ACIT, Erode V. NKCM Spinners Pvt Ltd., Erode

ITA 1259/CHNY/2013

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 7194 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 6 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-12-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 09-12-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 07-06-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A V SREEKANTH
• Assessee Lawyers: S SRIDHAR
• Section: 143(3); 115JB; 12

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL , C B ENCH, CHENNAI . , ! # $ , % & BEFORE SHRI A.MOHAN ALANKAMONY ACCOUNTANT MEMBER AND SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER I.T.A.NO . 1259/MDS/2013 & C.O.NO.154/MDS/2013 (IN ITA NO.1259/MDS/2013) ( / ASSESSMENT YEARS: 2009-10) THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-I GANDHI ROAD, ERODE. VS M/S. NKCM SPINNERS PVT.LTD. 18, ALAGIRI SINGH STREET, FORT ERODE-638 001. PAN: AACCN7095D ( /APPELLANT) ( /RESPONDENT/CROSS OBJECTOR) / APPELLANT BY : MR. A.V. SREEKANTH, JCIT /RESPONDENT BY : MR. S.SRIDHAR, ADVOCATE / DATE OF HEARING : 9 TH DECEMBER, 2014 /DATE OF PRONOUNCEMENT : 19 TH DECEMBER, 2014 / O R D E R PER CHALLA NAGENDRA PRASAD, JM: THIS APPEAL IS FILED BY THE REVENUE AGAINST THE O RDER OF COMMISSIONER OF INCOME TAX (APPEALS)-I, COIMBAT ORE DATED 05.03.2013 FOR THE ASSESSMENT YEAR 2009-10. 2. THE REVENUE RAISED THE FOLLOWING GROUNDS IN ITS APPEAL:- 1. THE CIT(A) ERRED IN NOT GIVING AN OPPORTUNITY TO THE ASSESSING OFFICER BY CALLING FOR REMAND REPORT TO ESTABLISH THE GENUINENESS CREDITWORTHINESS AND IDENTITY OF THE CREDITOR COMPANY. 2 ITA NO.1259/MDS/2013 & C.O. NO.154/MDS/2013 2. THE CIT(A) HAD FAILED TO CROSS EXAMINE THE COMPANY NAMELY TOP GRAIN VYAPAR AND ITS DIRECTOR AND NEITHER HAS THE DETAILS OF THE OUTCOME OF HIS ENQUIRY REGARDING THE CREDIBILITY OF THE SHAREHOLDER COMPANIES STATED IN HIS APPEAL ORDER. THOUGH REVENUE RAISED GROUND AGAINST NOT GIVING OPPORTUNITY TO THE ASSESSING OFFICER CALLING FOR RE MAND REPORT AND CROSS-EXAMINING THE CREDITOR COMPANIES WHO INVE STED SHARE APPLICATION MONEY IN THE CONCERNS WHICH WERE TAKEN OVER BY THE ASSESSEE, THE ISSUE RELATES TO DELETION OF ADDITION MADE BY THE ASSESSING OFFICER IN RESPECT OF SHARE APPLICATION MONEY AND UNSECURED LOAN CREDITORS. 3. BRIEF FACTS ARE THAT THE ASSESSEE COMPANY WHICH IS INTO THE BUSINESS OF TRADING AND MANUFACTURING OF YARN F ILED ITS RETURN OF INCOME FOR THE ASSESSMENT YEAR 2009-10 ON 29.9.2009 ADMITTING INCOME OF ` 56,74,140/- UNDER NORMAL PROVISIONS OF THE ACT AND COMPUTED BOOK PROFIT UND ER SECTION 115JB AT ` 37,89,604/- . THE ASSESSMENT UNDER SECTION 143(3) OF THE ACT WAS COMPLETED ON 30.12.2011 DETER MINING THE INCOME OF THE ASSESSEE AT ` 3,26,61,000/-. WHILE COMPLETING THE ASSESSMENT, THE ASSESSING OFFICER MA DE 3 ITA NO.1259/MDS/2013 & C.O. NO.154/MDS/2013 ADDITION OF ` 2,50,00,000/- ON ACCOUNT OF SHARE APPLICATION MONEY RECEIVED BY THE ASSESSEE AND ` 16,14,923/- TOWARDS UNSECURED LOAN CREDITORS ON THE GROUND THAT IDENTIT Y OF THE CREDITOR COMPANIES HAS NOT BEEN PROVED AND THEREFOR E TRANSACTIONS ARE NOT GENUINE. IN THE COURSE OF ASS ESSMENT PROCEEDINGS, THE ASSESSEE WAS REQUIRED TO FILE AD DRESSES OF CREDITOR COMPANIES NAMELY M/S. TOP GRAIN VYAPAR (P) LTD., AND M/S. UMANG COMMO TRADE (P). LTD., FROM WHICH TH E ASSESSEE IS SAID TO HAVE BEEN RECEIVED SHARE APPLIC ATION MONEY. THE ASSESSEE PROVIDED THE ADDRESSES OF THESE COMPANIES. THE ASSESSING OFFICER SEEMS TO HAVE ISS UED LETTERS TO THOSE COMPANIES FOR CONFIRMATION OF THE AMOUNTS INVESTED BY THEM AS SHARE CALL ADVANCE IN THE ASSES SEE COMPANY. AS THE ASSESSING OFFICER COULD NOT GET IN FORMATION / DETAILS REGARDING INVESTMENTS MADE BY THE SAID CO MPANIES AND NO REPLY HAS BEEN RECEIVED FROM THOSE COMPANIES , THE ASSESSING OFFICER SEEMS TO HAVE REQUESTED THE ASSIS TANT COMMISSIONER OF INCOME TAX, CIRCLE-13,KOLKATTA TO VERIFY PRESENCE OF THESE TWO COMPANIES BY SENDING A REPORT . A VERIFICATION REPORT DATED 8.12.2011 WAS SENT BY AS SISTANT COMMISSIONER OF INCOME TAX, CIRCLE-13, KOLKATTA STA TING THAT 4 ITA NO.1259/MDS/2013 & C.O. NO.154/MDS/2013 NO SUCH COMPANIES ARE IN EXISTENCE IN THE GIVEN ADD RESS. THIS REPORT WAS RECEIVED BY THE ASSESSING OFFICER O N 15.11.2011. THE ASSESSING OFFICER REQUIRED THE ASSE SSEE BY LETTER DATED 13.12.2011 TO FILE DETAILS OF DIRECTOR S OF THOSE COMPANIES, RETURN OF INCOME FILED BY THE CREDITOR C OMPANIES ALONG WITH BALANCE SHEET, PROFIT & LOSS ACCOUNT AND OTHER STATEMENTS IN SUPPORT OF THE RETURNS FILED. ON 21. 12.2011 THE ASSESSEE FILED DETAILS OF DIRECTORS, THEIR PAN, ROC DETAILS, COPIES OF ACKNOWLEDGEMENT OF RETURN FILED BY THESE TWO COMPANIES. SUMMONS WERE ISSUED BY ASSESSING OFFICER UNDER SECTION 131(1A) OF THE ACT ON 22.12.2011 TO THE DIRECTORS OF THE TWO COMPANIES AND STATEMENT OF MR . RATANLAL NAKHAT, ONE OF THE DIRECTORS OF M/S. TOP GRAIN VYAP AR (P) LTD. WAS RECORDED ON 26.12.2011 WHEREIN HE DEPOSED THAT HE DOES NOT KNOW ABOUT SHARE CALL ADVANCE MONEY, THE TRANSACTION AND ACTIVITIES OF M/S. TOP GRAIN VYAP AR (P) LTD. ARE ALL LOOKED AFTER BY THE OTHER DIRECTOR OF THE C OMPANY MR. SHARVAN PATWARI. SUMMONS WERE ALSO SERVED ON MR. SHARVAN PATWARI, DIRECTOR OF M/S. TOP GRAIN VYAPAR (P) LTD., AND MR. RAM CHANDRA SAHARA AND MR. SUNILKUMAR MUNDHARA ON 27.12.2011 AND 26.12.2011 RESPECTIVELY . 5 ITA NO.1259/MDS/2013 & C.O. NO.154/MDS/2013 THOSE DIRECTORS APPEARED TO HAVE SENT THEIR REPLY O N 29.12.2011 BY FAX. NOT SATISFIED WITH THE DETAILS P RODUCED BY THE ASSESSEE, THE ASSESSMENT WAS COMPLETED ON 30.12.2011 BY THE ASSESSING OFFICER TREATING SHARE CALL ADVANCE MONEY MADE BY THOSE COMPANIES AS INCOME OF THE ASSESSEE STATING THAT CREDITORS ARE NOT IDENTIFIE D AND GENUINENESS OF THE TRANSACTIONS ARE NOT ESTABLISHED . ON APPEAL, COMMISSIONER OF INCOME TAX (APPEALS) DELETE D THE ADDITIONS CONSIDERING THE SUBMISSIONS OF THE ASSESS EE AND ON EXAMINING THE EVIDENCES PRODUCED BY THE ASSESSEE IN THE FORM OF ASSESSMENT ORDERS OF M/S. TOP GRAIN VYAPAR (P) LTD. AND M/S. UMANG COMMO TRADE P. LTD., THEIR BANK STATEMENTS, THEIR INVESTMENTS IN THE OTHER CONCERNS OF THE ASSESSEE AND THOSE CONCERNS WERE LATER ACQUIRED BY THE ASSESSEE, COPIES OF CERTIFICATES ISSUED UNDER SECTI ON 197 BY THE REVENUE , COPIES OF COMMUNICATIONS BY THE COMPA NIES TO RESERVE BANK OF INDIA AND COMMUNICATIONS DATED 30.3 .2011 BY RESERVE BANK OF INDIA TO THOSE COMPANIES EVIDENC ING THE ADDRESSES OF THESE TWO COMPANIES AT 1B, BLACK BURN LANE, 4 TH FLOOR, KOLKATA. ON EXAMINING ALL THESE EVIDENCES F URNISHED BY THE ASSESSEE, THE COMMISSIONER OF INCOME TAX (AP PEALS) 6 ITA NO.1259/MDS/2013 & C.O. NO.154/MDS/2013 CAME TO THE CONCLUSION THAT THE CREDITOR COMPANIES ARE IDENTIFIED AND THE TRANSACTIONS ARE GENUINE. THE COMMISSIONER OF INCOME TAX (APPEALS) FURTHER HELD T HAT THOUGH HAVING SUFFICIENT MATERIALS IN HIS POSSESSIO N THERE IS LACK OF ENQUIRY ON THE PART OF THE ASSESSING OFFICE R AND THE ADDITIONS WERE MADE ONLY BASED ON THE REPORT SENT B Y THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-13, KO LKATA. THEREFORE, COMMISSIONER OF INCOME TAX (APPEALS) DEL ETED THE ADDITION MADE BY THE ASSESSING OFFICER WITH REG ARD TO SHARE CALL ADVANCE MONEY AND UNSECURED LOAN WITH IN TEREST. THE REVENUE IS IN APPEAL BEFORE US. 4. DEPARTMENTAL REPRESENTATIVE VEHEMENTLY SUPPORTS THE ORDER OF THE ASSESSING OFFICER IN MAKING ADDITION I N RESPECT OF THE SHARE CALL ADVANCE MONEY, UNSECURED LOANS AND I NTEREST THEREON FROM THE SAID CREDITOR COMPANIES STATING TH AT THE IDENTITY OF THE COMPANIES WERE NOT PROVED BY THE A SSESSEE COMPANY AND GENUINENESS OF THE TRANSACTIONS ARE NOT PROVED. REFERRING TO THE ASSESSMENT ORDER AND THE R EPORT SENT BY ASSISTANT COMMISSIONER OF INCOME TAX, CIRCL E-13, KOLKATTA, DEPARTMENTAL REPRESENTATIVE SUBMITS THAT THE 7 ITA NO.1259/MDS/2013 & C.O. NO.154/MDS/2013 REPORT CLEARLY ESTABLISHES THAT THE COMPANIES WERE NOT IN EXISTENCE AT THE ADDRESSES GIVEN AND THEY ARE ONLY PAPER COMPANIES. THE DEPARTMENTAL REPRESENTATIVE FURTHER SUBMITS THAT ON THE EVIDENCES FURNISHED BY THE ASSESSEE, TH E COMMISSIONER OF INCOME TAX (APPEALS) SHOULD HAVE CA LLED FOR REMAND REPORT AND WITHOUT CALLING FOR REMAND R EPORT ADDITION WAS DELETED. 5. COUNSEL FOR THE ASSESSEE VEHEMENTLY SUPPORTS THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS). AS FAR AS OPPORTUNITY NOT GIVEN BY THE COMMISSIONER OF INC OME TAX (APPEALS) BY CALLING FOR REMAND REPORT FROM THE ASS ESSING OFFICER IS CONCERNED, COUNSEL SUBMITS THAT NO NEW M ATERIAL WAS FILED BEFORE THE COMMISSIONER OF INCOME TAX (AP PEALS) WHICH WERE NOT FILED BEFORE THE ASSESSING OFFICER. THE COUNSEL SUBMITS THAT IN FACT IT IS THE FINDING OF THE COMMISSIONER OF INCOME TAX (APPEALS) THAT ALL THESE INFORMATION WERE IN POSSESSION OF THE ASSESSING OFF ICER AND THERE WAS LACK OF ENQUIRY BY HIM. RELYING ON THE O RDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) ,COUNSEL PRAYS FOR 8 ITA NO.1259/MDS/2013 & C.O. NO.154/MDS/2013 SUSTAINING THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) IN DELETING THE ADDITIONS. 6. HEARD BOTH SIDES. PERUSED ORDERS OF LOWER AUTHOR ITIES. IN THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESS ING OFFICER CALLED FOR VARIOUS DETAILS OF THE CREDITORS AND THE DIRECTORS OF THE CREDITOR COMPANIES TO PROVE IDENTI TY AND GENUINENESS OF THE TRANSACTION OF INVESTMENTS MADE BY THESE CREDITORS AS SHARE APPLICATION MONEY IN THE ASSES SEE COMPANY. THE ASSESSEE FURNISHED VARIOUS DETAILS OF THEIR ADDRESSES, PAN, DIRECTORS CONFIRMATIONS, DIRECTORS PAN ETC. THE ASSESSING OFFICER ALSO CALLED FOR A REPORT FROM HIS COUNTERPART AT KOLKATTA ON THE EXISTENCE OF THESE C OMPANIES SINCE THESE COMPANIES DID NOT RESPOND TO THE LETTER ISSUED BY THE ASSESSING OFFICER. BASED ON THE REPORT SENT BY THE ACIT, CIRCLE XIII, KOLKATTA, STATING THAT THE COMPANIES ARE NOT IN EXISTENCE AT THE GIVEN ADDRESS, HE FURTHER ASKED DE TAILS OF THE COMPANIES AND THE ASSESSEE FURNISHED ALL THESE DETA ILS AND DIRECTORS ALSO CONFIRMED THROUGH FAX. SINCE THERE W AS NOT MUCH TIME LEFT FOR COMPLETION OF ASSESSMENT, THE AS SESSING OFFICER WITHOUT PROPER ENQUIRIES SEEMS TO HAVE COM PLETED 9 ITA NO.1259/MDS/2013 & C.O. NO.154/MDS/2013 THE ASSESSMENT WITHOUT CONSIDERING THE EXPLANATION OF THE ASSESSEE ADDED THE SHARE APPLICATION MONEY AS CREDI TORS WERE NOT IDENTIFIED AND GENUINENESS OF THE TRANSACT ION ARE NOT ESTABLISHED BY THE ASSESSEE. THE COMMISSIONER OF INCOME TAX (APPEALS) CONSIDERING THE SUBMISSIONS AN D EVIDENCES FURNISHED BY THE ASSESSEE DELETED THE ADD ITION OBSERVING AS UNDER:- 13. IT IS VITAL AND APPROPRIATE TO POINT OUT THE D ETAILS WITH EVIDENCES FILED BY THE APPELLANT AS TO THE EXISTENC E OF THOSE TWO COMPANIES, WHICH ARE AS UNDER. (1) EVIDENCES AS TO REGISTRATION OF THE TWO COMPANI ES WITH REGISTRAR OF COMPANIES. (2) PAN OF THE TWO COMPANIES (3) COMMUNICATIONS FROM RBI TO THE ADDRESSES OF THE TWO COMPANIES (4) COPIES OF INCOME TAX RETURNS OF THE TWO COMPANI ES. (5) COPIES OF CERTIFICATES ISSUED U/S. 197 ISSUED B Y THE IT DEPARTMENT TO THE TWO COMPANIES. (6) COPIES OF THE ANNUAL REPORTS OF THE TWO COMPANI ES (7) COPIES OF THE BANK ACCOUNTS OF THE TWO COMPANIE S AT KOLKATTA AND ALL THE TRANSACTIONS ARE THROUGH BANKI NG CHANNELS ONLY. (8) COPY OF THE ASSESSMENT ORDER U/S. 143(3) IN TH E CASE OF M/S. TOP GRAIN VYAPAR P LTD. AND COPY OF INTIMATION U/S. 143(1) IN THE CASE OF M/S. UMANG COMMO TRADE P LTD. , EVIDENCING ARISING OF REFUND. 14. EXCEPTING ITEM NUMBERS 1 AND 2, THE ADDR ESSES OF THE TWO COMPANIES ARE CLEARLY MENTIONED IN ALL THE OTHERS AS '1B, BLACK BURN LANE, FOURTH FLOOR, KOLKATA-7000 12'. 15. THE APPELLANT FURNISHED THE DETAILS OF PAN AN D ADDRESS OF ,SHARAVAN PATWARI AND RATANLAL NAKHAT - DIRECTOR S OF M/S. TOP GRAIN VYAPAR P LTD. THE APPELLANT ALSO FURNISHE D THE DETAILS OF PAN AND ADDRESS OF SHRI RAM CHANDER SHAR MA AND SUNI KUMAR MUNDRA, DIRECTORS OF M/S. UMANG COMM O 10 ITA NO.1259/MDS/2013 & C.O. NO.154/MDS/2013 TRADE P LTD. SUMMONS WERE ISSUED BY ASSESSING OFFIC ER TO THE DIRECTOR OF THE COMPANY ON 22.12.2011 TO APPEAR BEFORE HIM ON 29.12.2011. AS SEEN FROM ASSESSMENT ORDER, T HE SUMMONS WERE SERVED ON 26.12.201 AND 27.12.2011 RESPECTIVELY. THE ASSESSING OFFICER RECEIVED A FAX ON 29.12.2011 WHEREIN THE THREE DIRECTORS HAVE GIVEN R EPLY THROUGH LETTER. EVEN IN THE COURSE OF APPELLATE PRO CEEDINGS, SHRI RAM CHANDER SHARMA, DIRECTOR OF M/S. UMANG COM MO TRADE P LTD., APPEARED BEFORE ME AND FILED A LETTER DATED 13.06.2012. THIS PROVES THAT THE DIRECTORS ARE EXIS TING AND THEREBY THE COMPANIES ARE ALSO EXISTENT. I HAD ALSO VERIFIED FROM THE ROC WEBSITE WWW.MCA.GOV.IN WHEREIN THE ADDRESS OF THE TWO COMPANIES HAVE BEEN AT 1B, BLAC K BURN LANE, 4 TH FLOOR, BOW BAZAR, KOLKATTA AND THE COMPANY STATUS IS SHOWN AS ACTIVE. 16. I HAD ALSO ASKED THE ASSESSEE TO FILE ALL TH E BANK DETAILS OF TAKEN OVER CONCERNS AND ALSO TO FURNISH BANK ACCOUNT OF M/S. TOP GRAIN VYAPAR (P) LTD. AND M/S. UMANG COMMO TRADE P LTD., KOLKATTA. THE DETAILS OF LEDGER EXTRACTS OF NARENDRA KUMAR COTTON MILLS, NKCM SPIN NERS AND M/S. NKCM TEXTILES WERE ALSO VERIFIED. 17. M/S NARENDRA KUMAR COTTON MILLS HAD TRANSACTI ON WITH TOP GRAIN :VYAPAR {P} LIMITED. AS ON 1.4.2007, OPEN ING BALANCE WAS ` 75,00,00,000/-. FURTHER 'THERE ARE TRANSACTIONS OF RS.22.75 LACS. THERE IS REPAYMENT O F RS.15 LACS, INTEREST IS RS.7,67,984/-. AS ON' 31.3.2008, AMOUNT TRANSFERRED IS RS.90.40 LACS. THERE WERE TRANSACTIO NS WITH CANARA BANK, KOLKATA AND ICLCI BANK ACCOUNT, KOLKAT A. THE ICLCI BANK ACCOUNT WAS OPENED ON 5.3.2004. A/C NO.000605004386. ADDRESS: 1-B, BLACK BURN LANE'4 TH FLOOR, KOLKATA. ALL THE TRANSACTIONS ARE BY CHEQUE AND NKC M SPINNERS RECEIVED FROM TOP GRAIN VYAPAR {P} LIMITED . THE DETAILS AVAILABLE FROM 2007 ONWARDS VERIFIED. THE C ANARA BANK A/C NUMBER OF TOP GRAIN :VYAPAR {P} LIMITED IS 0315201005231 AND THE ADDRESS GIVEN IS 1B, BLACK BU RN LANE, FOURTH FLOOR, KOLKATA-700012'. THIS BANK ACCO UNT IN 2007 DID NOT SHOW ANY CASH DEPOSITS. 18. REGARDING M/S UMANG COMMO TRADE (P) LTD, KOLK ATA, THE APPELLANT ALSO FILED LEDGER EXTRACTS OF NARENDR A KUMAR COTTON MILLS, AND NKCM TEXTILE. THE OPENING BALANCE IN NARENDRA KUMAR COTTON MILLS IS 1.4.2007 - RS.8,50,0 00/- RECEIPTS - RS.75 LAKHS AND ON 31.3.2008 CLOSING ` 84,92,891. THE OPENING BALANCE IN NKCM TEXTILE ON 1.4.2007 IS ` 72,74,999/- AND ON 31.3.2008 CLOSING BALANCE 11 ITA NO.1259/MDS/2013 & C.O. NO.154/MDS/2013 IS ` 79,27,894/-. THE APPELLANT ALSO FILED HDFC BANK ACCOUNT OF M/S. UMANG COMMO TRADE (P) LTD. THE BAN K ACCOUNT NO. IS 2322320001993 AND ADDRESS IS 1B, BLA CK BURN LANE, FOURTH FLOOR, KOLKATA-700012. THE TRANSA CTIONS ARE BY CHEQUE AND THERE WERE NO CASH DEPOSITS. THE ASSESSMENT OF M/S. NARENDRA KUMAR COTTON MILLS (PAN AADFN1571C) FOR THE ASSESSMENT YEAR 2008-09 AND NKC M SPINNERS (PAN AAEFN3523H) FOR THE ASSESSMENT YEAR 2006-07 WERE COMPLETED BY ORDERS U/S. 143(3) DATED 26.2.2010 AND 29.12.2008 BY THE DCIT CIRCLE-I, EROD E AND ITO, WARD-I(1), ERODE RESPECTIVELY. IT IS IMPORTANT TO NOTE THAT BOTH THE ABOVE COMPANIES HAVE SHOWN THE INVEST MENTS MADE BY THEM IN THE APPELLANT COMPANY AS SHARE APPLICATION MONEY (PENDING ALLOTMENT)IN THEIR RESP ECTIVE ANNUAL REPORTS. THE COMPANY TOP GRAIN VYAPAR (P) LT D. FILED THE INCOME TAX RETURN FOR ASSESSMENT YEAR 200 8-09 ELECTRONICALLY WITH DIGITAL SIGNATURE WITH ADDRESS AS 1-B, BLACK BURN LANE, 4 TH FLOOR, BOW BAZAR, KOLKATA. SIMILARLY, M/S. UMANG COMMO TRADE (P) LTD. HAS ALSO FILED ITS RETURN FOR ASSESSMENT YEAR 2008-09 WITH SAME ADDRESS. 19. THE ADMITTED AND UNDISPUTED FACTS ARE : (A) THE APPELLANT HAS TAKEN OVER ALL THE ASSETS & LIABILITIES OF THREE CONCERNS NAMED THEREIN. I) M/S. NARENDRAKUMAR COTTON MILLS (A FIRM) II) M/S. NKCM SPINNER (A FIRM ) AND III) M/S. NKCM TEXTILE (PROPRIETORY CONCERN) (B) THE ABOVE TWO COMPANIES NAMELY M/S. UMANG COMMO TRADE (P) LTD. AND M/S. TOP GRAIN VYAPAR P) LTD. HAVE ALREDY LENT SUMS TO THE SAID THREE CONCER NS EARLIER, (C) THE ASSESSMENTS OF TWO CONCERNS, OUT OF THE THR EE CONCERNS WHOSE ASSETS AND LIABILITIES WERE TAKEN OVER BY THE APPELLANT COMPANY WERE COMPLETED BY ORDERS U/S.143(3) WHEREIN CONFIRMATIONS FILED IN RESPECT OF SUMS LENT BY THE SAID TWO COMPANIES, WER E ADMITTED AND (D) THE COMPANIES AND THE ADDRESSES WERE NEVER FOUN D TO BE FICTITIOUS / BOGUS. 23. THE ASSESSING OFFICER HAS NOT CARRIED OUT THE EXERCISE WHICH IS REQUIRED IN LAW AND AS THE ASSESS ING OFFICER HAS ALL THE EVIDENCES/MATERIALS IN ITS POSS ESSION AND THEN CAME FORWARD TO MERELY REJECT THE SAME ON PRESUMPTIONS, I AM OF THE CONSIDERED VIEW THAT THERE WAS CLEARLY A LACK OF INQUIRY ON THE PART OF THE ASSESSING OFFICER. FURTHER, AS THE APPELLANT HAD FURNISHED ALL THE RELEVANT MATERIALS, INCLUDING THE ASSESSMENT ORDER U/S.143(3), INTIMATION U/S.143(1) 12 ITA NO.1259/MDS/2013 & C.O. NO.154/MDS/2013 EVIDENCING REFUND AND COPIES OF CERTIFICATES ISSUED U/S.197 FOR THE TWO COMPANIES, WHICH HAVE BEEN REFE RRED ABOVE TO CONCLUSIVELY PROVE THAT THE TWO COMPANIES NAMELY UMANG COMMO TRADE (P) LTD. AND M/S. TOP GRAIN VYAPAR P) LTD. DO EXIST AT THE ADDRESS 1- B, BLACK BURN LANE, 4 TH FLOOR, KOLKATA-700012 MORE PARTICULARLY OF THE FACT THAT AFTER ADDUCING EVIDEN CES IN SUPPORT OF THE SHARE CALL ADVANCE AND UNSECURED LOA N BY THE APPELLANT, NO FINDING AS TO THE UNTRUSTWORTHY OR CREDIBILITY-LACKING OF THE MATERIALS AND EVIDENCES FILED BY THE APPELLANT COMPANY WAS GIVEN AND THAT THE 'ASSESSING OFFICER MERELY CONCLUDED ON THE BASIS OF THE ENQUIRY REPORT. HENCE, THE ASSESSING OFFICER IS, DI RECTED TO DELETE THE ADDITIONS MADE ON ACCOUNT OF SHARE CA LL ADVANCE MONEY OF RS.250,00,000 /-AND UNSECURED LOAN (NET) WITH INTEREST THEREON RS.16,14,923/-. 7. ON GOING THROUGH THE ABOVE ORDER, WE FIND THAT T HE ASSESSEE HAS FURNISHED VARIOUS EVIDENCES TO ESTABLI SH THE IDENTITY OF THE CREDITOR COMPANIES AS EXTRACTED BY THE COMMISSIONER OF INCOME TAX (APPEALS) IN HIS ORDER. WE ALSO FIND THAT DIRECTORS WERE APPEARED BEFORE THE COMMIS SIONER OF INCOME TAX (APPEALS). THE COMMISSIONER OF INCOME TA X (APPEALS) DIRECTED THEM TO FILE BANK DETAILS OF WHI CH CONCERNS THEY ARE DIRECTORS. THE INFORMATION REQUIRED BY THE COMMISSIONER OF INCOME TAX (APPEALS) WERE ALSO FURN ISHED. ON EXAMINING ALL THESE DETAILS, THE COMMISSIONER OF INCOME TAX (APPEALS) HAS GIVEN A FINDING THAT ASSESSEE HAS TAKEN OVER ALL THE ASSETS & LIABILITIES OF THREE CONCERNS NAMELY M/S. NARENDRAKUMAR COTTON MILLS (A FIRM), M/S. NKCM SPIN NER (A FIRM) AND M/S. NKCM TEXTILES (PROPRIETORY CONCERN) . THE 13 ITA NO.1259/MDS/2013 & C.O. NO.154/MDS/2013 ABOVE COMPANIES LENT AMOUNTS TO THE ABOVE THREE CON CERNS IN EARLIER YEARS., THE ASSESSMENTS OF THE TWO CONCE RNS OUT OF THE THREE CONCERNS REFERRED TO ABOVE WHOSE ASSETS A ND LIABILITIES WERE TAKEN OVER BY THE ASSESSEE COMPAN Y WERE COMPLETED UNDER SECTION 143(3) WHEREIN CONFIRMATIO NS FILED IN RESPECT OF THE SUMS LENT BY THE TWO COMPANIES WE RE ADMITTED AND THE COMPANIES ADDRESSES WERE NEVER FO UND TO BE FICTITIOUS OR BOGUS. IT WAS ALSO THE FINDING OF THE COMMISSIONER OF INCOME TAX (APPEALS) THAT ALL THESE INFORMATION WERE AVAILABLE WITH THE ASSESSING OFFIC ER AND IT IS ONLY LACK OF ENQUIRY ON THE PART OF THE ASSESSING O FFICER. THE COMMISSIONER OF INCOME TAX (APPEALS) ON EXAMINING A LL THESE DETAILS CONCLUDED THAT EVIDENCES CONCLUSIVEL Y PROVED THAT TWO CREDITOR COMPANIES M/S. TOP GRAIN VYAPAR ( P) LTD. AND M/S. UMANG COMMO TRADE P. LTD. DO EXIST AT THE ADDRESSES GIVEN BY THEM AND THEREFORE DELETED THE ADDITION MADE BY THE ASSESSING OFFICER IN RESPECT OF SHARE C ALL ADVANCE MONEY AND UNSECURED LOANS WITH THE SAID CRE DITOR COMPANIES. NONE OF THE FINDINGS OF THE COMMISSIONER OF INCOME TAX (APPEALS) WERE REBUTTED WITH ANY EVIDENC E BY THE REVENUE. IN THE CIRCUMSTANCES, WE UPHOLD THE OR DER OF 14 ITA NO.1259/MDS/2013 & C.O. NO.154/MDS/2013 THE COMMISSIONER OF INCOME TAX (APPEALS) IN DELETIN G THE ADDITION AND REJECT THE GROUNDS RAISED BY THE REVEN UE. 8. THE CROSS OBJECTION FILED BY THE ASSESSEE IS IN SUPPORT OF THE ORDER OF THE COMMISSIONER OF INCOME TAX (APP EALS). SINCE WE AFFIRM THE ORDER OF THE COMMISSIONER OF IN COME TAX (APPEALS) AND DISMISS THE APPEAL OF THE REVENUE, CR OSS OBJECTION FILED BY THE ASSESSEE BECOMES INFRUCTUOUS AND THUS THE SAME IS DISMISSED. 9. IN THE RESULT, APPEAL OF THE REVENUE AND THE CRO SS OBJECTION OF THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON FRIDAY, THE 19 TH DAY OF DECEMBER, 2014 AT CHENNAI. SD/- SD/- ( . ) ( ' )* ) ( A.MOHAN ALANKAMONY ) ( CHALLA NAGENDR A PRASAD ) , / ACCOUNTANT MEMBER ) , / JUDICIAL MEMBER ) /CHENNAI, . /DATED, 19 TH DECEMBER, 2014 SOMU 12 32 /COPY TO: 1. ASSESSEE 2. ASSESSING OFFICER 3. 4 () /CIT(A) 4. 4 /CIT 5. 2 7 /DR 6. /GF .