Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2019 (6) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (6) TMI 472 - AT - Income TaxReassessment proceedings u/s 147 - AO in the instant case after receiving information from the Investigation Wing has duly applied his mind and recorded reasons before issue of notice u/s 148 - share application money from entry providers - HELD THAT:- Notices u/s 148 were issued, however, it is seen that because of certain clerical mistake, the name of the company was wrongly mentioned which was corrected on the same date and fresh notice was issued at correct postal address mentioning the correct addresses. Therefore, concur with the finding of CIT(A) that it was a bonafide mistake or small irregularity which was immediately corrected/rectified by the AO within the time available and without hampering the legality of the reassessment proceedings. Since the assessment was reopened on the basis of specific information received that the assessee is a beneficiary of taking accommodation entry of ₹ 30 lakhs in the garb of share application money from entry providers Shri Surendra Kumar Jain / Virendra Kumar Jain which was identified by Investigation Wing of the department after thorough investigation and enquiries and the AO after due application of mind has recorded the reasons for reopening of the assessment, therefore, in view of the detailed reasoning given by CIT(A), no infirmity in the same. Accordingly, grounds relating to validity of reassessment proceedings are dismissed. Addition u/s 68 - share application money - commission u/s 69C - HELD THAT:- It is an admitted fact that due to non-production of the Directors of the Investment Companies in the shares of assessee company and non-fulfillment of conditions laid down in terms of provisions of S.68, the AO made addition of ₹ 30 lakhs u/s 68 in respect of the share application money received from the five investing companies and further made addition of ₹ 60,000/- u/s 69C being the commission expenses incurred for arranging the accommodation entries. Subsequent to passing of the order of CIT(A) two decisions have come viz., the decision of Hon’ble Delhi High Court in the case of PCIT vs. NDR Promoters P.Ltd. [2019 (3) TMI 323 - SUPREME COURT] and the decision of PCIT vs. NRA Iron & Steel P. Ltd. [2019 (1) TMI 1089 - DELHI HIGH COURT] . Neither the assessee nor the AO/Ld.CIT(A) had the benefit of the above two decisions wherein the issue relating to bogus share application money/share capital have been considered and certain observations were made. Restore the issue to the file of AO with the direction to give one more opportunity to the assessee to substantiate with evidence to his satisfaction regarding the identity and credit worthiness of the share applicant companies and genuineness of the transaction. - Appeal of assessee allowed for statistical purposes.
|