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2015 (12) TMI 127

Addition u/s 68 - accommodation entries - Held that:- when the assessee has duly explained the source of credit in their account on account of loan, interest on loan and cash deposits etc. and has also claimed expenses on account of bank charges, conveyance, salary and allowances and depreciation, we are of the considered view that addition should not have been made without verifying the genuineness and creditworthiness of the parties who have otherwise confirmed the same. So, in view of the mat .....

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of the Assessing Officer that the assessee was engaged in money laundering. 3. That the learned Commissioner of Income tax (Appeals) has erred in sustaining the addition on account of alleged accommodation entries to the tune of ₹ 16,65,000/- by invoking provisions of section 68 the Income Tax Act. 4. That the learned Commissioner of Income tax erred in rejecting the details and evidences adduced by the appellant explaining the deposits made in the bank accounts without properly going thr .....

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and style of M/s. Next Wave India (A.O.P) and Shri Bharat Bhushan and Smt. Renu Bhushan came into existence and the return in the capacity of AOP has been filed. ITO, Ward 13(2), wrote a letter along with a copy of MOU signed by Shri Bharat Bhushan and Smt. Renu Bhushan and a copy of statement of Shri Bharat Bhushan was recorded by him. 4. Pursuant to the inquiries conducted by Investigation Wing of the Department, it was noted that Shri Bharat Bhushan and Smt. Renu Bhushan had opened bank acco .....

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and owned up the transactions made by them in the above said bank account, which was done in terms of Memorandum of Understanding signed by the present directors of M/s. Next Wave (India) Pvt. Ltd. The Bhushans were the first party and present directors of M/s. Next Wave India Pvt. Ltd. namely Shri P. K. Arora, Smt. Pooja Juneja and Mr. Rajeev Juneja were the second party to this agreement. The relevant clause NO.2 of the Memorandum of Understanding states as under: "That the First Party de .....

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an and Smt. Ritu Bhushan in the books of account was operated by them in the name and style of M/s. Next Wave India Pvt. Ltd. with the intention of introducing their unaccounted money in the normal process. Therefore, entire receipt of ₹ 17,00,058/- is being treated as unexplained income of Shri Bharat Bhushan and Smt. Ritu Bhushan and has been added u/s 68 of the Act in the hands of the AOP pursuant to MOU annexed therewith. 7. Feeling aggrieved, the assessee challenged the order of A.O. .....

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ve India (P) Ltd. Vs ITO, New Delhi for the Assessment Years 2002-03, 2003-04 and 2004-05 vide order dated 25.01.2012 in assessee s own case. 9. On the other hand Ld. D.R. relied upon the order of Ld. CIT(A) and prayed for dismissal of appeal. 10. We have heard Ld. Authorized Representatives of both the parties and gone through the documents relied upon in the light of facts and circumstances of the case. 11. Under Section 68 of the Act, if any sum is found credited in the books of an assessee m .....

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he account of the assessee. 13. Keeping in view the totality of the facts and circumstances of the case when the assessee has duly explained the source of credit in their account on account of loan, interest on loan and cash deposits etc. and has also claimed expenses on account of bank charges, conveyance, salary and allowances and depreciation, we are of the considered view that addition should not have been made without verifying the genuineness and creditworthiness of the parties who have ot .....

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