TaxTMI 
TaxTMI 
2022 (1) TMI 1150
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.... 7th August, 2013. In response to the notice u/s. 153A of the Act, the assessee filed the return of income on 12th September, 2015 declaring an income of Rs. 1,52,26,930/- which is the same income as per the original return of income filed. 2.1. During the course of assessment proceedings, the AO noted that the assessee has invested in share application money in the following two companies and has subsequently sold the shares the details of which are as under:- 3. In an attempt to establish the multi-layered transactions, the AO called for the bank statement of the Kolkata based companies which, according to him, are bogus. From the details of the said bank statements, he noted that all the above companies are maintaining their bank accounts with the same bank branch in Kolkata, i.e., Oriental Bank of Commerce, Bhowanipore. He further noted from the bank statements that these are channels to layer the fund flow, ultimately being credited into Mauria Group of companies. He noted that whatever amount is credited into the bank accounts gets debited the same day or the next day and every other day and the bank account is left with almost identical minimum balance. After analyzing....
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....a misnomer and actually the title should have been "Amount transferred to Bihariji Group." Further, Shri Rohtash Kumar specified that in his correspondences, names Bihariji Group and Mauria Group were used interchangeably. He noted that during the F.Y. 2012-13, Rs. 9 crore was received in cash. Shri Pramod Kumar Aggarwal, a property dealer and close associate of Shri Navneet Kumar Sureka received Rs. 50 lakhs each on 11.12.2012 and 01.02.2013, Shri Vaibhav Jain, as per Shri Akhil Kumar Sureka received to Rs. 1 crore in cash on 16.02.2013 and 14.03.2013, Shri Akhil Kumar Sureka himself received Rs. 1 crore cash on 21.02.2013, Shri Sonu and Shri Ravindra Adhana both field boys of M/s. Mauria Udyog Ltd., received Rs. 50 lakhs in cash on 31.01.2013. The remaining amount of Rs. 4.50 crore which is not directly attributable to any of the entities is to be added to the income of M/s. Mauria Udyog Ltd., M/s. Bihariji Ispat Udyog Ltd. and M/s. Jotindra Steel & Tubes Ltd., in proportion to the turnover of these companies with M/s. Amrapali Group for FY 2012-13 appearing in the documents. After recording the following details, the AO proposed an addition of Rs. 1,14,75,000/- in the hands of t....
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.... of Rs. 1,14,75,000/- made by the AO on account of unexplained cash is concerned, the ld. CIT(A) deleted the same by observing as under:- "4.5 Ground Nos. 10(i) to (iv) relate to addition of Rs. 1,14,75,000/- on account of alleged cash received from Amrapali group of companies by the Mauria group of companies/individuals as per account found in the e-mail of Sh. Rohtash Kumar sent to Sh. Akhil Kumar Sureka, and added by the AO in the hand of the Mauria group companies/individuals on proportionate basis, u/s. 69 of the Act. The facts of the matter and the assessment order at paras-6 to 6.14 as well as the submissions of the appellant are similar to that considered by me in the appellate order dt. 31.08.2016 in the case of M/s. Bihariji Ispat Udyog Ltd. for AY 2013-14 in Appeal No. 23/16-17 wherein I have held as under: "4.1 Ground No. 01 which emanate from Form-35 relates to the addition of Rs. 1,64,20,000/- on account of alleged cash received from Amrapali group of companies by the Mauria group of companies/individuals as per account found in the e-mail of Sh. Rohtash Kumar sent to Sh. Akhil Kumar Sureka, and added by the AO in the hand of the Mauria group compani....
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....ellate order of even date in the case of M/s. Bihariji Ispat Udyog Ltd. for AY 2013-14 in Appeal No. 23/16-17 wherein having dealt with the matter in detail I have deleted the addition so made in that case. Since the facts of the matter is similar in the case of the appellant as well, based on my decision in M/s. Bihariji Ispat Udyog Ltd. for AY 2013-14 the addition made in this case as well is deleted." and following the same the addition made on this account in this case as well is deleted." 9. So far as the addition of Rs. 13,01,395/- made by the AO on account of unexplained share application money is concerned, the ld. CIT(A) deleted the same by observing as under:- "4.6 Ground No. 11 (i) to (ii) relate to addition of Rs. 13,01,395/- on account of share application money u/s. 68 of the Act. The facts of the matter and the assessment order at paras-7 to 7.2 as well as the submissions of the appellant are similar to that considered by me in the case of appellant for AY 2010-11 in A. No. 299/16-17 vide my order dt. 18.04.2017 at paras-4.4 to 4.4.2 wherein the facts related to the receipt of the entire share application money of Rs. 8,10,00,000/- has been consi....
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....rein similar additions were made by the AO on account of sale of shares of the same parties. Thereafter, the Revenue filed an appeal before the Tribunal against the order of the CIT(A) and the Tribunal, vide ITA No. 6660/Del/2016, order dated 29.11.2018 deleted the addition. In the present case also, the assessee has sold the shares of M/s. Nexus Common Sales Pvt. Ltd. and M/s. Linkwise Marketing Pvt. Ltd. which is evident from the assessment order itself. Therefore, this issue being squarely covered in favour of the assessee by the decision of the Tribunal, the order of the CIT(A) on this issue be upheld and the ground raised by the Revenue on this issue should be dismissed. 15. We have considered the rival arguments made by both the sides, perused the orders of the Assessing Officer and 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, made addition of Rs. 6 crores on account of sale proceeds of shares received by invoking the provisions of section 68 of the IT Act on the ground that the existence of the parties at the given address is not verifiable. According to the ....
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....source of the money utilized by SHPL, PCPL & DMPL for payments against the purchase of shares from MUL was in fact the unaccounted money of MUL routed through non-banking channels. I have also examined the confirmations of account, the bills of the sale of shares, the share transfer forms, the ITRs, audited accounts and the bank statements of SHPL, PCPL & DMPL submitted in the PB, also submitted before the AO with their various replies mentioned earlier in this order, and I do not find anything adverse so as to conclude that the source of the money utilized by PCPL, DMPL & SHPL for payments to MUL was in fact the unaccounted money of MUL. Even on consideration of the status of the impugned shares of NCPL and LMPL post sale by MUL, the shares were delivered to SHPL, PCPL & DMPL and if any 11 adverse inference on material evidence was necessitated it was to be considered in the hands of PCPL, DMPL & SHPL. Besides, from the assessment order it is apparent that the initial purchase of shares by MUL from NCPL & LMPL and source thereof have not been questioned by the AO and have apparently been accepted by the AO, and even if it is considered that the sale transactions were bogus and the....
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....of shares of two companies? Considering the facts of the case in hand in totality, we do not find any error in the findings of the CIT(A). This ground is also dismissed." 16. Since the facts of the instant case are identical to the facts of the case decided by the Tribunal in the case of Maurya Udyog Ltd., therefore, respectfully following the decision of the Tribunal in the case of Maurya Udyog Ltd., we uphold the order of the CIT(A) and the ground raised by the Revenue on this issue is dismissed. 17. Ground of appeal No. 3 by the Revenue relates to the order of the CIT(A) in deleting the addition of Rs. 1,14,75,000/- made by the AO on account of unexplained cash. 18. The ld. DR heavily relied on the order of the AO. 19. The ld. Counsel, on the other hand, submitted that the AO made proportionate disallowance in the hands of the three companies, namely, Mayrya Udyog Ltd. - Rs. 2,78,10,000/-; Bihariji Ispat Udyog Ltd. - Rs. 57,15,000/-; and Jotindra Steel & Tubes Ltd., i.e., the assessee - Rs. 1,14,75,000/-. 20. He submitted that the proportionate disallowance in the hands of the two companies, namely, Maurya Udyog Ltd. and Bihariji Ispat Udyog Ltd., has been deleted....
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....ver, the Assessing Officer made the addition on the strength of the statement of Shri Rohtash wherein he has admitted that Rs. 1 crore has been received. Exhibit 85 of the paper books reveals that on the date of receipt of the impugned amount, the same was returned back to Amrapali Group by M/s. Bihariji group. The entries of Rs. 50 lakhs each on 11.12.2012 and 01.02.2013 can be seen from the said Exhibit 85 of the paper book. This means that the date on which the alleged Rs. 1 crore was received, on the very same day the same was returned back. 11. More importantly, there is no mention of the assessee's name in the impugned document. The Assessing Officer has simply assumed that the reference to the impugned amount is in relation to the assessee. In our understanding, no addition can be made on the basis of presumptions and surmises. Assuming, yet not accepting that the amounts were received by the assessee, the same were returned back on the very same date as per Exhibit 85 of the paper book. Even on this count, addition is uncalled for. 12. In the result, the appeal filed by the Revenue is dismissed." 22. Since the facts of the instant case are identical....
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.... documents to justify the identity and credit worthiness of the share applicants and the genuineness of the transaction. Further, the RBI has noted that the assessee has followed due procedure which is required to be followed for issue to foreign share applicants. Since the ld. CIT(A) has rightly deleted the addition, the same does not call for any interference. He accordingly submitted that the ground raised by the Revenue should be dismissed. 27. 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, made an addition of Rs. 13,01,395/- being share application money received from Mr. Hemand Vinkatramani Lalith Raj, M/s. Sneha Santosh Tirodkar, Mr. Digvijay Singh and Smt. Deepa Subramaniam on the ground that the assessee failed to prove the identity and credit worthiness of the share applicants and the genuineness of the transaction. We find, the ld. CIT(A) deleted the addition the reasons of which have already been reproduced in the preceding paragraphs. We do not find any inf....