TMI Blog2023 (7) TMI 745X X X X Extracts X X X X X X X X Extracts X X X X ..... passed by him amenable for revision u/s 263 of the Act is supported by the judgment of Deniel Merchants (P) Ltd [ 2017 (12) TMI 476 - SUPREME COURT] . On a perusal of the reasons to believe as per the information, the investment made with the assessee company of Rs. 21.20 lac (supra) by M/s Cherry Vintrade Pvt. Ltd. was sourced out of a receipt of Rs. 51 lac in the latters bank account, which amount had no business rationale or basis but was only received for layering purpose. We are unable to fathom that as to on what basis it is claimed by the ld. AR that reopening of the assessee s case was based on non-descript information. In our considered view, as the A.O had sufficient material with him to arrive at a bonafide belief that the income of the assessee company that was chargeable to tax had escaped assessment, therefore, the claim of the Ld. AR that the reopening of its case was based on non-descript information being absolutely misconceived is accordingly rejected. We, thus, in terms of our aforesaid observations concur with the view taken by the Pr. CIT who had rightly set-aside the assessment order passed by the A.O u/s. 143(3) r.w.s. 147 and, uphold the same. Decide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 26.02.2021, wherein he had set-aside the order passed by the A.O u/s. 143(3)/147 of the Act dated 29.12.2017. The Pr. CIT was of the view, that the summarily acceptance by the AO of the assessee s claim of having received a share capital of Rs. 21.20 lac from M/s. Cherry Vintrade Pvt. Ltd., an identified paper/bogus/shell company, with dummy directors, viz. S/Shri Ashis Kumar (PAN: ANMPK1331K) and Rahul Sharma (PAN : AWSPS8620A) who were under the control and management of an infamous entry operator Shri Dinesh Dhandhania, had rendered his order as erroneous in so far it was prejudicial to the interest of the revenue u/s 263 of the Act. 4. It transpires on a perusal of the record that the case of the assessee was reopened by the A.O u/s. 147 of the Act on the basis of following reasons to believe : M/s. Spectrum Infonet Private Limited PAN : AALCS5656E A.Y.2010-11 Annexure-A Reasons for the belief that income had escaped assessment As per ITD database and e-filing ITBA portal, return was filed till assessment year 2013-14 (filed on 27.09.2013) by M/s Cherry Vintrade Pvt. Ltd. Return for the assessment year was filed 02.09.2010. On perusal of both returns i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated 29.12.2017 as erroneous in so far it was prejudicial to the interest of the revenue, set-aside the same, with a direction to him to adjudicate the same afresh after affording a reasonable opportunity of being heard to the assessee. 5. Aggrieved the assessee company has assailed the order passed by the Pr. CIT u/s. 263 of the Act dated 26.02.2021 before us. 6. We have heard the ld. authorized representatives of both the parties, perused the orders of the lower authorities and the material available on record, as well as considered the judicial pronouncements that have been pressed into service by them to drive home their respective contentions. 7. Admittedly, it is a matter of fact borne from record that the case of the assessee company was reopened by the A.O, for the reason, that as per information received from Dy. DIT (inv.), Unit-II, Kolkata - M/s. Cherry Vintrade Pvt. Ltd., i.e. a company from whom the assessee during the year was in receipt of share capital of Rs. 21.20 lac, as per the database of Investigating Wing, Kolkata was identified as a paper/bogus/shell company having dummy directors, viz. S/Shri Ashis Kumar (PAN: ANMPK1331K) and Rahul Sharma (PAN : AWS ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te specific directions failed to substantiate the authenticity of its claim of having received share capital from M/s. Cherry Vintrade Pvt. Ltd., but the same was summarily accepted by the A.O without carrying out necessary verifications. 9. Apart from that, it was observed by the Pr. CIT that computation of income of the assessee company did not reveal any income/loss on sale of investment; and the Schedule-CG (capital gain/loss) of the original return and that filed in response to the notice u/s. 148 revealed a blank column. Also, it was observed by the Pr. CIT that transactions in the assessee s bank account i.e. A/c. No. 167030117517 with Bank of Rajasthan Ltd. read a/w. its financial statements did not reveal as to from where the amounts were received and to whom the same were thereafter transferred. It was further observed by the Pr. CIT that the A.O had neither disputed the source of huge deposits and its application by way of withdrawals from the aforesaid bank account; nor carried out any enquiry as regards the same. The Pr. CIT on the basis of the aforesaid facts was of the view that the A.O had summarily accepted the submissions of the assessee company without carryin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... available on record which show that such details were filed before the AO during the reassessment proceedings. 3. It is further seen that M/s Cherry Vintrade Pvt. Ltd. (vide SI. No. 10608) is an identified paper/bogus/shell company having director Shri Ashis Kumar (PAN: ANMPK1331K) and Shri Rahul Sharma (PAN: AWSPS8620A) who are dummy directors under the control and management of identified entry operator Shri Dinesh Dhandhania. There was no worthwhile business of this company. It was being used merely for layering of transactions. No details of the company were obtained by the AO as can be seen from the assessment records and no enquiries were conducted by the AO regarding its creditworthiness and genuineness of the transaction with the assessee as is evident from following facts which emerge from examination of records - Further, The A/R of the assessee appeared for the first time during the entire proceeding on 21/12/2017 and filed copy of 26AS, Audited A/cs, Share holding pattern and Bank statement. On 26/12/2017, the assessee filed hard copy of the return and acknowledgement, computation of income, explanation of reason u/s 148 (a photocopy) that the sum of Rs. 21,20,00 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stment whatsoever. The computation of income also did not show any income/loss from Sale of Investment and the Schedule- CG(Capital Gains/Loss) of the Original Return and Return filed in response to Notice u/s 148 showed the entire column blank. The perusal of Bank statement of the assessee company with The Bank of Rajasthan Ltd. G. C. Avenue Branch, A/c No. 167030117517 showed that the assessee's address was given as 2A, Ramnath Sadhu Lane, Kolkata-700007 whereas the assessee address as per return of income was that of Raigarh, Chhattisgarh implying that the company had changed base and its control and management has also changed. Further, it was found that there were huge deposits and withdrawals throughout the year in the above account leaving very nominal/insignificant balances at the end of the transactions which is not in conformity with the Profit Loss A/c and Balance-sheet of the assessee. The Total deposit in the above account during the period was found at Rs. 17,91,28,274/- whereas the total of Balance-sheet was Rs. 6,33,00,000/- only on 31/03/2009 and Rs. 6,34,70,884/- only as on 31/03/2010 and the total receipt as per Profit Loss a/c as on 31/3/2010 is only ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... art of his reasons to believe the amount of Rs. 51 lac credited in the bank account No.518011045909 of M/s. Cherry Vintrade Pvt. Ltd. had no business rationale and was merely received by it for being utilized for layering purpose, but the A.O despite knowing well that an amount of Rs. 21.20 lac received by the assessee company on 27.09.2009 from the aforesaid investor company was sourced out of the aforesaid tainted amount of Rs. 51 lac (supra), had however failed to carry out the bare minimum enquiries to verify the authenticity of the said transaction. Although it is the claim of the ld. AR before us that the A.O had carried out necessary verifications in the course of the assessment proceedings, but a careful perusal of the assessment order a/w. the records does not inspire any confidence as regards the said claim. We, thus, on the basis of our aforesaid deliberations are of the considered view that as observed by the Pr. CIT and, rightly so, as the AO while framing the assessment had failed to carry out necessary verification as regards the very issue which had formed the basis of reopening of its case u/s 147 of the Act, and had summarily accepted the authenticity of the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the latters bank account, which amount had no business rationale or basis but was only received for layering purpose. We are unable to fathom that as to on what basis it is claimed by the ld. AR that reopening of the assessee s case was based on non-descript information. In our considered view, as the A.O had sufficient material with him to arrive at a bonafide belief that the income of the assessee company that was chargeable to tax had escaped assessment, therefore, the claim of the Ld. AR that the reopening of its case was based on non-descript information being absolutely misconceived is accordingly rejected. 13. We, thus, in terms of our aforesaid observations concur with the view taken by the Pr. CIT who had rightly set-aside the assessment order passed by the A.O u/s. 143(3) r.w.s. 147 of the Act dated 29.12.2017 and, uphold the same. Thus, the grounds of appeal raised by the assessee are dismissed in terms of our aforesaid observations. 14. In the result, the appeal of the assessee in ITA No.33/RPR/2022 for A.Y.2010-11 is dismissed in terms of our aforesaid observations. ITA No.34/RPR/2022 A.Y.2011-12 15. As the facts and issue involved in the present case ..... X X X X Extracts X X X X X X X X Extracts X X X X
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