TaxTMI 
TaxTMI 
2024 (1) TMI 411
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....iary of taking accommodation entries of Rs. 66,00,000/- in the garb of share application money/share capital from entry providers namely Shri S. K. Jain group in the names of following entities:-- 2.1 On the basis of the above information, reasons were recorded and reassessment proceedings were initiated by him by issuing notice u/s 148 of the Act dated 19.02.2016. However, during the reassessment proceedings, after analyzing the material found during the search proceedings in the case of entry providers and co-relating with the details of return of income of the assessee, it was found by AO that the assessee has received total share application money of Rs. 66,00,000/- as accommodation entry from S.K. Jain Group. Consequently, he added the same u/s 68 of the Act and completed the assessment proceedings u/s 143(3)/147 of the Act after making following additions :- 1. Unexplained cash credits u/s 68 Rs. 66,00,000/- 2. Unexplained commission Rs. 1,18,800/- Consequently, the income of assessee was determined at Rs. 23,64,444/- against the re....
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....us, the addition so made should be deleted. 7. The CIT(A) erred in law and on fact in confirming an addition of Rs. 1,09,800/- as unexplained investment for commission paid @ 1.8% for obtaining the accommodation entry on surmises and ignoring the facts, evidences and submissions placed on record. Thus, the addition so made should be deleted. 8. The appellant craves the leave to add, substitute, modify, delete or amend all or any ground of appeal either before or at the time of hearing." 5. Heard and perused the record. 6. It is pertinent to mention that at the time of arguments, ld. AR made an endorsement in the appeal memo not pressing ground no. 4 and argued the matter on the basis that the reopening was invalid and in any case the assessment should have been u/s 153C instead of Section 147 and 148 of the Act. 7. Ld. DR however submitted that Ld. CIT(A) has fallen in error in considering the Income Tax return of the creditor to conclude about genuineness. It was submitted that there is no error in the assessment u/s 147. 8. Appreciating the submissions it comes up that Ld. AO has primarily examined the issue on the basis of Investigation Wing information to consider th....
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....n respect of each and every beneficiary and forwarded the information to the relevant assessing officers for further enquiry and assessment. It is not the case where incriminating document or information was found independently for each and every beneficiary, rather, after making an examination and further enquiry, in the case of these beneficiaries, Investigation Wing reached to the conclusion that these beneficiaries have taken accommodation entries in lieu of cash deposited by them from undisclosed sources. On the basis of such reports, the AO has initiated the reassessment proceedings u/s 147 of the Act in the case of the appellant which is valid and tenable in law. The several decisions, as mentioned above, of Jurisdictional High Court as 'Well as other Courts also substantiate this fact that the information received from Investigation Wing is a tangible material for initiating the reassessment proceedings in the case of any assessee. In view of this, the objection raised by AO is not acceptable and deserves to be rejected." 10. We are of the considered view that Ld. Tax Authorities have fallen in error as the reopening u/s 147/148 is on the basis of income chargeable to tax....
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....lier paragraphs, it has been proved that the apparent was not real." 13. Further, in ITA No. 2668/DEL/2019 [Assessment Year: 2010-11] City Life Projects Pvt. Ltd. Vs. The I.T.O SMC Bench at Delhi vide order dated 17/9/2021, has dealt with similar issue involving similar facts and alleged entries given by SK Jain Group and held as follows; "10. I have given thoughtful consideration to the orders of the authorities below and have carefully perused the decisions relied upon ld. counsel for the assessee. I find that the decision of the coordinate bench in the case of Naval Oil and Containers Pvt. Ltd [supra] squarely applies on the facts of the case in hand, in as much as, in that case also, information was received out of the search operation carried out in S.K. Jain group of cases which is evident from the facts extracted at Para 4 of the order and the same are as under: "4. The brief facts of the case are that assessee filed its return of income on 30.9.2009 declaring income of Rs. 2,73,720/-. The AO processed the same u/s. 143(1) of the Income Tax Act, 1961 (hereinafter referred as the Act) on 21.2.2011. On the information received from the office of the Director of Income T....
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....ounds of appeal which includes legal as well as on merits. But he draw my attention towards the ground no. 3 regarding jurisdiction of the AO ignoring the provisions of section 153C of the Act which ought to have been applied by the revenue instead of section 147 as the former provisions are non-obstantive provisions and exclude the operations of section 147 of the Act. He draw my attention towards a small paper book containing pages 1-62 in which he has attached various documentary evidences including various judgements on the issue in dispute and stated that the ground no. 3 has already been adjudicated and decided in favour of the assessee by the various Benches of the ITAT including the ITAT, SMC, Delhi Bench decision dated 08.08.2017 passed in ITA No. 1500 & 1501/Del/2017 (AY 2007- 08) in the cases of Sushil Gaur vs. ITO, Ward 2(3), Ghaziabad and Shelly Agarwal. Vs. ITO, Ward 2(3), Ghaziabad. He especially draw my attention towards the facts of the case and the decisions mentioned in para no. 8 at page 7 to 9 of the aforesaid Tribunal's order dated 08.08.2017 and requested by following the same ratio, the appeal of the assessee may be allowed. 6. On the contrary, Ld. DR rel....
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....icer having not followed procedure under sec. 153C, reassessment order was rightly quashed by the Learned CIT(Appeals). I also draw my support from the ITAT, New Delhi decision in the case of Rajat Shubra Chatterji vs. ACIT, New Delhi ITA No. 2430/Del/2015 dated 20.5.2016, wherein the reassessment was quashed on the similar facts and circumstances by following the ITAT, Amritsar decision in the case of ITO vs. Arun Kumar Kapoor (supra). In the present case before me, it is an admitted fact, as also evident from the reasons recorded and the assessment order that the initiation of reopening proceedings was made by the Assessing Officer on the basis of information available with the AO. I thus respectfully following the decision of Co-ordinate Bench of the ITAT, Amritsar in the case of ACIT vs. Arun Kapur - 140 TTJ 249 vs. (Amritsar) and the ITAT, Delhi decision in the case of Rajat Shubra Chatterji vs. ACIT, New Delhi ITA No. 2430/Del/2015 dated 20.5.2016 hold that provisions of sec. 153C of the Act were applicable in the present case for framing the assessment, if any, which excludes the application of sec. 147 of the ~ hence, notice issued under sec. 148 of the Act and assessment f....