TaxTMI 
TaxTMI 
2019 (7) TMI 1758
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....l apply mutatis mutandis to all other appeals. The grounds of ITA No. 5949/Del/2018 (AY 2013-14) read as under:- Jurisdictional Assail 1. "That order passed by Ld. AO dated 29/12/2017 and further order passed by Ld. CIT (A) dated 18/07/2018 are bad in law in as much as while passing the impugned orders material/statement found/taken from/during search at one Pradeep Kumar Jindal are applied against the assessee u/s 153A whereas admittedly from assessee's own search u/s 132 no document much less any incriminating document was found where law does not allow use of such document/statement etc. not found from assessee's search u/s 153A (refer AO order para 1.3, CIT-A order para 7 & 7.1), thereby vitiating the entire exercise being against the mandate of law. 1.1 That order passed by Ld. AO dated 29/12/2017 and further order passed by Ld. CIT(A) dated 18/07/2018 are bad in law in as much as while passing the impugned orders material/statement found/taken from/during search at one Pradeep Kumar Jindal are applied against the assessee u/s 153A (refer AO order para 13, CIT-A order para 7 & 7.1) which could have been only imported in assessee's case as per procedure pre....
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....re aborted from unknown reasons which supports assessee's stand and position taken on impugned transactions which are stated to be genuine and free from any taint. Merits of the cases: assessee's version on facts glossed over like rip van winkleism 7. That order passed by Ld. AO dated 29/12/2017 and further order passed by Ld. CIT(A) dated 18/07/2018 are bad in law in as much as both the authorities have not objectively considered and appreciated copious evidence filed by assessee where reference may be made to point no. 6.2 to 6.7 at pae 3/4 of CIT(A) order ergo we pray for deletion of additions made. 7.1 That on the facts and in the circumstances of the case and in law, Ld. CIT(A) erred in sustaining the action of Ld. AO in making addition of Rs. 155,06,771/- and Rs. 200,00,000/- without appreciating that burden to prove that transaction is bogus/sham has remained un-discharged from side of Revenue. 7.2 That on the facts and in the circumstances of the case and in law, Ld. CIT(A) erred in sustaining the action of Ld. AO in making addition of Rs. 930,406/- and Rs. 300,000/- on a/c of alleged commission u/s 69C which is plainly perverse and inval....
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....o the same, the AR of the assessee appeared and filed the details as called for. 2.1 Assessee has declared income under head 'income from salary, house property and profits and gain from business and profession". The AO issued show cause notice to the assesee and his group of companies as to why their share premium / share capital / share forfeiture / Long Term Capital Gain/ Loss should not be treated as bogus as these entries were obtained through front companies which are controlled, managed and run by Sh. Pradeep Kumar Jindal. The assessee denied to have such entries and expressed his ignorance of even knowing Sh. Pradeep Kumar Jindal. In this case Sh. Pradeep Kumar Jindal had admitted in his statement dated 18.11.2015 recorded u/s 132(4) of the Act that during search at his residence that his front companies had provided accommodation entries to Sajan Kumar Jain group companies and all his family members through intermediary role of Sh. Sudhir Chaudhary, Chartered Accountant. Sh. Sudhir Chaudhary, CA is authorized representative of Sajan Kumar Jain Group companies and all his family members. Consequently, the assessee and his group companies requested for cross examina....
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....irmation was attached. Subsequently, these shares were dematerialized by the company and transferred in the DMAT account of the assessee and assessee has also attached the details of these shares in DMAT Form with the reply, which the AO has reproduced at page no. 5 of the assessment order, which read as under:- "The assessee had also submitted as under:- "After that, with the order of Hon 'able Delhi High Court, the said Company M/s Instant Travels Tours (P) Ltd was amalgamated with M/S Focus Industrial Resources Ltd and 5,64,480 share of M/s Focus Industrial Resources Ltd were exchanged against the 14400 shares of M/s Instant Travels Tours (P) Ltd under the scheme of Amalgamation by the Hon'ble Delhi High Court. Copy of Demat Account showing the exchange of shares of M/S Focus Industrial Resources Ltd and the Copy of order of Hon'ble Delhi High Court showing the scheme of Amalgamation are enclosed herewith. Subsequently, the assessee company has received 11,28,960 Bonus shares of M/S Focus Industrial Resources Ltd in its demat account which can be verified from the relevant demat account enclosed herewith: The said Company MIS Focus Industrial R....
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....td with documentary evidences, in this regard, we respectfully submitted that we have already submitted above the required information with documentary evidences." At page No 39 your good self have explain why this commission paid in cash with reference to your books of account, in this regard respectfully submitted that the Assessee has not paid any commission in cash to any person against the sale of aforesaid shares. Since all these shares have been sold at Bombay Stock Exchange through Recognised Stock broker and the payments have been remitted through Stock Exchange after deduction of Brokerage, STT etc. as per the applicable terms of the Stock Exchange from the bank account of the assessee your goodself can verify whether any cash has been withdrawn to pay the commission in cash." 2.3 The AO has examined the reply filed by the assessee with reference to the search / seized documents and statements recorded of various persons under oath and held that assessee was informed that Sh. Pradeep Kumar Jindal in his statement recorded u/s. 132(4) of the I.T. Act had admitted that he was engaged in the business of providing accommodation entries and for this purpose h....
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....term capital gain accommodation entries from Sh. Pradeep Kumar Jindal. This version of the assessee is on the basis of the investigation made by the Investigation Wing by issuing the summons, out of 78 entities who had taken accommodation entries from Sh. Pradeep Kumar Jindal, 34 entities had paid tax on account of accommodation entries taken by them from Sh. Pradeep Kumar Jindal. The list of these companies is mentioned at page no. 22 & 23 of the assessment order. Keeping in view of the aforesaid facts and circumstances, explained by the AO, the AO has rejected the claim regarding exempt long term capital gain (LTCG) from Sh. Pradeep Kumar Jindal and made the addition of Rs. 1,55,06,771/- as bogus long term capital gain claimed u/s. 10(38) of the I.T. Act and disallowed the same by adding back to the total income of the assessee vide order dated 29.12.2017 and also added the commission amounting to Rs. 9,30,406/- on account of unexplained expenditure u/s. 69C of the Act, on bogus LTCG received through accommodation entries at the income of the assessee and also added Rs. 2,00,00,000/- and Rs. 3,00,000/- on account of Commission, details of which AO has mentioned in the assessment ....
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....O regarding summoning Sh. Pradeep Kumar Jindal for cross examination on the request of the assessee and also not informed regarding the cross examination of Sh. Pradeep Kumar Jindal. Therefore, denying the cross examination of Sh. Pradeep Kumar Jindal is in violation of the Hon'ble Supreme Court of India decision in the case of Andaman Timber Industries vs. Commissioner of Central Excise, Kolkata-II-281 CTR 241. Finally, Ld. Counsel for the assessee stated that in support of his his legal arguments as well as merits which he has not arguing now and is ready to argue after the decision of the legal issue, he has attached all the evidences in the shape of Paper Book. He also draw our attention towards the statement on oath of Sh. Pradeep Kumar Jindal on 17.8.2013 which enclosed at page no. 5-29 of the Paper Book and statement of Sh. Pradeep Kumar Jindal dated 18.11.2013. Ld. Counsel for the assessee relied upon the following case laws on the legal issues:- i) ITAT, Delhi 'C' Bench order dated 19.3.2019 in ITA No. 5585/De;/2015 (AY 2006-06) DCIT vs. Smt. Shivali Mahajan & Cross Objection No. 447/Del/2015 Smt. Shivali Mahajan vs. DCIT and 05 Other Revenue's Appeals and Assesse....
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....ces as well as statement of Pradeep Kumar Jindal, the addition in dispute in the case of the assessee has been made. He further stated that assessee has requested for cross examination of Sh. Pradeep Kumar Jindal which has been provided to him, but he did not avail the same, therefore, the question of violation of any right does not arise. He further stated that AO has made the addition after examining the seized materials found during the search and statement recorded of various persons under oath under Section 132(4) of the I.T. Act, in which they have admitted that the assessee was engaged in the business of providing accommodation entries for the purpose of managing and controlling a web of 33 paper companies for the purpose of providing accommodation entries in lieu of cash receipt and the companies were not in business. All the Directors of these paper companies are dummy who also in their statements recorded u/s. 132(4) of the Act vehemently deposed that they were only signing the documents and that they were not aware of the business activities of these companies. He further submitted that AO has held that assessee has taken accommodation entries of LTCG from the companies ....
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....) 75 taxmann.com 308 (Delhi). vi) M/s Peeble Investment and Finance Ltd. Vs. ITO (2017-TIOL-238-SC-IT) M/s Peeble Investment and Finance Ltd. Vs. ITO (2017-TIOL-188-HC-MUM-IT) vii) Raj Hans Towers P Ltd. Vs. CIT 56 taxmann.com 67 viii) PCIT vs. Avinash Kumar Setia (2017) 81 taxmann.com 476 (Delhi). 5. We have heard both the parties and perused the records especially the orders of the revenue authorities below and the written submissions filed by the Ld. CIT(DR) and the case laws relied upon by both the parties, as aforesaid. We find that Ld. Counsel for the assessee has draw our attention towards the relevant portion of the judgement / decision of the Hon'ble Supreme Court of India, Hon'ble High Courts and various Benches of the Tribunal on the legal issue on which he argued. Ld. Counsel for the assessee further submitted that admittedly from assessee's own premises during search u/s. 132 of the Act no incriminating material was found and no adverse statement is there on record of the assessee u/s. 132(4) of the I.T. Act and it is an admitted fact before us that mere basis of un-confronted statement of Sh. Pradeep Kumar Jindal recorded u/s. 132(4) of t....
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.... appellant themselves to explain as to why their ex-factory prices remain static. It was not for the Tribunal to have guess work as to for what purposes the appellant wanted to crossexamine those dealers and what extraction the appellant wanted from them. As mentioned above, the appellant had contested the truthfulness of the statements of these two witnesses and wanted to discredit their testimony for which purpose it wanted to avail the opportunity of crossexamination. That apart, the Adjudicating Authority simply relied upon the price list as maintained at the depot to determine the price for the purpose of levy of excise duty. Whether the goods were, in fact, sold to the said dealers/witnesses at the price which is mentioned in the price list itself could be the subject matter of crossexamination. Therefore, it was not for the Adjudicating Authority to presuppose as to what could be the subject matter of the cross-examination and make the remarks as mentioned above. We may also point out that on an earlier occasion when the matter came before this Court in Civil Appeal No. 2216 of 2000, order dated 17.03.2005 was passed remitting the case back to the Tribunal with the direction....
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....the search takes place. ii. Assessments and reassessments pending on the date of the search shall abate. The total income for such AYs will have to be computed by the AOs as a fresh exercise. iii. The AO will exercise normal assessment powers in respect of the six years previous to the relevant AY in which the search takes place. The AO has the power to assess and reassess the 'total income' of the aforementioned six years in separate assessment orders for each of the six years. In other words there will be only one assessment order in respect of each of the six AYs "in which both the disclosed and the undisclosed income would be brought to tax". iv. Although Section 153A does not say that additions should be strictly made on the basis of evidence found in the course of the search, or other post-search material or information available with the AO which can be related to the evidence found, it does not mean that the assessment "can be arbitrary or made without any relevance or nexus with the seized material. Obviously an assessment has to be made under this Section only on the basis of seized material." v. In absence of any incriminating material....
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....supra) took note inter alia of the decision of the Bombay High Court in Commissioner of Income Tax v. Continental Warehousing Corporation (Nhava Sheva) Ltd. [2015] 58 taxmann.com 78 (Bom), wherein it was held that if no incriminating material was found during the course of search, in respect of each issue, then no addition in respect of any such issue can be made to the assessment under Sections 153A and 153C of the Act. The decisions of this Court in CIT v. Anil Kumar Bhatia (supra) and CIT v. Chetan Das Lachman Das [2012] 254 CTR 392 (Del) were extensively discussed in Commissioner of Income Tax (Central-III) v. Kabul Chawla (supra). The Court in Commissioner of Income Tax (Central- III) v. Kabul Chawla (supra) had also discussed and concurred with the decision of the Rajasthan High Court in Jai Steel (India), Jodhpur v. ACIT (2013) 36 Taxman 523 (Raj) which had held that the assessment in respect of each of the six assessment years, preceding the year of search "is a separate and distinct assessment." It was further held in the said decision that "If in relation to any assessment year, no incriminating material is found, no addition or disallowance can be made in relation to tha....
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....d to in sub-section (1) of section 153A]:]." 15. Thus, when during the course of search of an assessee any books, document or money, bullion, jewellery etc. is found which relates to a person other than the person searched, then the Assessing Officer of the person searched shall hand over such books of account, documents, or valuables to the Assessing Officer of such other person and thereafter, the Assessing Officer of such other person can proceed against such other person. However, in the case under appeal before us, admittedly, Section 153C is not invoked in the case of the assessee and the assessment is framed under Section 153A. We, respectfully following the above decisions of Hon'ble Jurisdictional High Court, hold that during the course of assessment under Section 153A, the incriminating material, if any, found during the course of search of the assessee only can be utilized and not the material found in the search of any other person. 16. Now, coming to question No.2, we find that this issue is also covered by the decision of Hon'ble Jurisdictional High Court in the case of Harjeev Aggarwal (supra) and Best Infrastructure (India) (P.) Ltd. (supra....
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....g search and seizure operations". Their Lordships further observed "However, such statements on a standalone basis without reference to any other material discovered during search and seizure operations would not empower the AO to make a block assessment merely because any admission was made by the assessee during search operation". In paragraph 24, their Lordships have mentioned about the prevailing practice of extracting statement by exerting undue influence or coercion by the search party. Though the above decision in the case of Harjeev Aggarwal is with reference to the meaning of undisclosed income u/s 158BB of the Income-tax Act, however, in our opinion, the above observation of Hon'ble Jurisdictional High Court would be squarely applicable while considering the evidentiary value of the statement while making the assessment u/s 153A. 18. In the case of Best Infrastructure (India) (P.) Ltd. (supra), Hon'ble Jurisdictional High Court reiterated in paragraph 38 "Fifthly, statements recorded under Section 132(4) of the Act do not by themselves constitute incriminating material as has been explained by this Court in Harjeev Aggarwal". 19. Learned DR has r....
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....admission, voluntarily made, on the part of the assessee, that would constitute a good piece of evidence for the Revenue." (emphasis by underlining provided by us) 21. From the above, it is evident that in this case also, certain documents were seized and copies of which were supplied to the assessee. Thus, admittedly, there was incriminating material in the above case. 22. The next decision relied upon by the learned DR is M.S. Aggarwal (supra). In this case, Hon'ble Delhi High Court did not agree with the earlier decision of the same High Court in the case of Harjeev Aggarwal (supra) and direct that the matter be placed before the Hon'ble Chief Justice for being referred to a Larger Bench for deciding the issues. We have asked both the parties to express their views whether after the decision of Hon'ble Delhi High Court in the case of M.S. Aggarwal (supra), the earlier decision of Harjeev Aggarwal (supra) still remains as a binding precedent. Learned DR stated that when Hon'ble Delhi High Court itself have expressed the view that the decision in the case of Harjeev Aggarwal (supra) needs to be reconsidered and reappraised, it cannot be consi....
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.... in the case of Harjeev Aggarwal (supra) is overruled. The above decision continues to be binding precedent. 24. Learned DR has also relied upon the decision of Hon'ble Jurisdictional High Court in the case of Smt. Dayawanti (supra). However, we find that Hon'ble Apex Court in the case of Smt. Dayawanti vide order dated 3rd October, 2017 have stayed the operation of this order. Once the operation of the order of Hon'ble Delhi High Court in the case of Smt. Dayawanti (supra) has been stayed by the Hon'ble Apex Court, it cannot be held to be a binding precedent. 25. Learned DR has also relied upon the following three cases which were relating to survey proceedings :- (i) M/s Pebble Investment and Finance Ltd. Vs. ITO - [2017-TIOL-238-SC-IT). (ii) Raj Hans Towers (P) Ltd. Vs. CIT - 56.taxmann.com 67. (iii) PCIT Vs. Avinash Kumar Setia - [2017] 81 taxmann.com 476 (Delhi). 26. As the above decisions were relating to survey proceedings, the same will have no application for interpreting the scope of assessment under Section 153A. 27. The next decision relied upon by the learned DR is of Hon'ble Gauhati High Court in t....
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.... 30,80,000 99,92,000 2 Sh. Nitin Mahajan 3500 sq.ft 53,90,000 1,75,26,000 3 Smt. Shivali Mahajan 2000 sq.ft 30,80,000 99,92,000 4 Sh. Jatin Mahajan 3500 sq.ft 53,90,000 1,75,26,000 5 Smt. Anila Mahajan 4500 sq.ft 69,30,000 2,24,82,000 6 Sh. Lalit Mahajan 4500 sq.ft 69,30,000 2,24,82,000 Total 3,08,00,000 10,00,00,000 30. From the above, it can be seen that with reference to question No.6, he admitted the cash payment of Rs. 10 crores by six family members including him. When in question No.7 he was asked to state as to whom the payment was made and when, in reply thereto, he stated "The cash payment was made to Sh. Sanjeev Aeren of AEZ Group during the F.Y. 2006-07 to 2008-09 ". If the payment is made during the financial year 2006-07 to 2008-09, the addition, if any, can be made in those years and not in assessment year 2006-07, which is the year under consideration. In the year under consideration, i.e., 2006-07, if any cash payment is made by the assessee during the financial year 2005-06, that can only be considered and not the payments made in the subsequent years. The lear....
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....he payment to Mis Aerens group payment have been made as reflected in the books of accounts Paper shown." 5. Thereafter, on 29th October, 2013, a notice was issued to the Assessee under Section 153A of the Act. In compliance thereof, the Assessee filed the return of income which he had originally filed and which had already been scrutinized by the AO under Section 143 (3) of the Act for the A Y in question i.e. A Y 2006-07. By the assessment order dated 27th March, 2014, the AO came to the conclusion that the Asses ee had failed to explain the nature and the source of the investment made in cash and, consequently, added the sum of Rs. 3 .21 Crores to the Return Income. 6. The Assessee went in appeal before the Commissioner of Income Tax (Appeals) who dismissed it by an order dated 2ih November, 2014. A further appeal was filed by the Assessee before the IT A T. The ITAT, inter alia, found substance in the contention of the Assessee that the assessment under Section 153(A) of the Act, in the absence of any incriminating material found during the search on the premise of the Assessee was not sustainable in law. Reliance was placed on the decision of this Court 111 C....
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....materials for the purpose of making addition in the hands of assessee other than the searched person that to without affording cross examination of the assessee. The Hon'ble Delhi High Court in the case of CIT vs. Raj Pal Bhatia, 333 ITR 315 held that statement was not the document which was found during search. In fact this was the document which came to the created during the search as the statement was recorded at the time of search. Therefore, it cannot be said that the statement was seized during the search and thus, would not qualify the expression ''document'' having been seized during the search. Even the statement recorded from the director of Pravin K. Jain Group and Shri. Bhanwarlal M. Jain & Group is not consequent upon any material found during the course of search of the Respondent- assessee. 11. Now the law is settled to the extent that in the absence of any incriminating materials found during the course of search and seizure operations, no addition can be made u/s.153A of the Act. Reliance can be placed on the decision of Hon'ble Delhi High Court in the case of PCIT vs. Meeta Gutgutia, (2017) 82 taxmann.com 287affirmed by the Hon'ble Supreme Court by dismi....
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....ereafter, the second AO, on being satisfied that the books of account and documents received have a bearing on the determination of the total income of the other person, should assume jurisdiction under section 153C of the Act. After assuming jurisdiction under section 153C of the Act, the AO proceeds to carry out an assessment in terms of section 153A r.w.s. 143(3) of the Act. In this regard, it is relevant to extract section 153 of the Act hereunder:- "153C(1) Notwithstanding anything contained in section 139, section 147, section 148, section 149, section 151 and section 153, where the Assessing Officer is satisfied that,- (a) any money, bullion, jewellery or other valuable article or thing, seized or requisitioned, belongs to; or (b) any books of account or documents, seized or requisitioned, pertains or pertain to, or any information contained therein, relates to, a person other than the person referred to in section 153A, then, the books of account or documents or assets, seized or requisitioned shall be handed over to the Assessing Officer having jurisdiction over such other person and that Assessing Officer shall proceed against each such....
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....uld abate on the date the AO received the seized material from the AO of Shri. Manoj Kumar Jain and fresh proceedings under section 153C of the Act ought to have been initiated. However, it is seen that, upon receipt of the said information / materials, the AO did not assume jurisdiction under section 153C of the Act, but rather chose to use the said materials / information for making additions in the impugned order of assessment for Assessment Year 2008-09 concluded under section 143(3) of the Act. The AO has discussed these additions in the order of assessment under the caption "Unaccounted Transactions with Shri. Manoj Kumar Jain". The AO noted that the assessment proceedings in the case of Shri. Manoj Kumar Jain were 'being concluded at Central Circle-1, Belgaum'. Thereafter, he has gone on to set-out the issues in the case of Shri. Manoj Kumar Jain, relevant to the assessee in the case on hand. But no satisfaction, it appears, has been recorded that these materials have a bearing on the determination of income. Thus, the AO has not followed the procedure laid down in section 153C of the Act for taking cognizance of the material found / seized in the case of Shri Manoj Kumar Ja....
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....vidence gathered from extraneous source and on the basis of statement or document received subsequent to search. Hence we hold that the said materials cannot be used in section 153A of the Act against the assessee. This opinion is given without going into the merits and veracity of the said seized documents implicating the assessee herein." 7.6.6 The Hon'ble Bombay High Court in the case of HDFC Bank (supra) has also considered a similar question of law in the context of the erstwhile provisions of section 158BD of the Act. The provisions of section 158BD is the pre-cursor to the present provisions of section 153C of the Act; as the said provisions were required to be invoked for framing an assessment in the case of a person who was not searched, but materials indicating undisclosed income was found in the course of search conducted by the Department. In the aforesaid case of HDFC Bank (supra), Revenue sought to take cognizance of the search material and disallow depreciation in regular assessment proceedings and the provisions of section 158BD of the Act was not invoked. The Hon'ble Bombay High Court held that the scope of a regular assessment and the scope of assessment ....
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....F) ITAT, 'G' Bench Delhi decision dated 13.6.2019 in the case of Urmila Devi Charitable Trust vs. CIT(E) passed in ITA 4136/Del/2017 (AY 2011-12). "8. We have carefully considered the arguments of both the sides and perused the material placed before us. Section 12AA of the Act reads as under:- "12AA. (1) The [Principal Commissioner or] Commissioner, on receipt of an application for registration of a trust or institution made under clause (a) [or clause (aa) [or clause (ab)] of subsection (1)] of section 12A, shall- (a) call for such documents or information from the trust or institution as he things necessary in order to satisfy himself about the genuineness of activities of the trust or institution and may also make such inquiries as he may deem necessary in this behalf; and (b) after satisfying himself about the objects of the trust or institution and the genuineness of its activities, he - (i) shall pass an order in writing registering the trust or institution; (ii) shall, if he is not so satisfied, pass an order in writing refusing to register the trust or institution, and a copy of such order shall be sent to the applicant : ....
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....hat the registration shall not be cancelled under this sub-section, if the trust or institution proves that there was a reasonable cause for the activities to be carried out in the said manner.]." 9. From a plain reading of the above Section, it is evident that the Principal Commissioner or Commissioner registers the trust or institution under sub-section (1) and he has been given the power under sub-section (3) to cancel the registration granted under sub-section (1). However, under sub-section (3), he can cancel the registration granted under sub-section (1) only when he is satisfied - a. that the activities of such trust or institution are not genuine; and b. the activities of such trust or institution are not being carried out in accordance with the objects of the trust or institution. 10. In the case under appeal before us, the CIT has cancelled the registration granted under Section 12AA(1) on the alleged ground that the trust had received the donation of Rs. 85 lakhs from HHBRF in lieu of cash. The above finding of the CIT(Exemptions) is based upon the report received from CIT(Exemptions), Kolkata. On the basis of above, the CIT(Exemptions....
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....ee's written submission at pages 6 & 7 of his order. However, in the CIT's finding, it is nowhere mentioned that the material which is being used against the assessee has been supplied to him. In paragraph 9, the CIT has considered and relied upon the report of CIT(Exemptions), Kolkata. For ready reference, the same is reproduced below :- "9. As per the detailed report of the Ld. CIT(Exemption) Kolkata and the Assessing Officer and Joint Commissioner of Income-tax (Exemption), Ghaziabad, M/s Herbicure Healthcare Bio-Herbal Research Foundation has admitted that this amount was paid by cheque to the assessee after payment of equal amount in cash and commission through brokers. Thus total amount of Rs. 85,00,000/- has been received by cheque from M/s Herbicure Healthcare Bio-Herbal Research Foundation by the assessee after paying cash of Rs. 85,00,000/- plus 5 to 10% of this amount also in cash as commission." 12. Similarly, in paragraph 13, which reads as under, he has relied upon the statement on oath and the letter signed by HHBRF :- "13. Moreover, the statement on oath and the letter signed by M/s Herbicure Healthcare Bio-Herbal Research Foundation have ....
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.... the Adjudicating Authority did not grant this opportunity to the assessee. It would be pertinent to note that in the impugned order passed by the Adjudicating Authority he has specifically mentioned that such an opportunity was sought by the assessee. However, no such opportunity was granted and the aforesaid plea is not even dealt with by the Adjudicating Authority. As far as the Tribunal is concerned, we find that rejection of this plea is totally untenable. The Tribunal has simply stated that crossexamination of the said dealers could not have brought out any material which would not be in possession of the appellant themselves to explain as to why their ex-factory prices remain static. It was not for the Tribunal to have guess work as to for what purposes the appellant wanted to crossexamine those dealers and what extraction the appellant wanted from them. As mentioned above, the appellant had contested the truthfulness of the statements of these two witnesses and wanted to discredit their testimony for which purpose it wanted to avail the opportunity of cross-examination. That apart, the Adjudicating Authority simply relied upon the price list as maintained at the de....
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.... material with the Department on the basis of which it could justify its action. Identical is the situation in the appeal before us. If the material collected behind the back of the assessee and the statement recorded behind the back of the assessee is discredited or ignored, there was no material with the Department on the basis of which it could justify its action. Therefore, in our opinion, the above decision of Hon'ble Apex Court would be squarely applicable. 15. Learned DR has also relied upon the decision of Hon'ble Jurisdictional High Court in the case of UP Distillers Association (supra) and has also pointed out that the SLP filed by the assessee against the above decision was dismissed by the Hon'ble Apex Court. From a perusal of the above decision, we find that the facts in the aforesaid case were altogether different. In the aforesaid case, there was search and seizure operation on the assessee i.e., UP Distillers Association and during the course of such search, the material was found as well as statement of Shri R.K. Miglani was recorded under Section 132(4). Thus, the facts in the aforesaid case were altogether different. In the case of the assessee, ther....
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.... based upon the allegation that the assessee received the donation of Rs. 85 lakhs in lieu of cash. As we have already stated, there is no basis for the Department to hold that the assessee received the donation of Rs. 85 lakhs from HHBRF in lieu of cash. Further, merely because the genuineness of one donation in one year is doubted, it cannot be a ground to draw the inference that the activities of the assessee society are not being carried out in accordance with the objects of the society or that no genuine activities are being carried out by the assessee. That if the genuineness of a donation in one year is doubted, the addition, if any, can be made in the assessment of the relevant assessment year in accordance with law. However, that, by itself, would not be sufficient to withdraw the registration under Section 12AA(3). If the genuineness of a donation is doubted, at the most, it can be a ground to examine deep into the activities of the society so as to ascertain whether the activities of the society are being carried out in accordance with the objects of the society. However, a conclusion cannot be drawn that the activities of the society are not being carried out in accorda....