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TMI Blog2019 (8) TMI 1499X X X X Extracts X X X X X X X X Extracts X X X X ..... n passed Assessment year 1712.2018 7 143(3)/147 2010-11 And in ITO vs. RMP Holding (P) Ltd.:- Date of Order Order passed by Ld. CIT0(Appeals) Section in which order has been passed Assessment year 29.08.2018 36 143(3)/147 2007-08 2. Since issues involved in all the appeals are common arising out of identical set of facts, therefore, same were heard together and are being disposed of by way of this consolidated order. In all the years the common issue involved relates to addition made u/s 68 on account of share application money and validity of reopening u/s 147 on various grounds. The quantum of addition and penalty levied for all the assessment years are tabulated here as under:- ITA No. Asstt. year Addition u/s 68 Order passed 6017/Del/2018 2007-08 Rs. 1,66,65,000/- u/s 143(3)/147 79/Del/2019 2010-11 Rs. 5,10,00,000/- u/s 143(3)/147 3299/Del/2017 2006-07 Rs. 55,00,000/- u/s 143(3)/147 584/Del/2018 2006-07 Penalty of Rs. 55,00,000/- u/s 271(1)(c) 6016/Del/2018 2007-08 Rs. 3,34,31,000/- u/s 143(3)/147 585/Del/2018 2008-09 Rs. 1,07,00,000/- u/s 143(3)/147 1029/Del/2019 2008-09 Penalty of Rs. 1,07,00,000/- u/s 271(1)(c) 78/Del/2019 20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... against the bogus sales, duly shown in the books of accounts. From there, this cash was transferred to the different paper companies floated by Sh. Surender Kumar Jain and Sh. Virendra Kumar Jain through a complex trail of transactions, so as to hide the actual sources of funds of the last set of recipient companies of Sh. Surendra Kumar Jain and Sh. Virendra Kumar Jain. In this way, the reserve & surpluses and the capital account of a specific set of companies are enhanced with the help of the unexplained cash received by Sh. Surendra Kumar Jain and Sh. Virendra Kumar Jain, which is routed to these companies through their dummy firm/companies. Once the funds of these companies have been enhanced sufficiently, accommodation entries throughRTGS/Cheque in the shape of the share capital, capital gains or loans as per the specific requirement of the recipient clients were provided them in lieu of the cash received from them. In this way, the chain for providing an accommodation entry gets completed. As per seized annexure, the assessee M/s R N Khemka Enterprises P Ltd. has taken the following accommodation entries from the following person(beneficiary) as per details hereunder:- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessment year. The Assessee Company was engaged in the business of trading of shares and was also earning interest income. AO further noted that as per the seized annexure found during the course of search and seizure action in the case of Shri Surender Kumar Jain and Shri Virender Kumar Jain on 14.9.2010, the seized annexure reflected following accommodation entries taken by the assessee from various companies: - Bank Book Date From To (Beneficiary) Bank Cheque/ RTGS Cheque Date Amount Through Annexure No. Page Nos. 15-02-06 Pelicon Finance & Lease Ltd. R N Khemka Enterprises P Ltd. KOTAK CH. No. 000248 16-02-06 10.00.000 Satish A-52 26 i 18-02-66 Vogue Leasing & Finance P Ltd. R N Khemka Enterprises P Ltd. KOTAK CH. No. 000043 18-02-06 10,00,000 Satish A-52 30 28-02-06 Pelicon Finance & Lease Ltd. R N Khemka Enterprises P Ltd. KOTAK C11. No. 000230 284)2-06 6.00,000 Satish A-52 47 10-03-2006 Finage Lease & Finance India Ltd. R N Khemka Enterprises P Ltd. BOI CH. No. 049900 10-03-06 7.00,000 Satish A-53 IS 16-03-06 Karishmn Industries Ltd R N Khemka Enterprises P Ltd. KOTAK CH. No. 000310 16-03-0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion moneys are a bogus accommodation entry and asked the assessee to produce the Directors of the companies for examination. But assessee has failed to produce these persons. 7. One very important fact as culled out from the assessment order and also recorded by the AO is that, at the instant of assessee, summons was issued to Shri Surender Kumar Jain and Shri Virender Kumar Jain, alleged entry providers as per the Investigation Wing. In response to such summons, they had duly appeared before the AO and their statement were also recorded on oath by him on 13.3.2014. Though there is no mention of the relevant content of the statement, however, AO has observed that though these persons have stated that they were not related to the said parties and have denied providing any accommodation entry to the assessee. But still he observed that they are the persons who have controlled the whole affair of the said parties and earlier also in Investigation Wing, they have not admitted that they are engaged in the business of providing the accommodation entry, therefore, their statement given before him cannot be relied upon, because Investigation Wing had earlier established that they were ent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ngly, he held that the amount of share application money of Rs. 55 lacs have been routed through bogus accommodation entries which is to be treated as unexplained cash credit to be added u/s 68. He has also initiated penalty proceedings u/s 271(1) for furnishing of inaccurate particulars. 9. Before the Ld. CIT (A) the assessee made very elaborate and detailed submissions along with all the documentary evidences filed before the AO in support of the share application money received by the assessee from all these companies. Assessee also challenged the validity of reopening on various counts. Ld. CIT (A) has called for the remand report of the AO on all the submissions. AO though admitted that assessee has filed the confirmations from the parties, their bank statements, copy of ITRs of the parties. Further, all these companies have also filed all these documents once again in response to notices u/s 133(6), but the Ld. AO in his remand report once again has mainly gone by the fact that the assessee has failed to produce the Directors of these companies. After receiving a remand report assessee has filed details of shareholders which have been tabulated from pages 15-16 of the order. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upon catena of judgments including those of Hon'ble Delhi High Court in the case of Pr. CIT vs. N.C. Cables Ltd., 391 ITR 11; United Electrical Co. Pvt. Ltd. vs. CIT, 258 ITR 317 (Del); Central India Electric Supply Co. Ltd. vs ITO, 333 ITR 237 (Del) and also judgments of Hon'ble Chattisgarh High Court in the case of Maruti Clean Coal & Power Ltd. vs. ACIT and Hon'ble MP High Court in the case of CIT vs. M/s. S. Goyanka Lime and Chemicals Ltd. 231 taxman 0073. He submitted that, such mechanical approval/ satisfaction goes to shows that there has been complete non application of mind by the approving authorities which is fatal to jurisdictional issue u/s 147/148 read with section 151. He also strongly relied upon the judgment of Hon'ble Delhi High Court in the case of Sabh Infrastructure vs. ACIT in W.P.(c) 1357/2016 dated 25.9.2017, wherein the Hon'ble High Court has held that furnishing of incomplete reasons without providing the ground on which satisfaction by the authorities concerned u/s 151 was reached to sanction the issue u/s 148 cannot be sustained. Here in this case, he pointed out that AO has mainly supplied reasons recorded and not the format/proforma in which such reas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the AO has not given any opportunity for cross examination of the statement. In so far as statement relied upon by the AO no adverse inference can be drawn based on such statement and in support several other judgements were relied upon including judgment of Hon'ble Supreme Court in the case of Anadaman Timber Industries vs CCE 281 CTR 241. 14. Lastly on merits, besides oral argument he has also filed written submissions. In sum and substance his main contentions are as under:- * The appellant had furnished during assessment of proceedings, which has been mentioned in table in sub para 6.3 of the Ld. CIT (A) order mentioning the documents filed such as Confirmation from each share applicants along with share application form, list of directors downloaded from MCA portal, affidavit of director, resolution of board of directors, relevant portion of Bank statement and Copy of ITR-V. In some cases, copies of assessment order, like in cases of M/s Karishma Industries for AY 2005-06 & AY 2006-07 M/s Finage Leasing and Finance (India) Ltd for AY 2007-08 and M/s S.R. Cables for AY 2006-07 were also enclosed. Similar details were submitted by the share applicant companies direc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Matters Pvt Ltd ITA 778/2015 Dated 13.10.2015 (Del): * Pr. CIT vs. Goodview Trading Pvt. Ltd. ITA NO.377 of 2016 (Del) dated 21.11.2016. * Aksar Wire Products Pvt Ltd vs ACIT in ITA No.1167 /Del/20 15 dated 11/12/2015 * ACIT vs Madhusudan Packaging Pvt Ltd in ITA No.4930/Del/2017 dated 09/05/2018 * Moti Adhesives Pvt Ltd vs ITO in ITA NO.3133/Del/2018 Dated: 25.06.2018. * M/s Astech Industries P Ltd vs DCIT (PB 386-399) ITA No.2332/Del/2018 dt: 20.12.2018. * On that basis, at best creditworthiness of the shareholders could only be disputed. So far as the identity of the share applicants and genuineness of the transaction is concerned, the AO has questioned genuineness of the transaction. There is no adverse observation with regard to identity of the shareholders. In view of the fact that the identity of the shareholder is not in dispute, the addition u/s 68 cannot be made in the hands of the assessee company in view of the decisions of jurisdictional Delhi High Court detailed as under: 1. CIT VS Vrindavan Farms (P) Ltd ITA No. 71 to 72 & 84/2015 (Del) dated 12.08.2015(PB 1-2) 2. Pr. CIT vs. Veedhata Tower Pvt. Ltd (Bombay High Court in ITA No.819 OF 2015 D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .) 12. Pr. CIT vs. Softline Creations Pvt. Ltd. (2016) 387 ITR 636 13. Pr. CIT vs. Oriental International Co P Ltd (Delhi High Court) ITA NO.9/2018 Dated: 08.01.2018. * The AO has simply believed what is provided to him in the information by the DDIT (Inv). The AO could have justification to initiate the reassessment proceedings based on the DDlT but he was not entitled to rely on the investigation report without establishing that there was nexus between the appellant and the so called entry provider. If the assessment order is gone into, it can be seen that the AO has not dealt with the contents of the information in question. In view of this it can be inferred that the information from DDIT (Inv) is not found to be relevant by the AO. Therefore, the said information cannot be basis for adverse inference against the appellant. Reliance is placed on CIT Vs Nova Promoters and Finlease (P) Ltd (Delhi High Court) 342 ITR169and CIT Vs Oasis Hospitalities Pvt Ltd (2011) 333 ITR119 (Del). * The Ld CIT (A) has taken adverse view of the issue of shares of Rs. 10 each at premium of RS.90per share. It is submitted that the identical issue came for consideration befo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AT in the case of Nokia India P. Ltd., v. DCIT, 59 taxmann.com 212. 16. In so far as on merits all the additions besides strongly referring to the various observations by the AO and Ld. CIT(A) he relied upon the following judgments: - i. Decision of Hon'ble Supreme Court of India in the case of PCIT v. NRA Iron & Steel (P) Ltd. 103 taxmann.com 48 (SC) ii. Decision of Hon'ble Supreme Court of India in the case of CIT v. Durga Prasad More, 82 ITR 540 (SC) iii. Decision of Hon'ble Supreme Court of India in the case of Sumati Dayal v. CIT 1995 AIR 2109 dated 28.03.1995. iv. Decision of Hon'ble Delhi High Court in the case of PCIT v. NDR Promoters (P) Ltd., 410 ITR 379 (Delhi) v. Decision of Hon'ble Delhi High Court in the case of CIT v. Nova Promoters & Finlease (P) Ltd., 342 ITR 169 (Delhi) vi. Decision of Hon'ble Delhi High Court in the case of CIT v. N.R. Portfolio (P) Ltd., 42 taxmann.com 339 (Delhi) vii. Decision of Hon'ble Delhi High Court in the case of CIT v. MAF Academy (P) Ltd., 361 ITR 258 (Delhi). 17. He submitted that in view of the aforesaid judgements, such kind of share application with high premium from the companies who do n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... legal requirements were spelt out by the Division bench ruling in Meenakshi Overseas (P) Ltd. (supra), in the following terms: "For the purpose of Section 151 (1) of the Act, what the Court should be satisfied about is that the Additional CIT has recorded his satisfaction "on the reasons recorded by the Assessing Officer that it is a fit case for the issue of such notice", In the present case, the Court is satisfied that by recording in his own writing the words: "Yes, I am satisfied", the mandate of Section 151 (1) of the Act as far as the approval of the Additional CIT was concerned, stood fulfilled. " In the present case, the PCIT recorded, on reassessment proposal on the file of each assessee, that inter alia, the "lifting of veil" over the tripartite "arrangement" between AICC (i.e. INC), AJL and YI to tax the assessee under Section 56(2)(vii) (c)(ii) of the Act, the sum of Rs. 48,93, 64,896/-. The PCIT, after stating this also recorded that "I am satisfied that the AO i.e. ACIT ......has sufficient information in her possession which leads to reasons to believe that the assessee would have income which had escaped assessment which exceeds Rs. 1 lakh ". In view of the rul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... jurisdiction reopen the assessment and proceed for making the assessment reassessment. Thus, this contention of the Ld. Counsel is also rejected. 21. Now coming to the non application of mind on the information report by the DDIT Investigation Wing, we find from the perusal of the 'reasons recorded' that the AO has mentioned the factum of search and seizure action which was conducted by Investigation Wing at the residence and office premises of Shri Surender Kumar Jain and Shri Virender Kumar Jain on 14.9.2010, wherein documentary evidences and material were seized and from the seized documents Investigation Wing had found that these persons were not only the entry operators but were also controlling various companies/entities through which they were providing accommodation entries. From the search a specific annexure was found wherein the name of the companies from where the assessee has received cheque/RTGS amount, name of the bank and reference of the person and amount paid has been mentioned. When specific information was provided by the investigation wing to the AO, then AO has to prima facie satisfy himself, whether the information is relevant to the assessee or not and whet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cept the assessee's evidence/ explanation. On the facts and circumstances of the present case and on perusal of the reasons recorded, we are of the opinion it cannot be held that AO did not have prima facie reason to belief based on report of investigation wing which is very specific entailing the details of the assessee along with annexure bank account, cheque no. etc. If there are such direct and specific reports which have been sent to the AO along with all the annexures, then it cannot be held that AO was not having any material in his possession to entertain prima facie reason to belief. Accordingly, contentions raised by the assessee Ld. Counsel cannot be accepted and none of the judgments relied upon by the Ld. Counsel can be held to be applicable on specific facts of the case. Accordingly the validity of reopening as challenged by the assessee on all counts are dismissed. 22. Now coming to the merits of the additions, we find that assessee has received share application money from 5 companies, namely Pelicon Finance & Lease Ltd., Vogue Leasing & Finance P Ltd., Finage Lease & Finance India Ltd., Karishma Industries Ltd. and S. R. Cable P Ltd. These share application money ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t and credit entries have not been stated or elaborate by him. The AO has not asked or enquired from these companies about the sources of their funds received from other companies. These companies have duly disclosed their sources of funds and application of funds including investments etc. in their balance sheets filed along with the Income Tax Returns. If AO had doubted about the source of funds either in the balance sheet or the source of funds in their bank statement, then he should have specifically asked them u/s 133(6) or could have issued summons u/s 131. If assessee has received share application money, then primary onus is upon the assessee to prove the nature and source of the credit. Here the nature of credit is share application money which is duly backed by share application form and all the statutory compliances associated with issuance of share application money and allotment of shares. The source has been proved by providing the identity and genuineness of the transaction, wherein the assessee has not only filed the confirmations and statutory details of the company and PAN but also the balance sheets, ITRs, bank statement, board resolution, but also the source fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elated to them and neither they have controlled the affairs of the said companies. This averment has not been controverted by the AO. Another thing they have stated that, even before the investigation wing they have not admitted being engaged in the business of providing accommodation entry. Thus, the entire substratum of alleged bogus entry through these persons which led to initiation of reassessment proceedings collapses when they have denied that they have not provided any bogus entry to the assessee company. When the witness of the AO themselves corroborate the stand of the assessee, then it completely dislodges the case of the AO sans any adverse material. Though exact statement has neither been referred in the assessment order nor in the first appellate order, however the statement which has been placed in the paper book, which for sake of ready reference is reproduced hereunder:- Q. No. 1 Please Identify yourself? Ans. I am Surender Kumar Jain s/o Jiwan Mal Jain. I am furnishing my ID proof. Q. No.2 Are you assessed to Income Tax? If so, please give your Income Tax Particulars. Ans. Yes, I am assessed to Income tax vide PAN - AAHPJ8940K with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... accommodation entries have been provided by him? Ans. Sir, as stated earlier we have proves that we are not entry operators. You can record his statement also. Q.No.10 Are you aware that if at any stage it is found that the above statement is wrong/false, you shall be liable to be prosecuted as per the provisions of the IT Act/CPC. Ans. Yes. Q.No.11 Please state the two address viz. as per notice sent as per proof furnished. Both the premises are our own premises. Previously we were residing at 555 Double Story, New Rajinder Nagar and now we are residing at the other address. My Mobile No.9891709895 and 9312206963 Q.No.12 Do you want to say anything else. Ans. No 25. Thus, if the entire premise is based on some earlier statement of Shri Surender Kumar Jain and Shri Virender Kumar before the Investigation Wing or any finding given by them that these two persons were entry providers, but before the AO, if they have been summoned as a witness of the department and these witnesses themselves have denied that they have not provided any accommodation entry to the assessee through any of these entities of companies, then it is very diffi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the AO as well as furnished by the assessee during the course of the assessment proceedings conducted by him. Extraneous information or report from the Investigation wing can form basis for reopening, but when AO is making the assessment then he must scrutinise himself all the documents and carry out his own inquiry. If he makes his own inquiry and nothing adverse has been found, then he cannot make his assessment on borrowed reasoning and rely upon the report of the investigation wing. Thus, on these peculiar facts and circumstances of the case, and in absence of any further inquiry by the AO to dislodge the evidence furnished by the assessee as well as gathered by him u/s 133(6), it would be very difficult to hold that the share application money received by the assessee is either non-genuine or bogus so as to sustain addition under the deeming provision of section 68. Accordingly, same are directed to be deleted. 27. In so far as reliance placed by the Ld. DR on various judgments specifically in the case of PCIT vs. NRA Iron & Steel (P) Ltd. (supra) and decision of Hon'ble Delhi High Court in the case of CIT vs. Nova Promoters; and lastly, decision of CIT vs. N.R. Portfolio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... scussed above. The ratio and principles especially in the cases of section 68 are mostly based on facts and circumstances and the degree of onus discharged by the assessee and the revenue. That is why, from the judgments as relied upon the parties before us, we find that on the issue of share application money and premium on such shares there are catena of judgments which are in favour of the assessee and some are in favour of the revenue. Thus, in such matters what is required to be seen is the onus which has been discharged by the assessee and the material available with the AO to doubt the explanation and the evidences filed by the assessee and also inquiry conducted by the AO to rebut or controvert the explanation of the assessee. Accordingly, we are not dealing with those judgments because, Ld. Counsel has relied upon as many as 65 judgments and it would be very difficult and cumbersome to deal with each and every judgments. ITA NO. 584/DEL/2018 ASSTT. YEAR 2006-07 29. In appeal pertains to penalty proceedings u/s 271(1)(c) against the same quantum of addition of Rs. 55 lacs received by way of share application money. The AO has levied penalty of Rs. 18,51,700/- on account ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ltd. R N Khemka Enterprises P Ltd. UTI CH. No. 006236 27-06-06 17,00,000 Satish & Bhageriy A-58 34 26/06/2006 Vogue Leasing 8t Finance P Ltd. R N Khemka Enterprises P Ltd. UTI CH. No. 046853 27-06-06 18,00,000 Satish & Bhageriy A-58 34 08/11/2006 Sunny Cast & Forge Ltd R N Khemka Enterprises P Ltd. UTI CH. No. 066969 09/11/2006 9,00,000 Satish Goel A-63 3 08/11/2006 Sunny Cast & Forge Ltd R N Khemka Enterprises P Ltd. UTI CH. No. 066970 09/11/2006 6,00,000 Satish Goel A-63 3 08/11/2006 Singhal Securities P Ltd. R N Khemka Enterprises P Ltd. UTI CH. No. 067153 14/11/2006 10,00,000 Satish Goel A-63 3 08/11/2006 Singhal Securities P Ltd. R N Khemka Enterprises P Ltd. UTI CH. No. 067154 14/11/2006 10,00,000 Satish Goel A-63 3 13/11/2006 Parshudh Finance Cpf P Ltd. R N Khemka Enterprises P Ltd. UT» CH. No. 047194 14/11/2006 10,00,000 Satish Goel A-63 5 18/11/2006 Hillridge Investments Ltd. R N Khemka Enterprises P Ltd. UTI CH. No. 080418 18/11/2006 30,00,000 Bhagaria A-63 9 25/11/2006 Hillridge Investments Ltd. R N Khemka Enterprises P Ltd. UTI CH. No. 080433 27/11/2006 63,00,000 Bhagaria Loan A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed on the premise that assessee must have paid commission out of undisclosed sources. Accordingly, the additions made by the AO under section 68 are directed to be deleted. This appeal of the assessee is partly allowed. ITA NO. 6017 DEL 2018 ASSTT. YEAR 2007-08 35. The aforesaid appeal has been filed by the assessee M/s. RMP Holding (P) Ltd. wherein the assessee has raised similar grounds viz. challenging the validity of reopening u/s 147 and addition of Rs. 1,66,65,000/- u/s 68 on account of share application money and addition of Rs. 83,325/- being 0.5% of the alleged accommodation entry. Here in this case also exactly similar reasons have been recorded, wherein following details of the amount received by the assessee from various companies have been mentioned. Bank Book Date From To (Seneflfcsary) Bank Cheque/RTGS Ovetftise Tihiotawgfe m. Pg. no ; 09/05/2006 Karishma Industries ltd. RMP Holdings P Ltd. Kotak V Ch. No. 000457 Ifl W?8(c)S 15,00,000 Satlsfo toan 12 09/05/2006 World Link Telecom Ltd. RMP Holdings P Ltd. Kotalc Ch. No. 000097 10/05/2006 15,(00.000 Sat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No 22-01-08 FIN ACE LEASE & FINANCE INDIA LTD R N KHEMKA ENTERPRISES P LTD BOI CH. NO. 107550 22-01-08 40,00,000' ''BHAGRI A JI (LOAN) A-89 26 07-02-08 SINGHAL SECURITIES P LTD. R N KHEMKA ENTERPRISES ' UTI CH. NO. 102584 07-02-08 10,00,000 VIMAL BHAGA A-94 9 12-02-08 FIN AGE LEASE & FINANCE INDIA LTD. R N KHEMKA ENTERPRISES AXIS * CH. NO. 102359 12-02-08 10,00,000 VIMAL BHAGA A-94 15 12-02-08 VIRGIN CAPITAL SERVICES P LTD R IV KHEMKA ENTERPRISES AXIS CH. NO. 094550 12-02-08 20,00,000 VIMAL s-BHAGA RIYA A-94 31 08-03-08 ZENITH AUTOMOTIVE P LTD R N KHEMKA ENTERPRISES AXIS CH. NO. 098120 08-03-08 9,00,000 BHAGA RIA A-95 11 08-03-08 VICTORY SOFTWARE P LTD R N KHEMKA ENTERPRISES AXIS CH. NO. 094439 08-03-08 8,00,000 BHAGA RIA A-95 11 12.02.08 Vergin Capital Services Pvt. Ltd. RN KHEMKA ENTERPRISES AXIS Ch. NO. 102420 12.02.08 10,00,000 VIMAL BHAGRI A-94 15 38. Here again in the impugned assessment order by and large facts remain the same, as the Ld. AO without rebutting any of the evidences filed and also replies and evidences received from the parties in re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ious seized annexure found during the course of search and has categorically stated that there is a mention of the assessee having taken cheques from various parties/concerns aggregating to Rs. 8,15,00,000/- in the case of R N Khemka Enterprises; and Rs. 5,10,00,000/- in the case of RMP Holding Pvt. Ltd. During the course of assessment proceedings assessee has furnished all the relevant details as filed in the earlier years, i.e., confirmations, copy of balance sheet, auditor's report, profit and loss account, income tax returns, bank statement, board resolution etc. Ld. AO on the perusal of these documents has noted following facts, which were not there in the earlier years as discussed above:- "These documents were examined and it has been noticed that none of the documents e.g. balance-sheet. Auditors report etc filed in respect of above said parties bear the contact number(s} and rubber stamp of the company issuing the name & stamps of its directors who signed these documents which proves that these documents are nothing but an attempt made by the assessee to divert the facts of the case. Further these copies show similar types of signatures appended in it and names of direct ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h the existence of these parties could not be proved either by these parties or by the assessee." 43. Since, none of the parties ever responded, therefore, he inferred that the genuineness and creditworthiness could not be proved. The said observation and the finding of the AO has also been confirmed by the Ld. CIT(A) on the same reasoning as given in the earlier years. Before us, Ld. Counsel submitted that the AO at no stage had confronted to the assessee that notices u/s 133(6) have been remained un-complied with and if the same would have been confronted, then assessee would have provided the correct addresses or further details or information regarding these companies. Simply because notices could not be complied with that does not mean that all the documents furnished by the assessee in support of identity, genuineness of the transaction and creditworthiness are to be discarded. He again referred and relied upon series of judgments that if assessee has discharged the onus found then no addition u/s 68 can be made without there being any adverse material on this regard. 44 On the other hand Ld. DR submitted that the very fact that these parties have not responded to the notic ..... X X X X Extracts X X X X X X X X Extracts X X X X
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