TaxTMI 
TaxTMI 
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2025 (3) TMI 1612
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.... these appeals were heard together and have been adjudicated by this common order. Brief factual metrics common to all the above appeals is that assessee group has been engaged in the business of manufacturing of trading of tobacco & food products and allied activities . A search and seizure section u/s 132 was conducted upon the assessee. Consequent to the search proceedings incriminating documents were found and seized. One Shri Moolchand Malu, main person of the group gave statement making disclosure of unaccounted of about Rs. 150 crores. The disclosure, inter-alia, included unaccounted investments in properties, share application, investments, unexplained transactions found in incriminating documents etc. ITA No .- 1406/Del/ 2023 -Vikas Malu 2. The first issue arising in the present appealis the action of AO in making an addition of Rs. 9,47,50,000/- under Section 68 of the Act, and its affirmation by the Ld. CIT(A). The assessee had reportedly taken unsecured loans of Rs. 9,47,50,000/- from two parties, namely, Hallow Securities Pvt. Ltd. and XO Infratech Pvt. Ltd. The Ld. Counsel for the assessee submitted that order 143(3) of the Act, was passed on 29/12/2016. The Ld.....
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....ition of Rs. 9,47,50,000/- made by the Ld. AO is deleted. Accordingly, all the grounds of appeal raised by the assessee on this issue, are allowed. 5. The next issue raised by the assessee is regarding the amount of Rs 18,94,000/- added to the income of the assessee by the Ld. CIT(A) invoking his powers of enhancement. Ld. Counsel submitted that the impugned enhancement is based upon twin presumption of assessee undertaking accommodation entries and such entry providers charging commission @ 1-4%. Thus, on an estimate basis assuming commission @ 2%, he made an enhancement of Rs 18,94,000/-. 6. We have heard rival submissions in the light of material available on records. The Ld. counsel for appellant has argued that they have not undertaken any entry from any dubious entry provider and that all its loans are genuine. Consequently, there cannot arise any case paying any commission to any entry provider. The Ld. DR relied upon order of Ld. CIT(A). We have considered the impugned loans in proceeding paras and concluded that they do not suffer from any lack of genuineness. Accordingly, there cannot be any case charging of any commission by such entry providers from the assessee. ....
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....n of lower authorities. 10. We have heard rival submissions in the light of the material available on record. We have noted that in the case of M/s Kuber Khanpaan Udyog at para 9 and 10 of its order on pages 10 to 12, the Hon'ble Co-ordinate Bench has observed as under: "9. We observe that the Hon'ble Coordinate Bench of the Tribunal in the case of Vijayshree Food Products P. Ltd Vs. ACIT, {ITA No. 587/Del/2019 decided on 06.12.2021} while relying upon the aforesaid judgment passed by the co-ordinate Bench in the case of Kuber Khanpan Pvt. Ltd (supra), deleted the similar addition by observing as under :- 23. We find, identical issue had come up before the Tribunal in the case of sister concerns of the assessee, namely, Kuber Khanpan Udyog Pvt. Ltd. And Kuber Food Products India Pvt. Ltd. in ITA No. 580/Del/2019 and ITANo. 322/Del/2019, respectively, order dated 22nd October, 2019 for AY 2011-12. We find, the Tribunal, in the case of Kuber Khanpan Udyog Pvt. Ltd., while deciding the issue had noted the following facts at para 4 of the order :- "4. Brief facts of the case is that Kuber Khanpan Udyog Pvt. Ltd filed its return of income on 29.09.2....
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.... and Vijayshree Food Products P. Ltd Vs. ACIT, hence, respectfully following the decisions of the Hon'ble Tribunal, we are inclined to delete the addition made by the AO affirmed by the ld. Commissioner. Consequently, the addition stands deleted." 11. A perusal of the above, shows that the tribunal has taken the decision that share capital from M/s Powmex Pvt Ltd share is not a part of any chequered/ suspicious entry. We have noted that the thrust of additions made by the Ld assessing officer is resting upon the statement of Sh Mul Chand Malu made during the search making disclosure of additional income. The assessing authority has also placed sufficient reliance upon enquiries conducted by the investigation wing of Kolkata, inter alia, including statement of third parties stated to be accommodation entry providers. In the case of Harjeev Agarwal, Hon'ble Delhi High Court has held that undisclosed income cannot be computed merely on the basis of statements of an accused unless, the same is supported by credible evidence on record. The ratio laid down by the Hon'ble Apex Court in the case of Abhisar Buildwell has also been found to applicable in the case. The statemen....
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..... In the result appeal of assessee vide ITA number 1408/del/2022 is allowed. ITA No .- 1409/Del/2022- Kuber Metpack Pvt. Ltd. 15. The first issue arising in the present appealis the action of AO in making an addition of Rs. 18,13,00,000/- under Section 68 of the Act, and its affirmation by the Ld. CIT(A). The assessee had reportedly taken unsecured loans of Rs. 18,13,00,000/- from few parties. The Ld. Counsel for the assessee submitted that order 143(3) of the Act, was passed on 31.03.2017. The Ld. AO while making the addition relied upon the statement of Shri Mulchand Malu, the head of the Group and inquiry conducted by Investigation Wing of Kolkata including statement of one Sh. Devesh Upadhaya. The Ld. AO had concluded that the said parties were actually Kolkata based accommodation entry providers who did not had sufficient creditworthiness qua the impugned unsecured loans. He also held the view that the said company was a non-existent entity. 16. The Ld. Counsel for the assessee submitted that the Ld. First Appellate Authority has affirmed the order of the Ld. AO by relying upon averments made therein. The Ld. Counsel, submitted that the addition made by the Ld. AO is ....
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.... is accepted to be genuine, then how the principal component thereon could be disbelieved by the lower authorities. We are unable to comprehend and unable to persuade ourselves to accept to this act of the lower authorities ... ".We have also noted that the thrust of additions made by the Ld assessing officer is resting upon the statement of Sh Mul Chand Malu made during the search making disclosure of additional income. The assessing authority has also placed sufficient reliance upon enquiries conducted by the investigation wing of Kolkata, inter alia, including statement of third parties stated to be accommodation entry providers. In the case of Harjeev Agarwal, Hon'ble Delhi High Court has held that undisclosed income cannot be computed merely on the basis of statements of an accused unless, the same is supported by credible evidence on record. The ratio laid down by the Hon'ble Apex Court in the case of Abhisar Buildwell has also been found to applicable in the case .edtha The statement of Shri Mulchand Malu, who was neither a Director nor an employee becomes questionable, for resting any addition. Further it is trite law that the assessing officer as a quasi judicial a....
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....and its affirmation by the Ld. CIT(A). The assessee had reportedly taken unsecured loans of Rs. 2 crores from Campbell Advertising Pvt. Ltd. The Ld. Counsel for the assessee submitted that order 143(3) of the Act, was passed on 24.12.2018. The Ld. AO while making the addition relied upon the statement of Shri Mulchand Malu, the head of the Group and inquiry conducted by Investigation Wing of Kolkata including statement of Shri Ashish Begwani and Shri Vikas Kumar Aggarwal. The Ld. AO had concluded that the said company did not had sufficient creditworthiness qua the impugned unsecured loans. He also held adverse view qua genuineness of the impugned loan transaction. 22. The Ld. Counsel for the assessee submitted that the Ld. First Appellate Authority has affirmed the order of the Ld. AO by relying upon averments made therein. The Ld. Counsel, submitted that the addition made by the Ld. AO is not based upon correct appreciation and understanding of the facts governing the case. The Ld. Counsel through documents filed in its paper book, submitted that the stand taken by the Ld AO is contradictory in as much as the impugned loan was returned by the assessee during the previous year ....
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.... 25. In the result, appeal of the assessee is allowed. ITA no .- 320/Del/2019- Kuber Khadyan Pvt. Ltd. 26. The only issue arising in the present appealis the action of AO in making an addition of Rs. 1,21,38,863/- under Section 68 of the Act, and its affirmation by the Ld. CIT(A). The assessee had reportedly taken unsecured loans of Rs. 1,21,38,863/- from M/s Powmex Sales Pvt. Ltd. of Calcutta. The Ld. Counsel for the assessee submitted that order 143(3) of the Act, was passed on 28.12.2016. The Ld. AO while making the addition relied upon the statement of Shri Mulchand Malu, the head of the Group and inquiry conducted by Investigation Wing of Kolkata. The Ld. AO had concluded that the said company did not had sufficient creditworthiness qua the impugned unsecured loans. He also held adverse view qua genuineness of the impugned loan transaction. 27. The Ld. Counsel for the assessee submitted that the Ld. First Appellate Authority has affirmed the order of the Ld. AO by relying upon averments made therein. The Ld. Counsel, submitted that the addition made by the Ld. AO is not based upon correct appreciation and understanding of the facts governing the case. The Ld. Couns....
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....ssing officer as a quasi judicial authority must make his own independent enquiries before making any addition of income. Third party enquiries and/or statements can be a starting point but not the sole basis for drawing any conclusions. The assessment order suffers from deficiency of AO making any independent enquiries of his own. Accordingly, we are unable to subscribe to the view point of Revenue of treating the impugned unsecured loan of Rs. 1,21,38,863/- as ingenuine loan hit by provisions of Section 68 of the Act. The order of lower authorities is therefore, set aside and the Ld. AO is directed to delete the impugned unsecured loan of Rs. 1,21,38,863/-. All the grounds of appeal raised by the assessee is therefore, allowed. 29. Grounds of appeal no. 1 to 4 and 10 have been found to be general in nature and hence, bereft of any meritorious adjudication. The same are therefore, dismissed. 30. In the result, appeal of the assessee is partly allowed. ITA- 885/Del/2019- Kuber Khaini Pvt. Ltd. 31. The only issue arising in the present appealis the action of AO in making an addition of Rs. 2,45,00,000/- under Section 68 of the Act, and its affirmation by the Ld. CIT(A). ....
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....e have noted that the thrust of additions made by the Ld assessing officer is resting upon the statement of Sh Mul Chand Malu made during the search making disclosure of additional income. The assessing authority has also placed sufficient reliance upon enquiries conducted by the investigation wing of Kolkata, inter alia, including statement of third parties stated to be accommodation entry providers. In the case of Harjeev Agarwal, Hon'ble Delhi High Court has held that undisclosed income cannot be computed merely on the basis of statements of an accused unless, the same is supported by credible evidence on record. The ratio laid down by the Hon'ble Apex Court in the case of Abhisar Buildwell has also been found to applicable in the case . The statement of Shri Mulchand Malu, who was neither a Director nor an employee becomes questionable, for resting any addition. Further it is trite law that the assessing officer as a quasi-judicial authority must make his own independent enquiries before making any addition of income. Third party enquiries and/or statements can be a starting point but not the sole basis for drawing any conclusions. The assessment order suffers from defi....
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....nuine but allows corresponding claim of interest on it as genuine. The Ld. counsel drew our attention to the decision of Mumbai Tribunal, in the case of M/s NH securities Ltd. passed vide ITA number 1079/mum/2018 dated 24/3/2021 where it was held that once interest is accepted as genuine qua a loan there cannot be case of treating principle as in genuine. The Ld. DR argued that the said case is distinguished on facts. 39. We have heard rival submissions in the light of the material available on record. We have noted that in the case of M/s NH securities Ltd passed vide ITA number 1079/mum/2018 dated 24/3/2021 at para 3.3 of its order on pages 3-4, the Hon'ble Co- ordinate Bench has observed as under: " 3.3. We find that the ledger extracts given by the assessee before the ld CITA itself contains the counter signature of the creditors duly confirming all the transactions together with their PAN. From the perusal of the ledger extracts, we find that there is a running account maintained by the assessee with these creditors and all the transactions are routed through regular banking channels in account payee cheques. One more excruciating fact to be noted here is that ....
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....er authorities is therefore, set aside and the Ld. AO is directed to delete the impugned addition of Rs. 13,23,00,000/-. The Ground of appeal raised by the assessee are therefore, allowed. 41. The next issue raised by the assessee is regarding the amount of Rs 26,46,000/- added to the income of the assessee by the Ld. CIT(A) invoking his powers of enhancement. Ld. Counsel submitted that the impugned enhancement is based upon twin presumption of assessee undertaking accommodation entries and such entry providers charging commission @ 1-4 %. Thus, on an estimate basis assuming commission @ 2%, he made an enhancement of Rs 26,46,000/-. 42. We have heard rival submissions in the light of material available on records. The Ld. counsel for appellant has argued that they have not undertaken any entry from any dubious entry provider and that all its loans are genuine. Consequently, there cannot arise any case paying any commission to any entry provider. The Ld. DR relied upon order of Ld. CIT(A). We have considered the impugned loans in proceeding paras and concluded that they do not suffer from any lack of genuineness. Accordingly, there cannot be any case charging of any commission....
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....ing document found during the course of search, the statement of Sh. Mulchand Mallu, head of Family cannot be relied upon as he was neither an employee nor a Director in any company. It was argued that, there was no reference to the impugned loan in the satisfaction note. Before the Ld. First Appellate Authority, the assessee relied upon decision of Hon'ble Delhi High Court in the case of Kabul Chawla 380 ITR 573, Meeta Gutgutiya 395 ITR 526. Harjeev Agarwal 241 taxman 199 and Best Infrastructure Pvt. Ltd. 397 ITR 182, in support of its claim that no addition was permissible in assessee's case on the existing facts and circumstances of the case. Reliance was also placed upon the decision and the case of Abhisar Buildwell. The Ld. DR placed reliance upon the order of the Ld. AO and submitted that statement of Sh Malu constitutes incriminating evidence. 48. We have heard rival submissions in the light of the material available on record. We have noted that the Ld. CIT(A), has comprehensively analysed the facts and circumstances of the case in the light of available judicial decisions of Hon'ble Delhi High Court. Through the decisions in case of Kabul Chawla 380 ITR 573....