TaxTMI 
TaxTMI 
2025 (6) TMI 799
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the Office of the ITO (Inv.), Unit 2(3), New Delhi relating to the assessee. Accordingly, the case was reopened after obtaining approval for issuance of notice u/s 148 of the Income-tax Act, 1961 (for short 'the Act'). Accordingly, approval was obtained u/s 151(1) of the Act. The AO has reproduced the reasons of reopening in his assessment order. The reasons recorded by the AO are that the companies, namely, M/s. First Hi Fin Limited and M/s. U P Electricals Ltd. have done large transactions of cash transactions and have been transferred during the year and the abovesaid information was received from ITO (Inv.). As per the information available at MCA site, Assessing Officer observed that the abovesaid companies have not filed their annual....
X X X X Extracts X X X X
X X X X Extracts X X X X
....hat assessee has authorized share capital of Rs. 5 lakh. issued and paid up capital of Rs. 3,40,000/- and received share application money of Rs. 2,25,000/-. The company, M/s. First Hi Fin Limited is having a shareholding of 12.95% of the assessee company. Further he observed that assessee has a gross receipt of Rs. 16,20,000/- and declared returned income of Rs. 4,29,301/-. Considering the fact that none of these companies are complied with various notices and also not traceable, he came to the conclusion that these companies are bogus and accordingly, proceeded to make the addition to the extent of money received from those companies. After considering the submissions of the assessee and not satisfied with the submissions of the assessee,....
X X X X Extracts X X X X
X X X X Extracts X X X X
....inancial Year 2011-12 are non-existing companies and had given accommodation. On this account, the AO was requested to give the copy of information received from Investigation Unit and also reasons for starting sec. 148 alongwith details of showing accommodation. The Ld. AO only supplied reasons for reopening that too after 2-3 reminders and did not give information received from investigation and material in support of accommodation was not supplied inspite of many letters which are in paper book appearing a~ pages 5, 8, & 12. However, the AO was informed that these companies have filed suit against Directors of Colorado Chattels Pvt. Ltd. in National Company Law Tribunal. Consequently it cannot be said that these companies are no....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ld not be started as per 342 CTR 465 (Born) in case of Shri Saibaba Sansthan Trust v/s UOI. Similarly in respect to accommodation reliance was placed on Hon'ble Supreme Court judgment reported at 472 ITR 1 (SC) copy attached laying down that entity with which sale of share was entered was not shell entity if no enquiry or any material in support of this was filed. On above account the proceedings 148 are void, bad in law and without any tangible new material. Consequently the proceedings and assessment are void, and need to be cancelled." 6. On the other hand, ld. DR of the Revenue relied on the findings of the ld. CIT (A) and he brought to our notice page 7 of the appellate order and submitted that AO has admitted ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....are capital from the abovesaid two companies and merely because these companies are untraceable. the investment made by these companies are treated as accommodation entries and made addition in the hands of the assessee. At the time of hearing, it is brought to my notice that both these companies having huge share capital and also huge reserves in the Balance Sheet. Assessee also filed copy of Balance Sheet before the tax authorities. The AO has issued notice u/s 148 of the Act by recording the reasons that assessee has received funds from these companies and also it was found that assessee has issued shares to these companies. I observed that the Assessing Officer himself recorded the findings that these companies are in existence in the R....