TMI Blog2017 (12) TMI 300X X X X Extracts X X X X X X X X Extracts X X X X ..... iled by the assessee, pertaining to Assessment Years 2004-05 and 2007-08, are directed against the orders passed by the Commissioner of Income Tax (Appeals)-21, Kolkata in Appeal No. 475 478/CC3(2)/CIT(A)-21/14-15, dated 19.01.2015, which in turn arise out of assessment orders passed by the Assessing Officer u/s 143(3)/153A of the I.T. Act, 1961 (hereinafter referred to as the Act ), dated 30.12.2011. 2. Since these two appeals relate to the same assessee, different Assessment Years, identical issues are involved, therefore, these have been clubbed and heard together and a consolidated order is being passed for the sake of convenience and brevity. 3. The assessee s appeal in ITA N0.270/Kol/2015, Assessment Year 2007-08 is taken as the lead case. 4. The grounds of appeal taken by the assessee in the lead case in ITA No.270/Kol/2015, are as follows: 1. For that in view of the facts and circumstances of the case the Ld. CIT(A) was wholly wrong and unjustified in dismissing the Ground Nos.1 2 of the appellant assessee company s appeal challenging the jurisdiction, legality and validity of (i) the arbitrary action taken against the appellant company u/s 132(1) of the I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the said addition of ₹ 1,20,000/- without taking into consideration the facts that similar type of additions made in the search assessments u/s 143(3)/153A dt. 30.12.2011 for the A.Ys 2005-06 2006-07 have been fully deleted by the Ld. CIT(A), Central - III, Kolkata, vide his consolidated order Nos. 150 151 dt. 24.07.2012. 5. For that your petitioner craves the right to put additional grounds and/or to alter/amend/modify the present grounds before or at the time of hearing. 5. Although, in this appeal, the assessee has raised a multiple grounds of appeal but at the time of hearing, the main grievance of the assessee has been confined to the issue that addition made by the Assessing Officer u/s 68 on account of cash credit at ₹ 1,20,000/- treating the share application money as bogus because identity creditworthiness of the share applicants as well as the source and genuineness of the investments made by the applicants were not established by the assessee. Ground No.1 and 2 were not pressed by the assessee. 6. The brief facts qua the issue are that a Survey u/s.133A was conducted at two premises of Shri Santosh Kumar Shah, located at 9/12, Lal Bazar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nnection whatsoever with the assessee company and AO has not allowed to cross-examine him with regard to any statement made by him in relation to the assessee company. There were no documents/evidence found in possession of assessee company or any of its directors during the course of survey/seizure. No deposit of any unaccounted cash in any of assessee`s bank accounts. Assessee has never charged or received any commission in whatsoever manner for providing any kind of accommodation entries and also it has not received any kind of direct or indirect benefit out of it. The assessee company is not a paper company, it is a registered company having NBFC certificate and a regular assessee of the Income tax, duly and correctly filing its income tax returns from time to time, which were also scrutinized by assessing officer. Regarding money lying in the current account of the company at Axis bank, Lake Town branch, the same were recorded in the books of account and assessee and provided with all reasonable evidences as to the source of such amount. The assessee also explained to AO with regard to year wise increase in the share capital and year wise share application money stating the fu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ound which revealed that a number of bank accounts being used to provide accommodation entries to a number of persons/firms and companies. Consequent to the search operation in the case of Shri Santosh Kumar Shah who was indulged in the activity of providing the accommodation entries, the search operation u/s 132 of the Act was conducted in the bank account of the assessee company on 11.02.2010 having Account Number 191010200005906 with Axis Bank, Lake Town Branch, Kolkata. The assessee has contested the action of the Assessing Officer making addition of ₹ 1,20,000/- u/s 68 of the Act on account of share application money accepted by the assessee company in the year under consideration. The facts of the case are that in the course of survey/search operation in the case of Shri Santosh Kumar Shah, it was gathered that he was indulged in the activity of providing accommodation entries to various beneficiaries after accepting cash from them. Therefore, substantial amount of cash was found from his premises at the time of search operation. In his statement, Shri Santosh Kumar Shah admitted that he had provided accommodation entries to various parties and charged commission from t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plicants, copy of PAN card of share applicants, copy of their I.T. Returns and balance sheet. The assessee also stated that the AO had issued notices u/s 133(6) of the Act to all the persons who had subscribed to the appellant's share capital and nothing adverse was found by him. Though, in the assessment order, the AO has not mentioned this fact. It was contended by the assessee that the entire share capital received by the assessee by account payee cheques from the corporate entities and full particulars thereof were before the AO to prove the identity and creditworthiness of the share applicants as well as the genuineness of the transactions. But CIT(A) ignored the submissions of the assessee, as mentioned above, and held that the AO was justified in making the addition of ₹ 1,20,000/- on account of share allocation money. The CIT(A) observed that in the course of search and post search enquiries Shri Santosh Kumar Shah had given a specific statement that the appellant company was floated by him and the directors of the company were acting on his instructions. He also stated that the assessee company was engaged in the activity of providing accommodation entries to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onsideration is squarely covered by the order of Hon ble ITAT, Kolkata in assessee s own case in ITA Nos.1545 1546/Kol/2012 Assessment Years 200506 2006-07, dated 10th July, 2015, wherein Hon ble Tribunal Kolkata held that since no incriminating material was found during the course of the search relating to the share capital and the share premium, therefore, no addition can be made while making an assessment under section 153A of the Income Tax Act. The Hon`ble Tribunal held that the Assessing Officer was not correct in law in making the addition in the assessment made under section 153A read with section 143(3) when no incriminating material was found during the course of the search in respect of the addition made by him. 9. On the other hand, ld DR for the Revenue has primarily reiterated the stand taken by the Assessing Officer, which we have already noted in our earlier para and is not being repeated for the sake of brevity. 10. We have heard both the parties and perused the materials available on record, we note that the assessee submitted complete details of share application money including copy of share applications, copies of relevant bank statements of share app ..... X X X X Extracts X X X X X X X X Extracts X X X X
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