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TMI Blog2019 (1) TMI 1877X X X X Extracts X X X X X X X X Extracts X X X X ..... consideration. On examining the said information vis-a-vis the record of the assessee and after due application of mind, the reasons were recorded by the Assessing Officer for initiating proceedings u/s.147/148 of the Income Tax Act. The notice was served upon assessee on 30th March, 2016. The assessee filed a reply that original return filed u/s.139(1) may be treated as return having filed in response to the notice u/s.148 of the IT Act. The assessee filed objections to the issue of notice u/s.148 of the IT Act which was disposed of by the Assessing Officer. The main gist of the reason for objection was that in assessment year 2004-05 and 2005-06 notices u/s.148 were issued on the same information given by the Investigation Wing and after verification returned income was accepted vide order passed u/s.143(3)/147 of the IT Act. M/s. Tauraus Iron and Steel Company Pvt. Ltd. has invested an amount of Rs. 18,00,000/- in the share capital of assessee company which are duly reflected in their balance sheet and no cash was found deposited in their accounts before subscription to the shares of assessee company. The assessee company has sold the goods so purchased from M/s. Maa Durga Tradi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fore the authorities below. He has referred to Paper Book 15 which is reasons recorded for reopening of the assessment and submitted that Mr. Tarun Goyal did not name the assessee in his statement for receiving any accommodation entry, copy of statement recorded by Investigation Wing on 15th September, 2008 is filed in the paper book. He too referred to the balance-sheet of the investor company in the paper book and also submitted that confirmation was filed by the investor company. Copy of the bank statement is filed in the paper book to show that no cash was deposited in their account before making investment in assessee's company. He has submitted that the same investor company M/s. Tauraus Iron and Steel Co. Pvt. Ltd. was referred to in the case of M/s. A.P. Refinery Pvt. Ltd. vs. Additional Commissioner of Income Tax, reported in 45 ITR (Trib.) 724 (Chandigarh) in which the reopening of the assessment was quashed as well as the addition on merit have been deleted. He, therefore, submitted that issue is covered in favour of the assessee by above decision of the Tribunal. 6. On the other hand, learned DR strongly relied upon the orders of the authorities below and submitted tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rom M/s Tauraus Iron & Steel Company Pvt. Ltd run and controlled indirectly by Sh. Tarun Goyal through his office at 13/34, WEA, Arya Samaj Road, Karol Bagh, New Delhi-110005. To verify this transaction notice u/s 133(6) of the I.T. Act, 1961 with the prior approval of Pr. CIT-3, New Delhi was issued to M/s Esha Strips Pvt Ltd. In response to the notice the assessee has filed reply on 23.03.2016 and the assessee has submitted the ledger account of M/s Tauras Iron & Steel Company for the period 01.04.2008 to 31.03.2009 and bank account statement of M/s Esha Strips Pvt Ltd. In the ledger account of M/s Tauras Iron & Steel Company the assessee has shown share application money of Rs. 6,00,000/- whereas in the bank account statement the account of the assessee has been credited by Rs. 18,00,000/-. (two entries of Rs. 9,00,000 each on 17.04.2008). Another letter was received from Assistant Director of Income Tax(lnv.)-ll, New CGO Complex, N.H.IV, Faridabad, Haryana through Income Tax Officer, Ward 8(4), New Delhi on 02.03.2016 having information regarding accommodation entries of bogus purchase through bills without any delivery of goods by Shri Vinod Goyal proprietor of M/s Maa Durga ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ew Delhi 28.03.2016" 7.1 The above reasons for reopening of the assessment are based on statement of Shri Tarun Goyal recorded by the Investigation Wing on 15th September, 2008 in which he has accepted on oath that he has provided accommodation entries and cash were deposited in various companies which were rotated and used to provide the accommodation entries to other beneficiary companies. The assessee was found one of the beneficiary companies which took accommodation entries of Rs. 18 lac in assessment year under appeal from M/s. Tauraus Iron and Steel Co. Pvt. Ltd. run and controlled indirectly by Shri Tarun Goyal. The ld. counsel for the assessee referred to statement of Shri Tarun Goyal, referred to in the reasons copy of which is filed in the paper book. Ld. counsel for the assessee rightly contended that name of the assessee company has nowhere been mentioned to whom alleged accommodation entries have been provided by the same person. Ld. counsel for the assessee also referred to page 49 of the Paper Book which is bank statement of the investor company M/s. Tauraus Iron and Steel Co. Pvt. Ltd. to show that the assessee has been credited of Rs. 18 lac by the said compan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssion, we set aside the orders of the authorities below and quash the reassessment proceedings under section 148 of the Income Tax Act, resultantly, all additions made therein stand deleted." 7.2 It may be also noted here that the Assessing Officer in the reasons for reopening of the assessment has also mentioned above information regarding accommodation entries of bogus purchases through bills without any delivery of goods by M/s. Maa Durga Trading Company. However, in the assessment order no such addition have been made by the Assessing Officer, because nothing adverse was found against the assessee. Payment for purchase could not be regarded escaped income u/s.148 of IT Act. 7.3 Considering the facts and circumstances of the case, it is clear that the Assessing Officer without verifying an information against the assessee merely acted on suspicion against assessee. The Assessing Officer without application of mind recorded the reasons for reopening of assessment. No specific material has been brought on record to justify reopening of the assessment, therefore, Assessing Officer has not validly assumed jurisdiction u/s.148 of the IT Act for reopening of the assessment in the m ..... X X X X Extracts X X X X X X X X Extracts X X X X
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