TaxTMI 
TaxTMI 
2024 (4) TMI 741
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....by hawala operator Shri. Praveen Kumar Jain & Group as accommodation entry and assessing the same as assessee's own income?" 3. "Whether in the facts and circumstances of the case, the Ld. CIT(A) is right in simply deleting the addition made by the AO rather than taking the investigation/enquiries further either by himself or cause to get it done as per section 250(4) of the I T Act, especially after making the findings that the entire focus of the AO was on the modus operandi adopted by Shri. Praveen Kumar Jain to provide bogus accommodation entries of loan than to examine the application of section 68 in the case of the assessee?" 4, "Whether on the facts and in the circumstance of the case and in law, the Ld. CIT(A) is correct in deleting the addition of Rs. 40,00,000/- without fulfilling the obligation of the first appellate authority to have ensured that effective enquiry was carried out as held by the Hon'ble Delhi High Court in the case of M/s. Jansampark Advertising & Marketing (P) Ltd. in ITA 525/2014 delivered on 11/03/2015? 5. The appellant prays that the order of the Ld. CIT(A) on the above grounds be set aside and that of the AO be restored. 6. The appellant cr....
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....ved during previous AY. 2008-09 from the companies controlled by Shri Pravin Kumar Jain and the same was appearing in the balance sheet as opening unsecured loan. The AO also noted that in year under consideration, the assessee company had also received Rs. 75,00,000/- and Rs. 25,00,000/- as unsecured loan from Mrs. Prabhaben N. Rambhia and Mrs. Priti Rajesh Savla respectively. The amount of Rs. 1,80,00,000/- has been shown as receipts from the companies & entities controlled/operated/managed by Shri Pravin Kumar Jain of Mumbai. The names of which entities has been mentioned by AO in para no. 2.2. According to AO, Shri Pravin Kumar Jain and his associates have clearly stated in their various statements (given before the department) in the search proceedings (and also in the post search proceedings) that they merely give accommodation entries of bogus unsecured loan/share capital/share premium to beneficiaries in lieu of commission. The modus operandi as explained by them was that the beneficiary will give them cash and the same will be returned to the beneficiary by issue of cheques, after charging their commission on such transactions. Thereafter, the AO took note of the fact that....
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....he provisions of section 68 of the Act are clearly attracted in this case. And therefore, he added Rs. 1.80 cr which assessee showed as unsecured loan from the entities shown in chart (supra) u/s 68 of the Act. Similarly, he made an addition of Rs. 80,00,000/- u/s 68 of the Act which according to him, the assessee has been shown as share application money received from the entities named therein in chart (supra). The AO also was of the opinion that the assessee ought to have paid commission/brokerage to the entry operator which he estimated @ 2% which he computed as Rs. 5.20 Lakhs. And thus, made an addition of Rs. 1.80 Lakhs + Rs. 80 Lakhs + Rs. 5.20 Lakhs total of Rs. 2,65,20,000/-. Aggrieved, the assessee preferred an appeal before the Ld. CIT(A) who was pleased to delete the same. Aggrieved, the revenue is before us. 5. We have heard both the parties and perused the records. We note that the assessee is a limited company engaged in the business of manufacturing of readymade garments, commission agent and had filed its return of income for AY. 2009-10 on 24.09.2009 declaring total income of Rs. 3,68,743/-. We note that the AO on receipt of information from DGIT (Inv.), Mumbai t....
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....t, interest given by assessee, TDS deducted and deposited by assessee on the interest, the date on which loan had been repaid and cheque number of repayment, which are as under : - Sr. No. Name of the concern Amount (Rs) Interest (Rs.) TDS deducting by assessee Repayment date Cheque No 1 Anchal Properties P. Ltd 20,00,000 1,06,667 21,973 26.10.2009 356159 2 Ansh merchandise P.Ltd (New Planet Trading Co. Pvt. Ltd) 20,00,000 90,000 18,540 10.11.2009 356168 3 Atharv Business P. Ltd (Faststone Trading Co. Pvt. Ltd.) 20,00,000 1,06,667 21,973 26.10.2009 356161 4 Casper Enterprises P. Ltd. (Ostwal Trading (I) Pvt. Ltd. 20,00,000 1,06,667 21,973 10.11.2009 356169 5 Duke Business P. Ltd. (JPK Trading I Pvt. Ltd. 20,00,000 3,35,334 21,973 26.10.2009 356163 6 Nakshatra Business P. Ltd. (Hema Trading Co. P. Ltd.) 20,00,000 92,000 69,079 26.10.2009 356162 7 Olive Overseas P. Ltd (Real Gold Trading Co. P. Ltd.) 20,00,000 1,06,667 18,952 10.11.2009 356140 8 Sumukh Commercial P. Ltd. (Capetown Mar. P. Ltd. 20,00,000 88,000 21,973 26.10.2009 356160 9 Traingular Infocom Ltd. (lexus Infotech Ltd.) 20,00,000 11,38,669 18,128 ....
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....hiness of the lenders parties and genuineness of the loan given to assessee. Moreover, we note that the AO has taken an adverse view only because during search at the premises of Shri Pravin Kumar Jain, he admitted to be providing accommodation entries in the form of bogus loan/share capital for beneficiaries in lieu of commission/cash. However, we cannot countenance such an action of the AO for the reason that the statement relied upon by the AO to draw adverse view against the assessee was recorded during the search at the premises of Shri Pravin Kumar Jain on 01.10.2013 and the relevant year under consideration is AY. 2009-10. Admittedly his statement was recorded behind assessee's back and no opportunity was given to assessee to cross-examine Shri Pravin Kumar Jain, which was the only basis for drawing adverse inference against the loan transaction and consequent addition in the hands of the assessee. Such a statement of Shri Praveen Kumar Jain could not have been relied upon by AO for making addition; and for such a preposition, we rely on the decision of the Hon'ble Supreme Court in the case of Andaman Timber Industries Vs. CCE reported in (2015) 281 CTR 241 (SC) wherein it w....