section 151 cannot be taken as having been complied with. The binding nature of judicial precedents is only for what they actually decide and not what can be inferred from these judicial precedents. Nothing, therefore, turns on these precedents in the present case. On the contrary, being satisfied that sanction envisaged by the scheme of section 151, i.e. by recording satisfaction on the reasons recorded by the Assessing Officer that it is a fit case for initiating reassessment proceedings, is given by the prescribed authority on the facts of this case, these judicial precedents are not clearly relevant in the present context. 8. In view of the detailed reasons set out above, we are of the considered view that the hyper technical grievances raised before us are devoid of legally sustainable merits. We accordingly reject the same. 9. As we part with the matter, we must that we have taken note of the fact that as reassessments after reassessments are being quashed by the judicial authorities, on the ground as raised before us in this case, the income tax authorities have not taken pains either to follows th....
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....eir Lordships have, inter alia, observed as follows: 10. The legal proposition is that when the statute casts a duty on a certain administrative officer, the same must be performed by him and the satisfaction arrived at even by the higher authority would not be sufficient. However, in the present case, there was no lack of satisfaction or exercise of power by the Joint Commissioner. He in clear terms, expressed his satisfaction that on the basis of the reasons recorded by the Assessing Officer, it was a fit case for issuance of notice under section 148 of the Act. Merely because the papers were thereafter for some erroneous reason also placed before the Commissioner who also recorded his similar satisfaction would not take away anything from the previous conclusion. 14. When the above position was pointed out to the learned counsel, he was somewhat dismissive of this precedent and he submitted that the decision of Hon'ble Gujarat High Court is not binding in this jurisdiction, and, while in the jurisdiction of Hon'ble Delhi High Court, we must not feel fettered by what views are held by a non jurisdictional High Court. Our careful analysis of the material on record, as also add....
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....ideration of the submissions of the learned counsel for the assessee, we find that before taking up the issue involved in the question of law referred to us in this case for consideration, it is necessary to first decide.... whether this Court, while interpreting an all India statute like Income-tax Act, is bound to follow the decisions of any other High Court and to decide accordingly, even if its own view is contrary thereto, because of the practice followed in this Court. Because, if we are to accept this submission, it will be an exercise in futility to examine the real controversy before us...." 8. One of the propositions that Their Lordships took note of was that 'the decisions of the High Court on the subordinate Courts and authorities or Tribunals under its superintendence throughout the territories in relation to which it exercises jurisdiction (but) it does not extend beyond its territorial jurisdiction.' Their Lordships in the same paragraph also noted that 'A Division Bench of the High Court should follow the decision of another Division Bench of equal strength or a Full Bench of the same High Court', and 'if one Division Bench differs with anothe....
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....h Court, it would appear to us that ratio decidendi in Thana Electricity Co. Ltd. (supra), is on the nonbinding nature of a High Court's judgment on another High Court. In any case, this Division Bench did not, and as stated in this judgment itself, could not have differed with another Division Bench of the same strength in the case of Godavari Devi Saraf (supra). Therefore, it cannot be open to a subordinate Tribunal like us to disregard any of the judgments of the Hon'ble Bombay High Court, whether in the case of Thana Electricity Co. Ltd. (supra) or in the case of Godavari Devi Saraf. It is indeed our duty to loyally extend utmost respect and reverence to the Hon'ble High Court, and to read these two judgments by the Division Benches of equal strength of the Hon'ble jurisdictional High Court, i.e., in the cases of Thana Electricity Co. Ltd. (supra) and Godavari Devi Saraf (supra), in a harmonious manner. 11. Let us now take a look at the Hon'ble jurisdictional High Court's judgment in the case of Godavari Devi Saraf (supra). In this case, question before Their Lordships was as follows : "Whether, on the facts and circumstances of the case, and in vi....
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....dgment in the case of Thana Electricity Co. Ltd.'s case. The only way in which we can harmoniously interpret these judgments is that these decisions deal with two different issues and ratio decidendi of these decisions must be construed accordingly. 14. Let us also see this issue from a different perspective. Even if we are to assume that it is possible to interpret that Godavari Devi Saraf's decision stands overruled by judgment in the case of Thana Electricity Co. Ltd.'s case, one cannot be oblivious to the fact that an interpretation is indeed possible to the effect that even non-jurisdictional High Court's judgment, for the reasons set out above, is binding on the Tribunal. This non-jurisdictional High Court's judgment is in favour of the assessee. Now, as held by the Hon'ble Supreme Court's judgment in the case of CIT v. Vegetable Products Ltd. ( 88 ITR 192), when two interpretations are possible, one in favour of the assessee must be adopted. For this reason, in our humble understanding, the plea of the assessee deserves to be accepted. 15. We may, however, add that the observations that we have made are particularly with reference to the leg....
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.... into all these issues. Suffice to say that respectfully following the Hon'ble Gauhati High Court's judgment in the case of Bandana Gogoi (supra) and having noted the position that notice under section 143(2) was admittedly not issued within one year from the end of the month in which block assessment return was filed, we quash the assessment proceedings. 15. Quite clearly, therefore, even the views expressed by a non-jurisdictional High Court, unless such a view comes in conflict with a view favourable to the assessee by any other nonjurisdictional High court and in the absence of guidance by Hon'ble jurisdictional High Court, are binding on us. The plea of the learned counsel does not merit acceptance. 16. Learned counsel has repeatedly stated that there is complete non-application of mind while recording, and while approving, the reasons for re-opening the assessment. As we deal with this aspect of the matter, it is necessary to understand as to what constitutes "reason to believe" in terms of provisions dealing with income escaping assessment, and what kind of application of mind is required to believe that income has escaped assessment. In the case of ACIT Vs Rajesh ....
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....w, should be drawn. The question, therefore, that is required to be examined whether on the basis of material available at the time of forming, or approving, the opinion that income has escaped assessment, a reasonable person would come to that conclusion. Here is a case in which certain companies subscribing to the share capital of the assessee company, based on the inputs available to the Assessing Officer at the point of time when such an opinion is formed, are entities engaged wholly in the business of providing accommodation entries, without any involvement in the bonafide business activities. These companies, as the Assessing Officer categorically notes in the reasons recorded while reopening the assessment, are "found to be only paper entities providing accommodation entries and not doing any other real business" and are controlled by one Tarun Goyal who "was found controlling more than 90 such concerns/ companies (including these companies)". It has also been noted in the reasons recorded for reopening the assessment that this Tarun Goyal "has been doing the business of providing accommodation entries through these concerns by giving cheques/PO/DD in lieu of cash with/witho....
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....d brining it to tax will certainly need much more of an exercise than holding this prima facie belief, there can be little doubt that at the stage of reopening the assessment all that is needed is existence of a prima facie belief that income has escaped assessment. That condition is satisfied, and, by no stretch of logic, it can be said that the Assessing Officer had held this belief without application of mind. It is not clear to us as to what kind of detailed application of mind was needed, according to the learned counsel for the assessee, to come to hold this belief. In our humble understanding, the Assessing Officer, as indeed his supervising officials, had duly applied his mind on the core question about income escaping the assessment, and, if at all, there were certain things they overlooked, though no such lapse is established even though repeatedly alleged, those aspects were not really relevant in the context of adjudicating the core issue regarding validity of reassessment. 18. As regards learned counsel's reliance on Hon'ble Delhi High Court's judgment in the case of Pardesi Developers (supra), that was a case in which the Assessing Officer already had the information....
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....so far as the question of approval is concerned, CIT (A) had clearly considered the "reasons to believe" that was put up to him and approved the notice. Lastly, it was urged that affixation is a known and accepted mode of service; counsel relied upon the decision cited as Commissioner of Income Tax v.Thayaballi Mulla Jeevaji Kapasi (1967) 66 ITR 147 (SC) = 2002-TIOL-1598- SC-IT-LB. At this stage, this Court notices that for the two assessment years 2008-09 and 2010-11, the judgment rendered on 18.10.2016 clearly found that identical notices under Section 147/148 of the Income Tax Act, 1961 did not measure up to the standards of a valid opinion based upon tangible material, as clarified by the Supreme Court ruling in Commissioner of Income Tax, Delhi vs. Kelvinator of India Ltd. (2010) 320 ITR 561 (SC) = 2010-TIOL-06-SC-IT-LB. The same logic in our opinion is applicable in the present case. Furthermore, the reference by the Revenue to the third paragraph of the "reasons to believe" in this case is of no consequence. The basic or necessary facts which led the AO to form the opinion are contained in the second paragraph of the impugned notice, i.e., the Investigation Wing's report. ....
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....assessment. We uphold his action and decline to interfere in the matter. 22. Lets now turn to the impugned additions of Rs. 80,00,000, in respect of alleged bogus share capital subscription, and Rs. 2,00,000 in respect of Rs. 2,00,000 as commission said to have been paid for arranging this alleged accommodation entry. These additions were made by the Assessing Officer in the course of reassessment proceedings and confirmed by the CIT(A) in first appellate proceedings, aggrieved by which the assessee is in further appeal before us. 23. The relevant material facts are like this. In the course of the reassessment proceedings, the Assessing Officer noted that the assessee has received Rs. 80,00,000 as share capital subscription from two entities - namely Geefcee Finance Investments Limited and Mahanivesh India Limited. As the Assessing Officer had good reasons to believe that these were merely accommodation entries and as, in the original assessment proceedings, the "the assessee company had simply submitted the names and address of the entities, who contributed to share capital, but did not furnish any details of source of funds received" and as "no documentary evidence in support o....
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....ere were satisfactory details about the source of funds in the hands of these two companies. The Assessing Officer sent an inspector at the given address but he could not locate these companies or their shareholders. In this factual backdrop, and after a very elaborate discussion on the legal position with respect to scope of Section 68 and onus cast on the assessee- which we are not reproducing for the sake of brevity, the Assessing Officer noted that that the assessee has failed to discharge the onus of establishing genuineness of transaction, the Assessing Officer treated the entire amount of Rs. 80,00,000 as unexplained credit in the hands of the assessee. The Assessing Officer further assumed that the assessee must have paid at least 2.5% commission to organize this accommodation entry. Accordingly, he made an addition of Rs. 2,00,000 in respect of this unaccounted expenditure as well. Aggrieved by the additions of Rs. 82,00,000 so made by the Assessing Officer, assessee carried the matter in appeal before the CIT(A) but without any success. The assessee is not satisfied and is in further appeal before us. 24. Learned counsel for the assessee begins by pointing out that all t....
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....at genuineness cannot be proved simply by giving evidences of existence of the assessee and procedural compliance, because even if the assessee is involving in not so genuine an activity, there will be a person dealing with the assessee nevertheless and the paper requirements will have to be complied with anyway. He goes on to say that in accommodation entries the entire emphasis is on the paper work and, therefore, there is paper work to support the transaction does not mean that it is a genuine commercial transaction. What is to be seen, according to the learned Departmental Representative, is whether the transaction was in the course of the normal business of the person alleged to be giving accommodation entries, and, unless that is proved, the assessee cannot be said to have discharged his onus. Our attention is then invited to a decision of Ahmedabad bench, in the case of Pavankumar M Sanghvi Vs ITO [(2017) 165 ITD 260 (Ahd)] which is now approved by Hon'ble Gujarat High Court in the case of Pavakumar M Sanghvi Vs ITO [(2018) 404 ITR 601 (Guj)]. Learned Departmental Representative takes us through these judgments and submits that in the absence of any decision to the contrary ....
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....eness of the transaction. There is no dispute about the basic legal position about section 68 which provides that where any sum is found credited in the books of accounts of an assessee maintained for any previous year, and the assessee offers no explanation about the nature and sources thereof, or the explanation offered by him is not, in the opinion of the Assessing Officer, satisfactory, the sum so credited may be charged to income tax as income of the assessee of that previous year. The expression 'nature and source' appearing in section 68 has to be understood as a requirement of identification of source and its genuineness. It is also a settled legal positon that the onus of the assessee, of explaining nature and source of credit, does not get discharged merely by filing confirmatory letters, or demonstrating that the transactions are done through the banking channels or even by filing the income tax assessment particulars. In the case of CIT v. United Commercial and Industrial Co (P.) Ltd [1991] 187 ITR 596/56 Taxman 304 (Cal) , Hon'ble Calcutta High Court has held that "it was necessary for the assessee to prove prima facie the identity of creditors, the capacit....
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.... a legitimate business and a documentation trail as a legitimate transaction would normally follow. The only thing which sets it apart from a genuine business entity is lack of genuineness in its actual operations. The operations carried out by these entities, are only to facilitate financial manoeuvring for the benefit of its clients, or, with that predominant underlying objective, to give the colour of genuineness to these entities. These shell entities, which are routinely used to launder unaccounted monies, are a fact of life, and as much a part of the underbelly of the financial world, as many other evils. Even a layman, much less a Member of this specialized Tribunal, cannot be oblivious of these ground realities. 9. I have noted that the assessee has received an amount of Rs. 10,00,000 from Natasha Enterprises on 12th August 2006, and, as a plain look at the Canara Bank statement of the lender, which is placed at pages 40 onwards of the paper book, would show, there is a credit of Rs. 10,00,000 just before this cheque is paid. The bank balance before these two transactions, and after these two transactions, was only Rs. 13,717. Quite interestingly, again on 14th August 20....
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.... of 24th March is Rs. 85,991. On a turnover of Rs. 127.87 crores, the profit is less than 0.09% resulting in tax outgo of Rs. 2,96,218. To effect this scale of operations, the lender incurs no travelling or telephone expense, and entire expenses of the business, except on brokerage and assortment of diamonds, are less than Rs. 5 lakhs in the year. Interestingly, in today's world where an average human being, much less a business organization, can live without telephones, this business entity has prospered without a rupee spent of telephones. The level of turnover and the expenditure incurred on achieving such high turnover do not match at all. The numbers do not add up and the details filed in respect of these lenders donot convince me that the lenders are routine businesses. Given this background the assessee s inability to produce the related persons or even give their current whereabouts makes the story of genuine transactions even more unbelievable. It is also important to bear in mind the fact that lending for an interest @12% p.a. without any security is not something which people do for rank outsiders. There has to be some close association to get such a kind of unsecure....
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....d realities. As Hon'ble Supreme Court has observed, in the case of Durga Prasad More(supra), ..........it is true that an apparent must be considered real until it is shown that there are reasons to believe that the apparent is not the real party who relies on a recital in a deed has to establish the truth of those recitals, otherwise it will be very easy to make selfserving statements in documents either executed or taken by a party and rely on those recitals. If all that an assessee who wants to evade tax is to have some recitals made in a document either executed by him or executed in his favour then the door will be left wide open to evade tax. A little probing was sufficient in the present case to show that the apparent was not the real. The taxing authorities were not required to put on blinkers while looking at the documents produced before them. They were entitled to look into the surrounding circumstances to find out the reality of the recitals made in those documents". As a final fact finding authority, this Tribunal cannot be superficial in its assessment of genuineness of a transaction, and this call is to be taken not only in the light of the face value of the docu....
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....alting the precedents into a prison house of bigotry, regardless of the varying circumstances and myriad developments. Realism dictates that a judgment has to be read, subject to the facts directly presented for consideration and not affecting the matters which may lurk in the dark". Genuineness of transactions thus cannot be decided on the basis of inferences drawn from the judicial precedents in the cases in which genuineness did come up for examination in a very limited perspective and in the times when shell entities were virtually non-existent. As the things stand now, genuineness of transactions is to be examined in the light of the prevailing ground realities, and that is precisely what I have done. In my considered view, and for the detailed analysis set out earlier in this order, the alleged loan transactions of the assessee cannot be held to be genuine on the peculiar facts and circumstances of this case. As the genuineness of transactions stands rejected, it is not really necessary to deal with other aspects of the matter. 27. These views were duly approved by Hon'ble Gujarat High Court, and, while approving these views, Their Lordships, inter alia, observed as follows....
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....he limitations of the assessee are not difficult to seek. As per decisions of this Tribunal filed by the assessee on his own, these entities, as indeed other entities in Tarun Goyal group, were never involved in any genuine business anyway and were only in the business of providing accommodation entries. The shell entities, like these two entities before us, have every semblance of a genuine business- its legal ownership by persons in existence, statutory documentation as necessary for a legitimate business and a documentation trail as a legitimate transaction would normally follow. The only thing which sets it apart from a genuine business entity is lack of genuineness in its actual operations. The operations carried out by these entities, are only to facilitate financial manoeuvring for the benefit of its clients, or, with that predominant underlying objective, to give the colour of genuineness to these entities. These shell entities, which are routinely used to launder unaccounted monies, are a fact of life, and as much a part of the underbelly of the financial world, as many other evils. Even a layman, much a Member of this specialized Tribunal, cannot be oblivious of these gro....
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....ble for even a layman, leave aside Members of this specialized Tribunal, to come to the conclusion that these transactions represent bonafide investment transactions. It is also important to note that there is nothing else about the genuine business activities, even if any, of the investor companies, about the backdrop of the promotors about the relationship these people had with the companies, and we are to take the call on genuineness only on the basis of these two bank statements for a limited period. We are unable to come to a positive conclusion about the bonafides of the investors on the basis of these bank statement, and quite to the contrary to the claim made by the assessee, these statements show lack of bonafides. Hon'ble Supreme Court has, in the case of Durga Prasad More (supra), observed that "human minds may differ as to the reliability of a piece of evidence but in that sphere the decision of the final fact finding authority is made conclusive by law". This faith in the Tribunal by Hon'ble Courts above makes the job of the Tribunal even more onerous and demanding and, in our considered view, it does require the Tribunal to take a holistic view of the matter, ....
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....d company and these entities could not have therefore been rank outsiders like walk in investors and yet the assessee does not throw enough light on these entities. A lot of emphasis is placed on bank transactions, on PAN cards and on board resolutions but all these factors have to be present in the cases of shell companies involved in money laundering as well. Nothing, therefore, turned on these documents so far as genuineness aspect is concerned. It is also a settled legal positon that the onus of the assessee, of explaining nature and source of credit, does not get discharged merely by filing confirmatory letters, or demonstrating that the transactions are done through the banking channels or even by filing the income tax assessment particulars. In the case of CIT v. United Commercial and Industrial Co (P.) Ltd [1991] 187 ITR 596/56 Taxman 304 (Cal) , Hon'ble Calcutta High Court has held that "it was necessary for the assessee to prove prima facie the identity of creditors, the capacity of such creditors and lastly the genuineness of transactions". Similarly, in the case of CIT v. Precision Finance (P.) Ltd [1994] 208 ITR 465/[1995] 82 Taxman 31 (Cal), it was observed that "....