TMI Blog2017 (1) TMI 1732X X X X Extracts X X X X X X X X Extracts X X X X ..... - Decided in favour of assessee. - ITA No. 849/CHD/2011 - - - Dated:- 5-1-2017 - Shri Bhavnesh Saini, Judicial Member And Ms. Annapurna Gupta, Accountant Member Appellant By: Sh. Tej Mohan Singh Respondent By: Sh. Ravi Sarangal (CIT DR) And Sh. S.K. Mittal, DR ORDER Bhavnesh Saini, JM This appeal by the assessee has been directed against the order of Ld. CIT(A), Panchkula dated 11.07.2011 for assessment year 2008-09 on the following grounds: 1. That the Ld. Commissioner of Income Tax (Appeals) has erred in law as well as on facts in upholding the reopening of the assessment by issuance of notice under section 148 of the Act which is illegal, arbitrary unjustified. 2. That there was no reason to believe warranting invocation of the provisions of section 147 148 of the Act and as such the re-assessment framed is illegal, arbitrary unjustified. 3. That the re-assessment has been framed and upheld by the Commissioner of Income Tax (Appeals) without considering and disposing of the objections raised against the reasons recorded and as such the order passed is illegal, arbitrary unjustified. 4. That without prejudice to above legal positi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... There is no denial of the fact that assessee's book showed credit from Delhi Companies and this is sufficient reason to believe that income has escaped assessment. Ld. CIT(A) also noted that whether the assessee was regularly filing return would not make any difference to the facts which came to the notice of the Assessing officer from DIT (Inv.) that income had escaped assessment to the extent of ₹ 21 lakhs. The Ld. CIT(A) also noted that Assessing officer has properly recorded the reasons for issuance of notice u/s 148, therefore, this plea of the assessee on this ground were dismissed. 4. During the period under consideration, as per information received from DIT (Inv), the assessee received accommodation entries as under:- S.No. Name of the Company Amount (Rs.) 1 Bhavani Portfolio Pvt. Ltd 5,00,000/- 2 Campri Fical Service (P) Ltd 5,00,000/- 3 DU Securities Pvt Ltd. 6,00,000/- 4 Taurus Iron Steel Co.( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... el for the assessee reiterated the submissions made before the authorities below and submitted that assessee filed return of income for assessment year under appeal in October 2008, copy of acknowledgement is filed at page 1 of the paper book. He has submitted that reasons for reopening the assessment are recorded on 25.3.2010 in which no satisfaction have been recorded by the Assessing officer before issuing the notice u/s 148 of the Act because Assessing officer formed his belief that income chargeable to tax had escaped assessment mainly because assessee was not filing return of income which fact is incorrect. The Assessing officer did not make any inquiry on the report received form Addl. DIT (Inv), New Delhi before issuing notices u/s 148 of the Act. The Assessing officer has not applied his mind before recording reasons for reopening of the assessment. The assessee asked for a copy of statement of Shri Tarun Goel, C.A. which was not supplied to the assessee and no right was given to cross examine his statement. He has referred to various replies filed before the authorities below. The Ld. Counsel for the assessee therefore submitted that Assessing officer did not have any rea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ded by Investigation Wing, Delhi, so the same could not be supplied to the assessee and even no cross- examination could be allowed. The Assessing officer received information from ADIT (Inv), New Delhi vide his letter dated 6/8 t h April 2009 that assessee had received accommodation entries from the above share holders. Therefore, Assessing officer was having reasons to believe that income chargeable to tax have escaped assessment. The Ld. DR placed on record copy of letter dated 6/8 t h April 2009 of ADIT (Inv), New Delhi. The Ld. DR also placed on record the copy of statement of Shri Taurn Goel recorded by Investigation Wing at Delhi on 15.9.2008. The Ld. DR also filed copy of the reasons recorded for reopening of the assessment dated 25.3.2010. The Ld. DR therefore, submitted that Assessing officer was having reasons to believe that income chargeable to tax had escaped assessment. The Ld. DR further submitted that assessee failed to prove the identity of the share holders their creditworthiness and genuineness of the transactions. Therefore, onus u/s 68 of the Act has not been discharged by the assessee. The Ld. DR relied upon the decision of the Hon'ble Delhi High Court in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng all the documents, bank cheques and also for transporting and exchanging cash and cheques in order to provide accommodation entries. c. At the time of serch on15/9/2008 Tarun Goyal was recorded on oath. As per his statement, he has accepted that he provides accommodation entries and his various companies are used for this purpose. Sh. Tarun Goyal has also described the modus operandi for providing accommodation entries. d. At the time of search on 15/9/2008, the statement on oath of the employees present at the premises of Sh. Tarun Goyal were recorded. These include Sh. Pramod Kunar, his peon; Sh. Harpreet Singh, Accountant. In their statements they stated that they were mere employees of Sh. Tarun Goyal and they were signing various documents related to many companies at his behest, as and when asked by Sh. Tarwi Goyal. e. Later, more employees were traced namely, Ms. Usha and Ms. Ritu Saxena, former receptionists. In their statements recorded on oath, they have started that various bank accounts were opened in their names by Sh, Tarun Goyal, who himself operated these accounts and deposited cash in them. As such, they could not refuse the same as they were mere emplo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n accommodation entry of ₹ 21,00,000/- from three bogus companies run by Sh. Tarun Goyal. The PAN of the company is AABCJ4419N and the details of the registered office of the company was obtained from the website of Registrar of Company and following details were obtained : 1. Date of incorporation is 07-07-2004 2. The Registered office address is H. No, 1456 Sector-4, Panchkula, On perusal of records of this office, it is seen that the assessee has not filed their returns of income for any of the assessment years since the date of incorporation. Therefore, it is evident that the assessee is non-filer and as such the income has escaped assessment within the meaning of explanation (ii) (a) of section 147 of the Income tax Act. Moreover, in the light of above mentioned facts, it is clear that the assessee has taken accommodation entries of Rs. .21.00 lacs in the assessment year 2008-09. In the light of the above .recorded reasons. I have reason to believe that income of more than ₹ 21.00 lacs has escaped assessment for the A.Y. 2008-09 in the case of the assessee. 11. The Ld. DR relied upon copy of the letter of the Addl. DIT (Inv.) New Delhi dated 6/8 April, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny document except list of beneficiaries which could not be regarded as a material or evidence that prima facie showed or established nexus or link which disclosed escapement of income. The letters dated 6/8th April, 2009 may not pointer to escapement of any income particularly when in the statement of Shri Tarun Goel recorded by Investigating Wing and letter of ADIT (Inv.), New Delhi did not name the assessee for receiving any bogus accommodation entry. 13. The Assessing officer formed his belief that income chargeable to tax had escaped assessment because assessee did not file return of income. It is, therefore, apparent that fact of non-filling of return of income for assessment year under appeal had prompted the Assessing officer for arriving at the conclusion about escapement of income. However, the material on record showed that the assessee filed original return of income for assessment year under appeal in October 2008, copy of acknowledgement is filed at page 1 of the paper book and is also not disputed by the Ld. DR. The Assessing officer, therefore, recorded incorrect, irrelevant and non- existing reasons u/s 148 of the I.T. Act. The reasons, therefore, are vitiated a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome chargeable to tax had escaped income. The Assessing Officer had to act on the basis of reasons to believe and not on reasons to suspect . The Tribunal rightly concluded that the Assessing Officer had failed to incorporate the material and his satisfaction for reopening the assessment and therefore the issuance of notice under section 148 of the Act for reassessment proceedings was not valid. 13.3 The Hon'ble Delhi High Court in the case of CIT Vs. Sfil Stock Broking Limited [2010] 325 ITR 285 (Delhi) held as under:- Held, dismissing the appeal, that the first sentence of the reasons recorded by the Assessing Officer was mere information received from the Deputy Director of Income-tax (Investigation). The second sentence was a direction given by the same Deputy Director of Income-tax (Investigation) to issue a notice under section 148 and the third sentence again comprised a direction given by the Additional Commissioner of Income-tax to initiate proceedings under section 148 in respect of cases pertaining to the relevant ward. The Assessing Officer referred to the information and the two directions as reasons on the basis of which he was proceeding to issue not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .5 The Hon'ble Delhi High Court in the case of Signature Hotels P. Ltd. Vs. ITO and Another [2011] 338 ITR 51(Delhi) held as under:- Held, allowing the petition, that the reassessment proceedings were initiated on the basis of information received from the Director of Income- tax (Investigation) that the petitioner had introduced money amounting to ₹ 5 lakhs during financial year 2002-03 as stated in the annexure. According to the information, the amount received from a company, S, was nothing but an accommodation entry and the assessee was the beneficiary. The reasons did not satisfy the requirements of section 147 of the Act. There was no reference to any document or statement, except the annexure. The annexure could not be regarded as a material or evidence that prima facie showed or established nexus or link which disclosed escapement of income. The annexure was not a pointer and did not indicate escapement of income. Further, the Assessing Officer did not apply his own mind to the information and examine the basis and material of the information. There was no dispute that the company, S, had a paid-up capital of ₹ 90 lakhs and was incorporated on January 4, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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