TMI Blog2012 (4) TMI 441X X X X Extracts X X X X X X X X Extracts X X X X ..... rgeable to tax had escaped assessment because of the failure of the petitioner company to furnish fully and truly all material particulars necessary for its assessment – against assessee. - W.P.(C) No.6707/2011 - - - Dated:- 23-4-2012 - MR. JUSTICE SANJIV KHANNA, MR. JUSTICE R.V. EASWAR, JJ. For Appellant: Mr. Salil Aggarwal with Mr. Prakash Kumar and Mr. Prakash Chand Yadav, Advs. For Respondents: Mr. Kamal Sawhney, Sr. Standing Counsel with Mr. Amit Shrivastava, Adv. R.V. EASWAR, J.: The petitioner in this writ petition is a Private Limited Company incorporated on 16.03.2004 under the Companies Act, 1956 as a Non-banking Finance Company. In respect of the assessment year 2004-05, the petitioner filed a return of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re capital was received were registered with the Ministry of Corporate Affairs, Income Tax Department and also Nationalised Banks and were maintaining accounts with those Banks which confirmed their identity. It was also submitted that the assessee issued shares to these companies against monies received from them through account payee cheques. It was therefore pleaded that the amounts received from the companies cannot be treated as unexplained cash credits under Section 68 of the Act and that the conclusion of the Assessing Officer that income chargeable to tax had escaped assessment was not correct. Objections were taken on the basis of the statement of Mukesh Gupta and it was pointed out that the name of the petitioner company did not f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .03.2011 re-opening the assessment. It is prayed that a writ of certiorari or any other writ, order or direction be issued to quash the notice as well as the letter disposing of the objections. 5. The contention of the counsel for the petitioner is that since the assessment was being re-opened after a period of 4 years from the end of the relevant assessment year, it was the duty of the Assessing Officer to show that the petitioner company did not furnish fully and truly all material particulars relating to its assessment, at the time of original assessment. It is argued that the reasons recorded have no nexus with the conclusion that the income chargeable to tax had escaped assessment by reason of the failure of the petitioner company to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re-opening the assessment. It is thus submitted by the learned Standing Counsel that there was prima facie material to show that the assessee did not furnish full and true particulars at the time of original assessment regarding the receipt of share capital. 7. On a careful consideration of the matter we are satisfied that the assessment was properly re-opened. The petitioner company received share capital of ₹ 67,40,000/- during the previous year relevant to the assessment year 2004-05. The share capital was received from several companies and the names of these companies are as under: - (i) Fair N Export P. Ltd. (ii) V. P. S. Values Tubes P. Ltd. (iii) Rajkar Electricals (iv) Rabik Exports Ltd. (v) Sehgal Fluid Line Equipment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s who gave accommodation entries were before the Assessing Officer when he recorded reasons for re-opening the assessment and this is clear from the first paragraph of the reasons recorded, in which the Assessing Officer has made a reference to the CD (Compact Disc) containing the material gathered and forwarded by the DIT (Investigation)-I under cover of DO letter dated 02.03.2006 forwarded through proper channel by the Additional CIT, Range-5 by letter dated 13.03.2006. The statement of Mukesh Gupta has been given to the petitioner. 9. The above facts show that the reasons recorded by the Assessing Officer were not a pretence. The reasons were germane to the prima facie belief reached by the Assessing Officer that income chargeable to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e material gathered by the Investigation Wing and which was available to the Assessing Officer when he recorded reasons for re-opening the assessment did not have any nexus with the formation of his belief that income chargeable to tax had escaped assessment cannot be accepted. The required nexus is furnished by the reference to the names of at least three companies in which Mukesh Gupta was a Director, through which, inter alia, he was admittedly carrying on the business of providing accommodation entries for commission. These companies had subscribed for the shares issued by the assessee. Thus not only was the required nexus provided, but there was also material before the Assessing Officer to show that the petitioner company had not furn ..... X X X X Extracts X X X X X X X X Extracts X X X X
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