TMI Blog2019 (4) TMI 498X X X X Extracts X X X X X X X X Extracts X X X X ..... enue by way of filing cross appeal. But again for the sake of repetition, we are of the considered view that since items of these additions were not subject matter of the reasons recorded / reopening, the addition per se cannot survive, as has been held by Hon’ble Delhi high court in Ranbaxy Laboratories Ltd. [2011 (6) TMI 4 - DELHI HIGH COURT ]. Consequently, Grounds determined in favour of the assessee - ITA No.6634/Del./2013, ITA No.256/Del./2014 - - - Dated:- 25-2-2019 - Hon ble Vice President, Shri G.D. Agrawal And Shri Kuldip Singh, Judicial Member For the Assessee : Shri Deepak Ostwal, CA, Shri Rishab Ostwal, Advcoate For the Revenue : Shri Amit Katoch, Senior DR ORDER PER KULDIP SINGH, JUDICIAL MEMBER : Present cross appeals filed by the assessee as well as by the Revenue are being disposed of by way of composite order to avoid repetition of discussion. 2. The appellant, M/s. Hopewin Admark Consultancy Services Pvt. Ltd. (hereinafter referred to as the assessee ) by filing the present appeal, sought to set aside the impugned order dated 17.10.2013 passed by Ld. CIT (Appeals)-XI, New Delhi qua the Assessment Year 2003-04 on the concise gro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to explain the identity, genuineness and source of credits appearing in his bank account. 3. On the facts and circumstances of the case, the Ld. CIT (A) has erred in holding that the assessee company was a stepping stone in routing back undisclosed money of the beneficiaries. 4. Briefly stated the facts necessary for adjudication of the controversy at hand are : Assessing Officer framed the assessment under section 143(3)/147 of the Income-tax Act, 1961 (for short the Act ) at total income of ₹ 7,82,370/- on substantive basis and ₹ 1,35,07,301/- on protective cases. AO made substantive addition on account of unexplained cash credit at ₹ 6,25,000/- and additions of ₹ 15,625/- ₹ 1,28,535/- are made on account of commission earned on providing entries to the beneficiaries. Protective addition of ₹ 1,28,53,466/- was made on account of bogus cash credits used by the assessee for rotating the entries as entry operators. 5. Assessee carried the matter before the ld. CIT (A) by way of an appeal who has given part relief by partly allowing the appeal. Feeling aggrieved, the revenue as well as the assessee have come before the Tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rough accompanying documents, I am completely satisfied that this transaction of ₹ 4,50,000/- as mentioned above, is nothing but assessee s own unaccounted money which has been routed back to it in the form of accommodation entry only. Accordingly, the amount of ₹ 4,50,000/- is unaccounted money belonging to the assessee which has been utilized for the entry and represents income escaping assessment. Accordingly, I have reasons to believe that ₹ 4,50,000/- has escaped assessment and the escapement has been on account of failure on part of assessee to truly and fully disclose all material facts therefore it is a fit case for initiation of proceedings u/s 147 of the I.T. Act. In view of the provision of section 151 of the I.T. Act, necessary approval for the issue of notice u/s 148 may kindly be accorded for the A.Y. 2003-04. SD/- (YOGESH NAYYAR) Income Tax Officer, Ward 12 (4), New Delhi. Addl.CIT, Range 12, New Delhi. 8. Undisputedly, AO reopened the assessment on the ground that an income of ₹ 4,50,000/- (Rs.2,50,000/- and ₹ 2,00,000/-) taken by the assessee as entry from M/s. Shivam Softech Ltd. and M/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duction under sections 80HH and 80-I as claimed by the assessee to be not admissible. He consequently proceeded to make deductions under sections 80HH and 80-I and accordingly reduced the claim on these accounts. The very basis of initiation of proceedings for which reasons to believe were recorded was income escaping assessment in respect of items of club fees, gifts and presents, etc., but while these items were not disturbed, the Assessing Officer proceeded to reduce the claim of deduction under sections 80HH and 80-I which was not permissible. The Tribunal was right in holding that the Assessing Officer had the jurisdiction to reassess issues other than the issues in respect of which proceedings were initiated but he was not justified when the reasons for the initiation of those proceedings ceased to survive. 12. When undisputedly the AO has not made any addition qua the income alleged to have escaped assessment as per reasons recorded, he had no jurisdiction to make reassessment on other items for which reopening was not initiated. When the AO has accepted the explanation made by the assessee as to the alleged escapement of income of ₹ 4,50,000/- and has not made a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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