TMI Blog2023 (10) TMI 1272X X X X Extracts X X X X X X X X Extracts X X X X ..... ioned as to who had given bogus entries/transactions to the assessee or to whom the assessee had given bogus entries or undertaken alleged transactions. It is also nowhere mentioned as to on which dates and through which mode and entity/companies the bogus entries and transactions were made by the assessee. AO has vaguely referred to certain documentary evidences including a list of 195 companies found and seized during search/survey operation on Jain Brothers to allege that the assessee company (listed at S.No. 139) was involved in giving and taking bogus entries/transactions during the relevant financial year. The AO did not mention the details of transactions that represented unexplained income of the assessee company. Decided in favour of assessee. - Shri Chandra Mohan Garg, Judicial Member And Dr. B.R.R. Kumar, Accountant Member For the Assessee : Shri Anil Jain, CA For the Revenue : Shri Manish Tiwari, Sr. DR ORDER PER CHANDRA MOHAN GARG, J.M. This appeal has been filed against the order of CIT(A)-34, New Delhi dated 01.12.2017 for A.Y. 2009-10. 2. The grounds of appeal raised by the assessee are as follows:- 1. That having regard to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the matter, impugned reassessment order passed by Ld. AO u/s 147/143(3), is bad in law and against the facts and circumstances of the case and not sustainable on various legal and factual grounds, and thus Ld. CIT(A) ought to have quashed the same. Further drawing our attention towards page 26 of assessee paper book the ld. AR submitted that from the reasons recorded it is amply clear that the Assessing Officer after recording modus operendi adopted by alleged entry provider noted that from verification of documents seized, it is clearly appears that the list of companies containing 195 names have obtained accommodation entries from various paper companies of Shri S.K Jain Group and in the said list the assessee was named at serial no. 139. Thereafter the Assessing Officer alleged that the assessee has obtained accommodation entries of Rs. 45 lakhs during the relevant financial period 2008-09 pertaining to present AY 2009-10. The ld. AR submitted that with these vague observations the Assessing Officer directly proceeded to record his satisfaction that he has reason to believe that income to the extend to the said amount has escaped assessment in the hands of beneficiary assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , in support of above legal contentions. 5. Replying to the above, the ld. Senior DR strongly opposed to the above submissions of ld. counsel of assessee and submitted that the copy of the reasons recorded for initiation of proceedings available at pages 24 to 26 of assessee paper book clearly reveals that the Assessing Officer received report of Investigation Wing New Delhi and thereafter evaluated contents thereof. The ld. Senior DR also submitted that during the course of search/survey action u/s. 132/133A of the Act conducted at the residential and business premises of Shri S K Jain and his brother Shri V. K Jain certain incriminating material found and seized. Which included cheque books and cash books maintained by Jain Brothers. From the said documents found and seized from Shri S.K Jain it was clearly revealed that the assessee was beneficiary of accommodation entries from various paper companies of Jain Group. Therefore the Assessing Officer had valid reason to believe that the income to the extent of alleged entries has escaped assessment for AY 2009-10 therefore legal contention of assessee may kindly be dismissed. 6. Placing rejoinder to the above contention of ld ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been evidently established that Shri S.K. Jain and his brother Sh. Virender Jain are in the business of providing accommodation entries to various beneficiary companies/entities/person through cheques through a number of paper dummy companies in lieu of cash. These dummy companies are totally managed and controlled by Sh. Surender Kumar Jain and his brother Sh. Virender Jain. 2. From the verification of the documents seized, it clearly appears that the list of companies containing 195 names have obtained accommodation entries from various paper companies of S.K. Jain Group in lieu of cash. In this list at Sr. No.139, it is found that M/s Hartron Case Communications Ltd. (PAN: AABCH5086M) has obtained accommodation entries of Rs. 45,00,000/- during the financial year 2008-09 relevant to assessment year 2009-10. 3. Therefore, I am satisfied and has reason to believe that a sum of Rs. 45,00,000/= has escaped assessment in the hands of M/s Hartron Case Communications Ltd., as M/s Hartron Case Communications Ltd., is the beneficiary of accommodation entry for the assessment year 2009-10. 8. From the above noted reasons, we clearly observed that in the first paragraph of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owingly concealed its particular of income to avoid the tax on the undisclosed income chargeable to tax thus the same has escaped assessment for AY 2009-10. We are unable to see any details of the company/entity through which the assessee received alleged accommodation entry, date of transaction, nature of transaction viz as to whether it was share application money or unsecured loan or any other kind of bogus transaction and from which entity or company the assessee received alleged entry or undertaken transaction. From the reasons it is also clear that the Assessing Officer had proceeded to initiate reassessment proceedings u/s. 147 of the Act and to issue notices u/s. 148 of the Act without any examination, verification or evaluation of the facts and documentary evidence and report received from the officer/competent authority of search/survey operation during which alleged documentary evidence found and seized from Jain Brothers. 11. On logical analysis and evaluation of the reasons recorded, we clearly find that in the reasons recorded, it is nowhere mentioned as to who had given bogus entries/transactions to the assessee or to whom the assessee had given bogus entries or u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent with regard to the amount and nature of bogus entries and transactions and the persons with whom the transactions had taken place. Therefore, we are compelled to hold that the A.O. initiated reassessment proceedings without application of mind to the material and without having a valid and sustainable reason to believe that income had escaped assessment from A.Y. 2009-10. 13. Above noted conclusion gets support from the judgment of Hon ble jurisdictional High Court of Delhi in the case of CIT vs. Insecticides (India) Ltd. (supra) wherein their Lordship by referring to its earlier judgments in the case of CIT vs. Atul Jain (supra) and Signature Hotels P. Ltd. (supra) held that where the information relied upon by the Assessing Officer for initiating proceedings u/s. 147 of the Act did not indicate the source of alleged unexplained credit and it is also not clear that the transactions were taken place with whom in that case there were absolutely no details available and the information supplied was extremely scanty and vague and in that light of the fact in view of said preposition initiation of proceedings u/s. 147 of the Act and issuance of notice u/s. 148 of the Act has to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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