TMI Blog2022 (10) TMI 841X X X X Extracts X X X X X X X X Extracts X X X X ..... lkata based corporate entities and the assessee herein. It must also be mentioned here that in the assessment order also though the AO refers to an investigation report by the Kolkata based Investigation Wing of the department, what is conspicuous by its absence is the connection between the said corporate entities, which are Kolkata based and the assessee. In the circumstances, we are of the view that the ld. CIT(A) is right in deleting the addition representing the alleged benami transaction of the assessee through 15 Kolkata based corporate entities. AO has used the term benami but the AO has not been able to prove that the said 15 Kolkata based corporate entities are under the control of the assessee herein much less there is any financial connection. It is also noticed that the ld. CIT(A) has followed the judicial discipline in following the decision of the coordinate bench of the Tribunal in assessee‟s own case for A.Ys.2005-2006 2006-2007 for the purpose of deleting the impugned addition. Appeal of the revenue and the cross objection of the assessee are dismissed. - ITA No.288/CTK/2017 And Cross Objection No.28/CTK/2018 (Arising out of ITA No.288/CTK/2017) - - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ein for a sale consideration of Rs.75,75,760/- along with the registration charges of Rs.18,41,618/- and consent fee paid to the State Government of Rs.18,93,940/-. It was further submitted that the company namely Rohini Resorts Pvt. Ltd. came to be taken over by the assessee and 15 corporate parties from Kolkata. It was the submission that the consideration paid by the said Kolkata based corporate parties for the amount of Rs.2.90 crores is the issue in dispute in this appeal. It was the submission that the AO treated the corporate entities from Kolkata as the Benamis of the assessee herein and has brought to tax the amount of Rs.2,90,00,000/- paid by the said Kolkata based corporate parties for the acquisition of the shares of Rohini Resorts Pvt. Ltd. as the undisclosed income of the assessee. The ld. CIT-DR has filed his written submission as follows :- 1. The Deptt. appeal pertains to relief allowed by the Id. CIT (A), Cuttack on account of benami investment of Rs.2,90,00,000/- made by Shri Srinibash Sahoo. The brief facts of the case are: i) One Shri Srikanta Mishra was owner of a plot (C-5, New Capital) admeasuring 1.01 acres at Satya Nagar, Bhubaneswar. The state go ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alyani Mishra, other director in Rohini Resorts Private limited admitted that they had received a sum of RsA.50 crores in their individual capacity (paragraph-5 on page-10 of assessment order). iv.) Smt. Kalyani. Mishra, wife of Shri Srikanta Mishra and also a director in Rohini Resorts Private limited, stated in her statement u/s.132(4) recorded on 03;04.2007 that Rohini Resorts Private Limited represented by Shri Srikanta Mishra was given Rs.75,75,760/- as per registered sale deed and also Rs.75,00,000/- as sale premium (Rs.74,24,240/- as per money receipt). This fact was also confirmed by the statement of Shri Srinibash Sahoo in his statement recorded by the DDIT(Inv.), Bhubaneswar (paragraph-Ion page-11 of the assessment order). v.) As per valuation report prepared by Manas Das Co. (page-73 of SM-03) in respect of valuation of shares, the value of land was shown at Rs.4,11,00,000/-. The value of goodwill was computed at Rs.l,86,77,716/- on the basis of total future maintainable profits in 10 years. vi.) During the course of search, a photocopy of draft dated 06.04.2006 for Rs.13 lakhs vide seized document (104 of SM-01) favouring Smt. Kalyani Mishra was found. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve. In view of above facts, the A.O. held that amount of Rs.2.90 crores invested y Kolkata based shell companies in the shares of Rohini Resorts Private limited was benami investment of Shri Srinibash Sahoo. 2) The Id. CIT(A) has allowed the relief to the assessee as discussed in para-I1.3 to 11. 3.2 on pages-7 to 10 of the appellate order. The order of Id. CIT(A) is erroneous for following reasons: a) The CIT(A) was aggrieved with the fact that names of these 15 Kolkata based companies were not mentioned anywhere in the assessment order. He was also aggrieved with the fact that details of inquiries made by the Investigation Wing of Kolkata were not mentioned in the assessment order. He was further aggrieved with the fact that no attempt was made to locate these companies which were duly registered with the Registrar of Companies and might be filing their ITRs with the Income Tax Deptt. He held that these companies could not have vanished in thin air. At the outset, the names of these companies were mentioned by the A.D. on page-7 of the assessment order. As far as enquiries carried out by the ADIT(Inv.) are concerned, the Id. CIT(A) could have asked the A.D. to furn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... loys Ltd. (CIAL). In these years, there was no evidence on record to show that Shri Srinibash Sahoo-had used these Kolkata based companies to bring his unaccounted monies in garb of share capital in CIAL. However in the present case, seized material (page-I04 of SM-01), statement of Smt. Kalyani Mishra and other circumstantial evidences do show that the assessee had used his unaccounted monies to be brought back in the form of share capital of Rohini Resorts Private Limited. Hence the facts of the present case are totally different. In view of above facts, the order of the A.O. be restored and appeal filed by the Deptt. be allowed. 4. Ld. CIT-DR took us through the assessment order as also the order of the ld. CIT(A). It was the submission that the ld.CIT(A) has deleted the addition by holding that the AO has not proved that the Kolkata based companies were the benamis of the assessee as also on the ground that no investigation per se has been done by the AO himself but has relied on the investigation report of the Investigation Wing at Kolkata. It was the submission that the ld. CIT(A) himself could have even directed for the specific investigation and he having not done ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lders of Rohini Resorts Pvt. Ltd. It must be understood that the original shareholding and the capital holding of Rohini Resorts Pvt. Ltd. remained proved and substantiated. The change that took place in the books of Rohini Resorts Pvt. Ltd. is only insofar as the shareholders register gets modified. This is not a case where the corporate entities have put the money into Rohini Resorts Pvt. Ltd. and the Rohini Resorts Pvt. Ltd. has in turn paid off their shareholders. Thus, the entries, if at all, are not in the books of the assessee herein nor in the books of any of the entities which are under the control of the assessee herein. Clearly when there are no entries in the books of the assessee, the assessee cannot be asked to explain the entries of other corporate entities in respect of whom no financial connection has been found even in the course of search on the assessee. This being so, it was for the AO to produce or investigate and find out some financial connection between the said Kolkata based corporate entities and the assessee herein. It must also be mentioned here that in the assessment order also though the AO refers to an investigation report by the Kolkata based Invest ..... X X X X Extracts X X X X X X X X Extracts X X X X
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