TaxTMI 
TaxTMI 
2025 (11) TMI 627
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....fore us are that the assessee for the impugned year had declared total income of Rs. 2,07,333/-. Subsequently, the AO came in possession of information that the assessee was beneficiary of accommodation entry from the entities managed and controlled by an accommodation entry provider, Shri Jignesh Shah. The quantum of accommodation entry alleged to have been taken by the assessee amounted to Rs. 6,53,712/-. Basis this information, the AO reopened the case of the assessee and made addition of the impugned sum to the income of the assessee in the order passed u/s.147 of the Act. 4. The Ld. CIT(A) considered the facts of the case and the submissions made by the assessee before him and found that the information in the possession of the AO did not relate to the assessee at all. He found that the bank account in which the accommodation entry was allegedly noted in the information, to have been provided to the assessee by the accommodation entry provider, did not pertain to the assessee. He noted the assessee to have pointed out this factual infirmity in the information to the AO immediately on receipt of the copy of reasons recorded for reopening of the case of the assessee. He noted....
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....t of the benefit of accommodation entry through AA Plus Share Brokers Pvt. Ltd on 24.08.2011 to the tune of Rs. 6,53,712/- during financial year 2011-12. Consequently, reason was recorded and after taking the approval of the competent authority, notice u/s 148 was issued on 30.03.2019. In compliance, ITR was e-filed on 07.05.2019. After providing the reason to believe as recorded by the AO, notice u/s 143(2), u/s 142(1) and show cause notice were issued. Finally, the entire amount was added to the total income of the appellant in the form of unexplained cash credit. This appeal has been instituted challenging the addition made u/s 143(3)/147. At the outset, the appellant has stated that notice u/s 148 was issued in a mechanical manner and without making any enquiry. Subsequent addition was made by the AO without any application of his mind. According to the appellant, AO went on to complete the reassessment without disposing his objections put forward against the notice u/s 148 which makes the entire proceedings vitiated in the eyes of the law. In the matter of the facts of the case, the appellant has asserted that the HDFC bank account bearing number 226101100618 does not....
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....sing him at a higher income after making addition of the impugned amount. Copy of the letter submitted to the AO on 07.05.2019 reads as under: 'Moreover, your assessee fully disown the transaction done on 24/08/2011 for an amount of Rs. 6,53,712/- through the beneficiary account# 226101100618 (as per your annexure to the approval letter) because the said bank account does not belong to your assessee. In a nut shell, your assessee has never entered into any such transaction on the day, of an amount and in the account allegedly stated in your notice' Further on 28.11.2019, the above denial was repeated and copy of the ledger in the name of AA Plus Share Brokers Pvt. Ltd., copy of HDFC bank account etc, were produced in affirmation of his claim that no such amount has been received in the HDFC bank account no. 02371000070334 which belongs to the assessee. The same has been recorded in the assessment order as under: 'In response to the same, the assessee has submitted details vide letter dated 28.11.2019 through ITBA mail. The assessee vide email letter dated 28.12.2019, has denied to have any transaction with such entity and also stated that the ....
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....s Share Brokers Pvt. Ltd. managed and controlled by Shri Jignesh Shah is liable to be added to the total income in the form of unexplained cash credit. From the above description of facts, it becomes obvious that there is no evidence of receipt of credit amounting to Rs. 6,53,712/- in the HDFC bank account of the assessee. From the documentary evidences submitted in this office, it transpires that the appellant has entered into gross total transaction of Rs. 1,93,149/- only with AA Plus Share Brokers Pvt. Ltd. and the amount was duly offered to tax in the form of income from other sources. Clearly, the amount mentioned as received in the form of accommodation entry could not be verified from the HDFC bank account number 02371000070334 and there is also no finding in the assessment order that the concerned bank account mentioned in the reason to believe recorded during reassessment actually belongs to the assessee. There is also no mention of any account statement of the HDFC bank account number 226101100618 which in the said amount of Rs. 6,53,712/- has been received by way of credit from the entry provider. Thus, the primary allegation that the appellant(HUF) has received....
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....meaning of substantive provision of sec. 147 was absent. (c) The A.O. had erred in issuing notice u/s 148 on the basis of information received from DDIT (Inv.), Unit1(3), Ahmedabad vide email dt. 22/03/2019 regarding accommodation entry provider, without verifying the authenticity of the information. (d) The Assessing Officer had erred in issuing Notice u/s 148 merely by acting mechanically on the information supplied by the Investigation wing about the accommodation entries without applying his own mind. Assessing Officer had not examined and corroborated the information received from the investigation wing before recording his own satisfaction of escaped income and initiating reassessment proceedings. [Smt. Paramjit Kaur vs. CIT, Jalandhar [311 ITR 38 (Punjab & Haryana HC)] (e) The A.O erred in forming the belief that there is escapement of income on the ground that the appellant had received accommodation entry of Rs. 6,53,712/- in HDFC Bank account no 00060340017268 through entry provider Jignesh Shah, even though the Appellant had specifically confirmed that the said HDFC Bank account is not belonging to him and his HDFC Bank Account no is 0237100007....
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.... account was a different one as noted above by me. 10. As the above facts noted by the Ld. CIT(A) have remained uncontroverted before me by the Ld. DR, in the light of the same, I shall now proceed to adjudicate both the appeals of the assessee in its CO and that of the Department. Considering the fact that the reasons recorded for reopening of the case of the assessee contained a fact which was incorrect and which was a very vital fact pertaining to the assessee having allegedly received accommodation entry in his bank account, which bank account was incorrectly recorded in the reason and considering that the assessee had pointed out this to the AO immediately on receipt of copy of reasons recorded and the AO still went ahead form his belief of escapement of income of the assessee so as to assume jurisdiction to reopen the case of the assessee, It is abundantly clear that the AO did not apply his mind to the information in his possession and his satisfaction of escapement of income of the assessee was nothing but a borrowed satisfaction. When the assessee had categorically pointed out to the AO that the bank account mentioned in the reasons did not pertain to him, the AO ought ....