9911796707
TMI Blog2025 (3) TMI 35X X X X Extracts X X X X X X X X Extracts X X X X ..... the Income Tax Act, 1961 ignoring the facts that the amount being spent from undisclosed sources being given infuse such funds in grab of share application money in respect of non family members of the assessee i.e. excluding the Company's directors and their family member. III) "The appellant craves, leave or reserving the right to amend modify, alter, add or forego any ground(s) of appeal at any time before or during the hearing of this appeal." 3. During the course of hearing, the Revenue requested for the revision of the grounds as grounds taken in original appeal. As the CIT(A) has allowed the appeal of the assessee on legal grounds also which was not taken up in the grounds of appeal filed along with appeal memo filed on 04.07.2017. Thereafter, the Revenue vide letter dated 04.04.2024 has filed Revised Form-36, however, no ground was taken on the legal issues and the revised/additional grounds of appeal has taken by the Revenue as under: "1. The impugned order of the CIT (A) is bad in Law as well as facts of the case. 2. "Whether on the facts and circumstances of the case the CIT(A) has erred in deleting the addition of Rs. 2,00,00,000/- made on account of share c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that the during course of re-assessment proceedings, the AO has issues summons to all the parties from whom share application money was received. Besides the Inspector was deputed for making separate and independent enquiry and his inspection report is reproduced at page 12 of the assessment order. AO observed that either the company is not existed at the given address or the address provided is wrong. This report was confronted to the assessee and assessee was asked to produce the direction and also other material to substantiate the share capital and premium received during the received. The assessee has not substantially explain the same and has failed to discharge onus of providing the identity and creditworthiness of the parties. Thus, under these circumstances, the Ld. Sr. DR submit that the AO has rightly made the addition of the share capital treating it as unexplained. The Ld. Sr. DR further submit that the Ld. CIT(A) has not appreciated these facts and deleted the additions which deserves to be reversed and order of the AO needs to be confirmed. 8. On the other hand, the Ld. AR of the assessee submits that the Revenue has not challenged the appellate order on legal iss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as well as creditworthiness of the subscribers were filed. 7.1 All the issues are connected and resulting into addition u/s 68 of the I.T. Act, hence taken up together. From the assessment order it is clear that the assessment was reopened on the basis of information received from Investigation wing. It has been submitted by the appellant that there is no application of mind on the part of the assessing officer before issue of notice u/s 148 of the Act as can be seen from the reasons recorded. It has also been submitted by the appellant that the initiation of re-assessment proceedings is barred by limitation because the notice has been issued beyond 4 years from the end of the relevant assessment year, as the issue on which notice was issued had been specifically examined by the AO during the assessment proceedings u/s 143(3) of the Act. The case of the appellant is indisputably covered by the proviso to section 147 of the Act according to which, where an assessment under section 143(3) or 147 has been made for the relevant assessment year, no action shall be taken under section 147 after the expiry of four years from the end of the relevant assessment year, unless any income cha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e u/s 148 of the Act. It has been submitted that for completion of assessment u/s 143(3) of the Act, a notice u/s 143(2) has to be served on the assessee after filing return of income. But no notice u/s 143(2) was served on the appellant after it filed the return of income and before completion of assessment. Hence the assessment completed u/s 143(3) on 17.03.2015 is bad in law and requires to be quashed. In view of the submissions made by the appellant, report of the AO was called for on the issue of non-service of notice u/s 143(2). The AO submitted that the notice u/s 143(2) was issued on 11.09.2014 fixing the hearing for 19.09.2014 at 11.50 AM and filed copy of same. In response to the report of the AO, the appellant submitted a rejoinder after inspecting the assessment records and taking copies of the same. It was reiterated that the notice dated 11.09.2014 was never served on the appellant. It was also pointed out that from the copy of notice it can be seen that there is no evidence of its dispatch, speed post number or the signature of the recipient, whereas in all other notices sent by the AO, there were dispatch number and speed post numbers or signature of the recipient. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... idence would come into play only when the basic test of direct and factual evidence fails. It is submitted that the copies of bank statements, income tax returns, PAN, complete annual accounts with schedules in respect of all the subscribers to the share capital of the appellant company, were filed during the course of the scrutiny assessment. It is also pointed out that verification was made by the AO at the time of original assessment under the provisions of section 133(6) of the Act, and compliance was duly made by the subscribers. In view of the above, it was submitted by the appellant that no adverse inference was required to be drawn as to the genuineness, existence and creditworthiness of the companies on the ground that the subscribers have not been produced. 7.5. It has also been submitted by the appellant that no evidence to suggest that the appellant had obtained accommodation entries from the companies owned and operated by Sh. S.K. Jain, was made available to the appellant or even mentioned in the assessment order. The appellant has further claimed that some of the investing companies were assessed u/s 143(3) read with 153C after the search in the case of S.K. Jain a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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