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2018 (2) TMI 2074 - GUJARAT HIGH COURTReopening of assessment u/s 147 - Addition u/s 68 - onus to prove - sufficiency of the reasons recorded by the Assessing Officer - HELD THAT:- Basic onus on the assessee to establish identity of the investor, genuineness of the transaction and creditworthiness attaches, also attaches on a company. There is a clear distinction between a situation where the company discharges its basic onus of providing details of the share applicants, genuineness of the transactions and their creditworthiness, but the Revenue still chases the company instead of inquiring with the investors if any mismatch or unexplained investments are found as compared to a situation where large scale share applications are found to be totally bogus transactions, are completely fictitious or stated to have been entered into by non existent persons or entities. The former is seen as a case where the company has discharged its own whereas the later would be a situation where the very genuineness of the transaction is in doubt. We therefore, do not accept the legal contention in this respect canvased by the counsel for the petitioner. As held by the Supreme Court in case of Rajesh Jhaveri Stock Brokers P. Ltd. [2007 (5) TMI 197 - SUPREME COURT] the sufficiency of reasons cannot be gone into at this stage. Nevertheless, the Assessing Officer must have tangible materials at his command to form a belief that the income chargeable to tax had escaped assessment. In this context, we may recall the Assessing Officer referred to the materials available with him which prima facie suggested that the assessee company had received share capital and share premium from various companies which were proved to be bogus companies engaged in providing mere accommodation entries. After analysing such materials, he came to the conclusion that share capital/share premium amounting to Rs. 1.55 crores received by the assessee during the financial year 2009-2010 relevant to the present assessment year was bogus. It cannot be stated that the Assessing Officer did not have tangible materials at his command to form such a belief. His reference to “materials on record” must be understood in the context of facts on record. The Assessing Officer was not writing a statute. His expression therefore, cannot be seen with such rigidity. If therefore, he referred to the returns filed by the assessee and the accompanying documents as also materials received by him post acceptance of return, ofcourse without scrutiny as “materials on record”, he did not commit any legal error. He was ofcourse, referring to the materials placed for his consideration which enabled him to form such a belief. The contention that this is a case of borrowed satisfaction also cannot be accepted. The Assessing Officer had perused the materials and analysed the same so as to come to the conclusion that prima facie it suggested that the assessee had received large number of share applications/share premiums from the companies which were bogus companies and which engaged in providing accommodation entries. The respondent has filed affidavit stating that before issuing notice, sanction was granted by the competent authority. A statement on oath, in absence of any contrary material on record need not be disbelieved. - Decided against assessee.
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