TaxTMI 
TaxTMI 
2018 (8) TMI 1761
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....1961 [hereinafter referred to as 'the Act'] were issued and served upon the assessee. The A.Y under consideration is one of the A.Ys out of six A.Ys, relevant for the date of search. 5. Pursuant to the notice u/s 153A of the Act, the assessee filed its return of income declaring total income of Rs. 7,13,983/-. The assessee was asked to furnish information and to produce books of account/vouchers as per questionnaire attached with the notice issued u/s 142(1) of the Act. 6. No compliance was made and once again fresh notices were issued and served upon the assessee. The assessee chose not to furnish evidences and no compliance was made. Subsequently, the Assessing Officer was informed that an application before the Settlement Commission has been filed and requested the Assessing Officer for adjournment of the case. 7. The Settlement Commission, however, vide their order passed u/s 245D(2C) of the Act dated 17.09.2007, declared the application filed by the assessee for all the A.Ys as invalid on account of non-payment of tax. The assessment proceedings were once again started and the assessee was once again directed to comply with the details. 8. While scrutinisin....
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....1 10.12.2001 10.12.2001 Harish Bhashin T-l, Rajori Garden, New Delhi 1,00,000 10,00,000 22.03.2002 22.03.2002 22.03.2002 Jyoti Bhasin T-l, Rajori Garden, New Delhi 1,00,000 10,00,000 10.12.2001 10.12.2001 10.12.2001 Jyoti Bhasin T-l, Rajori Garden, New Delhi 1,00,000 10,00,000 22.03.2002 22.03.2002 22.03.2002 Jyoti Bhasin T-l, Rajori Garden, New Delhi 20,000 2,00,000 30.03.2002 30.03.2002 30.03.2002 Connoiseur Mangement Services Pvt. Ltd. 34, Engineers Enclave, Pitampura, New Delhi 1,00,000 10,00,000 10.12.2001 10.12.2001 10.12.2001 Connoiseur Mangement Services Pvt. Ltd. 34, Engineers Enclave, Pitampura, New Delhi 1,00,000 10,00,000 28.02.2002 28.02.2002 28.02.2002 Tanita Leasing Finance Ltd. A-2/3, Lusa Tower, 3 rd Floor, Azadpur, New Delhi 70,000 7,00,000 10.12.2001 10.12.2001 10.12.2001 Tanita Leasing Finance Ltd. A-2/3, Lusa Tower, 3 rd Floor, Azadpur, New -Delhi 1,30,000 13,00,000 28.02.2002 28.02.2002 28.02.2002 ....
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.... Performance Trading and Investment Pvt. Ltd. A-261, Sashtri Nagar, New Delhi 1,70,000 17,00,000 28.02.2002 28.02.2002 28.02.2002 Technocom Associates Pvt. Ltd. 205, Delhi Chambers, Delhi Gate. Nev.' Delhi 50,000 5,00,000 28.02.2002 28.02.2002 28.02.2002 Transpan Financial Services Ltd. E-36, Jawahar Park, Laxmi Nagar, Delhi-92 1,00,000 10,00,000 28.02.2002 28.02.2002 28.02.2002 Jasdeep Financers Pvt. Ltd. 203, Mukund House, Commercial Complex, Azadpur, New Delhi 1,50,000 15,00,000 28.02.2002 28.02.2002 28.02.2002 S.N. Electrical Pvt. Ltd. S-172, Co Cir. 29(4), New Delhi 1,50,000 15,00,000 28.02.2002 28.02.2002 28.02.2002 Titan Securities Ltd. A-2/3, Lusa Tower, Azadpur, New Delhi 2,00,000 20,00,000 28.02.2002 28.02.2002 28.02.2002 Tanuja Industries Credit Ltd. A-2/3, Lusa Tower, 3rd Floor, Azadpur, Delhi 75,000 7,50,000 28.02.2002 28.02.2002 28.02.2002 Arun Finvest Pvt. Ltd. CA/16-D, Hari Nagar, New Deihi 2,00,000 20,00,000 28.02.2002 28.02.2002 28.02.2002 ....
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....s made. 13. The assessee carried the matter before the CIT(A) and once again explained the modus operandi pleading that the benefit of peak credit should be allowed to the assessee. In support of its claim, the assessee furnished the valuation report by the Valuation Cell of the I.T. Department pointing out that even the Valuation Cell has valued the cost much lesser than the cost shown by the assessee. It was strongly contended that by inflating the cost, the assessee siphoned the surplus towards its share capital and, therefore, benefit of peak credit should not be denied. The assessee also furnished a chart arriving at the peak amount of cash introduced during the year. The CIT(A) found that the peak is coming to Rs. 70 lakhs. The CIT(A) assumed that the assessee must have incurred 5% as commission. The first appellate authority was also of the opinion that by inflating the cost of machinery, peak amount comes to Rs. 1,40,05,370/-. Being convinced with the theory of peak credit, the first appellate authority restricted the total addition to the maximum peak credit of Rs. 1,40,05,370/- and deleted the addition of Rs. 4,48,94,630/-. 14. In so far as addition on account of un....
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....gus. 23. Now the only issue remaining to be decided is whether the assessee is entitled for benefit of rotation of cash thereby restricting the addition to the extent of peak credit. No doubt, the assessee in its explanation has time and again stated that it has inflated the cost of land/building/plant and machinery/expenditure. It is also not in dispute that the assessee has time and again contended that by inflating the assessee has rotated cash back in its books of account, therefore, bogus share capital introduced through accommodation entries taken from the brokers. But the most important fact is that the assessee could not adduce a single piece of evidence to demonstrate that the money has been circulated and reintroduced in the books of account. The assessee could not demonstrate any nexus between the inflation of items mentioned elsewhere and reintroducing the cash generated from such inflation. Forget about the direct evidences, there is not even a single circumstantial evidence to substantiate the claim of the assessee. The first appellate authority, in his wisdom, blindly accepted the theory of the assessee without asking for /looking for any evidence in support of th....