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TMI Blog2015 (12) TMI 1418X X X X Extracts X X X X X X X X Extracts X X X X ..... ls) has deleted the addition of Rs. 10,55,000/- u/s 68 of the Act, disregarding the finding of the department that the assessee has introduced its own unaccounted money in its bank as accommodation entries. iii. The appellant craves to add, alter, amend, modify, add or forego any ground of appeal at any time before or during the hearing of this appeal. 2. The facts in brief are that for the assessment year in consideration, the assessee filed its return of income on 11.08.2004 declaring income of Rs. 1,16,168/-. The return was processed under Section 143(1) of the Income-tax Act, 1961 (for short "the Act"). Consequently upon the information received from the Director of Income Tax (Investigation), New Delhi, that the assessee was one of the beneficiaries of the accommodation entry in the form of share application money in the financial year 2003-04 relevant to the assessment year 2004-05, the Assessing Officer issued notice under Section 148 of the Act, dated 18.03.2001 for reopening of the assessment. In response to this notice, the assessee filed a letter dated 15.04.2011 requesting to treat the original return of income filed as return filed against the notice under Section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Wing of the Department and fixed the hearing on 15.12.2011. In response to the said show cause, neither anyone attended nor any written submissions was filed and therefore the Assessing Officer completed the assessment holding the share application money of Rs. 10.55 lacs received as unexplained credit on the basis of material available before him. The relevant findings of the Assessing Officer are as under: "Whatever submissions made by the assessee have been considered carefully, but not found acceptable. It should not be ignored the facts emerged from the survey/search operation conducted on various companies/individuals etc. by the Investigation Wing of the department. It was found during these operations and post enquiries that many companies/individuals and other entities are involved in giving or taking accommodation entries. The purpose of taking/giving these entries was nothing but to route through their unaccounted money into business. The findings were referred to all the assessing officers alongwith list of name of the persons and details of transactions for further necessary action. The details were not prepared baselessly. In fact, it was based on facts revealed dur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the case of CIT vs Nova Promoters and Finlease Pvt. Ltd. (supra). In view of the above, since the appellant had duly substantiated the identity, genuineness and creditworthiness of the cash creditors in respect of an amount of Rs. 10.55 lakhs received during the year as share application money, the addition made by the Ld. AO under Section 68 cannot be sustained. Accordingly, addition made is deleted." 3. At the outset, the learned Authorized Representative submitted that the tax effect in the Revenue appeals was below Rs. 4 lacs and therefore relying on the decision of Income Tax Officer Vs. Sh. Om Prakash, ITA No. 6338/Del/2013, dated 16.06.2015, the appeal of the Revenue may be dismissed. 4. However, the learned Departmental Representative brought to our knowledge that the tax effect in the present case was Rs. 3,78,482/- and in view of the judgment of Hon'ble Supreme Court in the case of Commissioner of Income Tax-VIII Vs. Suman Dhamija, Civil Appeal Nos. 4919-4920 of 2015, dated July 1st, 2015, the CBDT Circular in respect of not filing an appeal when less than tax effect of Rs. 4 was prospective and not retrospective. He submitted that the CBDT circular for non filing o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shwari Metal (P.) Ltd (supra), the Hon'ble High Court has held that when there was a clear lack of inquiry on the part of the Assessing Officer, once the assessee had furnished all the material, then in such eventuality, no addition could be made under Section 68 of the Act. The relevant findings of the aforesaid case are as under: "9. As can be seen from the above extract, two types of cases have been indicated. One in which the assessing officer carries out the exercise which is required in law and the other in which the assessing officer 'its back with folded hands' till the assessee exhausts all the evidence or material in his possession and then comes forward to merely reject the same on the presumptions. The present case falls in the latter category. Here the assessing officer, after noting the facts, merely rejected the same. This would be apparent from the observations of the assessing officer in the assessment order to the following effect: - "Investigation made by the Investigation Wing of the Department clearly showed that this was nothing but a sham transaction of accommodation entry. The assessee was asked to explain as to why the said amount of Rs. 1,11,5 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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