TaxTMI 
TaxTMI 
2019 (9) TMI 343
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....search. During the post search investigation and perusal of seized documents it was observed that Sh. Surender1 Kumar Jain and Sh. Virender Jain were engaged in the business of providing accommodation entries by providing cheques/PO/DD in lieu of cash to a large number of beneficiary companies thorough various paper and dummy companies floated and controlled by them. It was also evidently established by the wing that Sh. Surender Kumar Jain and Sh. Virender Jain are known entry providers and are the actual controllers of more than 100 companies/ Proprietary firms/partnership firms. They control these entities through various persons, by appointing them as directors/partners/proprietors apart from nominating them as authorized signatories for maintaining the bank accounts of these entities but in fact all these persons act only as their stooges. The cash received from the recipient parties for providing the accommodation entries was first deposited in the accounts of these dummy firms/companies in the disguise of the cash received against the bogus sales, duly shown in the books of accounts. From there, this cash was transferred to the different paper companies floated by Sh. Surend....
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....ized annexure, the assessee-company has taken the accommodation entries from M/s. Hillridge Investment Ltd., amounting to Rs. 40,00,000/-. During the course of assessment proceedings, the assessee has furnished copy of share application form, copy of bank statement, copy of ITR etc. in support of its claim of having entered into genuine transaction. Perusal of bank account reveals that there have been regular debit and credit entries of equivalent amounts within a span of 2-3 days. Such is a general phenomenon in the case of the entry providers. The bank account of the Investor clearly defies the claim of genuineness and creditworthiness of the person who have allegedly made the investment as they never had sufficient balances and the cheque issued to the beneficiaries are cleared by way of transfer of funds from associate concerns involved in the business of providing bogus accommodation entries. As per explanation offered by the assessee about the nature and source of the sums found credited in the books was not satisfactorily explained and there was a prima facie evidence against the assessee of receipt of bogus accommodation entry. The assessee has failed to discharge its onus ....
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....ng of the assessment. The Ld. CIT(A) considering the submissions of the assessee noted that the objections of the assessee with regard to initiation of reopening of the assessment under section 147/148 of the I.T. Act are without any basis, therefore, claim of assessee has been rejected. The A.O. has reproduced the reasons recorded for re-assessment in the assessment order which are also reproduced in this order hereinabove. The reasons clearly show that there was a credible information and material with the A.O. to show that assessee has received accommodation entry, therefore, reopening of the assessment is wholly justified in the matter. Since the Learned Counsel for the Assessee did not argue this ground, I do not find any infirmity in the order of the Ld. CIT(A) in confirming the initiation of re-assessment proceedings. Therefore, this ground of appeal of Assessee is dismissed. 6. Learned Counsel for the Assessee, as regards the other additions on merits submitted that assessee filed income tax record of the Investor, their copy of Bank Account, ROC Record and confirmation before the authorities below. PB-93 is Affidavit of the Director of the Investor confirming the tra....
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.... to produce one of the Director of the Investor Company to check the genuineness of the transaction in the matter. Shri Naveen Kumar, one of the Director of M/s. Hillridge Investment Ltd., (Investor) was produced before A.O. and his statement was recorded on oath. Copy of his statement is filed on record in which he has stated that he joined this company as an Accountant in October, 2013 and become Director in January, 2014. He was not conversant with the financial affairs of the assessee company in assessment year under appeal. He was also not in a position to give any reasons for investing in assessee company without any return and acting in an improbable manner against the wisdom of a normal prudent person. Most of the questions he did not answer. In answer to Question No.24, he has admitted that M/s. Hillridge Investment Ltd., has given accommodation entry of Rs. 40 lakhs to the assessee company in assessment year under appeal. At the end of his statement, he has admitted that he has signed the statement voluntarily and without any pressure or fear. During the course of arguments, Learned Counsel for the Assessee has referred to PB-87 which is P & L A/c of Investor Company a....