M/s Jagdamba Optics Pvt. Ltd., Delhi V. ITO, New Delhi

CO 151/DEL/2010

• Counselvise Citation: [2015] 123 COUNSELVISE.COM (IT) 1195 (ITAT-DELHI)
• Duration Of Justice: 5 year(s) 2 month(s) 20 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 04-09-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 14-08-2015
• Assessment Year: 2004-2005
• Appeal Filed On: 14-06-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: J P CHANDRAKAR
• Keywords: Reopening of assessment; Unexplained cash credit; Additional evidence; Accommodation entries; Assessment record; Reassessment proceedings
• Section: 143(3); 142(1); 133(6); 147; 131; 148; 68

Judgement Text

ITA NO. 4 597/ DEL/20 09 & CO NO. 151 /DEL/201 0 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH D , NEW DELHI BEFORE SHRI N.K. SAINI, ACCOUNTANT MEMBER AND SHRI H.S. SIDHU, JUDICIAL MEMBER I.T.A. NO. 4 597 /DEL/20 09 A.Y. : 200 4 - 0 5 INCOME TAX OFFICER, CO. WARD 4(1), ROOM NO. 418, CR BUILDING, I.P. ESTATE, NEW DELHI VS. M/S JAGDAMBA OPTICS PVT. LTD., 107, KANDLE KASAN, FATEH PURI, DELHI 110 006 (PAN:AAACJ0693H) (APPELLANT) (RESPONDENT) AND CROSS OBJECTION NO. 151 /DEL/201 0 (IN ITA NO. 4597 /DEL/20 09 A.Y. : 200 4 - 0 5 M/S JAGDAMBA OPTICS PVT. LTD., 107, KANDLE KASAN, FATEH PURI, DELHI 110 006 (PAN:AAACJ0693H) VS. INCOME TAX OFFICER, CO. WARD 4(1), ROOM NO. 418, CR BUILDING, I.P. ESTATE, NEW DELHI (APPELLANT) (RESPONDENT) DEPARTMENT BY : S HRI J.P. CHANDRAKAR, SR. DR ASSESSEE BY : SH. VED JAIN, CA DATE OF HEARING : 14 - 0 8 - 201 5 DATE OF ORDER : 04 - 0 9 - 201 5 ORDER PER H.S. SIDHU : J M THE APPEAL FILED BY THE REVENUE AND THE CROSS OBJECTION FILED BY THE ASSESSEE EMANATE OUT OF THE ORD ER DATED 16 . 9 .20 09 PASSED ITA NO. 4 597/ DEL/20 09 & CO NO. 151 /DEL/201 0 2 BY THE LD. CIT(A) - VII , NEW DELHI RELEVANT TO ASSESSMENT YEAR 200 4 - 0 5 . 2. THE FOLLOWING GROUNDS HAVE BEEN RAISED IN THE REVENUE S APPEAL: - 1. THE ORDER OF THE LD. CIT(A) IS ERRONEOUS AND CONTRARY TO FACTS AND LAW. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS. 13,70,000/ - MADE U/S 68 OF THE INCOME TAX ACT BEING THE UNEXPLAINED CASH CREDIT AND RS. 27,400/ - BEING THE UNACCOUNTED CASH PAID FOR OBTAINING ACCOMMODATION ENTRIES. 2.1 THE LD. CIT(A) FAILED TO APPRECIATE THE FACTS THAT THE ASSESSEE DID NOT DISCHARGE THE ONUS OF PROVING THE CREDITWORTHINESS OF THE CREDITORS AND GENUINENESS OF THE TRANSACT IONS. 3. THE APPELLANT CRAVES LEAVE TO ADD, TO ALTER, OR AMEND ANY GROUNDS OF APPEAL RAISED ABOVE AT THE TIME OF HEARING. ITA NO. 4 597/ DEL/20 09 & CO NO. 151 /DEL/201 0 3 3. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS IN ITS CROSS OBJECTION: - 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CI T(A) HAS ERRED, BOTH ON FACTS AND IN LAW, IN REJECTING THE CONTENTION OF THE ASSESSEE THAT ASSESSMENT MADE BY THE AO BY REOPENING THE ASSESSMENT MADE IS BAD AND LIABLE TO BE QUASHED AS CONDITIONS AND PROCEDURE PRESCRIBED UNDER SECTION 147 READ WITH SECTIO N 148 HAVE NOT BEEN COMPLIED WITH. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE ORDER PASSED BY LD. CIT(A) IS BAD BOTH ON FACTS AND IN LAW IN IGNORING THE CONTENTION OF THE ASSESSEE THAT THE ORDER PASSED BY THE AO IS BAD AND IS LIABLE TO BE QUASHED AS THE REASONS ON THE BASIS OF WHICH THE ASSESSMENT HAS BEEN REOPENED DOES NOT HAVE ANY LIVE LINK WITH THE BELIEF OF THE AO THAT THE INCOME HAS ESCAPED ASSESSMENT, IN THE ABSENCE OF THE NAME OF THE ASSESSEE IN THE ALLEGED STATEMENT ON THE BASIS OF WHICH T HE ASSESSMENT HAS BEEN REOPENED. 3. THAT THE APPELLANT CRAVES LEAVE TO ADD, AMEND OR ALTER ANY OF THE GROUNDS OF APPEAL. 4. THE BRIEF FACTS OF THE CASE ARE THAT ASSESSEE FILED THE RETURN OF INCOME DECLARING LOSS OF RS. 5,78,075/ - ON 27.10.2004. THE CASE WAS SELECTED FOR SCRUTINY U/S. 148 OF THE INCOME TAX ACT, 1961. THE ITA NO. 4 597/ DEL/20 09 & CO NO. 151 /DEL/201 0 4 INVESTIGATION WING OF THE INCOME TAX DEPARTMENT HAS GATHERED THAT THE ASSESSEE HAS INDULGE D IN RECEIVING ACCOMMODATION ENTRY IN THE GARB OF SHARE APPLICATION MONEY DURING THE YEAR. AO RECORDED THE REASONS TO BELIEVE THAT THE AMOUNT RECEIVED REPRESENTS THE UNDISCLOSED INCOME OF THE ASSESSEE, WHICH HAS NOT BEEN OFFERED TO TAX AND HE ISSUED NOTIC E U/S. 148 OF THE INCOME TAX ACT, 1961 DATED 25.1.2007 WHICH WAS SERVED ON THE ASSESSEE. IN RESPONSE TO THE SAME, ASSESSEE FILED ITS RETURN DECLARING THE SAME INCOME AS THE ASSESSEE H AS EARLIER DECLARED AND STATED THAT ORIGINAL RETURN FILED ON 27.10.2 004 MAY BE TREATED AS FILED IN RESPONSE TO NOTICE U/S. 148. THE ASSESSEE RAISED OBJECTION STATING THAT THE REOPENING OF THE CASE U/S. 148 IS BAD IN LAW BECAUSE THE REASONS RECORDED DO NOT LEAD TO ANY REASONABLE PERSON TO CONCLUDE THAT ANY INCOME HAS ES CAPED ASSESSMENT. AO IS OF THE VIEW THAT THE CASE OF THE ASSESSEE UPON ON SPECIFIC INFORMATION THAT THE SHARE APPLICATION MONEY RECEIVED BY THE ASSESSEE FROM TEERATH IMPEX & TRADERS (P) LTD. ARE ACCOMMODATION ENTRIES AS THE INFORMATION RECEIVED FROM THE I NVESTIGATION WING OF THE DEPARTMENT. HE FURTHER HELD THAT THESE FACTS ARE ALSO CONFIRMED FROM THE BANK STATEMENT OF TEERATH IMPEX & TRADERS (P) LTD. WHICH SHOWS THAT THE CASH OF HIGH AMOUNT IS DEPOSITED REGULARLY AND CHEQUE OF SAME AMOUNT IS ISSUED ON SAM E DAY OR ON THE VERY NEXT DAY. THIS TYPE OF DEALINGS ARE DONE BY ENTRY OPERATOR TO GIVE ACCOMMODATION ENTRIES IN LIEU OF CASH. AO HAS ALSO ITA NO. 4 597/ DEL/20 09 & CO NO. 151 /DEL/201 0 5 ISSUED U/S. 143(2) AND 142(1) OF THE ACT. IN RESPONSE TO THE SAME LD. AR OF THE ASSESSEE APPEARED FROM TIME TO TI ME AND THE CASE WAS DISCUSSED WITH THE AO. SECONDLY, DURING THE YEAR UNDER CONSIDERATION ASSESSEE HAS RECEIVED SHARE CAPITAL OF RS. 13,70,000/ - FROM 6 COMPANIES NAMELY: * TEERATH IMPEX & TRADERS PVT. LTD. RS. 2,50,000/ - * MASTOGI GRANITES PVT. LTD. RS. 2,00,000/ - * AMALGAMATED FOODS & CHEMICALS PVT. LTD. RS. 2,00,000/ - * CHAMBAL VALLEY SUGAR MILLS LTD. RS. 2,50,000/ - * DAYA BUILDERS PVT. LTD. RS. 1,70,000/ - * GRAPHIC STATION COMPUTERS PVT. LTD. RS. 3,00,000/ - 4.1 ASSESSEE WAS AS KED TO FILE THE DETAILS OF SHARE APPLICANT AND SUBMIT COPIES OF THEIR IT RETURNS, CONFIRMATIONS AND BANK STATEMENTS IN ORDER TO PROVE THE IDENTITY AND CREDITWORTHINESS OF THE SHARE APPLICANT AND GENUINENESS OF THE TRANSACTION. IN RESPONSE TO THE SAME, THE AR OF THE ASSESSEE FILED THE COPY OF ITR OF THE ABOVE MENTIONED PARTIES TO VERIFY THE SAME. AO ISSUED SUMMON U/S. 131 OF THE I.T. ACT TO ALL THE ABOVE 6 COMPANIES WHICH RECEIVED BACK WITH THE COMMENTS NO SUCH FIRM THE SAME. FOR 3 FIRMS THE AO AL SO ISSUED NOTICE TO THE CONCERNED BANK WHICH ALSO RECEIVED BACK FROM THE POST AUTHORITIES WITH THE REMARKS THAT NO SUCH BANK AT NAI ITA NO. 4 597/ DEL/20 09 & CO NO. 151 /DEL/201 0 6 SARAK . AFTER CONSIDERING THE EVIDENCE FILED BY THE ASSESSEE AND THE FACTS AND CIRCUMSTANCES OF THE CASE, AO HAS HELD THAT ASSES SEE HAS GIVEN ITS UNACCOUNTED CASH TO THE ENTRY PROVIDER AND THE SAME HAD BEEN RECEIVED BY THE ASSESSEE. THEREFORE, THE AMOUNT OF RS. 13,70,000/ - HAS BEEN CREDITED INTO THE BOOKS OF THE ASSESSEE COMPANY AND THE CREDITWORTHINESS OF THE COMPANY DEPOS ITING THE CASH IN ITS BANK ACCOUNT AND GENUINENESS OF THE TRANSACTION HAVE NOT BEEN PROVED AND HE MADE THE ADDITION OF RS. 13,70,000 AND COMPLETED THE ASSESSMENT U/S. 143(3) OF THE INCOME TAX ACT, 143(3)/147 OF THE INCOME TAX ACT, 1961 VIDE ORDER DATED 28. 12.2001. 5 . AGGRIEVED WITH THE AFORESAID ASSESSMENT ORDER, ASSESSEE FILED THE APPEAL BEFORE THE LD. CIT(A), WHO VIDE IMPUGNED ORDER DATED 16.9.2009 PARTLY ALLOWED THE APPEAL FOR STATISTICAL PURPOSES AND DELETED THE ADDITION IN DISPUTE. 6. NOW THE REVEN UE IS AGGRIEVED WITH THE DELETION OF ADDITION OF RS. 13,70,000/ - AND ASSESSEE HAS ALSO FILED THE CROSS OBJECTION FOR CHALLENGING THE REASSESSMENT PROCEEDINGS U/S. 147 OF THE I.T. ACT, 1961. 7. AT THE TIME OF HEARING, LD. DR RELIED UPON THE ORDER PASSE D BY THE AO AND THE ASSESSEE RELIED UPON THE ORDER OF THE LD. CIT(A). LD. AR FOR THE ASSESSEE STATED THAT THE ADDITION DELETED BY THE LD. ITA NO. 4 597/ DEL/20 09 & CO NO. 151 /DEL/201 0 7 CIT(A) IS AS PER LAW. BUT AS REGARDS, THE REOPENING OF THE ASSESSMENT, HE STATED THAT THE ASSESSEE HAS FILED THE CR OSS OBJECTION IN WHICH HE REITERATED HIS CONTENTION AND REFERRED THE CASE LAWS ALONGWITH THE SYNOPSIS SUPPORTING THE ORDER OF THE LD. CIT(A) ON THE DELETION OF THE ADDITION AND STATED THAT THE NOTICE U/S. 148 HAS BEEN ISSUED BY THE AO WITHOUT ANY BASIS A ND THE SAME MAY BE CANCELLED AND THE RE ASSESSMENT MAY BE DECLARED AS NULL AND VOID BY ACCEPTING THE CROSS OBJECTION FILED BY THE ASSESSEE. 8. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE RELEVANT RECORDS AVAILABLE WITH US, ESPECIALLY THE ORDERS PASSED BY THE REVENUE AUTHORITIES , WRITTEN SYNOPSIS FILED BY THE ASSESSEE. AS REGARDS THE APPEAL FILED BY THE REVENUE IS CONCERNED, IN WHICH THE REVENUE HAS CHALLENGED THE DELETION OF ADDITION OF RS. 13.70 LACS MADE U/S. 68 OF THE I.T. ACT BEING UNEXPLAINED CASH CREDIT OF RS. 27,400/ - FOR OBTAINING ACCOMMODATION ENTRIES, WE ARE OF THE VIEW THAT THE LD. CIT(A) HAS DECIDED THE ISSUE IN APPEAL VIDE PARA NO. 4.6 TO 4.8 AT PAGE NO. 12 TO 14 IN HIS IMPUGNED ORDER . FOR THE SAKE OF CONVENIENCE, THE SAID RELEVANT PARAGRAPHS ARE REPRODUCED AS UNDER: - 4.6 I HAVE GONE THROUGH THE ASSESSMENT ORDER, THE WRITTEN AND ORAL SUBMISSION(S) OF THE APPELLANT AND THE REMAND REPORT OF THE A.O. DURING THE COURSE OF ITA NO. 4 597/ DEL/20 09 & CO NO. 151 /DEL/201 0 8 ASSESSMENT AS WELL AS APPELLATE PROCEEDINGS, ALL THE PARTICULARS / DETAILS SUCH AS SHARE APPLICATION FORM, THE COPIES OF PAN CARD, INCOME - TAX DETAILS, BANK PARTICULARS AND BANK STATEMENTS, THE COMPLETE ADDRESSES OF THE SHARE APPLICANT WERE FURNISHED. IT IS NOW WELL SETTLED THAT WHERE THE ASSESSEE HAD FURNISH ED (I) THE NAMES AND ADDRESSES OF THE SHARE APPLICANTS (II) THE GIR NOS./P.A.N. NOS. (III) THE WARD NOS. WHERE ASSESSED (IV) THE MODE OF PAYMENT AND (V) OTHER INFORMATION WHICH THE ASSESSEE KNOWS OR POSSESSES, THEN IT CAN BE SAID THAT INITIAL BURDEN ON THE ASSESSEE CAN BE SAID TO BE DISCHARGED. ONCE THE IDENTITY OF THE SHAREHOLDERS WAS ESTABLISHED IT ALSO STANDS ESTABLISHED THAT THE SHAREHOLDERS HAVE INVESTED MONEY IN THE PURCHASE OF SHARES AND HENCE THE ONUS, ON THE PART OF THE ASSESSEE COMPANY, IS DISCHAR GED AND THERE CANNOT BE ANY ADDITION IN THE HANDS OF THE ASSESSEE COMPANY ON ACCOUNT OF SHARE APPLICATION MONEY. RELIANCE IS PLACED ON THE FOLLOWING DECISIONS OF THE APEX COURT AND THE JURISDICTIONAL HIGH COURT OF DELHI: - I) CIT VS. LOVELY EXPORTS (P) LTD. (2008) 216 CTR (SC) 195. ITA NO. 4 597/ DEL/20 09 & CO NO. 151 /DEL/201 0 9 II) CIT VS. DIVINE LEASING & FINANCE LTD. (2007) 299 ITR 268 (DEL.). III) CIT VS. VALUE CAPITAL SERVICES LTD. (2008) 307 ITR 334 (DEL.). IV) CIT VS. TDI MARKETING PVT. LTD. (2009) 26 DTR (DEL.) 358. IN THE PRESENT CASE THE ASSESSEE CAN BE SAID TO HAVE DISCHARGED ITS ONUS UNDER SECTION 68 OF THE ACT. THE APPELLANT HAS GIVEN ALL THE NECESSARY DETAILS IN ORDER TO ESTABLISH THE IDENTITY OF THE SHARE APPLICANTS. AFTER CONSIDERING THE ENTIRE MATERIAL PLACED ON RECORD, IT IS FAIR TO CONCLUDE THAT THE SHARE APPLICANTS WERE EXISTING PARTIES AND THE PAYMENTS WERE MADE THROUGH BANKING CHANNELS. 4.7 IT IS ALSO SEEN THAT THE ASSESSING OFFICER COULD NOT POINT OUT ANY DISCREPANCY IN THE EVIDENCES RELIED UPON BY THE ASSESSEE. HE HAS NEITHER BROUGHT OUT ANY DIRECT OR INFERENTIAL EVIDENCE TO CONTRADICT THE CONTENTION OF THE ASSESSEE. IT IS FURTHER OBSERVED THAT EVEN THOUGH AO. HAS VAST POWERS ULS 131 AND 133(6) OF THE ACT, HE HAS NOT USED ANY OF HIS POWERS TO VERIFY TH E GENUINENESS OF THE CLAIM OF THE ASSESSEE BY VERIFYING THE DOCUMENTS FURNISHED BY IT. IF AO HAD DOUBTED THE IMPUGNED ITA NO. 4 597/ DEL/20 09 & CO NO. 151 /DEL/201 0 10 TRANSACTION AFTER RECEIVING THE EVIDENCES WHICH HAD BEEN PRODUCED BY THE ASSESSEE IN SUPPORT OF ITS CLAIM IT WAS VERY MUCH OPEN TO THE AO TO DO HIS INDEPENDENT ENQUIRY AND VERIFICATION. THIS HAS NOT BEEN DONE BY THE AO. FURTHER, WHAT IS THE DESIRED DOCUMENTARY EVIDENCE REQUIRED TO SUPPORT THE CLAIM OF THE ASSESSEE AS REQUIRED BY THE AO. IS NOT COMING OUT OF THE ORDER OF THE A.O. THOUGH, THE SHARE - APPLICANTS COULD NOT BE EXAMINED BY THE AO, SINCE THEY WERE EXISTING ON THE FILE OF THE INCOME TAX DEPARTMENT AND ITS INCOME - TAX DETAILS WERE MADE AVAILABLE TO THE AO, IT WAS EQUALLY THE DUTY OF THE AO TO HAVE TAKEN STEPS TO VERIFY THEIR ASSESSMENT RECORDS AND IF NECESSARY TO ALSO HAVE THEM EXAMINED BY THE RESPECTIVE AOS HAVING JURISDICTION OVER THE SHARE - APPLICANTS, WHICH HAS NOT BEEN DONE BY HIM. 4.8 UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE STATED ABOVE, IT IS HELD THAT THE ADDITION OF RS.13, 70,000/ - CANNOT BE SUSTAINED AND ACCORDINGLY, THE SAME IS DIRECTED TO BE DELETED. AS THE ADDITION ON ACCOUNT OF ACCOMMODATION ENTRY HAS BEEN DELETED, THE CONSEQUENTIAL ADDITION ON ACCOUNT OF COMMISSION OF RS. ITA NO. 4 597/ DEL/20 09 & CO NO. 151 /DEL/201 0 11 27,400/ - FOR OBTAINING THE SAID ACCOMMODATION ENTRIES IS ALSO DIRECTED TO BE DELETED. AS A RESULT, GROUND NO. 2 AND 3 ARE ALLOWED. 9. AFTER GOING THROUGH THE AFORESAID RELEVANT PARAGRAPHS OF THE IMPUGNED ORDER, WE ARE OF THE VIEW THAT THE ASSESSEE HAS FILED SOME ADDITIONAL EVIDENCES BEFORE THE LD. CIT(A) WHICH HAS BEEN VERIFIED BY THE AO AND THE LD. CIT(A) ON THE BASIS OF THE ADDITIONAL EVIDENCE, AFTER GIVING FULL OPPORTUNITY TO THE AO HAS DELETED THE ADDITION IN DISPUTE. LD. CIT(A) HAS TAKEN THE REMAND REPORT FROM THE AO AND ALSO EXAMINED ALL PART ICULARS/ DETAILS OF THE SHARE APPLICATION FORM, COPIES OF PAN CARDS, INCOME TAX RETURNS, BANK PARTICULARS AND BANK STATEMENTS, THE COMPLETE ADDRESS OF THE SHARE APPLICANTS AND DELETED THE ADDITION IN DISPUTE. LD. CIT(A) HAS ALSO CITED VARIOUS DECISION RE NDERED BY THE HON BLE JURISDICTIONAL HIGH COURT AS WELL AS THE HON BLE SUPREME COURT OF INDIA WHICH INCLUDES CIT VS. LOVELY EXPORTS PVT. LTD. [2008] 216 CTR (SC) 195; CIT VS. DIVINE LEASING & FINANCE LTD. (2007) 299 ITR 268 (DEL.) AND CIT VS. VALUE CAPITA L SERVICES LTD. (2008) 307 ITR 334 (DEL.). 10. AFTER GOING THROUGH THE IMPUGNED ORDER PASSED BY THE LD. CIT(A) AS WELL AS THE CITATIONS REFERRED BY THE LD. CIT(A) IN THE IMPUGNED ORDER, WE ARE OF THE CONSIDERED VIEW THAT LD. CIT(A) HAS RIGHTLY DELETED THE ADDITION OF RS. 13,70,000/ - ON THE BASIS OF THE ITA NO. 4 597/ DEL/20 09 & CO NO. 151 /DEL/201 0 12 VARIOUS DOCUMENTARY EVIDENCE S , WHICH IS AS PER LAW. THEREFORE, NO INTERFERENCE IS CALLED FOR IN THE WELL REASONED ORDER PASSED BY THE LD. CIT(A) ON THE DELETION OF THE ADDITION IN DISPUTE, HENCE, WE UPHOLD T HE SAME. 11. AS REGARDS THE VALIDITY OF REASSESSMENT PROCEEDINGS U/S. 147 OF THE I.T. ACT, INITIATED BY THE AO WHICH IS THE DISPUTE RAISED BY THE ASSESSEE IN ITS CROSS OBJECTION IS CONCERNED, A FTER HEARING BOTH THE PARTIES AND RELEVANT RECORDS, WE ARE O F THE VIEW THAT THE LD. CIT(A) HAS DECIDED THE ISSUE IN DISPUTE VIDE PARA NO. 3.2 TO 3.3 AT PAGES 3 TO 5 IN HIS IMPUGNED ORDER. FOR THE SAKE OF CONVENIENCE, THE SAID RELEVANT PARAGRAPHS ARE REPRODUCED AS UNDER: - 3.2 I HAVE CAREFULLY CONSIDERED THE SUBM ISSIONS MADE ON BEHALF OF THE APPELLANT & FINDINGS OF THE ASSESSING OFFICER AND FACTS ON RECORD. THE PERUSAL OF THE RE - ASSESSMENT ORDER REVEALS THAT IT WAS ONLY AFTER THE DIRECTORATE OF INCOME - TAX(INVESTIGATIONS),DELHI INFORMED THE A.O. AS REGARDS THE ACC OMMODATION ENTRIES PROVIDED TO THE ASSESSEE BY CERTAIN PARTIES. BEFORE THAT DATE THERE WAS NO INFORMATION AVAILABLE WITH THE A.O. WHICH WOULD HAVE SUGGESTED THAT THE APPELLANT HAS OBTAINED ACCOMMODATION ENTRIES. THEREFORE, IT IS AN ADMITTED FACT THAT THE ABOVE FACTS WERE NOT BEFORE THE A.O. BEFORE THE RECEIPT OF SUCH INFORMATION FROM THE DIRECTORAT E OF ITA NO. 4 597/ DEL/20 09 & CO NO. 151 /DEL/201 0 13 INCOME - TAX(INVESTIGATIONS), DELHI. ON FACTS AND CIRCUMSTANCES OF THE CASE, I AM OF THE VIEW THAT THE APPELLANT HAS NO CASE TO SUCCEED ON THE GROUND RELATING TO RE - ASSESSMENT PROCEEDINGS. WHAT IS REQUIRED FOR INITIATING RE - ASSESSMENT PROCEEDINGS IS THE EXISTENCE OF A FRESH PRIMA - FACIE MATERIAL. CONSEQUENT TO THE RECEIPT OF SUCH INFORMATION, THE ASSESSING OFFICER, AFTER EXAMINATION OF RECORD, HAS TO HAVE A REASONABLE BELIEF THAT THE INCOME HAS ESCAPED ASSESSMENT. THE A.O. NEED NOT CONDUCT A DETAILED INVE STIGATION TO PROVE THAT THE INCOME HAS ESCAPED ASSESSMENT IN THE HANDS OF ASSESSEE BEFORE INITIATING RE - ASSESSMENT PROCEEDINGS . THE REQUIREMENT IS THE BELIEF OF THE A.O. CONSEQUENT UPON THE RECEIPT OF SUCH FRESH INFORMATION. THE INFORMATION OBTAINED FROM T HE DIRECTORATE OF INCOME - TAX (INVESTIGATION),DELHI CONSTITUTES VALID INFORMATION FOR THE A.O. TO HOLD THE VIEW THAT THE INCOME HAS ESCAPED ASSESSMENT. THE INFORMATION OBTAINED FROM THE DIRECTORATE OF INCOME - TAX(INVESTIGATIONS),DELHI IS SUFFICIENT FOR THE A.O. CONC ERN ED TO REACH SUCH CONCLUSION. THERE WAS EXISTENCE OF FRESH INFORMATION, WHICH PROMPTED THE A.O. TO PROCEED TO ISSUE NOTICE ULS 148 OF THE ACT. ONLY IN THE RE - ASSESSMENT PROCEEDINGS, THE A.O. COULD PROCEED TO EXAMINE SUCH MATERIAL AND CAUSE NECES SARY ENQUIRIES BEFORE FRAMING THE ASSESSMENT ORDER AS PER LAW. IN THE INSTANT CASE, THE ASSESSING OFFICER IS IN ITA NO. 4 597/ DEL/20 09 & CO NO. 151 /DEL/201 0 14 POSSESSION OF A FRESH MATERIAL RECEIVED FROM THE OTHER STATUTORY AUTHORITY REGARDING SOME TRANSACTIONS. 3 .3 THE APPELLANT HAS ALSO RAISED THE C ONTENTION THAT THOUGH THE COPY OF REASONS RECORDED BEFORE ISSUANCE OF NOTICE ULS 148 HAD BEEN PROVIDED BY THE A.O. TO IT BUT A.O. DID NOT DISPOSE OF THE OBJECTIONS RAISED BY IT AGAINST THE REOPENING OF ASSESSMENT IGNORING THE JUDGMENT OF THE HON'BLE SUPREM E COURT IN THE CASE OF GKN DRIVESHAFTS (INDIA) LTD. VS. ITO 259 ITR 19 (SC). IT IS WELL - SETTLED THAT WHEN A NOTICE ULS 148 IS ISSUED, THE PROPER COURSE FOR THE ASSESSEE IS TO FILE A RETURN AND THEN SEEK REASONS FOR RE - OPENING THE ASSESSMENT, IF HE DESIRES. IF SUCH REQUEST IS MADE THE A.O. IS BOUND TO FURNISH THE REASONS WITHIN A REASONABLE TIME AS HELD BY THE SUPREME COURT IN G.K.N. DRIVESHAFTS INDIA LTD. V. ITO (SUPRA). IN THE INSTANT CASE, THE UNDISPUTED FACT IS THAT THE COPY OF REASONS WAS GIVEN TO THE A SSESSEE DURING THE REASSESSMENT PROCEEDINGS. WITHOUT PREJUDICE TO THE OBSERVATIONS MADE ABOVE, I FIND THAT THERE WAS AN EARLIER JUDGMENT OF THE SUPREME COURT BY A BENCH OF THREE ID. JUDGES IN THE CASE OF S. NARAYANPPA V. CIT (1967) 63 ITR 219 (SC) WHEREIN IT WAS HELD THAT THE REASONS FOR REOPENING THE ASSESSMENT NEED NOT BE COMMUNICATED TO THE ASSESSEE SINCE THEY ARE ADMINISTRATIVE IN CHARACTER AND NOT QUASI - JUDICIAL & THIS JUDGMENT WAS NOT BROUGHT TO THE NOTICE OF THE ITA NO. 4 597/ DEL/20 09 & CO NO. 151 /DEL/201 0 15 SUP RE ME COURT IN THE LATER JUDGMENT IN THE CASE OF G.K.N. DRIVESHAFTS (P) LTD.(SUPRA). THEREFORE, NON - COMMUNICATION OF THE REASONS RECORDED AND SUBSEQUENT DISPOSAL OF THE OBJECTIONS RAISED BY THE ASSESSEE AGAINST THE REOPENING OF ASSESSMENT IS NOT FATAL TO THE VALIDLY OF REASSESSMENT PROCEEDIN GS. IN S. NARAYANPPA V. CIT 63 ITR 219 (SUPRA) THE APEX COURT CONSIDERED THE VIEW TAKEN BY MADRAS HIGH COURT IN PRESIDENCY TALKIES LTD. V. ADDL. IT O (1954) 25 ITR 447, AS CORRECT ONE. RELIANCE IS ALSO PLACED ON THE DECISION IN IT O VS. SMT. GURINDER KAUR (2 006) 102 ITD 189 (DELHI) WHEREIN IT HAS BEEN HELD BY THE HON'BLE IT AT, DELHI THAT NON - COMMUNICATION OF THE REASONS, EVEN ACCORDING TO THE JUDGMENT OF THE SUPREME COURT IN THE CASE OF G.K.N. DRIVESHAFTS (P) LTD. (SUPRA) IS NOT CONSIDERED TO FATAL TO THE V ALIDITY OF THE REASSESSMENT PROCEEDINGS. WHEN THE NON - COMMUNICATION OF THE REASONS HAS BEEN HELD AS NOT SUFFICIENT ENOUGH TO I N VALIDATE THE RE - ASSESSMENT PROCEEDINGS, THERE IS NO REASON AND LOGIC TO AGREE WITH THE CONTENTION OF THE APPELLANT THAT THE RE - AS SESSMENT PROCEEDINGS WERE NULL AND VOID BY SHEER DINT OF THE FACT THAT THE A.O. DID NOT DISPOSE OF THE OBJECTIONS RAISED BY THE ASSESSEE AGAINST THE RE - ASSESSMENT PROCEEDINGS. HENCE, THE APPELLANT'S PLEA REGARDING NON - DISPOSAL OF THE ITA NO. 4 597/ DEL/20 09 & CO NO. 151 /DEL/201 0 16 OBJECTIONS RAISED BY T HE ASSESSEE AGAINST THE REOPENING OF ASSESSMENT IS DISMISSED. 12. KEEPING IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE AND THE ORDERS PASSED BY THE REVENUE AUTHORITIES, ESPECIALLY THE IMPUGNED ORDER ON THE ISSUE OF VALIDITY OF REASSESSME NT PROCEEDINGS U/S. 147 OF THE INCOME TAX ACT, 1961, WE ARE OF THE VIEW THAT ON THE SPECIFIC INFORMATION THE CASE OF THE ASSESSEE HAS BEEN REOPENED. WE ARE OF THE VIEW THAT THE MATERIAL IN POSSESSION OF THE AO IS A FRESH MATERIAL WHICH HAS BEEN EXAMINED BY THE AO , CAME TO BE VALID REASONABLE BELIEVE THAT THE INCOME OF THE ASSESSEE HAS ESCAPED ASSESSMENT. AFTER CONDUCTING THE DETAILED INVESTIGATION TO PROVE THAT THE INCOME HAS ESCAPED ASSESSMENT IN THE HANDS OF THE ASSESSEE, THE REASSESSMENT PROCEEDINGS H AVE BEEN INITIATED BY THE AO. THEREFORE, IN OUR CONSIDERED OPINION, THERE WAS EXISTENCE OF CORRECT INFORMATION WHICH PROMPTED TO THE AO TO PROCEED TO ISSUE NOTICE U/S. 148 OF THE I.T. ACT AND HENCE, THIS REASSESSMENT PROCEEDINGS COULD NOT BE DECLARED AS N ULL AND VOID. 12.1 WE ALSO FIND THAT THE LD. CIT(A) HAS UPHELD THE REASSESSMENT PROCEEDINGS BY CITING THE VARIOUS DECISIONS RENDERED BY THE HON BLE SUPREME COURT OF INDIA AS WELL AS THE HON BLE HIGH COURT MENTIONED IN THE IMPUGNED ORDER. AFTER GOING THR OUGH THE SAME, WE ARE OF THE CONSIDERED VIEW THAT THE ISSUE RAISED BY THE ASSESSEE IN THE CROSS ITA NO. 4 597/ DEL/20 09 & CO NO. 151 /DEL/201 0 17 OBJECTION IS NOT SUSTAINABLE IN THE EYES OF LAW, HENCE, WE REJECT THE SAME AND UPHOLD THE ORDER OF THE LD. CIT(A) ON THIS ISSUE. 1 3 . IN THE RESULT, THE APPE AL OF THE REVENUE IS DISMISSED AND THE CROSS OBJECTION FILED BY THE ASSESSEE ALSO STAND DISMISSED. ORDER PRONOUNCED IN THE O PEN C OURT ON 04 / 9 /20 1 5 . SD/ - SD/ - [ N.K. SAINI ] [ H.S. SIDHU ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATE 04 / 9 /201 5 SRBHATNAGAR COPY FORWARDED TO: - 1. APPELLANT - 2. RESPONDENT - 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENCHES