TaxTMI 
TaxTMI 
2023 (9) TMI 373
X X X X Extracts X X X X
X X X X Extracts X X X X
....rs were not found to be existing at the given address and the list of nine such parties was provided. Ld. AO observed that during the relevant AY 2007-08 the assessee has raised share application money to the extent of Rs. 3,59,50,000/- and based upon the response of the assessee addition of Rs. 3,56,79,600/- was made. Ld. AO had primarily relied on the statement of Shri Rajesh Bhagat who was the Director in M/s Rajesh Metal India the predecessor entity of the assessee. The Ld. CIT(A) has set aside the addition primary observing that statement of Shri Bhagat was not reliable statement and he had retracted and given divergent statement on different occasion. At the same time Ld.CIT(A) examined the issue on merits of the to conclude "No cogent reasoning or any evidence was relied upon. Here it is pertinent to mention that a search has taken place in the premises of appellant and nothing has been found in this regard to substantiate that the appellant has taken this amount as bogus entry and routed its funds for the year under consideration." 3. The Revenue is in appeal raising following grounds: 1. "That on the facts and in the circumstances of the case, the Id. CIT(A) ha....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... u/s 132(4) post recording reasons to believe for initiating the re-assessment proceedings and as such the reopening is merely on surmises and presumption. 2. That orders passed by lower authority are not justified on facts and same are bad in law. 3. That the appellant craves leaves to add, alter, amend, and forego any of the grounds of appeal at the time of hearing." 4. Heard and perused the record. 5. It was submitted by Ld. DR that Ld. CIT(A) has fallen in error in not appreciating the fact that Shri Brijesh Bhagat was Director of the assessee company on the basis of his statement of involvement in accommodation entries. Ld. AO had rightly relied on the statement and made the addition and Ld. CIT(A) in an unjustified manner considered the statement to be not reliable. 6. On the other hand, Ld. AR submitted that primarily on the basis of statement of Shri Brijesh Bhagat only the impugned reassessment order was passed and also the cases were assessment u/s 153A for AY 2008-09 and 2010-11 were also opened these assessment orders u/s 153A were subject matter of appeal before the Tribunal in ITA Nos. 6367 & 6368/Del/2016 and by the order dated 09.09.2021, ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....on the statement of Mr. Brijesh Bhagat recorded on 16.03.2016 despite the fact that the said person retracted the same by way of an affidavit on 29.03.2016 and except the statement of Mr. Bhagat and the suggestion of DDIT (lnvestigation), there is no material, whatsoever, to corroborate and substantiate the addition. In view of the decision of Hon'ble jurisdictional High Court in the case of Anand Kumar Jain (HUF) (supra), wherein the Hon'ble High Court followed the decision in CIT vs. Harjeev Aggarwal (2016) 70 taxmann.com 95 (Delhi) and observed that though the statement recorded u/s. 132(4) of the Act has evidentiary value and the relevance as contemplated under the Explanation therefore, on standalone basis such statement does not empower the Assessing Officer to frame the block assessment without there being any material discovered during the search and seizure operations. In so far as the merits are concerned, the observations of the Id. CIT(A) are lawful and his conclusions are impeccable. The statement of Mr. Brijesh Bhagat on standalone basis cannot afford any support to the addition and in view of the decisions of Hon'ble jurisdictional High Court in the case ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the shares have been allotted and certificates have been issued. Form 2 with ROC has also been filed in this regard. In view of the above, it is contended that the appellant has discharged its onus with regard to the identity, creditworthiness and genuineness of transaction of the investor company. Therefore, relying upon the ratio in various decisions including a decision of jurisdiction High Court in Kurele Paper Mills P. Ltd., ITA No. 369/2015 and SLP against the same has been dismissed by Supreme Court, decision of Hon'ble Supreme Court in the case of CIT vs. Kamdhenu Steel and Alloys Ltd. 361 ITR 320 (2014) and CIT vs. Lovely Exports P. Ltd. 216 CTR 195, requested that there is no merit to consider this investment as unexplained. 8.2 In the other hand AO has just mentioned that these investor companies creditworthiness to advance such huge amount, looking to the smallness of the income disclosed by them. No cogent reasoning or any evidence was relied upon. Here it is pertinent to mention that a search has taken place in the premises of appellant and nothing has been found in this regard to substantiate that the appellant has taken this amount as bogus entry and ro....