ACIT, Jaipur V. M/S DHANLAXMI EQUIPMENT PVT. LTD., Jaipur

ITA 1103/JPR/2011

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 5335 (ITAT-JAIPUR)
• Duration Of Justice: 4 year(s) 3 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-03-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 24-05-2012
• Assessment Year: 2008-2009
• Appeal Filed On: 15-12-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P R MEENA
• Assessee Lawyers: RAJIV SOGANI; ROHAN SOGANI CA DH
• Keywords: Unexplained investment; Opportunity of being heard; Principle of natural justice; Source of fund; Deemed to accrue or arise in india; Question of law; Corroborative evidences; Capital receipt; Onus to prove
• Section: 143(3); 14A; 131; 68

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, JAIPUR JH VH-VKJ-EHUK] YS[KK LNL; ,OA JH YFYR DQEKJ] U;KF; D LNL; DS LE{K BEFORE: SHRI T.R.MEENA, AM & SHRI LALIET KUMAR, JM VK;DJ VIHY LA- @ ITA NO. 1103/JP/2011 FU/KZKJ.K O'K Z @ ASSESSMENT YEARS : 2008-09 ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-7, JAIPUR. CUKE VS. M/S DHANLAXMI EQUIPMENT PVT. LTD., F-79(A), JETPURA INDUSTRIAL AREA, JETPURA, JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AAACD 5583 A VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT JKTLO DH VKSJ LS @ REVENUE BY : SHRI P.R. MEENA FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : SHRI RAJIV SOGANI & SHRI ROHAN SOGANI (CA) LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 04/02/2016 MN?KKS'K .KK DH RKJH[ K@ DATE OF PRONOUNCEMENT : 21/03/2016 VKNS'K@ ORDER PER: T.R. MEENA, A.M.: THE REVENUE HAS FILED THIS APPEAL AGAINST THE ORDER OF THE LD. CIT(A)-III, JAIPUR DATED 01/09/2011 FOR THE ASSESSME NT YEAR 2008-09 RAISING THEREIN THE FOLLOWING GROUNDS AS UNDER:- ITA NO. 1103/JP/2011 ACIT VS M/S M/S DHANLAXMI EQUIPMENT PVT. LTD. 2 I. THE CIT(A) HAS PASSED A PERVERSE ORDER IN ACCEPTING INADMISSIBLE EVIDENCE TO DELETE THE ADDITION OF RS. 2.16 CRORES MADE UNDER SECTION 68 OF THE ACT. II. THE CIT(A) HAS ERRED IN OVERLOOKING THE FACT THAT THE ENTIRE SUBMISSIONS INCLUDING THE AFFIDAVITS OF THE CREDITORS WERE CONTRIVED AND ORCHESTRATED AND LACKED VALIDITY IN THE FACTS AND CIRCUMSTANCES OF THE ASSE SSEE. III. THE CIT(A) HAS ERRED IN HOLDING THAT THE ONUS OF PROOF HAD SHIFTED TO THE A.O. EVEN WHEN THE ASSESSEE HAD N OT DISCHARGED ITS BURDEN UNDER SEC. 68 OF THE I.T. ACT, 1961. 2. THE ASSESSEE IS ENGAGED IN THE BUSINESS OF MANUFA CTURING AND TRADING OF TRANSFORMERS. THE ASSESSEE FILED ITS RETU RN OF INCOME ON 30/09/2008 DECLARING TOTAL INCOME OF RS. 6,34,790/- . THE CASE WAS SCRUTINIZED U/S 143(3) OF THE INCOME TAX ACT, 1961 ( IN SHORT THE ACT). ALL THE GROUNDS OF THE REVENUE ARE AGAINST DELETING THE ADDITION OF RS. 2.16 CRORES MADE U/S 68 OF THE ACT CONSIDERING THE AFFID AVITS AND NOT DISCHARGING THE BURDEN CASTED ON THE ASSESSEE. THE L D ASSESSING OFFICER OBSERVED THAT THE ASSESSEE HAD INTRODUCED FRESH CAS H CAPITAL OF RS. 6,11,50,000/- IN THREE DIFFERENT HEADS, RS. 80,00,0 00/- AS UNSECURED LOAN, RS. 2,25,00,000/- IN RESERVE AND SURPLUS AND RS. 3, 06,50,000/- AS SHARE APPLICATION MONEY. A LETTER WAS SENT TO ADIT(INV.), UNIT-3(III), KOLKATA TO VERIFY THE SOURCE OF CASH CAPITAL INTRODUCTION IN T HE CASE OF ASSESSEE DURING THE F.Y. 2007-08. THE LD ASSESSING OFFICER GO T THE INTERIM REPORT ITA NO. 1103/JP/2011 ACIT VS M/S M/S DHANLAXMI EQUIPMENT PVT. LTD. 3 FROM ADIT, KOLKATA, WHICH WAS RECEIVED ON 14/12/2010 I N THE OFFICE. ACCORDING TO THE REPORT IN NINE CASES, COPIES WERE R ETURNED BACK. DEPARTMENTAL INSPECTORS WERE DEPUTED TO ASCERTAIN TH E EXISTENCE OF 9 CONCERNS. THEY WERE ALSO COULD NOT ASCERTAIN THE EXIS TENCE OF THESE COMPANIES AT THEIR RESPECTIVE GIVEN ADDRESSES. THE NOTICES ISSUED U/S 131 OF THE ACT HAD BEEN SERVED IN RESPECT OF 21 CONCERN S WITH WHICH TRANSACTIONS WERE MADE BY THE ASSESSEE. SOME OTHER P ARTIES, WHICH ARE TRACEABLE BUT THEY COULD NOT EXPLAIN THE SOURCE OF THE FUND ADVANCED TO THE ASSESSEE. THE SUMMARY OF THE LOAN/SHARE CAPITAL AS PER ASSESSING OFFICER IS AS UNDER:- COMPANIES WHICH ARE NOT TRACEABLE : S.NO. NAME OF THE CONCERNS POSTAL REMARKS BY ADIT AMOUNT RECEIPT IN DHANLAXMI 1. M/S RAJDEEP MARCHANDISE PVT. LTD., 6, WATERLOO STREET, KOLKATA. NOT KNOWN RS. 25,00,000/- 2. M/S PUSHPAK ADVISORY PVT. LTD., 28, VIVEKANAND ROAD, KOLKATA -DO- RS. 9,00,000/- 3. DIVINE TIE UP PVT. LTD., 14A, MADHU ROY LANE, KOLKATA-700006 NO SUCH COMPANY DIVINE TIE UP LTD. IN THIS ADDRESS 14A MADHU ROY LANE, KOLKATA-6, HENCE NOT KNOWN RS. 45,00,000/- 4. M/S LAKE VIEW VINIMOY PVT. LTD., 13, MOTHER TALA LANE, HOWRAH-711106 NOT KNOWN RS. 4,50,000/- ITA NO. 1103/JP/2011 ACIT VS M/S M/S DHANLAXMI EQUIPMENT PVT. LTD. 4 5. M/S SHIBPUJAN AGENCIES PVT. LTD., 50B, GARIAHAT ROAD, GROUND FLOOR, KOLKATA 700019 LEFT RS. 13,50,000/- 6. NISCHAY DISTRIBUTORS PVT. LTD., 13, MOTHR TALA LANE, HOWRAH-711106 NOT KNOWN RS. 22,50,000/- 7. UJJAL VANIJYA PVT. LTD. 13, MOTHER TALA LANE, HOWRAH-711106 DO RS. 9,00,000/- 8. M/S PANDHMUKHI COMMODIES PVT. LTD., TOLLYGUNE HOUSE STREET, EMERGENCY POLICE LINE, BLOCK-4, R.NO. 33, KOLKATA-33 DO RS. 4,50,000/- 9. GAYLORD MERCHANDISE PVT. LTD., 6, WATERLOO STREET, KOLKATA-700069. COULD NOT BE SERVED RS. 30,00,000/- COMPANIES WHERE SOURCE OF FUND IS UNEXPLAINED SL.NO. NAME OF THE CONCERNS POSTAL REMARKS BY ADIT AMOUNT RECEIPT IN DHANLAXMI 1. SANKHU BALAJI TRADE COM PVT. LTD., 5/1, CLIVE ROW, 2 ND FLOOR, R.N.-54, KOLKATA- 700001 SERVED RS. 5,00,000/- 2. BRAJAL SATI TRACOM PVT. LTD. DO RS. 5,00,000/- 3. SAFAL DEALERS PVT. LTD. 52B, TAL TALLA LANE, KOLKATA- 700016 DO RS. 4,50,000/- 4. EVERGREEN TRAFIN PVT. LTD., 52B, TAL TALLA LANE, KOLKATA-700016 DO RS. 13,50,000/- 5. GURUKRIPA PROJECTS PVT. LTD. DO RS. 25,00,000/- ITA NO. 1103/JP/2011 ACIT VS M/S M/S DHANLAXMI EQUIPMENT PVT. LTD. 5 THE LD ASSESSING OFFICER GAVE REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE WHY LOAN SHOWN IN THE NAME OF COMPANY W HICH ARE NOT TRACEABLE AND COMPANIES WHERE SOURCE OF FUND UNEXPL AINED SHOULD NOT BE ASSESSED U/S 68 OF THE ACT. THE ASSESSEE REPLIED VID E LETTER DATED 27/12/2011, IT WAS SUBMITTED THAT THE DEPARTMENT HAD NOT ENQUIRED ON THEIR CHANGED ADDRESSES AND ALL THE DATAS ARE AVAIL ABLE ON MCA SITE. IT IS CLEAR FROM THE REPORT SENT BY THE ADIT THAT AS PER N EW ADDRESSES PROVIDED BY THE ACIT, CIRCLE-7, JAIPUR INQUIRY WERE A LSO MADE BY DEPUTING DEPARTMENTAL INSPECTORS TO VERIFY THE EXISTENCE OF THE CONCERNS BUT THEY COULD NOT FIND OUT ANY BUSINESS ACTIVITIES DONE BY THESE CONCERNS. SO SHE HELD THAT THERE IS A REASON TO ADD BACK WHOLE AMOUNT RECEIVED FROM 9 COMPANIES, WHICH ARE NOT TRACEABLE. SHE FURTHER HELD THAT IN CASE OF SOME COMPANIES, INVESTMENT FUND WAS UNEXPLAINED. THE CREDI TWORTHINESS OF THE CREDITORS HAD NOT BEEN PROVED. SHE ALSO CONSIDERED THE CASE LAWS CITED BY THE ASSESSEE BUT WHICH WERE FOUND DISTINGUISHABLE. A CCORDINGLY, THE LD ASSESSING OFFICER MADE ADDITION OF RS. 2.16 CRORES U/S 68 OF THE ACT. 3. BEING AGGRIEVED BY THE ORDER OF THE ASSESSING O FFICER, THE ASSESSEE CARRIED THE MATTER BEFORE THE LD CIT(A), WHO HAD ALLO WED THE APPEAL BY OBSERVING AS UNDER:- ITA NO. 1103/JP/2011 ACIT VS M/S M/S DHANLAXMI EQUIPMENT PVT. LTD. 6 2.3. I HAVE CAREFULLY EXAMINED CONTENTS OF THE I NTERIM REPORT DATED 14/12/2010, OF ADI (INV.) KOLKATA, WHICH HAS F ORMED THE SOLE BASIS OF THE GIVEN BY THE AO IN THE IMPUGN ED ASSESSMENT ORDER, VIZ. THE ISSUES UNDER CONSIDERATI ON AND ALSO THE DETAILED COUNTER SUBMISSIONS MADE BY THE L D. AR IN THIS REGARD. FROM THE ASSESSMENT ORDER, IT IS EVIDE NT THAT MAINLY THE AO HAS MADE THE ADDITIONS U/S. 68 OF THE IT ACT, I.R.O., THE PART OF SHARE APPLICATION MONEY RECORD AND ALSO TOWARDS THE UNSECURED LOANS, RECEIVED BY THE APPELLA NT, DURING THE RELEVANT PERIOD. HERE, IT IS ALSO RELEVA NT TO MENTIONED THAT AS PER THE PROVISIONS OF SEC. 68 OF THE ACT, TO PROVE THE GENUINENESS OF ANY CASH CREDIT, THE ASSES SEE HAS TO PROVE THREE VITAL ASPECTS .I.E. IDENTITY, CAPACITY OF CREDITORS AND THE GENUINENESS OF SUCH TRANSACTION. THE ABOVE V IEWS HAVE BEEN EXPRESSED IN THE VARIOUS DECISIONS, INCLU DING IN THE CASES OF RAJSHREE SYNTHETIC PVT. LTD (256 ITR 331) ( RAJ) AND ARAVALI TRADING CO. (220 CTR 622)(RAJ). ACCORDINGLY, WHILE DECIDING THE PRESENT APPELLATE PROCEEDING, THE ABOV E CRUCIAL GUIDELINES WERE ALSO APPLIED TO APPRECIATE AND UNDER STAND THE INTRICACIES INVOLVED IN THE ABOVE RIVAL STANDS OF T HE AO AND LD. AR, VIZ. THE ISSUE UNDER CONSIDERATION. BASED O N THE ABOVE ASPECTS, MY ISSUES WISE FINDINGS AND CONCLUSIO N ARE BEING DISCUSSED AS UNDER:- 2.3.1. UNSECURED LOANS: - FROM THE ASSESSMENT ORDER , IT CAN BE SEEN THAT THE APPELLANT HAS RECEIVED TOTAL LOANS OF RS. 80 LACS, FROM THE FOLLOWING PARTIES A. M/S. RAJDEEP MERCHANDISE P. LTD. RS. 80 LACS ITA NO. 1103/JP/2011 ACIT VS M/S M/S DHANLAXMI EQUIPMENT PVT. LTD. 7 B. M/S. GAYLOAD MERCHANDISE P. LTD. RS. 30 LACS C. GARU KRIPA PROJECTS P. LTD. RS. 25 LACS RS. 135 LACS AS PER THE ADIS ABOVE REPORT, THE SUMMONS U/S. 131 COULD NOT BE SERVED THROUGH POSTAL AUTHORITY AS WELL AS TH ROUGH WARD INSPECTOR, AT THE OFFICE PREMISES M/S. RAJDEEP MERCHANDISE P. LTD. AND M/S. GAYLOAD MERCHANDISE P. LTD. THUS BASED ON THE ABOVE FINDING, THE AO CONSIDERED S UCH LOANS AS NONE GENUINE IN NATURE. SIMILARLY AS REPOR TED BY THE ADI, IN THE CASE OF M/S. GARU KRIPA PROJECTS P. LTD ., THOUGH THE PERSON CONCERNED ATTENDED BEFORE THE ADI (INV.) , KOLKOTA, IN RESPONSE TO THE SUMMON U/S. 131 OF THE ACT, HOWEVER CONSIDERING THE FINANCIAL STATUS OF SUCH COM PANY, THE AO WAS OF THE OPINION THAT THE SOURCES AN GENUIN ENESS OF SUCH LOANS TRANSACTIONS WERE NOT PROVED SATISFACTORI LY. ON THE OTHER HAND, THE LD. AR HAS SUBMITTED THAT TO PROVE THE IDENTITY, CAPACITY AND GENUINENESS OF THE ABOVE LOA N TRANSACTIONS, THEY HAVE SUBMITTED CONFIRMATIONS, AF FIDAVITS, PAN NO., COPY OF RELEVANT RETURNS OF INCOME, BANK S TATEMENT OF RELEVANT PERIOD AND COMPLETE ADDRESS OF SUCH CRE DITORS ETC. ACCORDINGLY, THE LOANS UNDER CONSIDERATIONS SHOULD BE CONSIDERED AS PROPER AND GENUINE U/S. 68 OF THE IT A CT. IN THE LIGHT OF THE ABOVE FACTUAL AND LEGAL POSITIO NS, I TENT TO AGREE WITH THE LD. AR THAT AS FAR AS APPELLANT IS CO NCERNED THEY HAVE DISCHARGE THEIR LEGAL OBLIGATION U/S. 68 BY FILING ALL THE POSSIBLE EVIDENCES AND STATUTORY DOCUMENTS, AS DISCUSSED ABOVE. THE AO HAS SIMPLY FOLLOWED THE INTERIM REPORT OF THE ITA NO. 1103/JP/2011 ACIT VS M/S M/S DHANLAXMI EQUIPMENT PVT. LTD. 8 ADI, WHICH ITSELF IS FOUND OF NON CONCLUSIVE AND HA LF COOKED IN NATURE, BEING NOT A FINAL REPORT AS SUCH. MOREOVER, - THE NON AVAILABILITY ASPECT, I.R.O,, TO CASH CREDITORS IS C ONCERNED, IN MY OPINION THE ADI REPORT IS NOT VERY CLEAR ABOUT THE EXACT REASON AND THE FOLLOW-UP ACTION TAKEN IN THIS REGAR D, SPECIALLY WHEN THESES PARTIES ARE NOT ONLY ASSESSED TO TAX BUT FILED THE RETURNS FOR THE RELEVANT PERIOD ALSO. IN THE LIGHT OF THE VOLUMINOUS DOCUMENTARY EVIDENCES, IT WOULD BE RATHER DIFFICULT TO UNDERSTAND AND APPRECIATE THE FINDINGS GIVEN BY THE ADI IN THIS REGARD. MOREOVER IN THE CASE OF M/S . -GARU KRIPA PROJECTS P. LTD., SINCE THE CONCERNED PERSON AS APPEARED AND SUBMITTED THE RELEVANT DOCUMENTS AND C ONFIRM THE LOANS TRANSACTION, IN THE LIGHT OF SETTLED LEGA L POSITION THEY ARE NOT SUPPORTED TO EXPLAIN THE SOURCE OF THE SOUR CE AND THE ONUS LIED ON THE APPELLANT GOT DISCHARGE, AS SUCH. THE ABOVE VIEWS HAVE BEEN EXPRESSED BY THE HONBLE RAJASTHAN H IGH COURT IN THE CASE OF ARIVALI TRADING CO. LTD. (220 C TR 662). IN THE LIGHT OF THE ABOVE DELIBERATION, IT IS CONCLUDE D THAT THE AO WAS NOT JUSTIFIED IN TREATING THE LOANS OF RS. 80 LA CS FROM THE ABOVE THREE PARTIES, SIMPLY ON THE BASIS OF GENERAL OBSERVATION/FINDINGS OF THE ADI (INV.) KOLKOTA, WHER EAS THE DOCUMENTARY EVIDENCES SUBMITTED IN THIS REGARD, SUG GEST OTHERWISE, AS SUCH. 2.3.2 SHARE CAPITAL/APPLICATION MONEY IN THIS REGAR D THE TOTAL SHARE CAPITAL/SHARE APPLICATION MONEY OF RS. 1.36 CRORES RECEIVED FROM 11 ENTITIES WERE CONSIDERED AS UNPROVED, U/S. 6 8 OF THE IT ACT, FOR VARIOUS REASONS AND GROUNDS BY THE AO, M AINLY ITA NO. 1103/JP/2011 ACIT VS M/S M/S DHANLAXMI EQUIPMENT PVT. LTD. 9 BASED ON THE FINDINGS GIVEN IN THE ADI REPORT, AS D ISCUSSED ABOVE. THE GISTS OF THE ABOVE STANDS OF THE AO ARE AS UNDER:- I. IN SEVEN CASES, THE NOTICES COULD NOT BE SERVED BY THE ADI, KOLKOTA, EITHER THROUGH THE POSTAL METHOD OR THROUGH THE WARD-LNSPECTOR, THEREFORE, THE SAME HAV E BEEN TREATED AS DEEMED INCOME OF THE APPELLANT, U/S . 68 OF THE ACT OF THE AO. THE DETAILS IN THIS REGARD ARE AS UNDER:- I. M/S. PUSHPAK ADVISORY P. LTD RS.9,00,000/- II. DIVINE TIE UP P. LTD. RS. 45,00,000/- III. M/S. LAKE VIEW VINIMOY.P.. LTD RS. 4,50,000/ - IV. M/S. SHIPUJAN AGENCIES P. LTD. RS.13,50,000/- V. NISCHAY DISTRIBUTORS P. LTD. RS.22,50,000/- VI. UJJWAL VANIJAY P. LTD. RS.9,00,000/- VII. M/S. PANCHMUKHI COMMODITIES LTD. RS.4,50,000 /- II. IN FOUR CASES, THOUGH THE COMPLIANCE OF SUMMONS U/S. 131 WERE MADE BY SUCH COMPANIES WITH NECESSARY DETAILS AND DOCUMENTS BEFORE THE ADI, KOLKATA, HOWEVER, IN THE LIGHT OF THEIR FINANCIAL STATUS, THE ADI AND THE AO DID NOT CONSIDERED RESPECTIVE SHARE CAPI TAL INVESTMENT, AS GENUINE, AS SUCH. THE DETAILS OF SUCH CONCERNS ARE AS UNDER:- I. SAFAL DEALERS P. LTD. RS.4,50,000/- II. EVERGREEN TRAFIN P. LTD. RS.13,50,000/- III. SANKHU BALAJI TRADE COM P LTD. RS.5,00,000/- IV. BRAJAL SATI TRACOM P. LTD. RS.5,00,000/- ITA NO. 1103/JP/2011 ACIT VS M/S M/S DHANLAXMI EQUIPMENT PVT. LTD. 10 THE UNDISPUTED FACTS I.R.O. OF THE ABOVE SHARE CAPITAL/APPLICATION MONEY RECEIVED BY THE AO ARE TH AT THE INVESTORS/CREDITORS OF SUCH TRANSACTIONS ARE PRIVA TE LIMITED COMPANIES ONLY. ACCORDINGLY WHILE DECIDING THE ISSU E UNDER CONSIDERATION, THE ABOVE VITAL ASPECT HAS TO BE KEP T IN MIND. IN THIS REGARD, THE APPELLANT HAS SUBMITTED CONFIRM ATIONS, AFFIDAVITS, PAN NO., COPY OF RELEVANT RETURNS OF IN COME, BANK STATEMENTS OF RELEVANT PERIOD AND COMPLETE ADDRESS OF SUCH COMPANIES ALONGWITH THE R.O.C. PAPERS ALSO. HERE TH E RATIOS UPHELD BY VARIOUS COURTS, INCLUDING THE HONBLE SUP REME COURT IN THE CASE OF M/S. LOVELY EXPORT PVT. LTD. 2 16 CTR 195 AND M/S. STELLAR INVESTMENT LTD. 251 ITR 463, ARE FO UND QUITE RELEVANT AND APPLICABLE, AS FOUND DEALT WITH THE ISS UE, SIMILAR TO THE PRESENT APPELLATE PROCEEDINGS ALSO. IN THE ABOVE DECISION, THE HONBLE APEX COURT HAS CATEGORICALLY HELD THAT EVEN IF THE SHARE APPLICATI ON MONEY HAS BEEN RECEIVED FROM SO- CALLED BOGUS SHARE HOLDE RS, WHOSE IDENTITY HAVE BEEN GIVEN AND PROVED, UNDER NO CIRCUMSTANCES SUCH SHARE CAPITAL CAN BE REGARDED AS UNDISCLOSED INCOME OF THE COMPANY. IN THE PRESENT C ASE THE APPELLANT HAS GIVEN SUFFICIENT DOCUMENTARY EVIDENCE S IN THE FORM OF CONFIRMATION, AFFIDAVIT, PAN NO., COPY OF R ETURN OF INCOME, R.O.C. PAPER SHOWING EXISTENCE AND ADDRESSES OF INVESTING COMPANY ETC., TO ESTABLISH THE IDENTITY A ND GENUINENESS OF SUCH COMPANIES, AS SUCH. IN THE LIGH T OF THE ABOVE DECISIONS AND ALSO SUCH VOLUMINOUS AND STATUT ORY EVIDENCES SUBMITTED BY THE APPELLANT, IN MY CONSIDE RED VIEW, ITA NO. 1103/JP/2011 ACIT VS M/S M/S DHANLAXMI EQUIPMENT PVT. LTD. 11 SIMPLY NON SERVING OF NOTICES AT GIVEN ADDRESSES OR INADEQUATE FINANCIAL RESOURCES OF SUCH COMPANIES ET C, TO SUPPORT SUCH INVESTMENT AS PERCEIVED BY THE ADI/THE AO, CANNOT BE A VALID GROUND TO MAKE THE ADDITION OF SU CH SHARE CAPITAL INVESTMENT IN THE HANDS OF THE APPELLANT CO MPANY, U/S. 68 OF THE IT ACT. IN ANOTHER RECENT JUDGMENT OF HONBLE DELHI HIGH C OURT, GIVEN IN THE CASE OF DWARKDHISH INVESTMENT PVT. LTD. (330 ITR 298) HAVING THE SIMILAR ISSUE UNDER CONSIDERATION, THE C OURT HAS HELD THAT THOUGH IN SEC. 68 PROCEEDINGS THE INITIAL BURDEN OF PROOF LIES ON THE ASSESSEE, YET ONCE HE PROVES THE IDENTITY OF THE CREDITORS/SHARE APPLICANTS BY EITHER FURNISHING THEIR PAN OR INCOME TAX ASSESSMENT NUMBER AND SHOWS THE GENUINENESS OF TRANSACTION BY SHOWING MONEY IN HIS B OOKS EITHER BY ACCOUNT PAYEE CHEQUE OR BY DRAFT ; THEN THE ONUS OF PROOF WOULD SHIFT TO THE REVENUE AND JUST BECAUSE TH E CREDITORS/SHARE APPLICANTS COULD NOT BE FOUND AT TH E ADDRESS GIVEN, IT WOULD NOT GIVE THE REVENUE THE RIGHT TO IN VOKE SEC. 68 AS REVENUE HAS ALL THE POWER AND WHEREWITHAL TO TRA CE ANY PERSON. MOREOVER, IT IS SETTLED LAW THAT THE ASSESSE E NEED NOT TO PROVE THE SOURCE OF SOURCE. AS IN THE INSTANT CA SE, THE TRIBUNAL HAS CONFIRMED THE ORDER OF THE CIT (A) OF D ELETING THE IMPUGNED ADDITION, WHILE HOLDING THAT THE ASSESSEE H AS BEEN ABLE TO PROVE THE IDENTITY OF THE SHARE APPLICANTS AND THE SHARE APPLICATION MONEY HAS BEEN RECEIVED BY WAY OF ACCOUNT PAYEE CHEQUES OR DRAFT ETC. THUS NO QUESTION OF LAW A RISES IN THE GIVEN SITUATION. FROM THE ABOVE DISCUSSION, IT IS APPARENT ITA NO. 1103/JP/2011 ACIT VS M/S M/S DHANLAXMI EQUIPMENT PVT. LTD. 12 THAT THE ABOVE RULING IS SQUARELY APPLICABLE IN THE PRESENT CASE ALSO. CONCLUSION - IN VIEW OF THE ABOVE FACTUAL AND LEGAL POSITION, I AM OF CONSIDERED VIEWS THAT THE APPELLANT HAS DISC HARGED ITS INITIAL BURDEN/ONUS CASED U/S. 68 OF THE ACT, I.R.O . THE CASH CREDITS OF RS. 80 LACS AND SHARE CAPITAL/APPLICATIO N MONEY OF RS. 1.36 CRORES, BY PROVIDING ALL POSSIBLE DOCUMENTARY/STATUTORY EVIDENCES, AS DISCUSSED ABOVE . IT IS ALSO FOUND THAT THE AO HAS DISAPPROVED OR DISBELIEV ED THE ABOVE TRANSACTIONS, SIMPLY ON THE BASIS OF A HALF C OOKED AND INCONCLUSIVE OBSERVATIONS OF THE ADI (INV.) KOLKOTA , DISCUSSED IN HIS INTERIM REPORT. IN THE LIGHT OF THE VARIOUS COURTS DECISIONS, INCLUDING OF THE APEX COURT AND THE JURI SDICTIONAL HIGH COURT AND TRIBUNAL AS RELIED UPON BY THE APPELL ANT ALSO, IT IS EVIDENT THAT THE AO HAS FAILED TO MAKE OUT AN Y REASONABLE AND PROPER CASE U/S. 68 OF THE ACT TOWARD S SHARE CAPITAL MONEY AND CASH CREDITS RECEIVED BY THE APPE LLANT, BY REFUTING THE DOCUMENTARY EVIDENCES SUBMITTED IN THE SE REGARDS. ON THE OTHER HAND, IT IS FELT THAT THE AO HAS ALSO SIMPLY REJECTED THE VOLUMINOUS SUPPORTING EVIDENCES OF THE APPELLANT IN A CRYPTIC AND SUMMARY MANNER IN THE IM PUGNED ASSESSMENT ORDER, WHICH CANNOT BE UPHELD, UNDER THE GIVEN CIRCUMSTANCES. ACCORDINGLY THE ENTIRE ADDITION OF R S. 2.16 CRORES MADE U/S. 68 OF IT ACT IS HEREBY DELETED. CO NSEQUENTLY THIS GROUND OF APPEAL IS UPHELD. ITA NO. 1103/JP/2011 ACIT VS M/S M/S DHANLAXMI EQUIPMENT PVT. LTD. 13 4. NOW THE REVENUE IS IN APPEAL BEFORE US. THE LD DR HAS VEHEMENTLY SUPPORTED THE ORDER OF THE ASSESSING OFFICER AND AR GUED THAT THE ASSESSEE HAD NOT PROVED THE IDENTITY, GENUINENESS AND CREDIT WORTHINESS OF THE CREDITORS. THE LD ASSESSING OFFICER HAD ENQUIRED THR OUGH ADIT, KOLKATA AND CAME TO CONCLUSION THAT LOAN TRANSACTION HAD NO T PROVED AS PER THE PROVISIONS OF SECTION 68 OF THE ACT. THE LD CIT(A) HA D DELETED THE ADDITION WITHOUT SATISFYING ALL THREE BASIC INGREDIENTS I.E. IDENTITY, CAPACITY AND GENUINENESS OF THE TRANSACTION. HE SIMPLY RELIED ON THE DECISION OF HON'BLE SUPREME COURT IN THE CASE OF M/S LOVELY EXPORT PVT. LTD. 216 ITR 195 AND M/S STELLAR INVESTMENT LTD. 251 ITR 463. IT IS FURTH ER ARGUED THAT THE AFFIDAVIT OF THE CREDITORS WERE CONTRIVED AND ORCHES TRATED AND ARE LACKED OF VALIDITY IN THE FACTS AND CIRCUMSTANCES OF THE A SSESSEE. ALL THE COMPANIES HAD BEEN INDULGING IN PROVIDING ACCOMMODA TION ENTRIES TO VARIOUS PARTIES IN LIEU OF THE COMMISSION CHARGES. IT WAS ALSO FOUND THAT THEY USED TO RECEIVE CASH EQUIVALENT TO THE SHARE A PPLICATION MONEY FROM THE INTERESTED PARTY, WHICH WERE DEPOSITED IN THE BAN K ACCOUNTS AND CHEQUES/DDS OF EQUAL AMOUNT HAVE BEEN ISSUED AS A S HARE APPLICATION MONEY TO SUCH PARTY CONCERNED ON GIVEN ADDRESSES. N O SUCH COMPANIES WERE FOUND. THE ASSESSEE FAILED TO PRODUCE THE DIRECT ORS OF SUCH COMPANIES FOR FURTHER VERIFICATION TO EXAMINE THE G ENUINENESS OF SUCH ITA NO. 1103/JP/2011 ACIT VS M/S M/S DHANLAXMI EQUIPMENT PVT. LTD. 14 INVESTMENTS U/S 68 OF THE ACT FOR ONUS. THE LD DR FU RTHER RELIED ON THE DECISION IN THE CASE OF CIT VS. KISHORI LAL SANTOSH LAL 216 ITR 9 (RAJ.). THE CASE LAWS CITED BY THE ASSESSEE I.E. SOPHIA FINA NCE LTD. 205 ITR 98 AND STELLER INVESTMENT LTD. (SUPRA) ARE NOT SQUAREL Y APPLICABLE. THE HON'BLE SUPREME COURT DECISION IN THE CASE LF CIT VS . LOVELY EXPORTS IS ALSO NOT APPLICABLE AS THE HON'BLE SUPREME COURT HA S DISMISSED THE SLP ON THE GROUND THAT THERE IS NO LAW POINT INVOLVED, T HE MATTER READY TO ACTUAL ASPECT. HE FURTHER RELIED ON THE DECISION IN THE CASE OF S.P. JAIN 87 ITR 370 WHEREIN IT HAS BEEN HELD THAT IN THE CASE OF UNEXPLAINED INVESTMENT IN FORM OF SHARE CAPITAL MADE BY THE ASS ESSEE, BENAMI ENTITY, THE IT AUTHORITIES WERE JUSTIFIED INCLUDING SUCH INVE STMENT IN THE HANDS OF THE ASSESSEE, AS SUCH. HE ALSO RELIED ON THE DECISI ON IN THE CASE OF SUMATI DAYAL VS. CIT (1995) 214 ITR 801 (SC). RELIANCE HAS ALSO BEEN PLACED ON THE FOLLOWING CASE LAWS:- I. CIT VS. RATHI FINLEASE LTD. 215 CTR 429 (MP). II. CIT VS. HIMALAYA INTERNATIONAL LTD. 214 CTR 437 (DEL). III. CIT VS. PRATEEK FINANCE & INVESTMENT CO. LTD. 215 ITR 272 (DEL). IV. CIT VS. NIVEDAN VANIJYA NIYOJAN LTD. 263 ITR 623 (CAL) V. HIDUSTHAN TEA TRADING CO. LTD. VS. CIT 263 ITR 289 (CAL) VI. CIT VS. DHAR ISPAT (P) LTD. 180 CTR 491 (MP). VII. CIT VS. BIJU PATNAIK (SC) 160 ITR 674 ITA NO. 1103/JP/2011 ACIT VS M/S M/S DHANLAXMI EQUIPMENT PVT. LTD. 15 VIII. ROSHAN DE HATTI VS. CIT (SC) 107 ITR 938 IX. SUMATI DAYAL VS. CIT (SC) 214 ITR 801 X. VASANTIBAI N. SHAH VS. CIT (BOM) 213 ITR 805 XI. SREELEKHA BANARJEE & ORS. VS. CIT (SC) 49 ITR 11 2 XII. CIT VS. PRECISION FINANCE P. LTD. (CAL) 208 ITR 465 XIII. K.C.N. CHANDRASEKHAR VS. ACIT (ITAT, BANG) 66 TTJ 355 XIV. CIT VS. UNITED COMMERCIAL & INDUSTRIAL CO. (P) LTD. (CAL) 187 ITR 596. XV. CIT VS. SOPHIA FINANCE LIMITED (DEL) 205 ITR 98 XVI. CIT VS. ACTIVE TRADERS P. LTD. (CAL) 214 ITR 58 3 XVII CIT VS. NIVEDAN VANIYA NIYOJAN LTD. (CAL) 263 ITR 623 XVIII. CIT VS. BHAGWATI JEWELS LTD. (DEL) 201 ITR 461 XIX. CIT VS. RATHI FINLEASE LTD. (MP) 215 CTR 429 XX. ACIT VS. DHANLAXMI STEEL RE-ROLLING MILLS (ITAT, HYD) 57 ITD 361. XXI. PRADIP KUMAR LOYALKA VS. ITO (ITAT, PAT-TM) 63 ITD 87. THEREFORE, ORDER OF THE ASSESSING OFFICER MAY PLEASE BE CONFIRMED. 5. AT THE OUTSET, THE LD AR OF THE ASSESSEE HAS REI TERATED THE ARGUMENTS MADE BEFORE THE LD CIT(A). THE LD ASSESSI NG OFFICER ACCEPTED THE SHARE CAPITAL RECEIPT FROM ALL THE PARTIES TO B E GENUINE. HOWEVER, HE DID NOT ACCEPT THE CORRESPONDING SHARE PREMIUM AMOU NT TO BE GENUINE. THE DETAILS ARE AS UNDER:- ITA NO. 1103/JP/2011 ACIT VS M/S M/S DHANLAXMI EQUIPMENT PVT. LTD. 16 S.NO. NAME OF THE PARTY SHARE CAPITAL (X) SHARE PREMIUM (Y) TOTAL (X+Y) 1 PUSHPAK ADVISORY PRIVATE LIMITED 100,000 900,000 1,000,000 2 DIVINE TIEUP PRIVATE LIMITED 500,000 4,500,000 5,000,000 3 LAKEVIEW VINIMAY PRIVATE LIMITED 50,000 450,000 500,000 4 SHIVPUJAM AGENCIES PRIVATE LIMITED 150,000 1,350,000 1,500,000 5 NISCHAY DISTRIBUTORS PRIVATE LIMITED 250,000 2,250,000 2,500,000 6 UJJAWAL VANIJYA PRIVATE LIMITED 100,000 900,000 1,000,000 7 PANCHMUKHI COMMODITIES PRIVATE LIMITED 50,000 450,000 500,000 8 SAFAL DEALERS PRIVATE LIMITED 50,000 450,000 500,000 9 EVERGREEN TRAFIN PRIVATE LIMITED 150,000 1,350,000 1,500,000 SUB-TOTAL (A) 1,400,000 12,600,000 14,000,000 10 HARIOM VANCON PRIVATE LIMITED 200,000 1,800,000 2,000,000 11 NIRMAL VINIYOG PRIVATE LIMITED 550,000 4,950,000 5,500,000 12 MONITOR SUPPLIERS PRIVATE LIMITED 150,000 1,350,000 1,500,000 13 ENERGY DISTRIBUTORS PRIVATE LIMITED 200,000 1,800,000 2,000,000 SUB-TOTAL (B) 1,100,000 9,900,000 11,000,000 TOTAL (A+B) 2,500,000 22,500,000 25,000,000 ACCEPTED AS GENUINE BY LD. AO NOT ACCEPTED AS GENUINE BY LD. AO ACCEPTED AS GENUINE BY LD. AO SHARE APPLICATION MONEY RECEIVED BY THE ASSESSEE CO MPANY THROUGH PROPER CHANNEL AMOUNTING TO RS. 10 LACS, WHICH WAS SU BSEQUENTLY RETURNED BACK THROUGH BANKING CHANNEL. HE REFERRED THE ORDER OF THE LD CIT(A) FOR THIS PURPOSES. THE ASSESSEE COMPANY PRODUC ED ALL THE REQUIRED ITA NO. 1103/JP/2011 ACIT VS M/S M/S DHANLAXMI EQUIPMENT PVT. LTD. 17 DOCUMENTS TO PROVE THE IDENTITY, GENUINENESS AND CR EDITWORTHINESS OF THE COMPANIES, WHO HAD INVESTED LENT MONEY. ALL THE PART IES ARE PRIVATE LIMITED COMPANY DULY REGULATED BY THE STRINGENT PRO VISIONS OF THE COMPANIES ACT, 2013 AND THEIR COMPLETE DETAILS COUL D BE VERIFIED FROM THE MAC WEBSITE. THE DEPARTMENT HAS ALSO ISSUED THEM PAN . THESE COMPANIES ARE REGULARLY ASSESSED TO TAX. THUS, THE O NUS, ON THE PART OF THE ASSESSEE COMPANY, STOOD FULLY DISCHARGED. THE LD ASSESSING OFFICER HAD SOLELY TAKEN DECISION ON THE BASIS OF INTERIM R EPORT OF ADIT, KOLKATA. NOTHING WAS BROUGHT ON RECORD BY THE ASSESSING OFFIC ER TO SHIFT THE BURDEN ON THE ASSESSEE COMPANY. THE LD AR HAS FURTHE R SUBMITTED THAT THE FOLLOWING COMPANIES HAD BEEN SERVED NOTICES BY T HE INCOME TAX DEPARTMENT, WHICH IS REPRODUCED AS UNDER:- S.NO NAME OF COMPANY ADDRESS PB 1. M/S RAJDEED MERCHANDISE PVT.LTD. 6, WATERLOO STREET, KOLKATA 700069 266-267 2. DIVINE TIE UP PVT.LTD. 25B, RAJA RAJ BALLAV STRE ET, GROUND FLOOR,KOLKATA - 700003 266 3. M/S LAKE VIEW VINIMOYPVT.LTD. 202, JESSORE ROAD, SHYAM LAKE GARDEN, BLOCK B, SHOP NO.5, KOLKATA 700089 266 4. M/S SHIVPUJAN AGENCIES PVT. LTD. 3, RAJA DEBENDRA NARAYAN DEB LANE, KOLKATA 700005 266 5. M/S PANCHMUKHI COMMODITIES PVT.LTD. 4B, GOPI BOSE LANE, KOLKATA 700012 266 6. GAYLORD MERCHANDISE PVT. LTD. 6, WATERLOO STREET, KOLKATA 700069 266 7. M/S PUSHPAK ADVISORY PVT. LTD. 28, VIVEKANAND ROAD, KOLKATA 700007 266 ITA NO. 1103/JP/2011 ACIT VS M/S M/S DHANLAXMI EQUIPMENT PVT. LTD. 18 THERE IS NO EVIDENCE WITH THE ASSESSING OFFICER DIREC TLY OR INDIRECTLY THAT THE ASSESSEES UNACCOUNTED MONEY HAD BEEN ROUTED TH ROUGH THESE DEPOSITS. IN ABSENCE OF THIS FINDING, NO ADDITION C AN BE MADE IN THE INCOME OF THE ASSESSEE MERELY ON SUSPICION. SINCE T HE IDENTITY OF THE CASH CREDITORS HAD BEEN ESTABLISHED BY THE ASSESSEE COMP ANY. THE LD ASSESSING OFFICER AT BEST COULD HAVE ASSESSED SUCH AMOUNT IN THE HANDS OF THOSE COMPANIES. THERE IS ALSO NO ALLEGATION BY THE LD ASS ESSING OFFICER OR IN THE INTERIM REPORT BY ADIT KOLKATA THAT THESE COMPANIES WERE PART OF ANY RACKET OR WERE ENTRY OPERATORS. THE LD ASSESSING OFFI CER MADE ROUTINE ENQUIRY TO ADIT, KOLKATA. THERE IS ALSO NO INFORMATI ON ON WHICH THESE CASES WERE ASSESSED BY REOPENING. HE FURTHER RELIED ON THE FOLLOWING CASE LAWS:- (I) CIT VS VACMET PACKAGING (INDIA) (P) LTD. (2014) 367 ITR 217 (ALL). (II) CIT VS PRANAV FOUNDATIONS LTD. (2014) 51 TAXMANN .COM 198 (MAD). (III) CIT VS VRINDAVAN FARMS (P) LTD. ITA NO. 71/201 5 DELHI HIGH COURT. (IV) CIT VS SOM TOBACCO INDIA LTD. (2014) 42 TAXMANN. COM 310 (ALL). (V) FAIR FINVEST LTD. (2013) 357 ITR 146 (DELHI). (VI) CIT VS MORANI AUTOMOTIVES (P) LTD. (2014) 264 C TR 86 (RAJ.) (VII) CIT VS FIRST POINT FINANCE LTD. (2006) 286 ITR 477 (RAJ.). (VIII) CIT VS SUPERTECH DIAMOND TOOLS (P) LTD. (2014) 44 TAXMANN.COM 460 (RAJ). ITA NO. 1103/JP/2011 ACIT VS M/S M/S DHANLAXMI EQUIPMENT PVT. LTD. 19 (IX) M/S BELLS PAPER BOARD (P) LTD. ITA NO. 575/JP/ 2011, M/S MISTY MEADOWS (P) LTD. ITA NO. 422/JP/2012. (X) SHREE MARKHA SYNTHETICS LTD. (2006) 155 TAXMAN 2 89 (RAJ.) 5.1 THE LD AR FURTHER ARGUED THAT WHEN THE IDENTITY H AS BEEN ESTABLISHED BY THE ASSESSEE, THERE IS NO NEED TO ES TABLISH THE SOURCE OF MONEY INFUSED BY THE CREDITORS, FOR WHICH HE RELIED ON THE FOLLOWING DECISIONS: (I) KANHAIALALJANGID V ASST. CIT (2008) 217 CTR (RAJ ) 354. (II) ARAVALI TRADING CO V ITO (2008) 220CTR (RAJ) 62 2 (III) LABH CHAND BOHRA V ITO (2010) 189 TAXMAN 141 ( RAJ) (IV) CIT VS. JAY DEE SECURITIES & FINANCE LTD.(2013 ) 350 ITR 220 (ALL.) IT IS FURTHER ARGUED THAT SECTION 68 AMENDED BY THE FINANCE ACT 2012 W.E.F 1.4.2013 GOES TO CONFIRM THAT PRIOR TO THIS AM ENDMENT THE PERSON IN WHOSE NAME SUCH CREDIT WAS RECORDED IN THE BOOKS OF T HE COMPANY WAS NOT EXPECTED TO OFFER ANY EXPLANATION ABOUT THE NAT URE AND SOURCE OF SUCH SUM. THE FACTUAL BACKGROUND OF THE CREDITOR IS TO BE UNDERSTOOD AND HAS HELD BY THE HONBLE SUPREME COURT IN SUN ENGINEERIN G WORKS (P.) LTD. [1992] 198 ITR 297 (SC). HE FURTHER RELIED ON THE D ECISION OF HONBLE ITAT-A BENCH MUMBAI IN THE CASE OF SUPERLINE CONSTR UCTION PRIVATE LIMITED ITA NO. 3644/MUM/2014 WHEREIN IT HAS BEEN H ELD THAT SUCH RECEIPTS CANNOT BE REGARDED AS THE UNDISCLOSED INCO ME OF THE ASSESSEE COMPANY AND IN CASE THE DEPARTMENT HAS INFORMATION ABOUT THE ALLEGED ITA NO. 1103/JP/2011 ACIT VS M/S M/S DHANLAXMI EQUIPMENT PVT. LTD. 20 BOGUS SHAREHOLDERS, THEN THE DEPARTMENT SHOULD PROC EED TO REOPEN THE INDIVIDUAL ASSESSMENTS OF THE INVESTORS. THEREFORE, HE PRAYED TO CONFIRM THE ORDER OF THE LD CIT(A). 6. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. THE LD ASSESSING OFFICER DURING THE COURSE OF ASSESSMENT PROCEEDINGS, NOTICED THAT THE ASSESSEE HAS SHOWN DEPOSITS, FRESH CAPITAL OF RS. 6,11,50,000/- IN DIF FERENT FORM I.E. UNSECURED LOAN, RESERVE AND SURPLUS AND SHARE CAPITAL MONEY. THE LD ASSESSING OFFICER VERIFIED THE INFORMATION SUBMITTED BY THE A SSESSEE THROUGH ADIT, KOLKATA, WHO HAD SENT INTERIM REPORT, WHICH WAS RECEI VED ON 14/12/2010 WHEREAS ASSESSMENT WAS COMPLETED ON 30/12/2010. IN IN TERIM REPORT, AS PER ASSESSING OFFICER IN 9 CASES, NOTICES WERE RETUR NED BACK BUT IT WAS NOT INFORMED TO THE ASSESSEE ABOUT THE CONCLUSION OF TH E ENQUIRY BY THE ADIT, KOLKATA OR ASSESSING OFFICER OF THE ASSESSEE. THE LD ASSESSING OFFICER HEAVILY RELIED ON THE INSPECTORS REPORT IN CONFIRM ING THE ADDITION BUT RESULT OF THE ENQUIRY OF THE INSPECTOR HAS NOT BEEN COMMUNICATED TO THE ASSESSEE, WHICH IS AGAINST THE PRINCIPLES OF NATURAL JUSTICE. AS PER ASSESSING OFFICER, IN CASE OF 5 COMPANIES, THE SOUR CE OF FUND WAS NOT FOUND EXPLAINED. THE LD ASSESSING OFFICER AGAIN GAVE SHOW CAUSE NOTICE ON 23/12/2010. THE ASSESSEE FILED REPLY ON 27/12/201 0 AND IT WAS ITA NO. 1103/JP/2011 ACIT VS M/S M/S DHANLAXMI EQUIPMENT PVT. LTD. 21 CLAIMED BEFORE THE ASSESSING OFFICER THAT NO ENQUIR Y HAS BEEN MADE BY THE ASSESSING OFFICER ON CHANGED ADDRESSES. THE LD A SSESSING OFFICER HAD NOT CONSIDERED THE EVIDENCE FILED BY THE ASSESSEE D URING THE COURSE OF ASSESSMENT PROCEEDINGS I.E. AFFIDAVITS CONFIRMING T HE TRANSACTION, PAN NUMBER, COMPLETE ADDRESSES OF CREDITORS, COPY OF BA LANCE SHEET, ITR FOR A.Y. 2008-09, BANK STATEMENT AND FORM NO. 18. THE AS SESSEE HAD DISCHARGED ITS ONUS BY PROVIDING THE REQUISITE EVID ENCES TO PROVE THE IDENTITY, GENUINENESS AND CREDITWORTHINESS OF THE CA SH CREDITORS. THE LD ASSESSING OFFICER HERSELF HAD ACCEPTED THE REMAININ G CASH CREDITORS TO THE TUNE OF RS. 3.95 CRORES EXPLAINED ON THE BASIS OF SIMILAR EVIDENCES PRODUCED BY THE ASSESSEE AS GENUINE. THE LOAN/SHARE CAPITALS WERE RECEIVED FROM THE PRIVATE LIMITED COMPANIES. THEY AL SO ARE FILING RETURN UNDER THE COMPANYS LAW AND ALL INFORMATION IS AVAIL ABLE ON MCA WEBSITE. THE ADIT REPORT WAS NOT CONCLUSIVE TO HELD THAT THE C ASH CREDITORS WERE NOT GENUINE. IT IS NOT REQUIRED UNDER THE LAW TO PRO VE THE SOURCE OF SOURCE U/S 68 OF THE ACT. PRIMARY BURDEN LIES ON THE ASSES SEE HAS BEEN DISCHARGED BY FILING THE REQUISITE EVIDENCES BEFORE THE ASSESSING OFFICER AND SHIFTED ON THE ASSESSING OFFICER TO DISPROVE TH E CASH CREDITORS TRANSACTIONS ARE NOT GENUINE OR BOGUS. THE SHARE AP PLICATION MONEY WAS RECEIVED BY THE APPELLANT AND SUBSEQUENTLY RETURNED THOUGH BANKING ITA NO. 1103/JP/2011 ACIT VS M/S M/S DHANLAXMI EQUIPMENT PVT. LTD. 22 CHANNEL. IN CASE OF 7 COMPANIES, THE NOTICES WERE SE RVED ON IT ON GIVEN ADDRESSES. THERE IS NO EVIDENCE DIRECTLY OR INDIRECT LY WITH THE ASSESSING OFFICER THAT THE ASSESSEE HAD ROUTED UNDISCLOSED MO NEY IN THE GUISE OF SHARE APPLICATION MONEY OR LOAN. THE LD DRS ARGUMEN T HAVE ALSO NOT CONVINCED US THAT THESE PARTIES WERE IN ACCOMMODATIO N ENTRIES IN FORM OF LOAN AND SHARE APPLICATION MONEY AFTER CHARGING CER TAIN COMMISSION AS SUCH NO SURVEY/SEARCH HAS BEEN CARRIED OUT ON THE C REDITORS TO PROVE THAT THESE COMPANIES ARE HABITUAL TO PROVIDE LOAN/SHARE APPLICATION MONEY EVEN THERE IS NO EVIDENCE WITH THE LD DR FOR MAKING SUCH ALLEGATION DURING THE COURSE OF WRITTEN SUBMISSIONS. THE CASE LAWS RELI ED BY THE LD AR ARE SQUARELY APPLICABLE ON THE GIVEN FACTS AND CIRCUMST ANCES. THE LD DR HAS ALSO NOT CONTROVERTED THE FINDING GIVEN BY THE LD C IT(A). ACCORDINGLY, WE UPHOLD THE ORDER OF THE LD CIT(A). 7. IN THE RESULT, REVENUES APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 21/03/2016. SD/- SD/- YFYR DQEKJ VH-VKJ-EHUK (LALIET KUMAR) (T.R. MEENA) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 21 ST MARCH, 2016 * RANJAN ITA NO. 1103/JP/2011 ACIT VS M/S M/S DHANLAXMI EQUIPMENT PVT. LTD. 23 VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- THE ACIT, CIRCLE-7, JAIPUR. 2. IZR;FKHZ@ THE RESPONDENT- M/S DHANLAXMI EQUIPMENT PVT. LTD., JAIPUR. 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE (ITA NO. 1103/JP/2011) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR