TMI Blog2021 (10) TMI 555X X X X Extracts X X X X X X X X Extracts X X X X ..... rected against the separate orders dated 28.12.2018 14.11.2018 passed by the Ld. CIT(A)-2 9, Ahmedabad arising out of the separate orders dated 22.12.2017 07.11.2017 passed by the ITO, Ward-2(1)(2) 3(1)(3), Ahmedabad under Section 143(3) r.w.s. 147 of the Income Tax Act, 1961 (hereinafter referred as to the Act ) for the Assessment Year (A.Y.) 2010-11 2012-13. ITA No. 112/Ahd/2019(A.Y. 2010-11):- 2. On the basis of certain information received from DGIT (Investigation), Mumbai that search under Section 132 of the Act was conducted in the case of one Praveen Kumar Jain on 01.10.2013 incriminating material whereof were seized and on the basis of the statement recorded during search of Shri Praveen Kumar Jain where he has accepted that he has engaged in providing accommodation entries of bogus unsecured loans bogus share application/capital etc. wherein the assessee was also found to be one of these beneficiaries who has taken accommodation entries by way of share application money to the tune of ₹ 20 lakh during F.Y. 2009-10 relevant to A.Y. 2010-11 from the bogus companies operated by Shri Praveen Kumar Jain reopening of assessment of the assessee company ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d Trading Co P Ltd.) AACCR4512K 5,00,000/- Triangular Infocom Ltd. (Lexus Infotech Ltd.) AAACK6149D 5,00,000/- Total 20,00,000/- Thus, the introducers of the share application money are found to be bogus by investigation wing. It is also seen (as tabulated below) from the returns of income (ROI) of assessee company that in preceding and following assessment years, the assessee does not have profits to warrant such large amount of share application money. A.Y. Date of ROI filed ROI (In Rs.) 2007-08 26.10.2007 0 2008-09 26.09.2008 0 2009-10 27.09.2009 1225/- 2011-12 07.09.2011 12597/- 2012-13 25.09.2012 26S92/- In view of the above facts, I have reason to bel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... capital and provided bogus entries to the assessee company Kansal Steels Pvt. Ltd.; no such statement has been provided to us In which he has confessed that he has provided bogus entry to Kansal Steels Private Limited through any of shareholder companies. m) That the assessee company had obtained the said share applications through their directors and on enquiry about the above referred fact the directors of the said companies revealed that they are not connected in any way with any Praveen Kumar Jain and as a curiosity and on enquiry the assessee company could know the fact that the said Praveen Kumar Jain has retracted his statement as alleged if any given by him vide his affidavit dated 15th day of May, 2014 for the reasons stated in the said affidavit, the assessee company made efforts to obtain the said affidavit and submitted to you by our letter dated 17 J 1.2017, therefore the statement of Praveen Kumar Jain, if any given by him but copy has not been provided to us, is Null and Void and does not have any value in the eyes of law and no addition can be made only on the basis of any such vague statements or finding thereon, if any. n) That the assessee company most ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... notice to assessee for reassessment holding that AO had reason to belief that income had escaped assessment-AO initiated reassessment proceedings u/s. 147/148-CIT(A) upheld order of AO-Tribunal held that requisite sanction had not been obtained by AO from Competent Authority under Section 151 and, therefore, invalidated re-opening, of assessment under Section 147/148- Revenue's appeal against said order of ITAT was allowed by Court-ITAT held that AO had not applied his mind at time of initiating proceedings of reassessment under Section 147-Tribunal quashed assessment proceedings under Section 147/148-Held, as rightly pointed out by ITAT, 'reasons to believe' were not in fact reasons but only conclusions, one after other-Expression 'accommodation entry' was used to describe information set out without explaining basis for arriving at such conclusion-Statement that said entry was given to Assessee on his paying unaccounted cash was another conclusion basis for which was not disclosed-Thus, crucial link between information made available to AO and formation of belief was absent-Court was not inclined to interfere in above circumstances in exercise of its writ j ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot be concluded that requirements of section 147 were satisfied - Held, yes - Whether, therefore, impugned reassessment proceedings deserved to be set aside - Held, yes [Para 13] [In favour of assessee] 8. Ld. A.R. also cited an order of Co-ordinate Bench in the matter of Shantaben Parasmal Jain in ITA No. 726/Ahd/2017 wherein similar circumstances, relief was granted by the ITAT with following observation: 14. The entire assessment is based upon the statement of Shri Mukesh Choksi. It is an undisputed fact that neither a copy of the statement was supplied to the assessee. nor any opportunity of cross-examination was given by the Assessing Officer/CIT(A). The Hon'ble Supreme Court in the case of Andaman Timber Industries in Civil Appeal No. 4228 of 2006 was seized with the following action of the Tribunal:- 6. The plea of no cross examination granted to the various dealers would not help the appellant case since the examination of the dealers would not bring out any material which would not be in the possession of the appellant themselves to explain as to why their ex factory prices remain static. Since we are not upholding and applying the ex factory prices, as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xamination and make the remarks as mentioned above. We may also point out that on an earlier occasion when the matter came before this Court in Civil Appeal No. 2216 of 2000, order dated 17.03.2005 was passed remitting the case back to the Tribunal with the directions to decide the appeal on merits giving its reasons for accepting or rejecting the submissions. In view the above, we are of the opinion that if the testimony of these two witnesses is discredited, there was no material with the Department on the basis of which it could justify its action, as the statement of the aforesaid two witnesses was the only basis of issuing the Show Cause We, thus, set aside the impugned order as passed In the Tribunal and allow this appeal. 9. Since statement of Shri P.K. Jain was not supplied to the assessee on the basis of addition was made and in the absence of said statement assessee could not cross examine to Shri P.K. Jain and same is amount to miscarriage of justice despite of the fact that assessee made a formal request to the lower authorities. In our considered opinion and after considering the aforesaid judgment, no addition can be made on the basis of which violate principle ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
