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Shri Rakesh Arora Versus DCIT

2015 (6) TMI 234 - ITAT DELHI

Addition u/s 69 - money is credited are the alleged benami accounts of the assesse - CIT(A) confirmed part addition - Held that:- AO has not made any logical enquiry and made addition of entire amount to order of settlement commission and during first appellate proceedings the CIT(A) deleted the part addition of ₹ 24,59,600/- in respect to M/s Samar Organics Pvt. Ltd. and since there is no appeal by the department about this part relief, therefore, it can be safely presumed that this delet .....

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. Meena And Shri C. M. Garg JJ For the Appellant : Sh. Gautam Jain, CA. For the Respondent : Sh. Vikram Sahay, Sr. DR ORDER Per C. M. Garg, JM. This appeal has been has been preferred by the assessee against the order of CIT (Appeals)-XXXI- New Delhi, vide dated 30.11.2011 in Appeal No.172/2010-11 for Assessment Year 2008-09. 2. The assessee has raised following grounds in this appeal: 1. That the Ld CIT(A) has erred in law while confirming the addition to the extent of ₹ 25,54,150/- out o .....

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nd on facts while confirming the addition made by the Ld AO, where such addition is made under predetermined mind set about material & documents seized during the course of search proceedings relevant to AY 2001-2002 to AY 2007-08 and not the period under consideration i.e. 2008-09, and as such addition confirmed to the extent of ₹ 25,54,150/- on the basis of such evidences may please be deleted. 3. Briefly stated the facts giving rise to this appeal are that the assessee filed his ret .....

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Being aggrieved by the above assessment order the assessee preferred an appeal before ld. CIT(A) which was partly allowed, deleting the part of addition and another part of addition made by the AO u/s 69 of the Act amounting to ₹ 25,54,150/- was confirmed. The ld. CIT(A) allowed relief to the assessee to the extent of 24,59,600/- and directed the AO to follow the order of the Settlement Commission with regard to the assessablity of above amount in the hands of Shri Rakesh Arora, and Shri .....

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money is credited is alleged benami account of the assessee, without considering the evidences filed during the assessment proceedings and again referred during appellate proceedings. The ld. counsel for the assessee vehemently contended that the ld. CIT(A) was not justified in confirming the addition where such addition is made under predetermined mind set about material and document seized during the course of search proceeding relevant to AY 2001-02 to 2007-08 and not relevant to the period .....

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tion of ₹ 25,54,150/-. The ld. DR further drawn our attention in Para 3.7 of the assessment order and submitted that the AO has made it clear that his conclusion a subject to the decision of Income Tax Settlement Commission , and if, Income Tax Settlement Commission takes a decision otherwise and such unexplained income is divided in the hands of three persons therefore, the AO also kept a space for consideration of prospective order of the Settlement Commission and approach and action of .....

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ement Commission takes a decision otherwise and such unexplained income is dvided in the hands of Shri Virendra Kumar Arora, Shri Rajesh Kumar Arora and Shri Rakesh Kumar Arora i.e. assessee of the present case, then its effect will be given in the assessment. Hence, it is clear that the AO made addition subject to the prospective order of the Settlement Commission. 8. From careful perusal of the impugned order, we note that the CIT(A) deleted the part addition of ₹ 24,59,600/- in respect .....

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t. Ltd. after giving evidence of the existence of the company and other related documents. As such, the AO was not correct in making the addition in the hands of appellant relying merely on the report of the Inspector and Statement of Shri Ashok Aggarwal who is not directly related to the company M/s Samar Organics Pvt. Ltd. This company is a separate legal entity having PAN No. AABCS9325E. If the cash deposit was not explainable, it should have been assessed in the company s hand. If we look at .....

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ot justified to make any addition in the hands of the appellant in respect of bank accounts operated by the said company M/s Samar Organics Pvt. Ltd. As such to that extent the ground of appeals are disposed of in favour of the appellant and the cash credits of ₹ 24,59,600/- assessed in its hands are deleted. 9. From further reading of the impugned order we also note that the CIT(A) confirmed the remaining part of impugned deposits in the hands of assessee and also directed the AO to follo .....

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; 25,54,150/-. The AO was not sure while making the assessment as to whether the addition should have been made in the hands of the appellant. The AO in Para 3.7 of the assessment order mentioned that if subsequently, Hon ble Income Tax Settlement Commission takes a decision otherwise and such unexplained income is divided in the hands Sh. Virendra Kumar Arora, Shri Rajesh Kumar Arora and Sh. Rakesh Kumar Arora, its effect will be given in this assessment. In view of above, I am of the view of t .....

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iry and made addition of entire amount to order of settlement commission and during first appellate proceedings the CIT(A) deleted the part addition of ₹ 24,59,600/- in respect to M/s Samar Organics Pvt. Ltd. and since there is no appeal by the department about this part relief, therefore, it can be safely presumed that this deletion has been accepted by the Revenue. We further observe that the ld. counsel of the assessee is mainly harping on the contention that even additions made by the .....

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rayan Corporation and M/s Mahalaxmi Thinners & Chemicals appearing at Sl. No. 4 & & of the 16 entities listed at issues no 1. The assessing officer summoned the said person u/s 131 IT Act and the has acknowledged the ownership of the bank accounts operated by him on behalf of his proprietorship concerns namely; M/s Mahalaxmi Thinners & Chemicals. It has been reported by the CIT that the said person is filing regular return of income and notice under section 148 has been also issu .....

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he has acknowledged the ownership of the bank account operated by him on behalf of his proprietorship concerns Punjab Solvent & Chemicals, Amrita Thinners & Chemicals, Shree Ganesh Enterprises and Hari Om Chemicals. It has been reported by the CIT that the said person is filling regular return of income and notice under section 148 has also been issued for assessment year 2007- 08 on 20.3.2014 it is also reported that the transaction which is Rakesh Arora were joint business transaction .....

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s been reported by the CIT that the said persons is filling regular return of income and notice under section 148 has also been issued for assessment year 2007-08 on 20.3.2014 it is also reported that the transaction which is Rekesh Arora were joint business transaction for purchase and sale. (Para 9 (9.1)(3) at page 30 of this Synopsis). 4. Girdhari Lal Swami - He is the proprietor of M/s. Devta Chemicals Company (No.3 of the 16 entities). The assessing officer summoned the said person u/s. 131 .....

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