TaxTMI 
TaxTMI 
TaxTMI 
2024 (2) TMI 986
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....ion of Rs. 2,16,33,868/- treated as unexplained cash credit u/s 68 of the Income Tax Act/ 1961 whereas the Hon'ble Supreme Court in the case of PCIT Vs NRA Iron & Steel (P.) Ltd. reported in [2019] 103 taxmann.com 48 (SC) / [2019] 262 Taxmann 74 (SC)/[2019] 412 ITR 161 (SC) held that "where assessee received share capita//premium, however there was failure of assessee to establish creditworthiness of investor companies, Assessing Officer was justified in passing the assessment order making additions under section 68 for share capita/premium received by assessee company." 3. Whether on the facts and in the circumstances of the case and in law, the Id. CIT(A), NFAC is justified in deleting the addition of Rs. 2,16,33,868/- treated as unexplained cash credit u/s 68 of the Income Tax Act, 1961 whereas the Hon'ble Supreme Court in the case of Navodaya Castle Pvt Ltd Vs CIT (Accommodation entry from Mahesh Garg) [2015] 56 taxmann.com 18 (SC)/[2015] 230 Taxmann 268 (SC) wherein it has been held that "SLP dismissed against High Court ruling that certificate of incorporation, PAN etc., are not sufficient for purpose of identification of subscriber company when there is material t....
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....efore the Ld. CIT(A), wherein the contentions raised by the assessee were found satisfactory and accordingly, the addition of Rs.2,16,33,868/- on account of unexplained cash credit u/s 68 have been vacated and the appeal of the assessee was partly allowed. 5. In order to assail against the aforesaid findings of Ld. CIT(A) the department has preferred the present appeal before us. 6. In the present appeal, the department has raised five grounds, but all these grounds are towards the solitary controversy regarding deleting the addition of Rs.2,16,33,868/- on account of unexplained cash credit u/s 68. Therefore, we are adjudicating all the grounds together in terms of our observations in the ensuing para's. 7. At the outset, Ld. CIT DR on behalf of the revenue have submitted that the order of Ld. CIT(A) is erroneous, bad in law & unacceptable for the reason that the assessee has received an amount of Rs. 2,16,33,868/- from M/s Dreamland Barter Pvt. Ltd., which was received by M/s Dreamland Barter Pvt. Ltd. from two parties namely M/s Surya International for Rs.1,63,57,908/- and M/s Jagdamba Traders for Rs.52,75,960/-. These amounts are received by the assessee company in its bank a....
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....tion available with the department the Ld.AO has rightly observed that the assessee has received its own money by way of multi layering and therefore, in absence of satisfactory explanations the amount so received has been added back to the income of the assessee on account of unexplained cash credit u/s 68 of the Act. Ld. AO also prepared and produced a multi layering chart the same is also extracting here: 9. Ld. CIT-DR further argued, disagreeing with the observations of Ld. CIT(A), wherein the addition made by the Ld. AO was vacated, that the amount were received by the assessee from fictitious entities/shell companies by depositing cash in one company and their after to other companies by way of multi layering, finally the amounts were brought to the bank accounts of the assessee which is the modus operandi of such companies/firms in execution of such bogus transactions. In the present case, the assessee was unable to substantiate by producing any cogent evidence w.r.t. the buyer M/s Vinayak Cement Udyog before the AO and the fact remain the same before the Ld. CIT(A) also. However, Ld. CIT(A) has summarily accepted the contentions assailed by the assessee on the basis of led....
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....2/- All the transactions except impugned ones accepted by AO. Nothing brought on record to dispute impugned transactions. iii) Impugned amounts adjusted against sales made to Vinayak Cement Udyog. Sales made remained undisputed. Sales included in profit & loss a/c, income therein offered in return & assessed also by AO. Books not rejected. iv) When one part of the transaction accepted by AO, no reason to not accept other part i.e. receipt of money against such accepted/taxed sales. v) Double addition - Profit taxed once, taxed again as remittance of money. Not permissible. Reliance on: - - CIT vs Kailash Jewellery House in ITA no. 613/2020, order cit. 09.04.2010 of Delhi High Court - ITO vs Parmanand Gupta in ITA no. 82/RPR/2017 cit. 04.08.2022, para no. 21, page no. 38, last five lines. -Rahul cold Storage vs. ITO (2022) 66 CCH 355 (Raipur) -Anantpur Kalpana vs ITO (2022) 194 ITD 702 (Bang.) -DCIT vs M/S M.c. Hospital (2022) 197 ITD 706 (Chennai) 6. Statement recorded during assessment Statement of Shri Bijan Kumar Dey was recorded during assessment, at PN 138 to 142 of PB. All facts explained. 7. Allegations of AO i) AO alleged that no do....
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....sessee company. Further when the assessee was required to produce necessary documents, it was unable to produce confirmation from M/s Vinayak Cement Udyog and according to statement recorded of Mr. Bijan Kumar Dey, the details regarding bank account and complete address etc were not provided to the Ld. AO. Mr. Dey, w.r.t. query about M/s Vinayak Cement Udyog has said that at present M/s Vinayak Cement Udyog is not our regular customer, they have purchased Clinker from 2010-11 to 2014-15. Assessee's submission on this aspect is that no enquiry was conducted with M/s Vinayak Cement Udyog whereas the complete address of the party was available with the Ld. AO on the copies of sales bills submitted before him cannot be accepted as when specifically the complete address of the creditor was asked, it was answered that at present the address is not available but the same will be made available subsequently, however, nothing could be brought on record to substantiate that the address was provided to the Ld. AO or the AO was made acquainted that such address is available on the invoices and that address is still the correct and the creditor is existent. Regarding necessary enquiries, Ld. CI....
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....er. 13. On this aspect, we draw support from the judgment in the case of CIT vs. Premkumar Arjundas Luthra (HUF) reported in [2016] 240 taxman 133, wherein Hon'ble Bombay High Court has held as under: "............It is very clear once an appeal is preferred before the CIT(A), then in disposing of the appeal, he is obliged to make such further inquiry that he thinks fit or direct the Assessing Officer to make further inquiry and report the result of the same to him as found in Section 250(4) of the Act. Further Section 250(6) of the Act obliges the CIT(A) to dispose of an appeal in writing after stating the points for determination and then render a decision on each of the points which arise for consideration with reasons in support. Section 251(l)(a) and (b) of the Act provide that while disposing of appeal the CIT(A) would have the power to confirm, reduce, enhance or annul an assessment and/or penalty. Besides Explanation to sub-section (2) of Section 251 of the Act also makes it dear that while considering the appeal, the CTT(A) would be entitled to consider and decide any issue arising in the proceedings before him in appeal filed for its consideration, even if the ....
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....ucing certain internal documents and bank statements. 15. While deciding this issue, we rely upon the judgment of the coordinate bench of ITAT, Raipur in the case of Raja Kaimoor Breweries Private Limited ITA No. 99/RPR/2020 vide order dated 06.02.2024 wherein the assessee was failed in producing necessary details before the Ld. AO, therefore, in absence of such details / evidence the addition made u/s 68 was sustained: 36. At this stage, we may herein observe that the assessee company despite specific direction by the A.O had not only failed to produce the aforementioned person for necessary verification but also not filed copy of his return of income, which would have evidenced creditworthiness to have made the aforesaid substantial investment of Rs.1.08 crore (approx.) with the assessee company. All that have been done by the assessee company is to place on record an "affidavit" of the aforementioned person wherein he had admitted of having made investment of Rs.1.08 crore towards share application money with the assessee company, Page 104 of APB. As nothing is discernible from the records, which would substantiate the creditworthiness of the aforementioned person who has sta....