Anjaney Steels P.Ltd, Delhi V. ITO, Ward-2(4), New Delhi

CO 158/DEL/2018

AI Insights

The case involves an appeal by the Income Tax Officer against M/s Anjaney Steels Pvt. Ltd. concerning the assessment year 2008-09. The primary contention was regarding the deletion of an addition of Rs. 2,25,00,000 plus commission, which was initially added to the assessee's income as unexplained income from accommodation entries. The CIT(A) had deleted this addition, leading to the Revenue's appeal. The tribunal's decision hinged on procedural lapses in serving the notice and substantive issues regarding the lack of evidence to support the allegations of accommodation entry.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 131746 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 8 month(s) 21 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 20-04-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 16-04-2023
• Assessment Year: 2008-2009
• Appeal Filed On: 30-07-2018
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Tangible material
• Section: 147; 27; 148; 2; 201

Judgement Text

THE INCOME TAX APPELLATE TRIBUNAL DELHIBENCH ‘A’, NEW DELHI Before Sh. Saktijit Dey, Judicial Member Dr. B. R. R. Kumar, Accountant Member ITA No. 4510/Del/2018 : Asstt. Year: 2008-09 Income Tax Officer, Ward-2(4), New Delhi Vs. M/s Anjaney Steels Pvt. Ltd., 401, Mahavirji Complex, LSC, Rishabh Vihar, Delhi-110092 (APPELLANT) (RESPONDENT) PAN No. AAFCA9980K CO No. 158/Del/2018 : Asstt. Year: 2008-09 M/s Anjaney Steels Pvt. Ltd., 401, Mahavirji Complex, LSC, Rishabh Vihar, Delhi-110092 Vs. Income Tax Officer, Ward-2(4), New Delhi (APPELLANT) (RESPONDENT) PAN No. AAFCA9980K Assessee by : Sh. Anil Jain, CA Revenue by : Sh. Kanv Bali, Sr. DR Date of Hearing: 17.04.2023 Date of Pronouncement: 21.04.2023 ORDER Per Dr. B. R. R. Kumar, Accountant Member: The present appeal and Cross Object have been filed by Revenue and the assessee against the order of ld. CIT(A)-32, New Delhi dated 07.03.2018. 2. Following grounds have been raised by the Revenue: “1. The findings of ld. CIT(A) are perverse. On the one hand, the ld. CIT(A) confirms that Sh. Rajiv Singh has given accommodation entry, whereas on the other hand, the addition of accommodation entry of ITA No. 4510/Del/2018 CO No. 158/Del/2018 Anjaney Steels Pvt. Ltd. 2 Rs.2,25,00,000/- plus commission is deleted in the hands of the recipient, i.e. M/s Anjaney Steels Pvt. Ltd. 2. The ld. CIT(A) erred in deleting the addition of Rs.2,25,00,000/- plus commission @ 1.50% amounting to Rs.3,37,500/- on the accommodation entry taken by the assessee.” 3. The assessee filed return of income on 13.11.2008 declaring Nil income. Proceedings were initiated u/s 147 of the Income Tax Act, 1961 and notice u/s 148 has been issued by the AO. On perusal of the notice, we find that the notice has been addressed to the assessee at 401, Mahavirji Complex, LSC, Shakarpur, New Delhi-110092 whereas the correct address is 401, Mahavirji Complex, LSC, Rishab Vihar New Delhi-110092. 4. It is a fact on record that the time of inspection of the file on 19.07.2017, it has been found that this notice has returned back and the original envelope was also lying in the file. Secondly, no notice has been issued on the address written in the ITR filed. The revenue has submitted that another notice addressed to Rishab Vihar has been served through affixture. It is undisputed fact that the notice addressed to Rishab Vihar has not been sent by post but was served by affixture. No evidence of issue of notice to the correct address of the assessee has been produced before us. 5. Further, we have gone through the Assessment Order. For the sake of ready reference, the entire portion of the relevant part of the Assessment Order is reproduced below: ITA No. 4510/Del/2018 CO No. 158/Del/2018 Anjaney Steels Pvt. Ltd. 3 “2 . N ot s ati s fi ed th e a s se s s e e fil ed a w ri t pe titi on b e f o r e th e H on ’bl e High C ou rt of D el h i s e ekin g t o qu a s h th e n ot ic e is su e d u/s 148 . T h e H on ’bl e High C ou rt i n its o rd e r da t ed 11 -03-2 016 in W P (C ) 2132/ 201 6 h as disp o s ed o ff th e w ri t p eti ti on by stat in g a s u n d e r:- “ Ha vin g l ea rn ed c ou n s el f o r th e pe titi o n e r at s o m e len gth, th e c ou rt i s o f th e vi e w th at th e ab ov e g r ou n d s d o n o t me r it c on s ide rat ion by th e c ou rt at th is st ag e i n e xe r ci s e o f it s w rit ju ris d icti on . It w ou ld b e app r op ria t e fo r th e A O t o e xa min e e ach of th e s e g r ou n d s in ac c o rd anc e with la w. ” 3. Th e H on ’ bl e h igh c ou rt h a s n ot gi ve n an y ad v e r se fin din g aga in s t th e o rd e rs di sp o si n g of f th e obj e cti on s. Fu rth e r in c o mplia n c e t o th e dir e cti on s of th e h ig h c ou rt obj e cti on s a n d th r e e gr ou n d s w e r e di sp os e d o ff by p a ss in g an o rd e r dat ed 28 -03- 20 16 N o. 37 0 in winch all th e th r e e gr ou n d s rai s ed b e f o r e th e H on ’b l e C o u rt h a v e b e en ad dr e ss e d t o as p e r law . It wa s r equ e st ed t o th e a ss e s s e e to su bmit th e n e c e s sa ry d et ail s t o en a bl e th e u n d e r sig n ed t o co mpl e t e th e r ea ss e s sm en t p ro c e edin gs . T ill th e dat e of p as sin g th e o rd e r th e a ss e s s e e did n ot su b mit an y co n fi r mati on o r det ail s . Th e a s s e ss men t a r e th e r ef o r e bein g c om pl eted on th e b as is o f wh at e v e r mat e ri al w as a vai labl e on re c o rd s . Th e f ailu r e t o su bm it th e d e tail s p r o ve s th at th e as s e ss e e h as al s o ta k en ac c om m odat i on en tr ie s t otal in g t o Rs . 2 .25 c r or e s fr o m th e c on c e rn s b ein g op e ra t ed b y th e e s tabli sh ed a cc o mm o dati on en t r y op er at o r s. H en c e th i s am ou n t o f R s. 2 .25 cr o r e s is t r eat e d a s u n e xp lain ed a s p e r th e pr o vi si on s o f s e cti on 6 8 an d as s es s ed as in c o me o f th e a ss e s s ee . Th e p en alt y pr o c e edin g s u/ s 27 1(1)( c) fo r fai lu r e to fu rn ish t ru e p art icu la r s o f it s in c om e . (Ad diti on : Rs .2 ,25 ,0 0, 000/ -)” 6. On going through the Assessment Order, we find that even the reasons for recording the satisfaction, or the details of satisfaction recorded viz., name, amount, bank details, details of the accommodation entity have not even been mentioned. 7. The Assessing Officer has not travelled even an inch beyond the allegations to prove the facts. Allegations, however ITA No. 4510/Del/2018 CO No. 158/Del/2018 Anjaney Steels Pvt. Ltd. 4 strong cannot be a reason to make addition without brining any basic tangible material on record. 8. Hence, the action of the revenue is to be discharged on merits and on account of failure to serve a valid statutory notice u/s 148. 9. In the result, CO of the assessee is allowed and the appeal of the revenue is dismissed. Order Pronounced in the Open Court on 21/04/2023. Sd/- Sd/- (Saktijit Dey) (Dr. B. R. R. Kumar) Judicial Member Accountant Member Dated: 21/04/2023 *Subodh Kumar, Sr. PS* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR