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2015 (12) TMI 497 - AT - Income TaxReopening of assessment - Addition u/s 68 on receipt of accommodation entries - information received from the investigation wing of the Department - Held that:- The assessment was reopened on the basis of information received from the investigation wing of the Department about the existence of accommodation entry providers and their modus operandi and the assessee's name has also figured in the list of beneficiaries. Although the assessee had filed documents relating to the transactions at the time of original assessment proceedings, it is again an undisputed fact that the persons who were summoned u/s 131 of the Act to depose before the AO failed to do so. The Ld. AR had nothing to say as to why the persons could not present themselves before the AO. The fact that the share application money had been received through account payee cheques is, at best, neutral. Section 68 permits the AO to add the credit appearing in the books of accounts of the assessee if the latter offers no explanation regarding the nature and source of credit or if the explanation offered by him is not satisfactory. The failure on the part of the assessee in producing the share applicants for deposition before the AO lends credence to the theory that the monies emanated from the coffers of the assessee company. As decided in CIT vs. Nova Promoters and Finlease (P) Ltd. (2012 (2) TMI 194 - DELHI HIGH COURT) wherein held that where sums were shown as share application moneys and information had been received from investigation wing about the assessee being a beneficiary of accommodation entries, failure on the part of the share applicants to respond to summons would absolve the AO from the duty of proving that the monies emanated from the coffers of the assessee. - Decided against assessee.
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