TMI Blog2022 (5) TMI 1054X X X X Extracts X X X X X X X X Extracts X X X X ..... arned CIT(A) on 1/2/2017, however, date of the order of the learned CIT(A) is 16th November, 2016 where the date of the order mentioned in form no. 36 is 16th November, 2018, apparently, there may be some typographical error on the part of the learned CIT(A) in mentioning those dates. In this type of transactions, multiple economic offence laws are triggered. In some of such laws Ld. Assessing Officer himself is authority to initiate/or inform to respective authorities. and in some of the case those may be referred to the respective authorities. It is the bounden duty of the authorities to take the issues to its logical conclusion. We are surprised that bankers were oblivion to the facts about suspicious transactions carried out in the bank account. On examination of bank account, Ld. DDIT, LD AO and LD CIT(A) also remained passive. Therefore, we are of the opinion that such transactions need to be probed further to curb such a malpractice. We set aside all these appeals back to the file of the learned Assessing Officer with following directions. i. To obtain information of the above bank account such as the ownership of CD account wherefrom the cheques were received, sign ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... missioner of income-tax (Appeal)-33, Mumbai [the learned CIT(A)], wherein the addition of ₹ 5,03,23,960/- deposited in the bank account of M/s. PK Trading Company was added as income of the assessee as unexplained cash credit. Similarly, for Assessment Year 2010-11 ₹ 42,50,000/-, for Assessment Year 2011-12 ₹ 71,13,698/-, for Assessment Year 2012-13 ₹ 1,33,05,911/- and for Assessment Year 2013-14 ₹ 1,88,83,290/- is added under section 68 of the Act confirmed by learned CIT(A) by the same order. 3. For the sake of clarity, we take the facts for Assessment Year 2009-10 first. The fact shows that assessee is an individual showing income from business and income from other sources. He filed return of income on 31st July, 2009 at ₹ 1,41,030/-. 4. Case of assessee was reopened by issue of notice under section 148 of the Act on 31st March, 2016. Reasons recorded shows that:- i. information is received from Deputy Director of income-tax (Investigation), Unit-8 vide letter dated 28th March, 2016, stated that in bank account of assessee with Union Bank of India in the name of M/s. PK Trading Company, Gowalia Tank Branch, where in credit transacti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed. Show cause notice states that as per KYC details received from Union Bank of India, assessee has submitted his photograph, copy of ration card in the name of father of the assessee where name of assessee appears, copy of PAN card and mobile bill. It was further stated that Union Bank issued a letter dated 18th January, 2008, addressed to M/s. PK Trading, Room no. 51, second floor, Jiya Masum chawl, N M Joshi Marg, Lower Parel, Mumbai-400 013, which is residential address of the assessee. Further, the signature of the application form and other documents are same as signed on the PAN card. The Gaondevi police station did not confirm the filing of the FIR and therefore, Assessing Officer asked assessee that why the credit entries in the bank account of M/s. PK Trading Company should not be added to the income of the assessee under section 68 of the Act. The Assessing Officer tabulated the credit entries from FY 2008-09 to FY 2012-13. 10. Assessee submitted reply reiterating the same facts. Assessee further stated that same fraudulent third party has carried out the transactions in his name. The signatures are forged. He stated that the introducer is Mr. Satish Kundanmal Porwal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt was opened with our branch after following necessary procedures like obtaining account opening form duly signed by the party and the introducer and obtaining necessary KYC document ration card, PAN card, telephone bill, Letter of thanks was issued to active account holder and introducer 12. Please go through the Xerox copy of PAN card and mobile bit submitted while opening the above referred account No. 352201010036448 If you see the Xerox copy of the PAN card it is seen that the PAN has been attested by Union bank officer on 7 kg. 2007 whereas the account was opened on 18 January 2008 why there is a gap of nine months between attestation and opening the account? Ans. The PAN card is attested on 7 April 2007 for any other purpose of the party and may have kept the Xerox copy of the attested PAN the same Xerox is submitted for opening the account. As far as telephone bill is concerned it pertains to the bill date 21 January 2007 which was 21 submitted for opening the account. 13. Please give details of the introducer of account of M/s. PK Trading Ans. The introducer of this account is M/s. Yash impex proprietor Shri Satish Kundanmal Porwal who is owning PAN No AADP ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id date. On verification of the address of Shri Satish Kundanmal Porwal it is gathered that Shri Satish Kundanmal Porwal and Shri Nayan Arvind Lalan are residing in the same building i.e. Zia Masum Chawl, Shri Nayan Arvind Lalan is residing on 2nd floor and Satish Kundanmal Porwal is residing on the 1st floor of the same chawl and it is very much possible that Shri Satish Kundanmal Porwal is very much known to Shri Nayan A Lalan and introduced him to open the account in Union Bank of India. 16. The simple device of opening and operating the bank account with Union Bank of India and further not producing the substantial evidence of filing FIR with police or further proceeding regarding the said case and his inability to produce Shri Satish Kundanmal Porwal before the police, bank manager or before the undersigned can be viewed as a way out to escape from the tax liability As such the assessee simply made baseless allegations and challenged the re-opening of assessment. It is very much clear that the case was reopened within the purview of income Tax Act and there is reason to believe that income has escaped assessment not due to change of opinion for reopening assessment u/s. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oducer Mr. Satish Kundanmal Porwal, proprietor of M/s. Yash Impex But he could not explain as to how documents of address proof and identity proof belonging to the assessee for opening bank account could have gone to Mr. Porwal. Factually, it does not seem correct that the appellant came to know about the said bank account after the DDIT (Inv.) issued summons and examined him as Union Bank of India at the time of opening the bank account, had issued letter dated 18.01.2008 informing customer no account ld., and account opening date addressed to M/s. P.K Trading, room no. 51, 2nd floor, Jiya Masum Chawl, N.M. Joshi Marg, Lower Parel, Mumbai-400013 which was residential address of the assessee. 6.3 The appellant had not explained whether he had any business or longer period of about 5 years and the probability of operating any account for a longer period by a third person without being caught is very less. 6.4 The Chief Manager of UBI in his statement has stated categorically that no person can open account in name of any third party in his branch. He also stated that signature of the appellant on his PAN card and account opening form seems to be identical. For opening the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT v/s Bhaichand H Gandhi (141 ITR 67)(Bom) Smt. Manasi Mahendra Pitka v/s ITO (ITA No. 4223/Mum/2015 dated 12.08.2016. (ii) Ld. CIT(A) has erred in upholding the addition made by the Assessing Officer u/s. 68 in respect to credit in bank account though cross examination of the bank manager was not given by the Assessing Officer though his statement is relied upon. Judgments relied CIT v/s Odeon Builder Pvt. Ltd. (2020) 17 SCC 311 17. The first additional ground challenges that amount deposited in the bank account cannot be added under section 68 of the income-tax Act, 1961 (the Act) and the second additional ground states that addition cannot be made in the hands of assessee without granting cross examination of bank manager. For the first ground assessee relied on the decision of Hon'ble Bombay High Court in CIT Vs. Bhaichand H. Gandhi (141 ITR 67 (Bom).For second proposition assessee relied on CIT vs. Odeon Builder Pvt. Ltd. (2020) 17 SCC 311. 18. The learned Departmental Representative vehemently objected to the additional ground. However, as these are legal grounds, does not require any further facts to be investigated, goes to the root of the m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bank account. vii. on 4th April, 2008 a RTGS of ₹ 9,88,000/- was received from Diamond Star International through Khand Bazar Branch of bank of Baroda, immediately thereafter on 5th April, 2008 ₹ 8,90,000/- is transferred to Yash Impex. viii. On 22nd January, 2008 ₹ 14,94,453/- was received from State Bank of India and immediately same was transferred to CD 36046 A/c amounting to ₹ 13,35,000/-. ix. Further, in the month of May, 2008, in this bank account high value transactions of ₹ 10 lacs each were carried out and some of the transactions were resulted into benefit of Yash Impex as amount was transferred to Yash Impex. x. Some of the high value transactions were also in the name of other persons mentioned, xi. modus operandi of transferring from CD 36046 of ₹ 1 lakh each in the bank account credited and withdrawn in cash subsequently was carried out. xii. On 29th October, 2008, the credit of ₹ 39,61,000/- was received and on 29th October, 2012, itself ₹ 26,60,000/- was transferred to Yash Impex. xiii. Like these transactions were carried out where sum is received and paid from Pushparatna Avenue. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, provision of Prohibition of Benami Transaction [Prohibition] Act applies. Further, the evidences produced before us which are stated to be received from bank authorities also shows that in the specimen signature card, the signature of somebody (allegedly assessee) is obtained which has been approved by some officers. However, there is no reference in whose presence it was signed, how it is captured and who verified it. Reference is specifically to page no. 77 of the paper book. There are apparent infirmities in the dates which are mentioned on respective documents submitted for opening of the account. It is rather unusual that a banker accepts PAN Card and other evidences which are not current. At page no. 88 there is welcome letter by the bank to M/s. PK Trading Co. dated 18th January, 2008, which was produced by the Bank Manager. There is no information whether this letter was served to the account holder as well introducer. Further, on the same date letter was issued to Yash Impex but there is no indication how it reached to the introducer also. Only purpose of welcome letter is to confirm that information, mainly address, submitted at the time of opening of account is correc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... surprised that bankers were oblivion to the facts about suspicious transactions carried out in the bank account. On examination of bank account, Ld. DDIT, LD AO and LD CIT(A) also remained passive. Therefore, we are of the opinion that such transactions need to be probed further to curb such a malpractice. 33. In view of this, we set aside all these appeals back to the file of the learned Assessing Officer with following directions. i. To obtain information of the above bank account such as the ownership of CD account wherefrom the cheques were received, signature of persons who withdrew cash of Rs. 1 lakhs on more than 100 occasions, where and how cheque books were issued, who are the owners of the bank accounts where the sums are diverted, These evidences may be obtained by the learned Assessing Officer by use of powers under section 133(6) as well as under section 131 of the Act. The Assessing Officer may also use any other provisions of the law which he is empowered to. ii. to obtain the complete details of Yash Impex, whose permanent account number is available in the statement recorded by the Bank Manager. Apparently, Yash Impex is the real beneficiary of the flow ..... X X X X Extracts X X X X X X X X Extracts X X X X
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