TaxTMI 
TaxTMI 
2026 (7) TMI 395
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....by the action of the learned CIT(A) in deleting the addition of Rs. 5,34,44,801/- made by the Assessing Officer on account of alleged accommodation entries by way of bogus purchases purportedly made from M/s. Supeema Advisory Pvt. Ltd. during the relevant previous year. 3. Briefly stated, the facts borne out from the record are that the assessee had filed her return of income on 31.10.2017 declaring total income of Rs. 5,19,460/-. Subsequently, based on information received through the departmental ITBA Insight Portal, the Assessing Officer formed a belief that the assessee had allegedly obtained accommodation entries in the guise of purchases from M/s. Supeema Advisory Pvt. Ltd. amounting to Rs. 5,34,44,801/- during the financial year r....
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....ing the assessment records, submissions of the assessee and the material available on record, the learned CIT(A) observed that though the Assessing Officer had attempted to verify the information by issuing notice under section 133(6), the alleged supplier itself had denied any transaction with the assessee. The learned CIT(A) further noted that apart from the information reflected in the Insight Portal, no independent evidence had been brought on record by the Assessing Officer to establish that the assessee had in fact obtained accommodation entries or had entered into any transaction with the said concern. Holding that the addition was founded solely upon unverified information and unsupported assumptions, the learned CIT(A) deleted the ....
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....eived from another source, irrespective of the source from which such information emanates. Such information may undoubtedly furnish a starting point for investigation or enquiry, but the ultimate addition must necessarily rest upon evidence gathered during the course of assessment proceedings. 9. It is a settled proposition of law that an addition can be sustained only when there exists tangible and credible material establishing the factual foundation of the charge sought to be levelled against an assessee. Mere suspicion, conjecture, probability or information generated through an electronic database cannot substitute legal evidence. The burden initially lies upon the Revenue to establish the existence of the primary facts giving rise....
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....ds, no statements of any person implicating the assessee and no incriminating material unearthed during any enquiry linking the assessee with the alleged accommodation entry arrangement. The assessment order is conspicuously silent on all these vital aspects. In fact, except for reproducing the information available in the Insight Portal and making a general observation that M/s. Supeema Advisory Pvt. Ltd. was allegedly engaged in providing accommodation entries, no independent evidence whatsoever has been discussed by the Assessing Officer. 12. The entire approach adopted by the Assessing Officer appears to proceed on an erroneous assumption that once a concern is identified by the Investigation Wing or by a departmental database as an ....
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....and investigation was expected before fastening a tax liability of more than Rs. 5.34 crores upon the assessee. 14. We also find considerable force in the reasoning adopted by the learned CIT(A). The learned CIT(A), after examining the assessment records and the material available on record, has correctly observed that the Assessing Officer failed to establish any nexus whatsoever between the assessee and the alleged accommodation entry provider. The findings recorded by the learned CIT(A) are not based on technicalities but on a fundamental deficiency in the Revenue's case, namely the complete absence of evidence proving the existence of the alleged transaction itself. Once the very substratum of the addition collapses, the consequentia....