AI Drafter 
TaxTMI 
TaxTMI 
2018 (9) TMI 960
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.... 148 of the Act along with reasons recorded. 4. 30.11.2009 Copy of impugned reassessment order under section 147/143(3) of the Act. 5. 28.02.2011 Copy of impugned order passed by learned CIT (A). 6. 18.05.2012 Copy of order passed by Hon'ble ITAT dismissing the appeal of assessee. 7. 17.10.2013 Copy of order passed by Hon'ble ITAT in miscellaneous petition by Hon'ble JM. 8. 02.12.2013 Copy of order passed by Hon'ble ITAT in miscellaneous petition by Hon'ble AM. 9. Jan 2014 Copy of reference for nomination of third member in miscellaneous petition and questions so framed by Hon'ble JM. 10. 13.02.2014 Copy of questions so framed by Hon'ble JM for reference to third member in miscellaneous petition. 11. 25.07.2014 Copy of order passed by Third Member, recalling the order so passed on 18.05.2012. 12. 03.11.2014 Copy of order passed by Hon'ble Bench giving effect to Hon'ble Third Member's order and refixing the case for hearing. 13. 31.05.2016 Copy of order passed by Hon'ble ITAT allowing the appeal of assessee. 14. 04.05.2018 Copy of orde....
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....me Tax (Appeals) erred in law and on facts in coming to a conclusion that the cheques received of Rs. 13,00,000/- were accommodation entries, whereas, the cheques were received in normal carrying out of business, on account of cancellation of order in respect of purchase of machinery. 5.1 That the learned Commissioner of Income Tax (Appeals) ignored the fact that the cheques were issued as advance for purchase of machinery, which were merely received back, as no machine was supplied by the suppliers. 5.2 That the learned Commissioner of Income Tax (Appeals) ignored the basic fact that such cheques were issued for purchase of machinery and money originated from assessee's own bank account. There was no question of any undisclosed money involved so as to make any addition. 6. That the learned Commissioner of Income Tax (Appeals) further erred in charging interest under section 234B, 234D and 244 of the I.T. Act. 4. During the course of assessment proceeding, the Assessing Officer noticed that the assessee had received a sum of Rs. 13 lacs from two parties as per following details : AMOUNT DATE NAME OF ENTRY PROVIDER NAME OF BANK BRANCH....
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.... Our case is different from the other case as we have not taken any accommodation entry. It was purely a business transaction. " The Assessing Officer pointed out to the assessee that the cheques said to have been issued of Rs. 8 lacs and Rs. 5 lacs in favour of above stated to companies, were not appearing in their bank accounts maintained with State Bank of Patiala, Daryaganj, New Delhi. In this regard, the assessee submitted a certificate from its bankers, i.e., IndusInd Bank dated 27.11.2009 stating that the amount has been encahsed by the above named to companies. Assessing Officer also observed that both the parties while giving cheques to the assessee of the impugned amount, have deposited cash of the equivalent amount in their bank accounts as noted in the assessment order. Keeping in view the fact that the alleged cheques issued by the assessee were not reflecting in the bank accounts of both the parties and deposit of cash of equivalent amount in their bank account, led the Assessing Officer to hold that the amount received by the assessee was an accommodation entry. He, therefore, made addition of Rs. 13 lacs u/s. 68 of the Act, being unexplained credit in the ....
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....ry, 2010, we are submitting the following information as verbally desired by your goodselves: 1. We had issued the cheque to the parties as Advance for purchase of machinery. We do not know which banks they deposited these cheques. We had already deposited the Bank Certificate from our banker for encashment of these cheques. 2. We come to know about these parties through our friends. 3. We have no proof to know that these parties had manufactured the machines or they were trading of these machines. 4. We have only correspondence for purchase order and advance for payment which were duly acknowledged by these parties. 5. There is no dealing with these parties after cancellation of order for purchase of machinery 6. We are not in a position to produce these parties because the dealing took place in the year 2001-02. You can summon these parties Yourself since the addressed are already available with you. Our case is different from the other case as we have not taken any accommodation entry. It was purely a business transaction. We first paid the money and then got our money refunded. " 5.1.2 From the above, it is....
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....f the authorities below. 9. We have heard the submissions of both the parties and have gone through the entire material available on record. It is notable that the ld. AR of the assessee could not be able to rebut the findings reached by the ld. CIT(A) that the assessee had no evidence to prove that the cheques issued by him were credited to the bank accounts of the alleged sellers of the machinery. The correspondence referred to by the assessee is an exparte correspondence and there is no reply thereof from the side of any of the above two parties. There is also absence of any evidence to show that the negotiation so made was cancelled. The assessee also failed to controvert the finding of the ld. Authorities below that the assessee failed to prove that the above two parties were engaged in manufacture and sale of machinery. Once, the negotiation of purchase of machinery was cancelled with the above two parties, the assessee also failed to substantiate that he had made purchase of such machinery from any other parties or not subsequently. The Bench asked the ld. AR to disclose the total turnover of the assessee, which he also failed to give any detailed thereof. The bank certif....
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....essing Officer was not specific as to the offense committed by the assessee. In the penalty proceedings, the Assessing Officer has imposed the penalty for concealing the particulars of income. Once, the Assessing Officer itself was not specific as to under which limb, the Assessing Officer was going to penalize the assessee or to seek explanation of the assessee, no penalty can be imposed against the assessee u/s. 271(1)(c) of the Act. This Bench of ITAT in the similar situation, has deleted the penalty in the case of Sh. Lakshya Seth vs. ITO (ITA No. 852/Del/2016 vide order dated 16.05.2018) after following the decision of Hon'ble Karnataka High Court in the case of SSAs Emrald Meadows, 73 taxmann.com 241 supported by Hon'ble Supreme Court. The findings of the Tribunal read as under : "4. After considering the rival submissions, we are of the view that penalty is not leviable in the matter. The A.O. issued show cause notice dated 28th March, 2013 before levy of the penalty against the assessee in which the A.O. has recorded as under : "have concealed the particulars of your income or furnished inaccurate particulars of such income in terms of explanation 1, 2, 3,....