TaxTMI 
TaxTMI 
2019 (9) TMI 863
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...., as both the companies failed to comply with notice dated 19.3.2015. 2. On the facts and in the circumstances of the case, the Ld. CIT(A) has erred in deleting the addition of Rs. 13,86,000/- made by disallowing commission paid for obtaining the above grounds unsecured loan and added back by the AO u/s. 68 when the assessee had failed to discharge its onus of proving the genuineness of the transaction. 3. It appears that Ld. CIT(A) has admitted the additional evidences and no opportunity was given to the AO for examination. 4. The appellant craves leave for reserving the right to amend, modify, alter, add or forego any ground(s) of appeal at any time before or during the hearing of this appeal. 2. The brief facts of the case are that assessee filed its return of income declaring an income at NIL on 16.09.2012 and the same was processed u/s. 143(1) of the Income Tax Act, 1961 (in short " Act"). The case of the assessee was selected for scrutiny. Accordingly, notice u/s. 143(2) of the Act was issued on 14.8.2013 and thereafter the case was transferred to Ward 2(1) on 7.10.2013. Subsequently, notice u/s 142(1) of the Act alongwith questionnaire were issu....
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.... Pvt. Ltd. 2013-TIOL-32-HC-DEL-IT, dated 07.01.2013 and the case of CIT vs. NR Portfolio Pvt. Ltd. 2013-TIOL4 955-HC-DEL-IT dated 22.11.2013 and Hon'ble Apex Court decisions in the case of CIT vs. Durga Prasad More (1971) 82 ITR 540 and Sumati Dayal vs. CIT (1995) 80 Taxman 89/214 ITR 801(SC) & CIT vs. Sri Meenakshi Mills Ltd. 63 ITR 609, has observed that assessee company received accommodation entries Rs. 18,48,00,000/- i.e. from M/s Shirin Exports Pvt. Ltd. amounting to Rs. 8,78,00,000/- and M/s Vigorous Trade Link Pvt. Ltd. amounting to Rs. 9,70,00,000/- and further observed that the accommodation entry givers usually charge 0.75% of the cheque amount as commission for providing accommodation entry. Therefore, he observed that in addition of Rs. 18,48,00,000/- the assessee company must have given Rs. 13,86,000/- as commission for providing accommodation entry. As the payment of Rs. 18,61,86,000 (Rs. 18,48,00,000/- plus Rs. 13,86,000/- has not been disclosed by the assessee company in their books of accounts, hence, he added back the amount of Rs. 18,61,86,000/- to the income of the assessee from undisclosed sources as per provisions of section 68 of the I.T. Act,. 1961 and asse....
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....td. Dated 16.3.2015; letter of AO written to the appellant dated 12.3.2015; acknowledgement of return of income of Promart Retail of AY 2012-13; Audit Report of Promart Retail of AY 2012-13; Reply of Promart Retail to AO regarding change of address; share holding of Promart Retail as on 31.3.2012; Details of Promart Retail from MCA Website; Letter of AO to Norman Stelco Pvt. Ltd. To AO dated 12.1.2015; letter of the appellant to AO dated 6.1.2015; confirmation of accounts of Nirmanstelco Pvt. Ltd; Acknowledgement of return of income of NormanStelco Pvt. Ltd. Of AY 2012-13; Letter of the appellant to the AO dated 12.12.2014 and Details of unsecured amount of Promart Holding Ltd. She relied upon on the various case laws including the following decisions:- - Pr. CIT vs. NDR Promoters Pvt. Ltd. (DHC) decided in ITA No. 49/2018 vide order dated 17.1.2019. - Pr. CIT vs. NRA Iron Steel Pvt. Ltd. In SLP (Civil) No. 9855/2018 vide order dated 5.3.2019 (Hon'ble Supreme Court of India). - Pr. CIT vs. Matchless Glass Services (P) Ltd. 65 taxmann.com 310 (Delhil) dated 18.12.2015 (DHC). - Onassis Axles (P) Ltd. Vs. CIT 44 taxmann.com 408 (Delhi). (DHC) dated ....
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....d in response to such notices the loan creditors filed their replies before the Assessing Officer confirming the loans given by them to the assessee company. In spite of availability of all the aforesaid information, and even the confirmation by creditors in compliance to notice issued by the Assessing Officer, in our opinion, the Assessing Officer was not justified in making the impugned addition of loans without rebutting the evidences furnished by the assessee. It is observed that the Assessing Officer, before making the additions, did not even issue any show cause notice to the assessee. Such action is not tenable. The Assessing Officer has made remarks that some alleged incriminating documents were found and seized during search and survey relating to Apple group of companies. According to the assessee, these remarks are highly vague and arbitrary. The Assessing Officer was duty bound to bring on record any such alleged incriminating document, if any. There is substance in the submission of assessee that had there been any search relating to the case of assessee, the A.O. could not have made assessment u/s 143(3) as in terms of provisions of section 153A, the assessment pro....
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....ee has been found by the Assessing Officer to be fully explained and the Assessing Officer has not made any adverse inference in respect of such investments. The Assessing Officer has also verified this investment by making independent 'inquiries from the Promart Retail India Pvt. Ltd. Therefore, there is no rationale for the Assessing Officer to make the addition on the ground that the assessee has made investment in Promart Retail India Pvt. Ltd. As per the audited statements of accounts of Shirin Exports Pvt. Ltd. it is having turnover of more than Rs. 25 Crore for A. Y. 2012-13. It has also filed its return of income and paid the taxes thereon. Similarly as per the audited statements of accounts of Vigorous Trade Link Pvt. Ltd. it is having turnover of more than Rs. 27 Crore for A.Y. 2012-13 and it has filed its return of income and paid the taxes thereon. Therefore, the loan creditor companies cannot be alleged to be paper companies or fake companies. Even the "source" of "source" i.e. Promart Retail India Pvt. Ltd. is a company having turnover of more than RS.73 crores for A.Y. 2012-13. It has filed return of income declaring income of Rs. 3,24,88,166/- and paid ....
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....ed as part of a pre-meditated plan - a smokescreen - conceived and executed with the connivance or involvement of the assessee excludes the applicability of the ratio. In our understanding, the ratio is attracted to a case where it is a simple question of whether the assessee has discharged the burden placed upon him under sec.68 to prove and establish the identity and creditworthiness of the share applicant and the genuineness of the transaction. In such a case, the Assessing Officer cannot sit back with folded hands till the assessee exhausts all the evidence or material in his possession and then come forward to merely reject the same, without carrying out any verification or enquiry into the material placed before him. The case before us does not fall under this category and it would be a travesty of truth and justice to express a view to the contrary. ' 28. In Nova Promoters & Finlease (supra), it was held that in view of the link between the entry providers and incriminating evidence, mere filing of PAN number, acknowledgement of income tax returns of the entry provider, bank account statements etc. was not sufficient to discharge the onus. " 5.3 From the abov....