TaxTMI 
TaxTMI 
2020 (10) TMI 749
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....ed in the Mahalaxmi Buildwell group of cases on 31st October, 2014. During the course of search, certain information/documents belonging to the assessee were also found. In response to notice u/s 153A which was issued on 25th May, 2015, the assessee filed its return of income on 20th August, 2016 declaring nil income. 3. The AO noted that during the course of search proceedings certain documents including documents Ann. A-14, Page No. 1 to 17 and A-22, Page No. 19 to 24 were found and seized. As per these documents the assessee purchased the following land which are as follows:- S.No. Name of the seller Particular of land sale consideration Date of transaction 1. Rakesh Aggarwal 211.8 Sq. Mt 8,48,000/- 30.05.2008 2. Sunil Joshi 178.438 Sq.Mt. 6,75,000/- 17.06.2008 4. During the course of assessment proceedings, the AO asked the assessee to furnish the source of investment in purchase of above land/properties with documentary evidence. It was submitted that the payments made for purchase of the land is duly accounted for in the books of account and investments have been made out of raising unsecured loans. The AO specifically asked ....
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....urplus of Rs. 3,74,85,000/- against Rs. 1,12,50,000/- shown in the assessment year 2009-10. He asked the assessee to give complete list of the persons to whom shares have been allotted with number of shares. From the various details furnished by the assessee, the AO noted that the assessee failed to substantiate the identity and credit worthiness of the following persons from whom an amount of Rs. 30 lakhs has been received as share capital/share premium:- S.No. Name of the Party Number of Share Amount @ Rs. 10 Per Share and Rs. 90 Per Share Premium (Rs. 100) 1. ABU Commerce International Foods Pvt. Ltd. 5000 500000 2. Higrow Ploymenrs Pvt. Ltd. 10000 1000000 3. Opti View Pvt. Ltd. 10000 1000000 4. Sar Stiches Pvt. Ltd. 5000 500000 Total 30000 30,00,000 7. He, therefore, made an addition of Rs. 30 lakhs to the total income of the assessee and determined the income at Rs. 34,09,960/- 8. Before the CIT(A), the assessee, apart from challenging the addition on merit, challenged the validity of the assessment proceedings u/s 153A. It was submitted that since no incriminating material was found during th....
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....en the lenders have disclosed meager income in their returns and each credit of share capital/unsecured loans to the assessee company is preceded by the equivalent or more amount of deposit on credit on the same date or on the prior date. Further, the assessee also failed to produce these creditors for examination by the AO during assessment proceedings. 11. Aggrieved with such order of the CIT(A), the assessee is in appeal before the Tribunal by raising the following grounds:- ITA No.2540/Del/2019 (A.Y. 2009-10) "1. That on the facts and in the circumstances of the case and in law, Id CITA erred in sustaining the order passed by Ld AO u/s 153A/143(3) without appreciating that assumption of jurisdiction u/s 153A was by Ld AO was in violation of mandatory jurisdictional conditions stipulated under the Act; 1.1 That on the facts and in the circumstances of the case and in law, Id CITA erred in sustaining the order passed by Ld AO u/s 153A/143(3) without appreciating that for making valid assessment of unabated year u/s 153A as on date of search that is 31.10.2014 (here for AY 2010-2011 return was filed on 15.10.2010 which u/s 143(2) was barred on 30.09.2....
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....n , law, Id CITA erred in sustaining the order passed by Ld AO u/s 153A/143(3) without appreciating that, while making addition u/s 68 Ld AO has not issued required show cause notice nor Ld AO has considered detailed reply filed by the assessee; 2.4 That on the facts and in the circumstances of the case and in law, Id CIT-A erred in sustaining the order passed by Ld AO u/s 153A/143(3) without appreciating that while making addition u/s 68 position of net worth of companies is suitably ignored; 2.5 That on the facts and in the circumstances of the case and in law, Id CIT-A erred in sustaining the order passed by Ld AO u/s 153A/143(3) without appreciating that none of evidence filed by assessee is overruled in accordance with law 2.6 That on the facts and in the circumstances of the case and in law the ld.CIT(A) erred in sustaining the order passed by the ld. AO u/s 147/143(3) without appreciating that shareholder companies who are giving share application money /share capital to assessee herein, their existence is never called in question as the companies are nowhere found untraceable; 3. That on the facts and in the circumstances of the case and ....
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....u/s 153A/143(3) without appreciating that there is no basis of any of the addition of Rs. 16,77,983 as there is no remote trait of any accommodation entry , no meaningful enquiry is done at any stage by Ld AO/Ld CIT-A to dislodge the case of assessee, no adversarial statement or smoke screen is established in extant facts, due to which entire addition makes invalid ; 2.2 That on the facts and in the circumstances of the case and in law, Id CITA erred in sustaining the order passed by Ld AO u/s 153A/143(3) without appreciating even no meaningful/valid and objective enquiry is made from lender's bank or income tax officer of lender etc which is sufficient to delete the additions made; Even no summon u/s 131 /enquiry letter u/s 133(6) of the Act was issued to share holder to enforce their personal attendance which is in exclusive domain of Ld AO ; 2.3 That on the facts and in the circumstances of the case and in law, Id CIT-A erred in sustaining the order passed by Ld AO u/s 153A/143(3) without appreciating that while making addition u/s 68 Ld AO has not issued required show cause notice nor Ld AO has considered detailed reply filed by the assessee; 2.4 That....
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.... with law. 13. So far as the second plank of his argument is concerned the ld. counsel drew the attention of the Bench to the copy of approval given by the JCIT under section 153D in case of Mahalaxmi Group of cases on 28th December 2016. The ld. counsel drew the attention of the Bench to Para 3 of the said approval which reads as under:- "3.A approval is accorded to pass assessment orders in the drafts assessment years in reference years. You are directed to ensure taking into account the seized documents/papers and comments in the appraisal report pertaining to AYs. The fact of initiation of penalty proceedings, wherever, applicable, must also be incorporated in the last para of the order. The initiation of correct penalty provisions of I.T. Act u/s 271(l)(c)/ 271AAB, as per facts of the case, must be ensured." 14. Referring to the decision of the Delhi Bench of the Tribunal in the case of Rishabh Buildwell P. Ltd., and batch of appeals vide order dated 4th July 2019, he submitted that the Tribunal has held that where the approving authority has given the approval in a technical manner and has directed the DCIT to ensure the seized materials and the findings of the....
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....satisfaction of the AO regarding the identity and credit worthiness of the loan creditors/share applicants and the genuineness of the transaction. In the instant case, despite repeated reminders the assessee did not produce the loan creditors/share applicants and has not discharged the onus cast on it by proving the identity and creditworthiness of the loan creditors and genuineness of the transaction. When the assessee did not discharge the onus cast on it, the counsel cannot argue that the AO did not issue summons under section 131 or called for details under section 133(6) of the Act. Relying on various decisions as relied on by the CIT(A), he submitted that the addition was rightly sustained by the CIT(A). 18. We have considered the rival arguments made by both the sides, perused the orders of the AO and the CIT(A) and the paper book filed on behalf of the assessee. We have also considered the various decisions cited before us. We find, the AO, in the instant case, has made addition of Rs. 17,15,113/- for assessment year 2009-10 and Rs. 30 lacs for assessment year 2010-11 in the orders passed u/s 153A r.w. section 143(3). A perusal of the assessment order shows that the addi....