2026 (3) TMI 469

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....0 was reopened following due procedure consequent to the information received after search u/s. 132 of the Income Tax Act, 1961(hereinafter referred to as 'the Act') on Galaxy Group, Shri Pradeep Indra Prasad Agarawalla, and entry providers Deepak Agarwal and Himanshu Verma. The documents seized during search conducted on 17.11.2021 contained information that suggests the aforesaid persons are engaged in providing accommodation entries and the assessee is one of the beneficiary of the accommodation entries provided by the said parties. M/s. ALPS Management Solutions P. Ltd. and M/s. LTE Info Technologies P. Ltd. are the companies operated by Deepak Agarwal for providing accommodation entries. The assessee had taken accommodation entry of Rs....

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....8. In the case of M/s. LTE Info Technologies P Ltd. the assessee had issued letter of regret for non compliance of the purchase order. Thus, the amount received as advance aggregating to Rs. 25,00,000/- against the aforesaid two purchase orders was refunded by the assessee within the same financial year i.e. within the period of 3 to 4 months from the date of advance received. The amount received by the assessee from the aforesaid parties was in the normal course of business through banking channel and amount received as advance was also refunded to the said parties after the cancellation of purchase order. The ld. Counsel for the assessee referred to Bank Statement to show that Rs. 12,50,000/- was refunded to M/s. LTE Info Technologies P L....

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....companies was repaid back through banking transactions. The fact of receipt of advances from the aforesaid companies through banking channel and repayment of the same amount within a period of four months' time to the respective companies through banking transaction is not disputed by the department. Thus, the amount received by the assessee from the above two companies was repaid within the same financial year within a span of four months from the date of receipt. 6. An accommodation entry is a bogus financial transaction to bring unaccounted cash in the legitimate stream of income. The entities which are engaged in providing accommodation entries charge commission to convert unaccounted money into regular stream of income. One of the m....