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2016 (10) TMI 808 - ITAT DELHI

2016 (10) TMI 808 - ITAT DELHI - TMI - Reopening of assessment - validity of notice u/s 148 - income escaped assessment based on investigation wing information - Held that:- the reasons merely based on investigation wing information without surveillance of substantiation and without any statement being mentioned therein and without nature of transaction being narrated therein and without tangible material, and further without application of mind on amount of income escaping assessment, shows tha .....

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6 on the following grounds :- 1. On the facts and circumstances of the case, the order passed by the learned Commissioner of Income Tax [CIT(A)] is bad, both in the eye of law and on the facts. 2. On the facts and circumstances of the case, the learned CIT(A) has erred, both on facts and in law, in confirming the proceedings under Section, read with Section, ignoring the fact that the same was bad in the eye of law as the condition and procedure prescribed under the statute have not been satisfi .....

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Section, read with Section, ignoring the fact that the notice issued under Section of the Act is bad in the eye of the law. 5. On the facts and circumstances of the case, learned CIT(A) has erred both on facts and in law in confirming the order of the AO rejecting the contention of the assessee that the reason recorded for reopening of the assessment are bad in law and as such the reopening of the assessment is illegal and liable to be quashed so. 7. On the facts and circumstances of the case, l .....

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tunity of being heard which is clear violation of the principle of natural justice. 8. (i) On the facts and circumstances of the case, learned CIT(A) has erred both on facts and in law in confirming the addition made by the AO on account of share Application money received from MIs Taurus Iron & Steel Co. Pvt. Ltd. amounting ₹ 10,00,000/- u/s 68 of the Income Tax Act. (ii), That the above said addition has been confirmed despite the fact that the assessee brought all material evidences .....

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tances of the case, learned CIT(A) has erred both on facts and in law in enhancing the addition to ₹ 3,80,2401- from ₹ 2,36,026/- made by the AO on account of expenditure incurred toward agriculture expense. (ii) That the above said enhancement has been made arbitrarily rejecting the detailed explanations and submissions submitted by the assessee. 11. (i) On the facts and circumstances of the case, learned CIT(A) has erred both on facts and in law in enhancing the income assessed by .....

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return of income on 29.10.2005 declaring income NIL and the same was processed u/s. 143(1) of the I.T. Act, 1961. Subsequently, proceedings u/s. of the I.T. Act were initiated by recording reasons on the basis of information received from the Investigation Wing of the Department vide letter dated 31.3.2009 from Addl. DIT (Inv.) Unit-IV, New Delhi that the assessee is also a beneficiary of taking accommodation entry of ₹ 10,00,000/- in the garb of share application money/share capital/shar .....

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use notice/questionnaire u/s 142(1) dated 04.02.2013 was issued to the assessee by speed post and in response to which, AR of assessee attended the assessment proceedings. Consequently, details were filed by assessee raising many objections in connection with validity of issuance and service of notices and also the reassessment proceedings. However, AO considered the submissions of assessee along with details filed and completed the assessment by making the various additions. 3. Aggrieved with t .....

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bed under the statute have not been satisfied and complied with. He further submitted that Ld. CIT(A) has also erred in confirming the order of the AO rejecting the contention of the assessee that the reason recorded for reopening of the assessment are bad in law and as such the reopening of the assessment is illegal and liable to be quashed so; the order u/s. is bad in the eyes of law as the same has been passed without service of notice u/s. of the Act; the order passed by the authorities belo .....

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ment proceedings. To support his contention, he referred the various case laws of the Delhi High Court by which the present case of the assessee is covered including the case of Signature Hotel Pvt. Ltd. (2011) 338 ITR 51. He further relied upon the ITAT, C Bench, Delhi in which on the similar facts and circumstances the issue in dispute has been dealt by the Tribunal in the case of Shri Govind Kripa Builders and Promoters vs. ITO passed in ITA No. 304/Del/2013 (AY 2008-09) vide order dated 19.1 .....

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application for adjournment. Keeping in view the facts and circumstances of the present case and the issue involved in the present Appeal, I am of the view that no useful purpose would be served to issue notice again and again to the Revenue, therefore, I am deciding the present appeal exparte qua Revenue, after hearing the Ld. AR and perusing the records. 7. I have heard Ld. Counsel of the assessee and perused the records. I find that the AO has recorded the reasons for belief that income has e .....

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/2008-09/392 dated 31.3.2009. The report is annexed as Annexure B. The main gist report are as under:- 1. Sh. Tarun Goyal has formed certain firms/ companies for providing accommodation entries. All these companies are operating from 13/34 WEA Karol Bagh or 203, Dhaka Chamber Naiwala, Karol Bagh. 2. Various bank a/c has been opened in the name of these companies with authorized signatories which are employees of Sh. Tarun Goyal. 3. Huge cash was found deposited in these bank accounts. 4. Sh. Tar .....

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ficiaries who has received accommodation entry during FY 03-04 to 2008-09. M/s Hasanpur Cold Storage Pvt. Ltd. (AABCH0861N) is one such concern who has received ₹ 10,00,000/- from the entry provider M/s Taurus Iron & Steel Company Pvt. Ltd. In view of the findings of the Investigation Report, the lenders in these cases have been proved to be men/parties of no creditworthiness. The statements on oath and the letters of admission clearly show that these transactions are non genuine. Ther .....

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orically stated that they had provided share capital/ share premium/ share application money after receiving cash from the beneficiaries. The categorical admission of the entry provider as well as the finance statement of the assessee clearly points out the fact that the transactions entered by the assessee are not genuine. I, therefore, have reasons to believe that this amount of ₹ 10,00,000/- represents income of the assessee chargeable to tax which has escaped assessment for AY 2005-06. .....

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Party), wherein the Hotel Signatures Pvt. Ltd. (Supra) decision of the Delhi High Court was followed. Against the order dated 19.12.2014 of the Tribunal, the Department went in Appeal before the Hon ble Delhi High Court, in ITA No. 486/2015 in the case of Pr. CIT vs. Sh. Govind Kripa Builders Pvt. Ltd. and the Hon ble High Court of Delhi vide its order dated 04.8.2015 has observed as under:- 3. It is seen that the ITAT has in the impugned order dated 19th December, 2014 passed in ITA No. 304/De .....

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also find that these reasons merely based on investigation wing information without surveillance of substantiation and without any statement being mentioned therein and without nature of transaction being narrated therein and without tangible material, and further without application of mind on amount of income escaping assessment, shows that the reopening is bad in law and needs to be quashed. 16.3 In the background of the aforesaid discussions, I am of the considered view that only effective g .....

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d 21.7.2011 passed by the Hon ble Jurisdictional High Court in the case of Signature Hotels P. Ltd. vs. Income Tax Officer [2011] 338 ITR 0051 wherein the Hon ble High Court has held matter as under:- Held, allowing the petition, that the reassessment proceeding were initiated on the basis of information received from the Director of Income Tax (Investigation) that the petitioner had introduced money amounting to ₹ 5 lacs during the financial year 2002-03 as stated in the Annexure. Accordi .....

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