TaxTMI 
TaxTMI 
2015 (11) TMI 1800
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....tral Circle -18 vide its letter No. DC1T/CC-18/2010-11/599 dated 18.02.2011 has stated that " Survey u/s 133A of the Income Tax Act, 1961 was earlier carried out by the Investigation Wing on 20.11.2007 in the case of Shri S.K. Gupta who is an accommodation entries provider and it was noticed that he had provided accommodation entries to a large number of beneficiaries. On the basis of the impounded material in the case of Shri S.K. Gupta and on the basis of further inquiries, it has been noticed that he has inter alia provided accommodation entries of the following companies/assessee who are under your jurisdiction:- 1. M/s Hitashi Estates Ltd. PAN: AAACH0455M Rs. 5 lacs The assessee belongs to Taneja Group of cases. During the course of search and seizure proceedings in the Taneja Group of cases, the main controlling person of the group Shri D.N. Taneja in his statement recorded on 07.01.2009 offered the entries (transactions) done with Mr. S.K. Gupta's Companies amounting to Rs. 6.23 crores as additional income in the respective financial years in respective companies of his group (there are 15 such companies and includes your assessee M/s Hitashi Estate Ltd. in which....
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....g my advance age and ill health it is difficult for me to continuously engaged in legal issues. Therefore in order to buy peace of mind and to avoid litigation on this time. I offer the entries (transactions) done with Mr.S.K. Gupta's companies amounting of Rs. 6.23 crores as our additional income in the respective FYs and in respective companies as tabulated in Annexure - A attached with the statements. I have made this officer to buy peace of mind and on the conditions that no penalty proceedings and prosecution proceedings is initiated on the same. I shall be provided with all the benefits available to us under the I.T.Act 1961. The Annexure 'A' of this statement clearly points out the fact that the amount declared for surrender by Shri D.N. Taneja includes the name of the assessee in respect of entry of Rs. 5 Lakh received from M/s Zenith Estates Ltd. as this annexure assessee has been duly signed by Shri D.N. Taneja on 07.01.2009 itself. The fact was further reaffirmed upon perusal of the statement of Shri S.K. Gupta which was recorded on oath on 05.01.2009 during the course of survey operation. Shri S. K. Gupta while answering Q. No. 7 has stated that "we give the loa....
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....on entries to bring their unaccounted money into regular books. * Circumstances leading to survey establish that Shri S. K. Gupta was an entry broker. Information was received from FIU-IND in respect of Shri S.K. Gupta that he was maintaining many account in Oriental Bank of Commerce, Connaught Place, New Delhi and in these accounts there were frequent cash deposits along with simultaneous transfer in same bank, value of transactions were inconsistent with client's financial position and unexplained transfers between accounts for no apparent reasons. * During survey on Shri S.K. Gupta on 20.11.2007, Shri S.K. Gupta admitted on oath that he was merely an entry operator and using his companies to provide entries. Thus, more than a year before the actual search on Taneja Group, Shri S.K. Gupta urns established to be an entry broker. * List of the companies being controlled by Shri S.K. Gupta are as under:- The list includes the name of M/s Zenith Estates Pvt. Ltd. S. No. 38. The statement of Shri S.K. Gupta recorded on 05/01/2009 which give the complete insight of the modus operandi of entries business of Shri S.K. Gupta. From the above discussion it is very clear and admitt....
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....erused various materials and report from Investigation Wing and on that basis it is evident that the assessee company has, introduced its own unaccounted money in its bank account by way of above accommodation entries." The above conclusion is unhelpful in understanding whether the AO applied his mind to the materials that he talks about particularly since he did not describe what those materials were. Once the date on which the so called accommodation entries were provided is known, it would not have been difficult for the AO, if he had in fact undertaken the exercise, to make a reference to the manner in which those very entries were provided in the accounts of the Assessee, which must have been tendered along with the return, which was filed on 14th November 2004 and was processed under Section 143(3) of the Act. Without forming a prima facie opinion, on the basis of such material, it was not possible for the AO to have simply concluded: "it is evident that the assessee company has introduced its own unaccounted money in its bank by way of accommodation entries". In the considered view of the Court, in light of the law explained with sufficient clarity by the Supreme Court in th....