TaxTMI 
TaxTMI 
2025 (7) TMI 1483
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....ce and the order passed u/s 263 of the Act and hence the impugned order is bad in law. 2. The learned Principal Commissioner of Income-tax-1, Rajkot erred in setting aside the assessment order framed u/s 147 r.w.s. 144B of the Act by holding that the A.O. did not conduct any inquiries in respect of loan of Rs. 54,02,781/-, taken by the assessee from M/s Dishman Carbogen Amies Ltd. 3. The learned Principal Commissioner of Income-tax-1, Rajkot failed to appreciate that the impugned issue was duly examined by the assessing officer by way of specific inquiry/notice and reply thereto, while finalizing assessment proceedings u/s 147 r.w.s. 144B of the Act. 4. The appellant craves leave to add, amend, alter and withdraw any ground of appeal anytime up to the hearing of this appeal. 2. The facts of the case which can be stated quite shortly are as follows: The assessee, before us, is a private limited company and had filed its return of income for assessment year (A.Y.) 2014-15, on 18/09/2014, declaring total income of Rs. 96,67,640/-. The assessee`s case was reopened on the basis of information that a search action u/s 132 of the Income Tax Act, in the case o....
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....the assessee. The relevant portion of said notice is reproduced as under: "In your case assessment has been finalized u/s 147 r.w.s. 144B of the I.T. Act on 30.03.2022 accepting the returned income of Rs. 96,67,640/-. 2. On perusal of records, it is seen that your case for the year under consideration was reopened on the basis of information that during the year under consideration, you had taken fictitious loans/advances from M/s. Dishman Carbogen Amcis Ltd. A search action u/s.132 of the I.T. Act in the case of Dishman group of Ahmedabad was conducted on 19.12.2019 and the group was found to be indulged in huge transactions of bogus loans and advances. You are one of the beneficiaries of accommodation entries of M/s. Dishman Carbogen Amcis Ltd. formerly known as Dishman Pharmaceuticals and Chemicals Ltd. The concerns operated with whom transactions were made by Dishman group companies, were non-existent and dubious. The company M/s. DCAL (DPCL earlier) is found to have received Rs. 671,92,06,680/- in the form of bogus loans and advances. They have advanced Rs. 795,00,36,904/- in the form of bogus loans and advances between F.Y. 2009-10 to F.Y. 2019-20. During th....
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....to this office on or before 28.02.2024." 5. In response to the above notice, the assessee has filed its reply, before the ld PCIT, on 28.02.2024. The assessee submitted before the ld. PCIT that loan was taken through banking channel and the said loan was repaid through banking channel, interest was also paid on such loan and TDS on interest was also deducted and the assessing officer has examined all these facts. Therefore, genuineness of the transactions should not be doubted, hence the order passed by the assessing officer is neither erroneous nor prejudicial to the interest of the revenue. 6. However, Learned PCIT rejected the above contention of the assessee and observed that the assessee has taken loan/advance of Rs. 54,02,781/- (Rs. 50,00,000/-, loan + Rs. 4,02,781/-, interest) from M/s Dishman Carbogen Amcis Ltd (Dishman Pharmaceuticals and Chemicals Pvt Ltd). During the course of search proceedings, evidences related to Bogus Nature of loans & advances were found and seized from Dishman Corporate House. During the course of search proceedings, on Dishman Group, a statement u/s 132(4) of the I.T. Act of Shri Bharat Padia, Executive Director was recorded in which he has....
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....Dishman Group, which is reproduced below: 10. The ld.DR for the Revenue, referring to the above statement in the case of Dishman Group wherein it has been clearly stated that the Dishman group with the help of entry operators, such as, Shri Rajiv Shah, Shri Jignesh Shah, Shri Jivan Jagatia, Milind Shah explained the modus operandi of accommodation entry and cash generation in Dishman group and this assessee under consideration, is associated with Dishman group and one of the beneficiaries, therefore, the order passed by the assessing officer is not sustainable in eyes of law. As the transactions with the Dishman group is itself considered as bogus, therefore, the entry taken by the assessee under consideration, should also be considered as bogus. The ld.DR for the Revenue submitted that cash is given by the assessee, and then cheque is taken by the assessee. To demonstrate, to be a genuine transaction, the TDS was deducted on interest, therefore, it is a case of completely lack of inquiry on the part of the assessing officer. The ld.DR, therefore, submitted that the order passed by the ld.Pr.CIT requires to the upheld. 11. We have heard both sides in detail and also perused t....
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....-2013 to 31-03-2015 filed alongwith reply dated 22-03-2022 in response to notice u/s 142(1) of the Act. 6. Copy of contra confirmation from the books of M/s Dishman Pharmaceuticals & Chemicals Ltd, for the period 01-04-2013 to 31-03-2015 filed alongwith reply dated 22-03-2022 in response to notice u/s 142(1) of the Act. 7. Copy of bank account statement of assessee for the period 01-04-2013 to 30-04-2013 filed alongwith reply dated 22-03-2022 in response to notice u/s 142(1) of the Act. 8. Copy of bank account statement of M/s Dishman Pharmaceuticals & Chemicals Ltd filed alongwith reply dated 22-03-2022 in response to notice u/s 142(1) of the Act 9. Copy of Annual Report of M/s Dishman Pharmaceuticals & Chemicals Ltd. for the F.Y. 2013-14 filed alongwith reply dated 22-03-2022 in response to notice u/s 142(1) of the Act. 14. From the above documents and evidences, it is abundantly clear that during the assessment proceedings, the assessing officer has conducted sufficient enquiry in respect of the issue raised by the ld. PCIT in his revision order under section 263 of the Act. We find that the assessing officer issued notice to the assessee, ....
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....uineness of the transaction. Therefore, in these circumstances, the transactions cannot be treated, as bogus. 16. Therefore, we find that there is no lack of inquiry on the part of assessing officer. Inadequacy of inquiry alleged by ld. PCIT is not a valid ground to assume jurisdiction u/s 263 of the Act. It is also obvious that the assessing officer had no incriminating material, concerning, M/s Dishman Carbogen Amies Ltd, and hence the explanation of the assessee was rightly accepted and no addition on the point of alleged fictitious loans, from M/s Dishman Carbogen Amies Ltd, was made, hence even on merits, the PCIT has erred in directing the assessing officer for fresh assessment. Even the ld. PCIT has not pointed out any such incriminating material against the assessee, in assessee`s name. Further, on merits, section 68 of the Act is not applicable to the impugned loan obtained by the assessee as it was duly repaid in the subsequent year and that identity, creditworthiness and genuineness was also established by the assessee.We note that section 263 of the Act, speaks of revision of orders prejudicial to revenue. As per the said section and various judicial precedents inclu....
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....e case of CIT Vs. Sunbeam Auto Ltd. 332 ITR 167 (Del.). 18. For reasons stated above, we are of the view that the jurisdiction u/s.263 of the Act was not properly exercised by the ld. PCIT, as the condition precedent for invoking the same viz., that the order of the assessing officer is erroneous and prejudicial to the interest of the revenue, is not shown to be present in the assessee's case, under consideration. We, therefore, quash the order u/s.263 of the Act, and allow the appeal of the assessee. 19. In the result, the appeal of the assessee is allowed. Order is pronounced in the open court on 02/06/2025 ============= Document 1 Q.1 Please introduce yourself? Λης. I am Bhartbhai Parmananddas Padia S/o Late Pramananddas Padia aged about 65 years, B. Com pass, residing at 21, Vrundavan Banlows, Near Medilink Hospital, Satellite, Ahmedabad. My mobile no. is 9824026751. Q.2 Are you aware that if you give false statement, you are liable for penalty and prosecution under Income Tax Act and IPC? Ans Yes, I have been explained the consequences of giving false statement under oath and I confirm the same. Q.3 What is your role as an Executive Directo....
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....ission receipts, be zus loans and adv ances or of any other nature as per digital data found and seized b/ Department and mentioned in the statement of Chirag shown to me is true depiction of non-genuine trar sactiom entered into by DPCI, for various years based on need for unaccounted cash as and when commercial expediency for the same arises. I was the highest authority in DPCI. for deciding as to when and from whom and for what purpose we should take accommodation entry. As and when need used to arise I would get in touch with entry operators such as CA Shri Rajiv Shah, Sh Jivan Jagatia CA, Milind Shah CA, Shri. Dharam Agarwal and others. I used to tell whether I need cheque or cash and they used to provide and arrange for the same from various parties as per our need. There was no underlying business rationale for any such transactions and funds just used to either come into our books or would go out of our books as per planning suggested by these entry operators. We were not knowing any of the parties to whom we were issuing cheques or from whom we used to receive cheques as they were parties controlled, operated or arranged through these entry operators. To make thes....
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....rporate House, Ambli Bopal Road, Ahmedabad on 24.12.2019 during the course of Search & Seizure operation u/s. 132 of the Income Tax Act, 1961 Q.6 Now I am showing you statement of Shri Chirag Thakkar recorded on oath u/s 132(4) of the IT Act recorded on 23rd and 24th Dec 2019 at this premises i.c. Dishman Corporate Office. Kindly go through the entire statement of Chirag and offer your comments on the contents of the same, especially about the categorical admission and explanation of all the incriminating evidences seized during search including files and folders maintined in his office computer and pen-drive seized from his drawer and pointing towards your role in cash handling and arrangement of accommodation entries for Dishman Pharmaceuticals and Chemicals Ltd (DPCL), Dishman Carbogen Amcis Ltd.(DCAL), Dishman Infrastructure Ltd (DIL) and other concerns of Dishman Group with the help of entry operators such as Shri Rajiv Shah, CA, Sh Jignesh Shah, Sh Jivan Jagatia, Milind Shah, Dharam Agarwal and others. Ans. 1 have carefully read the entire statement of Chirag Thakkar recorded m/s 132(4) on 2374 and 24th which runs into 50 pages (temporarily concluded) along-with its ann....