9911796707
TMI Blog2021 (10) TMI 448X X X X Extracts X X X X X X X X Extracts X X X X ..... d on 23.09.2013 and served upon the assessee. Due to change in incumbent, notice u/s 143(2) of the I.T. Act was issued on 30.09.2013. Further, notice u/s 142(1) of the I.T. Act along with detailed questionnaire was issued on 11.12.2013. In pursuant to restructuring the Central Circle -16 is restructured as Central Circle-20 vide order No. of The Chief Commissioner of Income Tax (Central), New Delhi vide F.No.33/CCIT(C)/T & P/14-15/4059 dated 15.11.2014, for the same notice u/s. 143(2) was issued on 11.11.2014 along with intimation regarding change in jurisdiction was sent to the assessee. 2. In response to the statutory notices Shri Atul Khandelwal, CA & AR of the assessee attended the assessment proceedings, filed power of attorney and furnished necessary details, in formation & documents called for from time to time. 3. A survey operation u/s 133A of the Income Tax Act were conducted at following premises of the Varrenyam Securities Pvt. Ltd. on 17.10.2012: S.No. Address Name of the Entity 1. 2442, 1s t floor, Gail No. 10, Karol Bagh, New Delhi - 110005 VARRENYAM SECURITY PVT. LTD. (Registered Office) and also office of M/s A.Khandelwal & Co. 2. A. Khandelwal and Comp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... FC P3066R 25000 10 990 181000 11. Rising Portfolio India Pvt. Ltd. B-62/11, Second Floor, Naraina Industrial Area, Delhi AAACR1677D 27000 10 990 270000 12. Veritable Township Pvt. Ltd. 8-62/11, Second Floor, Naraina Industrial Area, Delhi AADCV5115H 250000 10 990 2500000 13. VS Import Pvt. Ltd. 2262/2, 3rd floor Mandir West Patel Nagar, Delhi AACCV5762B 17000 10 990 170000 Total 250000 4. During the course of search operation and post search proceedings statement of Himanshu verma was taken on oath, in his statement Himanshu Verma has accepted that all the above mentioned entities are manage and controlled by him. Books of accounts of a number of entities included in the list mentioned above, bank statements etc. were found in his laptop. After going through the bank accounts of the entities manage and controlled by Himanshu verma it is also revealed that the transactions in all the bank accounts are interlinked. Himanshu Verma used bank accounts of the abovementioned entities to deposit cash received from the beneficiaries and for the routing of transaction of the cash and cheque among the above ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity of the beneficiary group in the shape of share capital and loans. (c) Money received from the entities against sale/purchase. Shri Verma was also providing accommodative purchase entries to some of the beneficiaries. In this mode, he used to issue sale bills from some of partnership firms managed and controlled by him. These bills were mostly of clothes and fabrics. In actually, no goods used to be actually delivered against those bills. The beneficiary party used to make payment through cheque or RTGS. Either this amount was used to be withdrawn immediately or this amount was routed through a number of other entities of Himanshu Verma. In this was ultimately cash was given back to the beneficiary party. 5(2) Statement of Himanshu Verma was taken on oath not only during the search operation but also during the post search proceedings. In his statement during the search operation and during the post search proceedings, he admitted that he was doing business of providing accommodation entries in the shape of share capital, unsecured loans, bogus sale and purchase etc. In the statement taken on oath on 14/4/2012, he clearly stated the modusoperandi of his business of prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d 29/3/2012 of Himanshu Verma is reproduced as under: Q.10 Please state how the beneficiary company / entity / firm / person approaches you getting accommodation entries? Ans. Whenever any company/concern who wish to take accommodation entries from us approaches us through various C.A. operating In this field. We receive cash from them and give them entries through cheque from any of our controlled company. We receive commission in the range of 0.75% to 1.50%. Q.12 Please state how the commission was charged by you for providing accommodation entry and how this commission is received by you? Ans. The commission is charged at the rate which I have already stated in my statement. The commission is charged quarterly or six monthly on all the accommodation entries provided through the particular C.A./middleman in the shape of share capital and after a year on the accommodation entries provided in the shape of unsecured loan. Commission is received always in cash. 6. The CIT(A)-XXVII vide Appeal No.152/14-15 CIT(A)- XXVII/2014-15 dated 26.12.2014 in the case of Himanshu Verma for the A.Y.2012-13 as per para 16 has that: "16. I have gone through the assessment order and writt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... delivered by the concerned middleman a day before the issue of accommodation entry cheque in the name of the beneficiary person by me. The cash was delivered personally by the concerned CA/middleman in our office. After receiving the cash we issue cheques of the same amount from any one of our fifteen to twenty company which are managed and controlled by us for providing accommodation entries. The cheques are delivered to the same CA/middleman who brings the cash. Sometimes instead of issuing the cheques funds are transferred through TRGS from all account of any one of 15-20 companies. The cheques provided to the beneficiaries are kept with us and these are the blank signed cheques duly signed by the Authorized signatory/Director of the relevant company and we only used to fill die name of the beneficiary amount and the date as and when the cheque is used to the namely beneficiary." 8. The above statement clearly indicts Sh. Atul Khandelwal, CA who has played the role of a middleman for arranging accommodation entries in the shape of share premium to the tune of Rs. 24 crore during F.Y.2011-12 from various companies owned and controlled by Sh. Himanshu Verma in lieu of commissio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns issued by this office, but when his statement was finally recorded by holding camp office at his residence, certain explicit assertions were made by Sh. Munjal concerning the role of Mr. Atul Khandelwal, which brings to bear many intriguing issues. Relevant portions of the statement of Shri Munjal recorded u/s 131(1A) on 2nd February, 2013 are reproduced herein as under:- Q8. Kindly explain the name of the companies to whom your company lends money on interest. In lieu of the loans so granted what securities are obtained or pledged with the company and in this regard furnish details of any agreement entered into with the borrowers and documentary evidences if any. Ans. Shri Atul Khandelwal does all the work of money lending with the respective owing companies on behalf of M/s Varrenyam Securities Pvt. Ltd. and he has details of all such borrowers companies. I have no knowledge about the companies/persons who are taking loans on interest from my company and everything in this regard is in the knowledge of Sh. Atul Khandelwal only. I have no knowledge of the securities pledged with my company in lieu of the loans so granted and the same is again being booked after by Mr. A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Proprietor of M/s A. Khandelwal & Co. During the course of inspection u/s 133A of the IT Act, 1961 at the premise, it was found that no semblance of an office activities of the company was available or could be found at the address as furnished to the Ministry of Corporate Affairs. Statutory documents which are mandated to be kept and maintinaed at the registered office of any company as per the Companies Act, 1965 could not be located. (vii) On the contrary it was learnt that Sit. Atul Khandelwal, CA had taken the premises bearing No. 10/2442 on lease and had sublet it to M/s Varrtenyam Securities Pvt. Ltd. No signboard indicating the existence of any company or dedicated cabins pertaining to various functional domains co address. 12. The share premium of Rs. 24.75 cr. so received by the caption M/s Varrenyam ies Pvt. Ltd. company from dubious companies owned and operated by Shri Himanshu Verma, was included in the total sum ofRs. 26 Cr. which was advanced as loan Sidhvandan Enterprises Pvt. Ltd. and therefore in this regard, the statement of Shri Ganesh Gupta, key person looking after the day to day a ffairs of M/s Sidhvandan Enteiprises Pvt. Ltd. was recorded on oath u/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as incorporated on 20.4.2011 and within a week of incorporation, the company has lend Rs. 26.85 cr. To M/s Sidhvandnn Enterprises Pvt. Ltd. In light of this please explain as to how is this transaction possible and secondly whether your company has done due diligence to ascertain the credit worthiness of the lending company. Please explain? Ans. It was not in our knowledge that when Varrenyam was formed and incorporated in ROC and how they have arranged the funds to Sidhvandan. We never fry to ascertain to know the credit worthiness of M/s Varrenyam Securities Pvt. Ltd. Q.19. During a survey action conducted at the premises of M/s Varrenyam Securities Pvt. Ltd. on 17.10.2012, it was noticed that said company was set up only with the object of raising funds from bogus companies controlled and managed by Shri Himanshu Verma with the active collusion of Shri Atul Khandelwal, CA and in turn the money so received barely within 10 days of incorporation was transmitted to your company. In light of these facts, why it will not be presumed that M/s Varrenyam Securities Pvt. Ltd. has been establish at the behest of your company only to enable the infusion of unaccounted/black money gener ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enied that they received cheques from these persons. The modus operand in such cases is well known. In the face of this information, a heavy burden lay on the appellant to prove that the credits were genuine. The onus had clearly shifted to the appellant. It is incorrect to say that the burden was on the A.O. to prove that these credits were unexplained. In such matters, the A.O. cannot be asked to prove the impossible and the addition is to be tested on the anvil of 'preponderance of probabilities, and not of 'beyond reasonable doubt'. The information received as a result of inquiries by the Income-Tax Department, the surrounding circumstances and the appellant's failure to discharge their burden of proof, shows that the credits were bogus accommodation entries. The assessee is still required to prove the identity and capacity of the creditors and the genuineness of the transactions. Considering the facts, the appellant has clearly failed to discharge his onus of proof. 17. In view of above fads a reasonable inference can be drawn that M/s Sidhvandan Enterprises Pvt. Ltd. wanted the introduction of its own unaccounted money in the books of accounts under the guis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itimately to provide business loans to its borrowers through banking channel and such loans were duly repaid by the appellant's borrowers through banking channels. The assessee has also received interest and shown the interest in their return of income and also claimed business expenses against that income which was duly assessed by the Assessing Officer. 7. From the order of the Co-ordinate Bench of the ITAT in the case of DCIT Vs. M/s Sidhvandan Enterprises Pvt. Ltd. in ITA No. 1177/Del/2016 vide order dated 12.12.2019, we find that the addition made in the hands of M/s Sidhvandan Enterprises Pvt. Ltd. of the same amount has been deleted after considering the fact that the appeal of the assessee has been dismissed by the Tribunal after considering the fact that M/s Sidhvandan Enterprises Pvt. Ltd. has received loan from the assessee and the loan repayment has been made leading to an indisputable conclusion that the amount originally belongs to the assessee. 8. The ITAT has also observed that the appeal of the assessee was dismissed whereas at this juncture, it is due to default of the assessee in hearing which has been recalled subsequently and being adjudicated now. 9. For th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e impugned order passed by the Ld. CIT(A) and stated that Ld. CIT(A) has passed well reasoned order which does not need any interference. In support of his contention, he also filed two paper books i.e. Paper Book-I containing pages 1-54 in which the assessee has attached the documents of M/s Varrenyam Securities Pvt. Ltd. Rs. 26,85,00,000/- i.e. copy of assessment order AY 2012-13 (assessed at Rs. 25,11,04,450/-); copy of audited financial statement; copy of PAN card; copy of bank account statement; certified ledger a/c of Varrenyam in books of assessee; incorporation certificate; ITR Ack. - AY 2012-13 (income declared 1.33 Cr.); submission dated 7.9.2015 to CIT(A) and ITAT order of M/s Varrenyam Securities Pvt. Ltd. and in another Paper Book-II which contained pages 1-108 attaching therewith Paper Book-I filed on 29.3.2019; CIT(A)'s order of Varrenyam Securities Pvt. Ltd AY 2012- 13; documents showing Varrenyam filed recovery suit no.CS620958.16 on assessee for recovery of outstanding amount - s till pending; ledger account of assessee in books of Varrenyam 1.4.11 to 31.8.16 and Audited Financial Statements of 'A' -AY 12-13. Ld. Counsel for the assessee stated that the addition o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enyam and then again in the hands of assessee will tantamount to double addition of the same amt. Reg. bal. amt. of Rs. 2.07 Cr. (26.85 - 24.78), the A.O. of Varrenyam has not doubted the source in the hands of Varrenyam to the extent of Rs. 2.0 Cr. therefore he has not made any addition in the hands of Varrenyam u/s.68 (1-18, RP-18) Even in the asstt. of assessee, the A.O. has doubted for only those receipts which have been reed. by Varrenyam from 13 companies operated by Himanshu Verma i.e. totaling Rs. 24.78 Cr. and not for bal. Rs. 2.07 Cr. Hence, there is actually no cogent reason assigned in the impugned asstt. for making addition to the extent of bal. Rs. 2.07 Cr. Thus, the complete addition of Rs. 26.85 Cr. is unjustified TWO - On further merits The assessee did not take share capital 1 premium but loan of Rs. 26.85 Cr. (40-43) It was intt. bearing loan @9% wherein the following intt. has been paid by assessee which has been allowed to assessee as a deduction after deduction of TDS A.Y. Interest paid and allowed TDS deducted and deposited Pg.No. of P/B 2012-13 2,17,42,274/- 21,74,227/- 87 2013-14 83,34,376/- 8,33,438/- 87 2014-15 6,00,075/- 60,0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ily - On appeal, CIT (A) was satisfied with respect to genuineness of transaction and creditworthiness of 'lA' and, therefore deleted addition.- It was found that total loan of Rs. 1.60 crores was advanced to assessee, out of which Rs. 15 lakhs was repaid to 'lA' -0 Balance loan amount was repaid by assessee in immediately next financial year - Whether when Deptt. had accepted same, addition made by AO was to be deleted - Held yes. For - source of the source can be asked only from A.Y.13-14 and that too in case of share capital PCIT Vs. VEDHATA TOWER (P) LTD. (Bombay High court order dtd. 17.04.18, ITA No. 819 of 2015) CIT Vs. Gagandeep In frastructure (P) Ltd. 394 ITR 680 (Born.) Held that - Sec. 68 is not applicable in case assessee is not able to explain source of the source. Further, held that the proviso to section 68 has been introduced by the Finance Act, 2012 with effect from 1-4-2013. Thus, it would be effective only from the assessment year 2013-14 onwards. ACIT VS. PREM ANAND (ITA NO. 3514 / D / 2014) (DELHI ITAT ORDER DTD. 13.04.2017) "7.1. It is a settled law that the assessee is not answerable to explain source of source of the fund. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of Rs. 26.85 crores clearly is a case of Double Taxation as it has been taxed in the hands of M/s Varrenyam Securities Private Limited as well as the assessee. As stated by the Ld. Counsel for the assessee that the add it ion of Rs. 24.78 Crore has been finally made in the hands of M/s Verrenyam Securities Pvt. Ltd. by the AO. The Ld. CIT(A) sustained the addition and ITAT has upheld the action of the Ld. CIT(A) by dismissing the appeal of the assessee and no further appeal has been filed against the order of the ITAT, therefore, it has become final. Keeping in view of the facts and circumstances of the present case, we are of the view that add it ion of Rs. 26.85 Crores was rightly deleted by the Ld. CIT(A), which does not need any interference on our part, hence, we uphold the act ion of the Ld. CIT(A) and reject the grounds raised by the Revenue. The judicial Decisions relied upon by the representatives of both the sides have been duly considered. In our considered view, we do not find any parity in the facts of the decisions relied upon with the peculiar facts of the case in hand." 10. From the above order of the Co-ordinate Bench, we find that the Tribunal while dis ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
