TMI Blog2018 (4) TMI 178X X X X Extracts X X X X X X X X Extracts X X X X ..... he source. None of the statements recorded during the course of search as are referred to in assessment order prove that assessee has received any accommodation entry from any person despite the fact that same were not confronted to the assessee at assessment stage. Therefore, it is proved on record that assessee has been able to explain the identity of the creditor, its creditworthiness and genuineness of the transaction in the matter - Decided in favour of assessee Annual letting value determination - assessee submitted that it is co-owner with others and that the same is used for the purpose of business for the assessee and for part period it was let-out for which rental income has already been shown - Held that:- In the case of other co-owners similar addition have been deleted when allegation have been made that it is used by Gambhir brothers for residence only. The statement of Shri Vinay Subhikhi (supra), was recorded at the back of the assessee without confronting the same to the assessee. Therefore, it cannot be read in evidence against the assessee. The A.O. in present case initiated the re-assessment proceedings under section 148 of the I.T. Act at the same address in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n Technobuild Pvt. Ltd., had received entry from Jain brother. A search action was carried-out at the premises of Jain Brothers and it was found that Jain Brothers had been providing accommodation entry to various parties after charging some commission for the same. It has been noted that assessee-company was the beneficiary in this transaction. Further, it was noticed that the assessee was owner of 29.40% of property at 48-Friends Colony East, New Delhi and this property was being used by Gambhir brothers as their residence. The A.O. asked the explanation of assessee on the accommodation entry received of ₹ 1,01,00,000 and ₹ 12,25,897 being 29.4% of annual value of the property should not be added to its income as income from house property as against ₹ 1,05,000 declared by assessee for 05 months. The assessee submitted before the A.O. that it has received amount of ₹ 1,01,00,000 from M/s. Golden Technobuild Pvt. Ltd., and in order to establish identity, creditworthiness and genuineness of the amount as received from the said company, assessee had filed its audited financial statements as on 31st March, 2005, copy of acknowledgment of I.T. Return filed by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nts in the O/o. M/s. Today Homes and Infrastructure Pvt. Ltd. Further, strengthening the fact that Directors of the above said companies are merely employees of Today Group and controlled by Gambhir brothers who are having the similar pass words. With the help of digital signatures most of the compliance including filing of the I.T. returns, filing papers before ROC etc., can be done by one person. During search and survey action conducted in the premises of Shri S.K. Jain and Shri Virendra Jain, it was found that they are entry provider on commission to the parties. They have provided accommodation entries in the from of share application money, capital gain on shares, expenditure entries etc., in lieu of commission. During the course of search and seizure proceedings at the residential and business premises of Jain brothers on 14th September, 2010, daily cash book, balance sheet and cheque/bank books were found and seized wherein date-wise details of cash received from different parties/concerns through various mediators and the date-wise details of accommodation entries given to the beneficiaries concern through mediators with their particulars have been found. On perusal of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Investment Ltd., Divine Leasing and Finance Ltd., 299 ITR 268, CIT vs. Lovely Exports 319 (Statute) 5, CIT vs. Winstral Petro Chemicals Pvt. Ltd., 330 ITR 603 etc. The assessee also argued that onus is on the department to prove that apparent is not real and relied upon the decision of the Supreme Court in the case of CIT vs. Doulatram 87 ITR 349 etc., It was submitted that once assessee filed the documentary evidences, initial onus upon assessee has been discharged. The creditor M/s. Golden Technobuild Pvt. Ltd., is a regular assessee, filing return of income. Whatever statements were recorded as referred in the assessment order are at the back of the same, the same were not confronted to assessee, therefore, cannot be read in evidence against the assessee. Even if the group companies are controlled by Gambhir brothers, no conclusion could be drawn that assessee received unaccounted/ undisclosed entry or represent that cash of assessee routed through paper companies. The companies are separate legal entity having independent Directors and shareholders. None of the person have admitted to have involve in giving accommodation entry. No corroborative evidence have been found against ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pra), CIT vs. Dwarakadheesh Investment Pvt. Ltd., 194 taxman 43 and decision of M.P. High Court in the case of CIT vs. STL Extrusion 11 taxman.com 125. He has also relied upon order of the ITAT, Delhi Bench in the case of M/s. Mission Verdes Estate Pvt. Ltd., in ITA.No.4236/Del./2015 for A.Y. 2005-2006 dated 16 th December, 2016 in which same facts have been considered with regard to credit received from M/s. Golden Technobuild Pvt. Ltd., and similar addition have been deleted, particularly, when same addition have been made in Assessment order dated 28 th March, 2013 for the A.Y. 2005-2006 in the hands of M/s. Golden Technobuild Pvt. Ltd. Copy of the assessment orders in the case of M/s. Golden Technobuild Pvt. Ltd., is also filed with bifurcation. In the same order the issue of annual letting value have been decided in favour of the assessee. He has also relied upon the order of the ITAT, Delhi Bench in the case of M/s. Palos Verdes Estate Pvt. Ltd., vs. ACIT ITA.No.4235/Del./2015 for the A.Y. 2005-2006 dated 16th December, 2016 in which the Tribunal on the issue of annual letting value, reopening of the assessment, have been quashed. He, therefore, submitted that both the addi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in view of the above findings noted that the assessee had provided several documents that could have showed light into whether truly the transactions were genuine. The assessee provided details of share applicants i.e. copy of the PAN, Assessment particulars, mode of amount invested through banking channel, copy of resolution and copies of the balance sheet. The AO failed to conduct any scrutiny of the document, the departmental appeal was accordingly dismissed. 9.3. Hon ble jurisdictional Delhi High Court in the case of CIT vs. (i) Dwarakadhish Investment P. Ltd., (ITA.No. 911 of 2010) and (ii) Dwarkadhish Capital P. Ltd., (ITA.No.913 of 2010) (2011) 330 ITR 298 (Del.) (HC), in which it was held as under : In any matter, the onus of proof is not a static one. Though in section 68 of the Income Tax Act, 1961, the initial burden of proof lies on the assesses yet once he proves the identity of the creditors/share applicants by either furnishing their PAN number or income-tax assessment number and shows the genuineness of transaction by showing money in his books either by account payee cheque or by draft or by any other mode, then the onus of proof would shift to the Revenue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d their addresses or had stopped functioning. Therefore, the Commissioner (Appeals) and the Tribunal were justified in holding that the genuineness of the transactions had been duly established by the assessee. 9.5. Hon ble jurisdictional Delhi High Court in the case of CIT vs. Value Capital Services Pvt. Ltd., (2008) 307 ITR 334 (Del.) (HC), in which it was held as under : Dismissing the appeal, that the additional burden was on the Department to show that even if the share applicants did not have the means to make the investment, the investment made by them actually emanated from the coffers of the assessee so as to enable it to be treated as the undisclosed income of the assessee. No substantial question of law arose. 10. The A.O. in order to disbelieve the explanation of assessee has referred to statements of certain persons which were recorded during the course of search in November, 2009, but, it appears that none of these statements have been confronted to the assessee or subject to cross-examination on behalf of assessee. Therefore, the same cannot be read in evidence against the assessee. We, rely upon the decision of the Hon ble Supreme Court in the case of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y, set aside the orders of the authorities below and delete the addition of ₹ 1,01,00,000. 11. As regards annual letting value of property No.48- Friends Colony (East), New Delhi, is concerned, the assessee submitted that it is co-owner with others and that the same is used for the purpose of business for the assessee and for part period it was let-out for which rental income has already been shown. However, the A.O. did not accept the contention of assessee and referred to statement of Shri Vinay Subhikhi who has stated that property in question used by Gambhir brothers for residence. In the case of the co-owners namely M/s. Mission Verdes Estate Pvt. Ltd., (supra) and M/s. Palos Verdes Estate Pvt. Ltd., (supra), the Tribunal has considered identical issue and in the case of M/s. Palos Verdes Estate Pvt. Ltd., reopening of the assessment quashed resulting the similar addition have been deleted on quashing of the re-assessment proceedings and in the case of M/s. Mission Verdes Estate Pvt. Ltd., (supra), the Tribunal found that property in question is used by the assessee for its own business and that copy of the ROC reveal that it is registered office of the assessee, ther ..... X X X X Extracts X X X X X X X X Extracts X X X X
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