TMI Blog2020 (1) TMI 1047X X X X Extracts X X X X X X X X Extracts X X X X ..... and does not call for any interference. Accordingly, we sustain the addition made by the AO and confirmed by the CIT(A). The Grounds raised by assessee in this regard are dismissed. - I.T.A. No. 436/HYD/2014 - - - Dated:- 4-12-2019 - Shri D. Karunakara Rao, Accountant Member And Shri V. Durga Rao, Judicial Member For the Assessee : Shri Sunil Kumar Jain, AR For the Revenue : Shri Nilanjan Dey, DR ORDER PER D.KARUNAKARA RAO, A.M. : This appeal of assessee is directed against the order of the Commissioner of Income Tax (Appeals)-II, Hyderabad, dated 02-12-2013, for the AY.2006-07. 2. The Ground(s) of Appeal raised by assessee are extracted as under: 1. From the facts and circumstances, the order of the learned Assessing Officer was wholly bad, illegal and unjustified, The learned CIT(A)-II, Hyderabad has made addition of ₹ 41,52,000/- treating the Share Application Money as unexplained cash credit u/s.68 of the Income Tax Act, 1961. a) The CIT(Appeals) Hyderabad has wrongly upheld the addition made by the AO i.e., treating the Share Application Money as unexplained cash credit amounting to ₹ 41,52,000/- . 3. Briefly stated r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g entries. A/c No.000405022074 of Talent Infoway Ltd. in ICICI Bank ' Sl Date Particulars Withdrawals Rs. Deposits Rs. Balance Rs. 1 15-09-2005 Buniyad 1000000.00 -- 13494.00 2 19-09-2005 By Cash Bahety -- 500000.00 513494.00 3 19-09-2005 Trfr from DK Brothers -- 500000.00 1013494.00 4 20-09-2005 Badrinath Steels Pvt. Ltd 1000000.00 -- 13494.00 A/c No.000405022074 of Talent Infoway Ltd. in ICICI Bank Sl Date Particulars Withdrawals Rs. Deposits Rs. Balance Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nasi Exim (627905006805) in ICICI Bank, Kolakata showed that there was a credit of ₹ 25,40,000/- with the narration Trfr from :various out of which cheques were issued to Buniyad and one other party. The striking similarity in the transactions in the Bank accounts of the above entities which are the immediate and next to immediate source of the share application money is not a coincidence. This appears to be a well organized activity of providing accommodation entries to bring unaccounted monies into the system in a circuitous way to escape the tax radar. 2. Mr. Mukesh Choksi, promoter and Director of Talent Infoway Ltd. and Buniyad Chemicals Ltd. had confessed that these two companies were indulging in providing accommodation entries. Though the name of the assessee is not appearing in the statement recorded from the Director, it is part of the evidence found during the search operation in that case. 3. As in the other cases, the source for the investments made by the 2 companies are funds deposited in their accounts immediately prior to the investment. The funds were deposited by entities like Bahety Enterprises, D K Brothers, Manasi Exim Pvt. Ltd. etc. whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted the statement of Shri Mukesh Choksi in his order. In para 3.2, there was a discussion about the reopening of the assessment and the present assessee to his transactional nexus with the company of Shri Choksi. The CIT(A) analysed each of the subscribers, contributed the said sum of ₹ 68,52,000/- in para 4 onwards. At the end of the proceedings, the CIT(A) allowed assessee s claim so far as the subscription by Shri Sambasiva Rao is concerned. Rest of the share application subscriptions in favoaur of M/s.Talent Infoway Ltd., M/s.Buniyad Chemicals, Shri Pawan Kumar Sharma, Shri Ratan Kumar Sharma and Shri Anil Kumar Sharma, added by the AO, were confirmed by the CIT(A) in her detailed order. Thus, the CIT(A) partly allowed the appeal of assessee, confirming the addition of ₹ 41,52,000/- against the addition of ₹ 68,52,000/-. 7. Aggrieved with the above order of CIT(A), the assessee is in appeal before the Tribunal, raising the Grounds mentioned above. 8. At the outset, Ld.Counsel for the assessee submitted that for adjudication, there are total of six creditors, who contributed the share capital to the company and the same is as under: S. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee before the First Appellate Authority. 9. On the other hand, Ld.DR for the Revenue relied on the orders of the AO and the CIT(A). 10. We shall now take up each of the subscribers and the decision thereof in the following paragraphs: M/s.Talent Infoway Ltd., and M/s.Buniyad Chemicals: It is an undisputed fact that these two companies belonging to Shri Mukesh Choksi Group of Companies and M/s.Mahasagar Securities Private Limited. Much amount of litigation existed relating to these companies and the accommodation entries provided by the Group of companies of Shri Choksi. Number of orders are in existence as on date. However, both the Counsels failed to file any of such orders of the Tribunal on similar facts. It is a settled legal proposition laid down by the Hon'ble High Court of Delhi in the case of CIT Vs. N.R.Portfolio (P) Ltd., [264 CTR 258] (Delhi). The relevant lines at para 31 of the Hon'ble High Court s order are as under: 31. It would be incorrect to state that the onus to prove the genuineness of the transaction and creditworthiness of the creditor stands discharged in all cases if payment is made through banking channe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed income for the AY.2006-07 is only ₹ 97,180/-. The same is the pattern in the cases of Shri Ratan Kumar Sharma and Shri Anil Kumar Sharma. In the case of Shri Anil Kumar Sharma, though the assessee relied on various decisions such as CIT Vs. Lovely Exports Pvt Ltd., (2008) [216 CTR 195] (SC), the CIT(A) held that the said decision is not applicable to the facts of the present case and relied on the decision of the Hon'ble High Court of Delhi in the case of CIT Vs. Titan Securities Ltd., (2013) [84 CCH 184] (Delhi HC). 11.1. Finally, the CIT(A) confirmed the additions made by the AO in favour of these three persons i.e., Shri Pavan Kumar Shar, Shri Ratan Kumar Sharma and Shri Anil Kumar Sharma. Relevant para of the CIT(A) s order is extracted here under: 10.4. Going by the above amendment it is must for the share subscribers to offer the explanation about the nature and sources of share capital to the satisfaction of the Assessing Officer. 12. Before us, Ld.Counsel for the assessee relied heavily on the submissions made before the AO and the CIT(A). 13. On the other hand, Ld.DR for the Revenue dutifully relied on the orders of the AO and the CIT(A). ..... X X X X Extracts X X X X X X X X Extracts X X X X
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