GST Helpdesk   Subscription   Demo   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Extracts
Home List
← Previous Next →

2015 (5) TMI 542 - ITAT DELHI

2015 (5) TMI 542 - ITAT DELHI - TMI - Unexplained investments - Unexplained credits received - accommodation entries - deposits in appellant's bank accounts received from various intermediaries operated by Sh. SK Gupta to provide accommodation entries to various beneficiaries against cash received from them - CIT(A) confirming the addition made u/s 68 - Held that:- There was no explanation filed before the AO except filing the copy of the bank pass book and it was only during the course of p .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

tion letter stating that amount deposited in the Bank account was provided by him. Nor, the order of the Hon’ble Settlement Commission establishes the availability of cash with Mr. Gupta when the cash was deposited in the bank accounts of assessee company. This issue is essentially based on the facts.

The interest of justice would be met, if the matter is restored to the file of the Assessing officer with a direction that the Assessing Officer shall verify the disclosure made in the .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

4-2015 - Shri G.C. Gupta And Shri Inturi Rama Rao JJ. For the Appellant : Sri V. Raja Kumar Advocate For the Respondent : Shri Vikram Sahay, Sr. DR ORDER Per Shri Inturi Rama Rao, AM: 1. This is an appeal by the assesee company for the AY 2008-09 against the order of Commissioner of Income Tax (Appeals)-XXXIII dated 20.03.2013 in ITA No. 391/10-11/363 raising the following grounds appeal: 1. Confirming addition and even venturing to make an enhancement of the income returned, without confronting .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

funds transfer and hence, the credits in the assessee s books could not have been treated as its income under section 68 of the Income-tax Act, 1961; 4. Not appreciating the complete impart of the proceedings in Shri S.K. Gupta s case, ignoring that such evidence is deemed to be correct as per Section 292(2) of the Act; 5. Not returning a cogent finding on the aspect of credits in the assessee s books also having been taxed in the hands of the other intermediaries; 6. Not accepting the findings .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

as been accepted after detailed security; 9. Enhancing the income by ₹ 57,06,000/- without appreciating the assessee s reply dated 14.03.2013; 10. Not allowing relied in respect of: a) ₹ 1,14,78,813/- twice added in the hands of the appellant as well as in the hands of the various other conduit companies from whom the amounts were before him. b) Cash deposited into the bank account out of the cash available with the company; c) Excess addition of ₹ 1,387/- on account of deposit .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

s on account of addition of ₹ 1,14,90,113/- found deposited in bank account namely, South Indian Bank (C.R. Park) New Delhi bearing Account No. 0358073000002321 held in the name of the assessee company. During the course of assessment proceeding, the Assessing Officer found an amount of ₹ 1,14,90,113/- was deposited in the Bank account of the assessee company. The assessee company was called upon to explain the source for such cash deposits. The assessee company had explained that it .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

n. Like any other business it does require man power according to the scale of operations Except for two or three persons who are required regularly to visist banks and do other work like collection of cash etc. most of the other persons involved are on part time basis. The part time employees are called as and when required to sing documents, cheques books etc. Sh. S.K. Gupta has also roped in his own relatives for operation of various bank accounts and for filing the income tax returns. It was .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

nquiries carried out by the Investigation wing the assessee was found to have been using the bank accounts opened in different banks to route the entries through two to four accounts to give the color of genuineness to these transactions. 3. The Assessing Officer called for the specific explanation for the sources for the cash deposited vide letters dated 1.11.2010 and 02.12.2010. In response to the specific query, what all the assessee company submitted was that it belongs to Group of companies .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

/214 ITR 801 held as under:- iii) The Hon ble Rajasthan High Court in the case of CIT Vs. R.S. Rathore (1995) 212 ITR 309 iv) The Hon ble Patna High Court in the case of CIT Vs. Bahri Bros. Pvt. Ltd. reported in (1985) 154 ITR 244. 4. Aggrieved by the above assessment order, an appeal was preferred before Commissioner of Income Tax(Appeals)-XXXIII, New Delhi, who vide order dated 20.03.2013 dismissed the appeal. Before the CIT(A) it was submitted inter alia that the assessee company is merely a .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

y commission income alone should be taxed in the hands of the assessee company reliance was placed by Hon ble Delhi High Court in the case of Manoj Agarwal and Special bench decision of Mumbai Tribunal in the case Gold Star Finvest P. Ltd. V. ITO, Mumbai in ITA No. 4625/MUM/2005. The Ld. CIT(A) after considering the submissions had turned down the plea of assessee company by holding that Hon ble Settlement commission has not given any comments for credit in the books of accounts of the assessee .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

the decisions of coordinate Bench of this tribunal in the case of M/s KSA Chits Pvt. Ltd. Vs. DCIT in ITA No. 4647/Del/2013 dated 20.03.2015 and in the case of M/s Omni Farms Pvt. Ltd. and Anr. Vs. DCIT in ITA No.3477/Del/2013 dated 28.01.2015. Wherein it has been held as follows:- 17. Thus, there is an order of the Settlement Commission as well as the Additional Commissioner of Income Tax under Section 144A holding that Shri S.K. Gupta was providing accommodation entries, he used various compan .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ese facts and the logical consequences of the order of the Settlement Commission as well as Additional CIT under Section 144A, we have no hesitation to hold that the addition under section 68 cannot be made in the case of theconduit companies. Therefore, we delete the addition made under section 68 in the case of all the nine companies, which are admittedly conduit companies of Shri S.K. Gupta. 6. On the other hand, Ld. DR had vehemently argued that addition should be sustained as the assessee c .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

d therefore, the addition should be sustained. 7. We heard the rival parties. On perusal of assessment order it is clear that the assessee failed to offer any explanation for the sources of cash deposited in the Bank account No. 0358073000002321. It was only during the course of proceeding before the CIT(A), explanation as stated above was filed. In our considered opinion the explanation does not conclusively explain the source for the cash deposits. Even the order of Hon ble Settlement Commissi .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

the books of account maintained, if any. In such cases, provisions of Section 69 are applicable and not the provisions of Section 68 as made out by the Assessing Officer. The provisions of Section 69 reads as under:- 69 Where in the financial year immediately preceding the assessment year the assessee has made investments which are not recorded in the books of account, if any, maintained by him for any source of income, and the assessee offers no explanation about the nature and source of the in .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

d situation being, where the explanation offered by him is, in the opinion of the Assessing Officer, not satisfactory. In the present case, there was no explanation filed before the AO except filing the copy of the bank pass book and it was only during the course of proceeding before the CIT(A) the assessee company tried to explain that the cash deposits were made out of the money belong to the beneficiary to whom accommodation entries were provided and the same explanation was reiterated before .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

nts of assessee company. This issue is essentially based on the facts. Therefore, the reliance placed by the Ld. AR on the orders of the coordinate Benches of this Tribunal in the case of M/s KSA Chits Pvt. Ltd. Vs. DCIT in ITA No. 4647/Del/2013 dated 20.03.2015 and in the case of M/s Omni Farms Pvt. Ltd. and Anr. Vs. DCIT in ITA No.3477/Del/2013 (Supra) is not of any help. In another case involving identical facts, the Hon ble coordinate Bench in the case of Tarun Goyal & Anr. Vs. ACIT in I .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version