TMI Blog2015 (11) TMI 429X X X X Extracts X X X X X X X X Extracts X X X X ..... hat these transactions stand already taxed in the hands of the Ravinder Yadav which fact remains un-assailed on record. In these peculiar facts and circumstances we find no infirmity arrived at in the impugned order. The departmental ground is accordingly dismissed. - Decided in favour of assessee. - ITA nos. 1269, 1270 and 1271/Del/2013 - - - Dated:- 23-9-2014 - SMT. DIVA SINGH, JM AND SHRI B.C.MEENA, AM For the Appellant : Sh. Ved Jain, C.A., Ms.Rano Jain, Adv. Sh.V.Chaurasiya, Adv. For the Respondent : Sh.Gunjan Prasad, CIT, D.R. ORDER PER BENCH These three appeals filed by the Revenue have been filed against the separate orders passed by the Ld.CIT(Appeals)-I, New Delhi dated 14.12.2012 pertaining to the Assessment Years 2006-07, 2007-08 and 2008-09. It was a common stand of the parties before the Bench that the arguments advanced for ground 2 in ITA 1269/Del/2013 would apply to ground no. 3 in the same appeal and would also fully apply on account of similarity of facts to the grounds raised in the remaining two years also as facts and circumstances remain identical on the issue involved. It was clarified that apart from the difference in amoun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... questionnaire etc.. 4.2 The circumstances which lead to the search have been set out in para 3 of the assessment order, which are extracted hereunder for ready reference: 3. Before discussing the additions in the case of M/s Northern Strips Pvt.Ltd., it is relevant to take note of the circumstances leading to the search. Information was received from Financial Intelligence Unit of the Ministry of Finance in the case of one Sh. Ravinder Yadav of Madipur Village, New Delhi, in respect of high volume cash transactions in his bank account number 01150003107 maintained by him in the name of M/s Ravinder Co., New Delhi. It was reported that during the financial year 2006-07, there were debits and credits to the tune of ₹ 677.28 lakhs and ₹ 677.14 lakhs respectively. It was also informed that another account number 015505002098 was also maintained in the name of Ravinder Co. As per the information during the month of December, 2006, cash amounting to ₹ 50,49,3001- was deposited by Sh. Ravinder Yadav in one of his accounts. 4.3 A perusal of the assessment order further shows that after receipt of the information, summons u/s 131 of the Act were issued and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es was credited to the bank accounts of concerns of the Bansal Group. M/s Super Plastic Coats Pvt. Ltd is run by the elder son of Sh. Devki Nandan Bansal i.e Sh. Praveen Bansal. The other director in the company is the wife of Sh. Praveen Bansal i.e Smt. Seema Devi Bansal. Subsequently, a search was conducted on the various individuals and companies of the Bansal Group (Also shown as the Swastik Group). The premises 1 Central Market Punjabi Bagh(W), New Delhi belonging to assessee was also covered. 4.5 Relying on the statement of Shri Ravinder Yadav during the course of search at 4 A, LIG flats, Ground floor, Madipur, New Delhi the AO concluded that Sh. Ravinder Yadav had not done any genuine business and had merely provided accommodation entries to different parties. The statement extracted in the assessment order relied upon by the AO is extracted for ready reference: Q.1 Please identify yourself? Ans. I am Ravinder Yadav S/o Sh. CS. Yadav Rio WZ-245, Madipur Vill. Aged 36 Years ..... Q.2 What is source of your income? Ans. Presently, I am doing business of corroborated boards on commission basis and I am earning ₹ 10 to 15,000/- p.m. This business I am do ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9 Are you also carrying out such entries business for other entities other than the said group of companies? Ans. Except said group of companies namely Northern Strips Ltd., M/s. super Plastic Coats P Ltd. and Swastik Packaging, I have not done any business of entry providing with any other entity except Jindal Polyfilms Ltd. Q.l0 Are you sure that Swastik Packaging also belongs to the said group (Devki Nandan Bansal)? Ans. Yes, Swastik Packaging is also owned by the promoters of Northern Strips Ltd. group. Q.ll I am showing you a Ledger (Marked Neel gagan) which is in red coloured marked by our team as Annexure A-i. In this ledger, so many entries have been done in different names. For example on page 14, you have written the name of parties under which name and style you are carrying your business of providing accommodation entries for any other business starting from Astha Enterprises and ending with Bhawani foods against which huge amounts (in lacs) have been mentioned. Please explain the nature of these entries? Ans. As explained above, I used to receive cash from the employees of Northern Strips Ltd. and other group companies for making Pay Orders for them&# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts of the assessee was obtained. The assessee was required to furnish the details of treatment of receipts in his regular books of accounts. In response thereto the assessee as per the assessment order vide its order dt. 9.10.2010, 14.10.2010 submitted that the amounts received from the bank accounts of Shri Ravinder Yadav had been adjusted against the sales to various parties. The details of the money transferred from the bank account of Shri Ravinder Yadav to the bank accounts of the assessee company and the parties against whose accounts the payments had been adjusted have been extracted in para 4.1 of the assessment order at pages 7.8 and 9 and these are reproduced hereunder for ready reference. 4.1. The assessee vide its letters dated 9.12.2010 and 14.12.2010 submitted that the amounts received from the bank accounts of Shri Ravinder Yadav has been adjusted against the sales to various parties. A. Y. 2006-07 Annexure-l Pay order issued by the HSBC Bank stated to be on the request of account no 140003757001 held in the name of M/s R V Traders in favor of Northern Strips Limited and particulars of amount received by Northern Strips Limited on account of parties. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. In this regard, we have to state that as a policy matter the assessee does not sell goods against cash insist the customers to made payment through banking channels only. It is possible that some of the customers right have arranged DD from him. So far as the assessee is concerned they have sold the goods to the parties who have made payment through banking channels out of the stock in trade duly recorded in the books of accounts at similar market rates without regard to the fact that the purchaser have made payment by Cheques, Bank Draft, Demand Draft, Manger's Cheque etc. 5. That the assessee has already filed the detail of purchases made against 'C' form from Jindal Polymers Ltd as well as the goods covered under VAT charged by them. 6. We are also enclosing herewith the copies of Sales Tax Return filed to substantiate that all the sales made have duly been furnished with the Sales Tax Department also. 7. That there is no bar in selling the goods in cash and even in recording the complete name address of the person who purchases the goods by paying cash and as such non recording of address of the persons who have purchased the goods does not in any ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot against genuine sales. These receipts are treated as credits into the account of the assessee against non existent sales. Thus the total receipts are added to the taxable income of the assessee under the head Income from other Sources. Penalty proceedings u/s 271 (1)( c) of the Income tax Act, 1961 are separately initiated. (Addition of Rs.l,17,12,111/-) 5. Aggrieved by this, the assessee went in appeal before the Ld.CIT(Appeals) who summarized the facts as under: - 1. This appeal has been filed against the order dt. 30.12.2010 u/s 143(3) r.w.s. 153A passed by the ACIT, CC 13, New Delhi. Investigation revealed that one Shri Ravinder Yadav was maintaining several bank accounts and depositing huge amounts of cash therein. Details collected from the bank in respect of draft and pay orders issued from the bank accounts of Shri Yadav revealed the following beneficiaries namely M/s Northern Strips Ltd., M/s Swastik Packaging and M/s Super Plastic Coats Pvt.Ltd. Out of these M/s Northern Strips Ltd., M/s Swastik Pipes Limited and M/s Super Plastic Coats Pvt. Limited belonged to the family or one Sh Devki Nandan Bansal of Punjabi 8agh. New Delhi. The flagship concern or this fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ders purchased on behalf of Swastik Pipes Group was about ₹ 20 crore in FY 2006 and 2007. On the other hand Sh Praveen Kumar Bansal, director of the appellant company in his statement u/s 132(4) said that he was not able to recollect the name Sh Ravinder Yadav and also did not recollect the transactions. He further said that M/s Swastik Packaging could be one of the parties to whom sales of polyfilms made. 3.2 The appellant claimed during the assessment proceedings that the demand drafts/ pay orders received from Sh Ravinder Yadav was against cash sales to various parties. The cash received from various parties against sales was given to Ravinder Yadav for making demand drafts/ pay order which were deposited in the bank account of the appellant company. All such receipts are duly recorded in the books or accounts as sales and offered to tax as part or the sales already disclosed in the audited P L Account. These sales were also duly vouched and details available in the stock records. The appellant filed details of purchases and sales from/to different parties during the course of assessment, copies 0 f sales tax returns and other records, etc. 3.3 During assessments, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t was available it was his argument that even the AO has said that nothing new has been argued. Apart from the argument that on the same facts view taken by a higher forum where there is no rebuttal on facts should be followed it was also submitted that consider the facts even if the worst conclusions against the assessee are drawn, in such a situation also at best it can be concluded that Sh. Ravinder Yadav was accepting cash on behalf of the assessee and depositing the same in his bank account and the said cash was being used for getting bank draft/demand drafts made. These facts are accepted by the assessee and have been found to have been recorded and accepted in the books of accounts of the assessee as these were as a result of sales made by the assessee who was under the misguided belief that even for sales the law forbade him to accept cash and the money had to be received only through the banking channels. Carrying us through the assessment order it was his submission that in the statement recorded by the Assessing Officer extracted in the impugned order the acceptance of the drafts for sales affected is accepted by the assessee and reflected by the assessee in his books of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts of the present case in fact the assessee has been overcautious and has been under the mistaken belief that under the law he could not make cash sales and getting confused with the provisions of S.40A(3) which frowns upon cash purchases if the amount exceeds ₹ 20,000/- he got the cash received from sales deposited in the bank and then recorded in his books of accounts as receipt of drafts/demand orders etc. against sales made. It was submitted that the fact that the transactions are genuine and have not been doubted is borne out from the fact that the Trading a/c it was submitted has not been tinkered with. The quantitative details and the trading a/c also it was submitted has not been tinkered with. In these peculiar facts and circumstances it was his submission that the finding of fact arrived at in the impugned order deserves to be upheld. 8.2 In reply the Ld.CIT, D.R. reiterated his stand that the impugned order be set aside and the issue restored to the AO for considering the issue in the alternative the assessment order be upheld. 9. We have heard the rival contentions and perused the material available on record. It is seen that the finding arrived at has not b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Being satisfied by the reasoning and finding arrived at therein, the departmental ground is dismissed. While coming to the said conclusion we have take into consideration the explanation offered by the assessee at the assessment stage and the fact that it was similarly argued before the CIT(A). The explanation along with evidences have been confronted to the AO who also agrees that nothing new is being said. The fact remains that genuineness of the transaction stands un-assailed on record. The drafts/pay orders received against sales made stands consistently accepted by the assessee. In these peculiar facts and circumstances of the case where the CIT(A) gives a finding that these transactions stand already taxed in the hands of the Ravinder Yadav which fact remains un-assailed on record. In these peculiar facts and circumstances we find no infirmity arrived at in the impugned order. The departmental ground is accordingly dismissed. 10. The facts qua the second issue addressed vide ground no. 3 by the Revenue, are found discussed in paras 5 to 5.12 of the assessment order, a perusal of the same shows that on analyzing the bank transactions extracted in the impugned order it was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2 crores to M/s Swastik Packaging the Assessing Officer further required the assessee to furnish evidence in support of the sales to M/s Swastik Packaging being genuine by way of delivery recipts/challans and transportation details. In response thereto the assessee is found to have made the following reply in his letter dt. 10.12.2010 which is extracted in para 5.9 of the assessment order which is extracted for ready reference: Under the instruction from the client we are enclosing herewith copy of account of M/s Swastik Packaging Nasik, Maharasthra for the period of 1.4.2005 to 31.3.2006 relevant to Assessment Year 2006-07 in the books of accounts of Northern Strips Ltd. duly confirmed by Lalit Sharma proprietors of the firm along with proof for filing return of income by him with his income tax officer at Nasi (Maharashtra) for the relevant Assessment Year . 10.2 Regarding the delivery of goods as per para 5.10 of the assessment order the assessee vide its letter dt. 10.12.2010 is found to have stated that it did not maintain any record for the sales which had taken place from the office or godown of the assessee. In view of the above the Assessing Officer proceeded to mak ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cer. Also the said party is being assessed before the same Assessing Officer. Notices u/s 148 of the Act have been issued for the Assessment Year 2006- 07 to 2008-09 and the assessment orders have been passed. The said party is regularly appearing before the Assessing Officer on time to time. Thus the allegation of the Assessing Officer that the whereabouts of the said party are unknown is bad on the facts of the case. Also during the course of hearing before the Assessing Officer the duly confirmed accounts of M/s Swastik Packaging were filed before the Assessing Officer. Further it is important to state that once the amount received from M/s Swastik Packaging has been recorded in the sales then the addition made by the Assessing Officer tantamount to double addition. Thus it is prayed to delete the Addition as the same has been made against the facts of the case. 12. Considering the same the Ld.CIT(Appeals) came to the following conclusion by which the Revenue is aggrieved: - The view taken by the revenue is that as the delivery of the goods to M/s Swastik Packaging could not be established, the sales are not genuine. Firstly, the sales to Swastik Packaging are undisputed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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