Suncity Projects Pvt. Ltd., New Delhi V. DCIT, New Delhi

ITA 14/DEL/2012

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 6454 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 2 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-03-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 08-02-2016
• Assessment Year: 2004-2005
• Appeal Filed On: 02-01-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUNIL CHAN D SHARMA
• Assessee Lawyers: A K AGGARWAL S
• Keywords: Unexplained cash credit; Bogus Share capital; Unexplained investment; Capital asset; Business income; Question of law; Bad and doubtful debts; Difference of opinion; Accommodation entries; Onus to prove; Documents seized; Change of opinion; Reassessment proceedings
• Section: 143(3); 133A; 153A; 133(6); 131; 68; 132; 15

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL DELHI DELHI DELHI DELHI BENCH BENCH BENCH BENCH G GG G : NEW DELHI : NEW DELHI : NEW DELHI : NEW DELHI BEFORE SHRI BEFORE SHRI BEFORE SHRI BEFORE SHRI G.D. AGRAWAL, VICE PRESIDENT G.D. AGRAWAL, VICE PRESIDENT G.D. AGRAWAL, VICE PRESIDENT G.D. AGRAWAL, VICE PRESIDENT AND AND AND AND SHRI SHRI SHRI SHRI CHANDRA MOHAN GARG CHANDRA MOHAN GARG CHANDRA MOHAN GARG CHANDRA MOHAN GARG, JUDICIAL MEMBER , JUDICIAL MEMBER , JUDICIAL MEMBER , JUDICIAL MEMBER ITA NO ITA NO ITA NO ITA NO . .. . 14/DEL/2012 14/DEL/2012 14/DEL/2012 14/DEL/2012 ASSESSMENT YEAR : ASSESSMENT YEAR : ASSESSMENT YEAR : ASSESSMENT YEAR : 2004 2004 2004 2004 - -- - 05 0505 05 M/S SUNCITY PROJECTS PVT.LTD., M/S SUNCITY PROJECTS PVT.LTD., M/S SUNCITY PROJECTS PVT.LTD., M/S SUNCITY PROJECTS PVT.LTD., N NN N- -- -49, FIRST FLOOR, 49, FIRST FLOOR, 49, FIRST FLOOR, 49, FIRST FLOOR, CO COCO CONNAUGHT PLACE, NNAUGHT PLACE, NNAUGHT PLACE, NNAUGHT PLACE, NEW DELHI NEW DELHI NEW DELHI NEW DELHI 110 001. 110 001. 110 001. 110 001. PAN : AABCS8906K. PAN : AABCS8906K. PAN : AABCS8906K. PAN : AABCS8906K. VS. VS. VS. VS. DEPUTY COMMISSIONER OF DEPUTY COMMISSIONER OF DEPUTY COMMISSIONER OF DEPUTY COMMISSIONER OF INCOME TAX, INCOME TAX, INCOME TAX, INCOME TAX, CENTRAL CIRCLE CENTRAL CIRCLE CENTRAL CIRCLE CENTRAL CIRCLE- -- -1, 1,1, 1, NEW DELHI. NEW DELHI. NEW DELHI. NEW DELHI. (APPELLANT) (RESPONDENT) ITA NO ITA NO ITA NO ITA NO S.44/DEL/2012, 45/DEL/2012, 46/DEL/2012, 47/DEL/2012 , S.44/DEL/2012, 45/DEL/2012, 46/DEL/2012, 47/DEL/2012 , S.44/DEL/2012, 45/DEL/2012, 46/DEL/2012, 47/DEL/2012 , S.44/DEL/2012, 45/DEL/2012, 46/DEL/2012, 47/DEL/2012 , 48/DE/2012 & 49/DEL/2012 48/DE/2012 & 49/DEL/2012 48/DE/2012 & 49/DEL/2012 48/DE/2012 & 49/DEL/2012 ASSES ASSES ASSES ASSES SMENT YEAR SMENT YEAR SMENT YEAR SMENT YEAR S SS S : : : : 2004 2004 2004 2004 - -- - 05, 2005 05, 2005 05, 2005 05, 2005 - -- - 06, 2006 06, 2006 06, 2006 06, 2006 - -- - 07, 2007 07, 2007 07, 2007 07, 2007 - -- - 08, 08, 08, 08, 2008 2008 2008 2008- -- -09 & 2009 09 & 2009 09 & 2009 09 & 2009- -- -10 1010 10 ASSISTANT COMMISSIONER OF ASSISTANT COMMISSIONER OF ASSISTANT COMMISSIONER OF ASSISTANT COMMISSIONER OF INCOME TAX, INCOME TAX, INCOME TAX, INCOME TAX, CENTRAL CIRCLE CENTRAL CIRCLE CENTRAL CIRCLE CENTRAL CIRCLE- -- -1, 1,1, 1, NEW DELHI. NEW DELHI. NEW DELHI. NEW DELHI. VS. VS. VS. VS. M/S SUNCITY PROJECTS PVT.LTD., M/S SUNCITY PROJECTS PVT.LTD., M/S SUNCITY PROJECTS PVT.LTD., M/S SUNCITY PROJECTS PVT.LTD., N NN N- -- -49, FIRST FLOOR, 49, FIRST FLOOR, 49, FIRST FLOOR, 49, FIRST FLOOR, CONNAUGHT PLACE, CONNAUGHT PLACE, CONNAUGHT PLACE, CONNAUGHT PLACE, NEW DELHI NEW DELHI NEW DELHI NEW DELHI 110 001. 110 001. 110 001. 110 001. PAN : AABCS8906K. PAN : AABCS8906K. PAN : AABCS8906K. PAN : AABCS8906K. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI VED JAIN AND SHRI A.K. AGGARWAL, ADVOCATES. REVENUE BY : SHRI SUNIL CHAND SHARMA, CIT - DR. DATE OF HEARING : 16.02.2016 16.02.2016 16.02.2016 16.02.2016 DATE OF PRONOUNCEMENT : 21.03.2016 21.03.2016 21.03.2016 21.03.2016 ORDER ORDER ORDER ORDER PER G.D PER G.D PER G.D PER G.D. AGRAWAL, VP . AGRAWAL, VP . AGRAWAL, VP . AGRAWAL, VP : :: :- -- - THE APPEAL BY THE ASSESSEE FOR THE ASSESSMENT YEAR 2004-05 AND THE APPEALS BY THE REVENUE FOR ASSESSMENT YEARS 2004- 05 TO ITA-14/DEL/2012 & 6 OTHERS 2 2009-10 ARE DIRECTED AGAINST THE ORDER OF LEARNED CI T(A)-III, NEW DELHI DATED 21 ST OCTOBER, 2011. ITA NO.44/DEL/201 ITA NO.44/DEL/201 ITA NO.44/DEL/201 ITA NO.44/DEL/2012 (REVENUES APPEAL) AND 2 (REVENUES APPEAL) AND 2 (REVENUES APPEAL) AND 2 (REVENUES APPEAL) AND ITA NO.14/DEL/2012 (ASSESSEES APPEAL) FOR AY 2004 ITA NO.14/DEL/2012 (ASSESSEES APPEAL) FOR AY 2004 ITA NO.14/DEL/2012 (ASSESSEES APPEAL) FOR AY 2004 ITA NO.14/DEL/2012 (ASSESSEES APPEAL) FOR AY 2004- -- -05 0505 05 : :: :- -- - 2. THESE CROSS-APPEALS ARE BEING TAKEN UP TOGETHER FOR HEARING AND DISPOSAL BECAUSE THEY INVOLVE SOME OF THE COMMON ISSUES. 3. THE GROUNDS RAISED IN THE REVENUES APPEAL I.E. IT A NO.44/DEL/2012 READ AS UNDER:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.7,52,00,000/- MADE BY THE ASSESSING OFFIC ER ON ACCOUNT OF ISSUE OF BOGUS SHARE APPLICATION MONEY. 2. THE ORDER OF THE LD.CIT(A) IS ERRONEOUS AND IS NOT TENABLE ON FACTS AND IN LAW. 3. THE APPELLANT CRAVES LEAVE TO ADD, ALTER OR AMEND ANY/ALL OF THE GROUNDS OF APPEAL BEFORE OR DURING TH E COURSE OF THE HEARING OF THE APPEAL. 4. THE GROUNDS RAISED IN THE ASSESSEES APPEAL I.E. ITA NO.14/DEL/2012 READ AS UNDER:- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE ORDER PASSED BY THE A.O. AND CONFIRMED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) UNDER SECTION 153 A IS BAD, BOTH IN THE EYE OF LAW AND ON FACTS. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE PROCEEDINGS INITIATED UNDER SECTION 153A AGAINST THE APPELLANT ARE IN VIOLATION OF THE STATUTORY CONDITIO NS OF THE ACT AND THE PROCEDURE PRESCRIBED UNDER THE LAW AND A S SUCH THE SAME IS BAD IN THE EYE OF LAW. ITA-14/DEL/2012 & 6 OTHERS 3 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE NOTICE ISSUED UNDER SECTION 153A BY THE A.O. IS BAD BO TH ON FACTS AND IN LAW AND AS SUCH THE ASSESSMENT FRAMED IN CONSEQUENCE THEREOF IS LIABLE TO BE QUASHED. 4. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE ASSESSMENT FRAMED UNDER SECTION 153A/143(3) BEING AGAINST THE STATUTORY PROVISIONS OF THE ACT AND THE PROCEDURE PRESCRIBED UNDER THE LAW, IS BAD AND THE SAM E IS LIABLE TO BE QUASHED. 5. ON THE FACTS AND CIRCUMSTANCES OF THE CASE CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN REJECTING THE CONTENTION OF THE ASSESSEE THAT THE A.O. HAS ERRED IN U SING THE PROVISIONS OF SECTION 153A OF THE ACT AS REVIEW PROCEEDINGS, WHICH IS NOT PERMISSIBLE UNDER THE LAW. 6.(I) ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN CONFIRM ING THE DISALLOWANCE OF AN AMOUNT OF RS.60,00,000/- MADE BY A .O. ON ACCOUNT OF INTEREST ON BORROWED FUNDS. (II) ON THE FACTS AND CIRCUMSTANCES OF THE CASE LD.CIT( A) HAS ERRED BOTH ON FACTS AND IN LAW IN NOT APPRECIATIN G THE CONTENTION OF THE APPELLANT THAT THE INTEREST EXPENSE S HAVING BEEN INCURRED DURING THE YEAR IN RESPECT OF C URRENT ASSETS, THE SAME IS REVENUE IN NATURE AND AS SUCH FULLY ALLOWABLE UNDER THE PROVISIONS OF THE ACT. (III) ON THE FACTS AND CIRCUMSTANCES OF THE CASE LD.A.O . HAS ERRED BOTH ON FACTS AND IN LAW IN MISINTERPRETING THE PROVISO TO SECTION 36(1), WHICH IS APPLICABLE WHEN THE CAPITAL IS BORROWED FOR THE PURPOSE OF ACQUISITION OF A CAPITAL ASSET AND NOT THE CURRENT ASSETS SUCH AS STOCK IN TRADE. THE EXPENSES ON ACCOUNT OF INTEREST HAVING BEE N INCURRED WITHOUT ANY ENDURING BENEFIT IS FULLY ALLOW ABLE UNDER THE PROVISIONS OF THE ACT. 7.(I) ON THE FACTS AND CIRCUMSTANCES OF THE CASE LD.CIT (A) HAS ERRED BOTH ON FACTS AND IN LAW IN CONFIRMING THE ABOVESAID DISALLOWANCE IN VIEW OF THE FACT THAT NO INCRIMINATING MATERIAL WAS FOUND DURING THE COURSE OF SEARCH. ITA-14/DEL/2012 & 6 OTHERS 4 (II) THE DISALLOWANCE IS OTHERWISE UNTENABLE AS THE REASSESSMENT PROCEEDINGS UNDER SECTION 153A ARE TO BE RESTRICTED TO THE INCRIMINATING MATERIAL FOUND DURIN G THE COURSE OF SEARCH. 8. ON THE FACTS AND CIRCUMSTANCES OF THE CASE LD.CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN NOT APPRECIATIN G THE FACT THAT THE VARIOUS ADDITIONS MADE BY THE A.O. ARE OTHERWISE UNTENABLE AS THE ORIGINAL ASSESSMENT HAS BEEN COMPLETED UNDER SECTION 143(3) AND THE DISALLOWANCE HAS BEEN MADE IN THE REASSESSMENT PROCEEDINGS MERELY ON CHANGE OF OPINION WITHOUT THERE BEING ANY ADVERSE MATERIAL FOUND DURING THE COURSE OF SEARCH. 9.(I) ON THE FACTS AND CIRCUMSTANCES OF THE CASE LD.CIT (A) HAS ERRED BOTH ON FACTS AND IN LAW IN NOT APPRECIATIN G THE FACT THAT THE ORIGINAL ASSESSMENT ORDER PASSED UNDER SECTION 143(3) HAVING MERGED WITH THE ORDER OF APPE LLATE AUTHORITIES, THE A.O. WAS NOT JUSTIFIED IN REAPPRAISING THE SAME AND TINKERING WITH THE SAME. (II) THE ABOVE ACTION OF THE A.O. IS AGAINST THE PRO VISIONS AND THE SCHEME OF THE ACT. 5. THE FACTS OF THE CASE ARE THAT THE ASSESSEE IS A COMPA NY WHICH HAD FILED THE ORIGINAL RETURN OF INCOME FOR ASSESSMENT YEAR 2004-05 ON 1 ST NOVEMBER, 2004 WHICH WAS ASSESSED U/S 143(3) OF THE ACT VIDE ORDER DATED 28 TH DECEMBER, 2006 AT A NET TAXABLE INCOME OF `3,05,04,140/-. SUBSEQUENTLY, SEARCH U/S 132 WAS CONDU CTED ON 25 TH SEPTEMBER, 2008. AFTER THE SEARCH, PROCEEDINGS U/S 15 3A WERE INITIATED AND FINALLY, ASSESSMENT U/S 153A READ WITH SEC TION 143(3) WAS COMPLETED ON 30 TH DECEMBER, 2010 AT THE TOTAL INCOME OF `11,17,04,140/-, IN WHICH FOLLOWING ADDITIONS WERE M ADE:- (I) ADDITION ON ACCOUNT OF SHARE APPLICATION MONEY : `7,52,00,000/- (II) ADDITION ON ACCOUNT OF INTEREST : `60,00,000/- ITA-14/DEL/2012 & 6 OTHERS 5 6. LEARNED CIT(A) DELETED THE ADDITION MADE BY THE ASSESSING OFFICER ON ACCOUNT OF SHARE APPLICATION MONEY. THER EFORE, REVENUE IS IN APPEAL AGAINST THE DELETION OF SUCH ADDITION. LEA RNED CIT(A) SUSTAINED THE ADDITION ON ACCOUNT OF INTEREST AGAINST WHICH ASSESSEE IS IN APPEAL. 7. AT THE TIME OF HEARING BEFORE US, LEARNED CIT-DR ARGUED AT LENGTH AND POINTED OUT THAT DURING THE COURSE OF SEARCH OF T HE ASSESSEES PREMISES, NUMBER OF DOCUMENTS WERE FOUND AND SEIZED W HICH INDICATED THE INTRODUCTION OF SHARE APPLICATION MONE Y BY THE ASSESSEE IN VARIOUS YEARS AND THE PATTERN OF RECEIVING SHARE A PPLICATION MONEY. HE REFERRED TO PARAGRAPH 4 OF THE ASSESSMENT ORDER IN T HIS REGARD. HE ALSO STATED THAT AFTER POST SEARCH ENQUIRY, NEW FINDING WITH REGARD TO SOME OF THE SHARE APPLICANTS HAS EMERGED WHICH INDICATE D THAT THOSE SHARE APPLICANTS HAVE BEEN INDULGING IN PROVIDING ACC OMMODATION ENTRIES. THIS FINDING WAS NOT AVAILABLE DURING THE OR IGINAL ASSESSMENT PROCEEDINGS. ACCORDINGLY, HE STATED THAT THE CIT(A) WAS NOT JUSTIFIED IN OBSERVING THAT NO INCRIMINATING MATERIAL WAS FOUND EI THER DURING THE SEARCH OR ANY POST SEARCH ENQUIRY AND, THEREFORE, THE ADDITION IS NOT SUSTAINABLE IN THE PROCEEDINGS U/S 153A. HE STATED THAT DURING THE COURSE OF SEARCH ALSO, CERTAIN MATERIAL WAS FOUND AND SE IZED AND DURING THE POST-SEARCH ENQUIRY ALSO, VARIOUS NEW FACTS A ND MATERIALS WERE FOUND WHICH WERE NOT AVAILABLE DURING ORIGINAL ASSESSMENT PROCEEDINGS. THEREFORE, THE ADDITION WAS RIGHTLY MAD E BY THE ASSESSING OFFICER U/S 153A. 8. WITH REGARD TO DELETION OF ADDITION ON MERITS ALSO , HE STATED THAT THE ONUS IS UPON THE ASSESSEE TO PROVE THE CREDIT IN ITS B OOKS OF ACCOUNT. TO DISCHARGE SUCH ONUS, ASSESSEE HAS TO ESTABLISH T HE IDENTITY OF THE SHAREHOLDER, CREDITWORTHINESS OF THE SH AREHOLDER AND ITA-14/DEL/2012 & 6 OTHERS 6 GENUINENESS OF THE TRANSACTION. FROM THE VARIOUS DETAI LS GIVEN BY THE ASSESSING OFFICER IN RESPECT OF THE SHARE APPLICANTS WHOSE CREDITS HAVE NOT BEEN ACCEPTED, IT IS EVIDENT THAT THEY HAD VERY MEAGER BUSINESS INCOME AND FROM SUCH MEAGER INCOME, THEY CANNOT INVE ST HUGE MONEY IN THE FORM OF SHARE CAPITAL WITH THE ASSESSEE COMPANY. THAT SUMMONS ISSUED TO THOSE SHARE APPLICANTS WERE NOT COMPLIED WITH. THE ASSESSEE WAS INFORMED OF THIS POSITION AND WAS REQUEST ED TO PRODUCE THE DIRECTOR OF SUCH SHARE APPLICANT COMPANY. THE ASSESSEE DID NOT PRODUCE THE DIRECTOR OF THE SAID COMPANY. O N THESE FACTS, THE ASSESSING OFFICER RIGHTLY CONCLUDED THAT THE ASSESSEE DID N OT DISCHARGE THE ONUS WHICH LAY UPON IT TO PROVE THE CREDIT IN TH E FORM OF SHARE CAPITAL. IN SUPPORT OF HIS CONTENTION, HE RELIED UPO N THE DECISION OF HON'BLE DELHI HIGH COURT IN THE CASE OF CIT VS. NOVA PROMOTERS AND FINLEASE (P) LTD. [2012] 342 ITR 169 (DELHI). HE, THEREFORE, SUBMITTED THAT THE ORDER OF LEARNED CIT(A) ON THIS POINT MAY B E REVERSED AND THAT OF THE ASSESSING OFFICER MAY BE RESTORED. 9. LEARNED COUNSEL FOR THE ASSESSEE STATED THAT NO INCRIM INATING MATERIAL RELATING TO SHARE APPLICATION MONEY WAS FOUN D DURING THE COURSE OF SEARCH AND, THEREFORE, THE ADDITION WITH RE GARD TO UNEXPLAINED CASH CREDIT IN THE FORM OF SHARE APPLICA TION MONEY IS OUT OF THE PURVIEW OF SECTION 153A OF THE INCOME-TAX AC T, 1961. IN SUPPORT OF THIS CONTENTION, HE RELIED UPON THE FOLLOWING DEC ISIONS OF HON'BLE DELHI HIGH COURT :- (I) CIT VS. KABUL CHAWLA IN ITA NO.707, 709 AND 713/ 2014 DATED 28.08.2015. (II) CIT VS. RRJ SECURITIES LTD. IN ITA NO.175 TO 177 /DEL/2015 DATED 30.10.2015. HE ALSO RELIED UPON THE FOLLOWING DECISIONS OF ITAT :- ITA-14/DEL/2012 & 6 OTHERS 7 (I) PARSVNATH DEVELOPERS LTD. VS. DCIT ITA NO.5188/D EL/2013 DATED 31.10.2014. (II) SANJAY AGGARWAL VS. DCIT ITA NO.3184/DEL/2013 DATED 16.06.2014. 10. HE SUBMITTED THAT THE CONTENTION OF THE LEARNED DR, THAT DURING THE COURSE OF SEARCH VARIOUS DOCUMENTS WERE FOUND AND SEIZED WHICH WERE WITH REGARD TO INTRODUCTION OF SHARE APPLICATI ON MONEY BY THE ASSESSEE IN VARIOUS YEARS AND THEREFORE THE ADDITION MADE WITH REGARD TO SHARE APPLICATION MONEY WAS WELL WITHIN THE AMBIT OF SECTION 153A, IS MISPLACED. HE REFERRED TO THE ASSESSMENT ORDER AND PO INTED OUT THAT IN PARAGRAPH 4 OF THE ASSESSMENT ORDER, THE ASSESSING OFFICER HAS MENTIONED AS UNDER:- DURING THE COURSE OF SEARCH, A NUMBER OF DOCUMENTS WE RE FOUND WHICH INDICATED THE INTRODUCTION OF SHARE APPL ICATION MONEY BY THE ASSESSEE IN VARIOUS YEARS AND THE PATTERN O F RECEIVING SHARE APPLICATION MONEY. ONE OF THESE DOCUMENTS SEIZED DURING SEARCH IS ANNEXURE A-22 OF PART Y SCE PAGES 15 TO 16 WHICH INDICATE THE PATTERN OF SHAR E APPLICATION MONEY AND A GROUP SUMMARY OF THE SHARE APPLICATION MONEY. THERE IS ANOTHER DOCUMENT INVENTORIZED AS ANNEXURE A7 PARTY SMA PAGE 30 WHICH GIVES PATTERN OF SHARE APPLICATION MONEY IN M/S SUNCIT Y PROJECTS (P) LTD. THE DOCUMENT CLARIFIES THAT THE C OMPANY IS BASICALLY CONTROLLED BY FOUR GROUP OF COMPANIES VIZ ., ESSEL GROUP, ACTION GROUP, ODEON GROUP, SUNCITY GROUP & OTHER MISCELLANEOUS COMPANIES. ON THE BASIS OF ABOVE DOCUMENTS A SUMMARY OF SHARE CAPITAL, SHARE APPLICATIO N MONEY AND SHARE PREMIUM WAS PREPARED FOR EACH OF THE ASSESSMENT YEAR WHICH SHOWS THE INCREASE IN SHARE APPLICATION MONEY AS WELL AS THE PATTERN OF SHARE APPLICATION MONEY IN EACH YEAR. 11. THAT NONE OF THE DETAILS MENTIONED ABOVE IN PARA GRAPH 4 OF THE ASSESSMENT ORDER CAN BE SAID TO BE INCRIMINATING MATERI AL. THE DETAILS ITA-14/DEL/2012 & 6 OTHERS 8 FOUND BY THE REVENUE AUTHORITIES DURING THE COURSE OF SEARCH WERE THE DOCUMENTS RELATING TO SHARE APPLICATION MONEY WHICH W ERE DULY DISCLOSED BY THE ASSESSEE IN ITS ACCOUNT. THE DOCUMENT W AS ONLY THE GROUP SUMMARY OF THE SHARE APPLICATION MONEY BECAUSE I N THE ASSESSEE COMPANY, PERSONS FROM VARIOUS GROUPS VIZ. M/S SUNCI TY GROUP, ESSEL GROUP, ACTION GROUP AND ODEON GROUP OF C OMPANIES HAVE APPLIED FOR SHARES AND THE ASSESSING OFFICER HIMSELF, AFTE R ANALYZING ALL THE SHARE APPLICATION MONEY, HAS MENTIONED ABOUT THE APPLICATION BY THESE GROUPS OF COMPANIES WHO HAVE APPLIED FOR THE SHAR ES IN THE ASSESSEE COMPANY. THAT IN THE ASSESSMENT ORDER, THE ASSESSING OFFICER HAS NOWHERE MENTIONED THAT ANY INCRIMINATING MATERIAL WAS FOUND AT THE TIME OF SEARCH. LEARNED DR ALSO, THOUGH ARGUED AT THE TIME OF HEARING THAT VARIOUS DOCUMENTS RELATING TO SH ARE APPLICATION MONEY WERE FOUND AND SEIZED, HAS NOT POINTED OUT A SIN GLE DOCUMENT WHICH WILL FALL WITHIN THE AMBIT OF INCRIMINATING M ATERIAL. HE FURTHER STATED THAT THE LEARNED CIT-DR HAS STATED THAT DURING POST-SEARCH ENQUIRY, IT IS GATHERED THAT SOME OF THE SHARE APPLICA NTS WHO HAVE APPLIED FOR SHARES IN THE ASSESSEE COMPANY ARE ISSUING ACCOMMODATION ENTRIES IN THE FORM OF SHARE APPLICATIO N MONEY. THIS SUBMISSION OF LEARNED DR IS FACTUALLY INCORRECT AS, IN THE POST-SEARCH ENQUIRY IN THE CASE OF THE ASSESSEE, NO PERSON HAS STATED T HAT HE HAS PROVIDED ACCOMMODATION ENTRY TO THE ASSESSEE. THE STATE MENT OF ANY SUCH PERSON, IF ANY, IS NEITHER CONFRONTED TO THE ASSESSEE NOR PLACED ON RECORD EVEN BEFORE THE TRIBUNAL. HE, THEREFORE, SUB MITTED THAT ON THESE FACTS, THE DECISIONS OF HON'BLE JURISDICTIONAL HIG H COURT IN THE CASE OF KABUL CHAWLA (SUPRA) AND RRJ SECURITIES LTD. ( SUPRA) WOULD BE SQUARELY APPLICABLE. 12. WITH REGARD TO THE MERIT OF THE ADDITION OF SHA RE APPLICATION MONEY, THE LEARNED COUNSEL STATED THAT THE ASSESSEE HAS DU LY PROVED ITA-14/DEL/2012 & 6 OTHERS 9 THE IDENTITY, CREDITWORTHINESS AND GENUINENESS OF THE T RANSACTION AND THEREBY HAS DISCHARGED THE ONUS TO PROVE THE CREDIT IN THE FORM OF SHARE APPLICATION MONEY. HE HAS STATED THAT THE ASSESSEE HAS FURNISHED THE COPY OF SHARE APPLICATION FORM, CONFIRM ATION FROM INVESTOR COMPANY, COPY OF INCOME TAX RETURN AND BANK STATEMENT OF THE INVESTOR COMPANY, CERTIFICATE OF INCORPORATION O F THE INVESTOR COMPANY AND, THEREFORE, IN VIEW OF VARIOUS JUDICIAL PRONOUNCEMENTS, THE ASSESSEE HAS DULY DISCHARGED THE ONUS TO PROVE THE CRE DIT IN ITS ACCOUNT. HE HAS ALSO FURNISHED THE WRITTEN SUBMISSION IN THIS REGARD RUNNING INTO EIGHT PAGES. 13. WE HAVE CAREFULLY CONSIDERED THE ARGUMENTS OF BOT H THE SIDES AND HAVE PERUSED THE MATERIAL PLACED BEFORE US. IN T HE CASE OF KABUL CHAWLA (SUPRA), HON'BLE JURISDICTIONAL HIGH COURT HAS CONSIDERED ALL EARLIER DECISIONS OF HON'BLE DELHI HIGH COURT AND HAS ALSO CONSIDERED THE DECISIONS OF OTHER HIGH COURTS AND TRIBUNALS AND SU MMARIZED THE LEGAL POSITION IN PARAGRAPH 37 AND AT THE CONCLUSION OF THE CASE IN PARAGRAPH 38, WHICH ARE REPRODUCED BELOW:- SUMMARY OF THE LEGAL POSITION. 37. ON A CONSPECTUS OF SECTION 153A(1) OF THE ACT, R EAD WITH THE PROVISOS THERETO, AND IN THE LIGHT OF THE LA W EXPLAINED IN THE AFOREMENTIONED DECISIONS, THE LEGAL POSITION THAT EMERGES IS AS UNDER:- I. ONCE A SEARCH TAKES PLACE UNDER SECTION 132 OF THE ACT, NOTICE UNDER SECTION 153A(1) WILL HAVE TO BE MANDATORILY ISSUED TO THE PERSON SEARCHED REQUIRING HIM TO FILE RETURNS FOR SIX AYS IMMEDIATELY PRECEDING THE PRE VIOUS YEAR RELEVANT TO THE AY IN WHICH THE SEARCH TAKES PLA CE. II. ASSESSMENTS AND REASSESSMENTS PENDING ON THE DATE OF THE SEARCH SHALL ABATE. THE TOTAL INCOME FOR SUCH AYS WILL HAVE TO BE COMPUTED BY THE AOS AS A FRESH EXERCI SE. ITA-14/DEL/2012 & 6 OTHERS 10 III. THE AO WILL EXERCISE NORMAL ASSESSMENT POWERS IN RESPECT OF THE SIX YEARS PREVIOUS TO THE RELEVANT AY IN WHICH THE SEARCH TAKES PLACE. THE AO HAS THE POWER TO ASSESS AND REASSESS THE TOTAL INCOME OF THE AFOREMENTIONED SIX YEARS IN SEPARATE ASSESSMENT ORDERS FOR EACH OF THE SIX YEARS. IN OTHER WORDS THERE WILL BE ONLY ONE ASSESSMENT ORDER IN RESPECT OF EACH OF THE SIX AYS IN WHICH BOTH THE DISCLOSED AND THE UNDISCLOSED INCOME WOULD BE BROUGHT TO TAX. IV. ALTHOUGH SECTION 153A DOES NOT SAY THAT ADDITIONS SHOULD BE STRICTLY MADE ON THE BASIS OF EVIDENCE FOUND IN THE COURSE OF THE SEARCH, OR OTHER POST-SEARCH MATERI AL OR INFORMATION AVAILABLE WITH THE AO WHICH CAN BE RELA TED TO THE EVIDENCE FOUND, IT DOES NOT MEAN THAT THE ASSESSMENT CAN BE ARBITRARY OR MADE WITHOUT ANY RELEVANCE OR NEXUS WITH THE SEIZED MATERIAL. OBVIOUSLY AN ASSESSMENT HAS TO BE MADE UNDER THIS SECTION ONLY ON THE BASIS OF SEIZED MATERIAL. V. IN ABSENCE OF ANY INCRIMINATING MATERIAL, THE COMPLETED ASSESSMENT CAN BE REITERATED AND THE ABATED ASSESSMENT OR REASSESSMENT CAN BE MADE. THE WORD ASSESS IN SECTION 153A IS RELATABLE TO ABATED PROCEEDI NGS (I.E. THOSE PENDING ON THE DATE OF SEARCH) AND THE W ORD REASSESS TO COMPLETED ASSESSMENT PROCEEDINGS. VI. INSOFAR AS PENDING ASSESSMENTS ARE CONCERNED, THE JURISDICTION TO MAKE THE ORIGINAL ASSESSMENT AND THE ASSESSMENT UNDER SECTION 153A MERGES INTO ONE. ONLY ONE ASSESSMENT SHALL BE MADE SEPARATELY FOR EACH AY ON THE BASIS OF THE FINDINGS OF THE SEARCH AND ANY OTHER MATERIAL EXISTING OR BROUGHT ON THE RECORD OF THE AO . VII. COMPLETED ASSESSMENTS CAN BE INTERFERED WITH BY THE AO WHILE MAKING THE ASSESSMENT UNDER SECTION 153A ONLY ON THE BASIS OF SOME INCRIMINATING MATERIAL UNEAR THED DURING THE COURSE OF SEARCH OR REQUISITION OF DOCUMENT S OR UNDISCLOSED INCOME OR PROPERTY DISCOVERED IN THE COURSE OF SEARCH WHICH WERE NOT PRODUCED OR NOT ALREADY DISCLOSE D OR MADE KNOWN IN THE COURSE OF ORIGINAL ASSESSMENT. CONCLUSION ITA-14/DEL/2012 & 6 OTHERS 11 38. THE PRESENT APPEALS CONCERN AYS 2002-03, 2005-06 AND 2006-07. ON THE DATE OF THE SEARCH THE SAID ASSESSMENTS ALREADY STOOD COMPLETED. SINCE NO INCRIMINATING MATERIAL WAS UNEARTHED DURING THE SEARC H, NO ADDITIONS COULD HAVE BEEN MADE TO THE INCOME ALREADY ASSESSED. 14. IN CLAUSE (IV) ABOVE, THEIR LORDSHIPS HELD OBVIOU SLY AN ASSESSMENT HAS TO BE MADE UNDER THIS SECTION ONLY ON THE BASIS OF SEIZED MATERIAL. IN CLAUSE (V), THE SAME IS REITERAT ED BY HOLDING IN ABSENCE OF ANY INCRIMINATING MATERIAL, THE COMPLETED ASSESSMENT CAN BE REITERATED AND THE ABATED ASSESSMENT OR REASSESSMENT CA N BE MADE. IN CLAUSE (VII), IT IS STATED COMPLETED ASSESSMEN TS CAN BE INTERFERED WITH BY THE AO WHILE MAKING THE ASSESSMENT U NDER SECTION 153A ONLY ON THE BASIS OF SOME INCRIMINATING MATERIAL UNEARTHED DURING THE COURSE OF SEARCH. 15. IN THE CASE OF RRJ SECURITIES LTD. (SUPRA), IN PAR AGRAPH 21, IT HAS BEEN HELD :- IN RESPECT OF SUCH ASSESSMENTS WHICH HAVE ABATED, THE AO WOULD HAVE THE JURISDICTION TO PROCEED AND MAKE A N ASSESSMENT. HOWEVER, IN RESPECT OF CONCLUDED ASSESSMENTS, THE AO WOULD ASSUME JURISIDCITON TO REASSESS PROVIDED THAT THE ASSETS/DOCUMENTS RECEIVED BY THE AO REPRESENT OR INDICATE ANY UNDISCLOSED INCOME OR POSSIBIL ITY OF ANY INCOME THAT MAY BE REMAINED UNDISCLOSED IN THE RELEVANT ASSESSMENT YEARS. THIS COURT IN COMMISSIONER OF INCOME TAX (CENTRAL)-III V. KABUL CHAWLA : ITA 707/ 2014, DECIDED ON 28 TH AUGUST, 2015 HAS HELD THAT COMPLETED ASSESSMENTS COULD ONLY BE INTERFERED WITH BY THE AO ON THE BASIS OF ANY INCRIMINATING MATERIAL UNEARTHED DUR ING THE COURSE OF THE SEARCH OR REQUISITION OF THE DOCUME NTS. IN ABSENCE OF ANY INCRIMINATING MATERIAL, THE AO DOE S NOT HAVE ANY JURISDICTION TO INTERFERE IN CONCLUDED ASSESSMENTS. ITA-14/DEL/2012 & 6 OTHERS 12 16. HAVING DISCUSSED THE LEGAL POSITION HELD BY HON'BLE JURISDICTIONAL HIGH COURT ABOVE, LET US EXAMINE THE FACTS OF THE CASE SO AS TO ASCERTAIN WHETHER ANY INCRIMINATING MATERIAL WAS UNEA RTHED DURING THE COURSE OF SEARCH OR REQUISITION OF DOCUMENTS. FOR THE YEAR UNDER CONSIDERATION, THE ASSESSEE HAD FILED THE RETURN OF INCO ME ON 1 ST NOVEMBER, 2012 DECLARING TOTAL INCOME OF `3,05,04,1 40/-. THE CASE WAS TAKEN UP FOR SCRUTINY BY ISSUANCE OF NOTICE U/S 143 (2). FROM PAGE 1 TO 62, THERE ARE THE DETAILS AND EVIDENCES PRODUCED BY THE ASSESSEE DURING THE ORIGINAL ASSESSMENT PROCEEDINGS. PARAGRAPH 3 OF THE ASSESSEES REPLY BEFORE THE ASSESSING OFFICER, COPY OF WHICH IS PLACED AT PAGE 1 OF THE ASSESSEES PAPER BOOK, READS AS UNDER:- 3. SHARE APPLICATION MONEY AS DESIRED, WE ARE ENCLOSING HEREWITH A LIST SHOWING DET AILS OF SHARE APPLICATION MONEY. SHARE APPLICATION MONE Y WAS RECEIVED FROM 29 PARTIES, OUT OF WHICH 15 ARE OLD AN D FRESH APPLICATION MONEY WAS RECEIVED FROM 14 PARTIES. AS DESIRED WE ARE ENCLOSING HEREWITH CONFIRMATIONS OF FIF TEEN PARTIES IN RESPECT OF OLD SHARE APPLICATION MONEY AND CONFIRMATION WITH PHOTOCOPY OF BANK STATEMENTS IN SUPP ORT OF SOURCE OF DEPOSITING SHARE APPLICATION MONEY IN RE SPECT OF FOURTEEN PARTIES FROM WHOM FRESH SHARE APPLICATION MONEY WAS RECEIVED DURING THE YEAR. 17. FROM THE ABOVE, IT IS EVIDENT THAT DURING ORIGIN AL ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER MADE ENQUIRY WITH RE GARD TO SHARE APPLICATION MONEY AND THE ASSESSEE DULY EXPLAINED THE S AME ALONG WITH NECESSARY EVIDENCE I.E. CONFIRMATION OF SHARE APP LICANT, PHOTOCOPY OF BANK STATEMENT ETC. SATISFIED WITH THE SAME, THE ASSESSING OFFICER COMPLETED THE ASSESSMENT U/S 143(3) ON 2 8 TH DECEMBER, 2006 ACCEPTING THE INCOME DECLARED BY THE ASSESSEE I.E., `3,05,04,140/-. NOW, THE QUESTION IS WHETHER ANY INC RIMINATING MATERIAL RELATING TO SHARE APPLICATION MONEY WAS FOUN D AT THE TIME OF SEARCH. LEARNED CIT-DR HAS RELIED UPON THE OBSERVATIO NS OF THE ITA-14/DEL/2012 & 6 OTHERS 13 ASSESSING OFFICER IN PARAGRAPH 4 OF THE ASSESSMENT ORDER SO AS TO POINT OUT THAT INCRIMINATING MATERIAL WAS FOUND. HOWEVER , IN PARAGRAPH 4, THE ASSESSING OFFICER ONLY POINTED OUT DURING THE COUR SE OF SEARCH, A NUMBER OF DOCUMENTS WERE FOUND WHICH INDICATED THE I NTRODUCTION OF SHARE APPLICATION MONEY. ADMITTEDLY, THE ASSESSEE HAS A LREADY DISCLOSED THE SHARE APPLICATION MONEY RECEIVED DURING THE YEAR UNDER CONSIDERATION AND THE NAMES OF THE PERSONS FROM WHOM SUC H SHARE APPLICATION MONEY WAS RECEIVED AND CONFIRMATIONS FROM SHARE APPLICANTS. THEREFORE, THE DOCUMENT WHICH INDICATED THE RECEIPT OF SHARE APPLICATION MONEY OR THE PERSONS FROM WHOM SUCH S HARE APPLICATION MONEY WAS RECEIVED CANNOT BE SAID TO BE I NCRIMINATING MATERIAL BECAUSE THESE DETAILS ARE ALREADY PLACED ON R ECORD BY THE ASSESSEE DURING ORIGINAL ASSESSMENT PROCEEDINGS WHICH WAS PRI OR TO THE DATE OF SEARCH. THE ASSESSING OFFICER HAS ALSO REFERR ED TO ANOTHER DOCUMENT WHICH GIVES THE PATTERN OF SHARE APPLICATION MONEY IN SUNCITY PROJECTS (P) LTD., I.E. THE ASSESSEE COMPANY. T HE SAID DOCUMENT CLARIFIES THAT THE ASSESSEE COMPANY IS BASICALLY CONTROLLED BY FOUR GROUP OF COMPANIES, VIZ., ESSEL GROUP, ACTION GROUP, ODEAN GROUP, SUNCITY GROUP AND OTHER MISCELLANEOUS COMPANIE S. IN OUR OPINION, WHEN THE NAMES OF ALL THE SHARE APPLICANTS AL ONG WITH THEIR ADDRESSES WERE ALREADY ON RECORD, MERELY BECAUSE IN A D OCUMENT THOSE SHARE APPLICANTS HAVE BEEN CLASSIFIED IN SOME GROUP S, DOES NOT MEAN THAT SUCH DOCUMENT WAS AN INCRIMINATING MATERIAL INDICATIVE OF ANY UNDISCLOSED INCOME. FOR THE YEAR UNDER CONSIDERAT ION, THE ASSESSING OFFICER HAS TREATED THE SHARE APPLICATION MONEY OF M/S ANU FASHIONS PVT.LTD. RS.4,02,00,000/-, M/S CHURU TRADING C O. PVT.LTD. RS.3,00,00,000/- AND M/S DAULAT FINVEST PVT.LTD. RS.50, 00,000/-. THE FACTS RELATING TO M/S ANU FASHIONS PVT.LTD. ARE DISCUSSED AT PAGE 7 PARAGRAPH 4.9 OF THE ASSESSMENT ORDER. MAIN REASON GIVE N BY THE ASSESSING OFFICER FOR NOT ACCEPTING CREDITWORTHINESS OF M /S ANU ITA-14/DEL/2012 & 6 OTHERS 14 FASHIONS PVT.LTD. IS THE MEAGER INCOME SHOWN BY THE SAI D COMPANY. HOWEVER, IN THE DETAILS DISCUSSED IN THE ASSESSMENT ORDER R ELATING TO M/S ANU FASHIONS PVT.LTD., THERE IS NO MENTION BY THE A SSESSING OFFICER WITH REGARD TO ANY INCRIMINATING MATERIAL. IN THE CASE OF CHURU TRADING CO. PVT.LTD., THE ASSESSING OFFICER, DURING ASSESSMENT PRO CEEDINGS, HAS ISSUED NOTICE U/S 133(6). IN RESPONSE TO WHICH, THE CO MPANY DID NOT FURNISH THE REQUISITE INFORMATION. THE ASSESSING OFFICER ALSO ASKED THE ASSESSEE TO PRODUCE THE DIRECTOR OF THE SAID COMPANY WHO WAS NOT PRODUCED. THUS, HERE AGAIN, THERE IS NO REFERENCE TO ANY INCRIMINATING MATERIAL FOUND AND SEIZED DURING THE COURSE OF SEARCH INDICATIVE OF ANY UNDISCLOSED INCOME IN THE FORM OF SHARE APPLICATION MO NEY. IDENTICAL FACTS ARE THERE WITH REGARD TO M/S DAULAT FINVEST PVT. LTD. THE SAID COMPANY ALSO DID NOT FURNISH THE INFORMATION IN RESPON SE TO NOTICE U/S 133A AND ALSO THE DIRECTOR OF THE SAID COMPANY WAS NOT PRODUCED BUT, THERE IS NO MENTION OF ANY INCRIMINATING MATERIAL FO UND AND SEIZED DURING THE COURSE OF SEARCH WITH REFERENCE TO SHARE AP PLICATION MONEY RECEIVED FROM M/S DAULAT FINVEST PVT.LTD. THEREFORE, WE HAVE NO HESITATION TO HOLD THAT NO INCRIMINATING MATERIAL RE LATING TO SHARE APPLICATION MONEY WAS FOUND DURING THE COURSE OF SEARC H OF THE ASSESSEES PREMISES AND, THEREFORE, THE DECISIONS OF HON'BL E JURISDICTIONAL HIGH COURT IN THE CASE OF KABUL CHAWLA (SUPRA) AND RRJ SECURITIES LTD. (SUPRA) ARE SQUARELY APPLICABLE. RESPE CTFULLY FOLLOWING THE SAME, WE HOLD THAT THE ADDITION ON ACCOUNT OF SHA RE APPLICATION MONEY MADE BY THE ASSESSING OFFICER WAS OUT OF PURVIEW O F ASSESSMENT U/S 153A. 18. WITH REGARD TO THE MERIT OF THE ADDITION OF SHA RE APPLICATION MONEY, BOTH THE PARTIES HAVE ARGUED AT LENGTH IN SUPP ORT OF THEIR RIVAL CONTENTIONS. LEARNED DR HAS CLAIMED THAT THE ASSESSEE H AS NOT DISCHARGED THE ONUS TO PROVE THE CREDIT IN ITS ACCOUNT IN THE FORM OF ITA-14/DEL/2012 & 6 OTHERS 15 SHARE APPLICATION MONEY AND THEREFORE, LEARNED CIT(A ) WAS NOT JUSTIFIED IN DELETING THE ADDITION ON MERITS ALSO. LEARNED COU NSEL FOR THE ASSESSEE, ON THE OTHER HAND, STATED THAT THE ASSESSEE HAS DUL Y DISCHARGED THE ONUS BY PRODUCING THE CONFIRMATION OF THE INVESTOR COMPANY WHO IS ASSESSED TO INCOME TAX. THE ASSESSEE HAS ALSO PRODUCED THE COPY OF BANK STATEMENT, BALANCE SHEET A ND CERTIFICATE OF INCORPORATION OF THE INVESTOR COMPANY. HE HAS ALSO RE LIED UPON THE VARIOUS JUDICIAL PRONOUNCEMENTS IN SUPPORT OF HIS CONT ENTION THAT THE ASSESSEE HAS DULY DISCHARGED THE ONUS TO PROVE THE CREDIT. HOWEVER, WHILE CONSIDERING THE SCOPE OF ASSESSMENT U/S 153A, WE HAV E ARRIVED AT THE CONCLUSION THAT IN VIEW OF THE DECISION OF HON 'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF KABUL CHAWLA (SUPRA) AND RR J SECURITIES LTD. (SUPRA), SINCE NO INCRIMINATING MATERIAL RELATING TO SHARE CAPITAL MONEY WAS FOUND, THE COMPLETED ASSESSMENT FOR ASSESSMENT YEAR 200 4-05 CANNOT BE INTERFERED WITH. IN VIEW OF THE ABOVE, W E ARE NOT GOING INTO THE MERIT OF THE ARGUMENT OF BOTH THE SIDES SO AS TO R ECORD THE FINDING WHETHER THE ASSESSEE HAS DISCHARGED THE ONUS OF PROVING TH E CREDIT IN THE FORM OF SHARE APPLICATION MONEY OR NOT BUT, WE U PHOLD THE ORDER OF LEARNED CIT(A) DELETING THE ADDITION OF `7,52,00,00 0/- ON THE LIMITED GROUND THAT IN VIEW OF THE DECISION OF HON'BLE JURISD ICTIONAL HIGH COURT IN THE CASE OF KABUL CHAWLA (SUPRA) AND RRJ SECURITIE S LTD. (SUPRA), THE COMPLETED ASSESSMENT CANNOT BE INTERFERED WITH. WITH T HIS REMARK, WE DISMISS THE REVENUES APPEAL IN ITA NO.44/DEL/2012. 19. THE ONLY OTHER GROUND RAISED IN THE ASSESSEES APPEAL IS WITH REGARD TO THE DISALLOWANCE OF `60,00,000/- MADE BY T HE ASSESSING OFFICER ON ACCOUNT OF INTEREST ON BORROWED MONEY. W ITH REGARD TO THIS GROUND ALSO, IT WAS STATED BY THE LEARNED COUNSEL THAT IN THE ASSESSMENT U/S 153A, THE ASSESSING OFFICER DISALLOWED `60,00, 000/- OUT OF INTEREST ON THE GROUND THAT THE BORROWED MONEY HA S BEEN UTILIZED ITA-14/DEL/2012 & 6 OTHERS 16 FOR ACQUISITION OF A CAPITAL ASSET AND, THEREFORE, INT EREST INCOME IS TO BE DISALLOWED IN PROPORTION TO THE INVESTMENT IN THE ACQ UISITION OF THE CAPITAL ASSET. THE LEARNED COUNSEL STATED THAT NO INCR IMINATING MATERIAL WITH REGARD TO INTEREST EXPENDITURE HAS BEE N FOUND AND, THEREFORE, THE ISSUE RELATING TO DISALLOWANCE OF INTER EST WAS ALSO OUT OF THE PURVIEW OF REASSESSMENT U/S 153A. 20. LEARNED DR, ON THE OTHER HAND, RELIED UPON THE ORDERS OF AUTHORITIES BELOW ON THIS POINT. 21. WE HAVE ALREADY DISCUSSED THE SCOPE OF ASSESSMENT U/S 15 3A AT LENGTH WHILE DISCUSSING GROUND NOS.1 TO 5 OF THE ASSESSEES APPEAL AND, RESPECTFULLY FOLLOWING THE DECISIONS OF HON'BLE J URISDICTIONAL HIGH COURT IN THE CASE OF KABUL CHAWLA (SUPRA) AND RRJ SEC URITIES PVT.LTD. (SUPRA) HAVE ARRIVED AT THE CONCLUSION THAT COMPLETED ASSESSMENT CAN BE INTERFERED WITH BY THE ASSESSING OFFICER WHILE MAKIN G THE ASSESSMENT U/S 153A ONLY ON THE BASIS OF SOME INCRIMINATIN G MATERIAL UNEARTHED DURING THE COURSE OF SEARCH OR REQUISITION O F DOCUMENT. ADMITTEDLY, NO INCRIMINATING MATERIAL RELATING TO I NTEREST EXPENDITURE WAS UNEARTHED DURING THE COURSE OF SEARCH OR REQUISITIO N OF DOCUMENTS AND, THEREFORE, IN OUR OPINION, THE DISALLOWANCE OF INTEREST WAS OUT OF THE PURVIEW OF THE ASSESSMENT U/S 153A. IN THE ABSENCE O F INCRIMINATING MATERIAL, THE ASSESSING OFFICER SHOULD REI TERATE THE COMPLETED ASSESSMENT. ACCORDINGLY, WE DELETE THE DISALL OWANCE OF `60,00,000/- MADE BY THE ASSESSING OFFICER OUT OF INTER EST EXPENDITURE AND ALLOW GROUND NOS.6 TO 9 OF THE ASSESSEES APPEAL. 22. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED AND THE APPEAL OF THE REVENUE IN ITA NO.44/DEL/2012 IS DISMISSE D. ITA-14/DEL/2012 & 6 OTHERS 17 ITA NO.45/DEL/2012 ITA NO.45/DEL/2012 ITA NO.45/DEL/2012 ITA NO.45/DEL/2012 REVENUES APPEAL FOR AY 2005 REVENUES APPEAL FOR AY 2005 REVENUES APPEAL FOR AY 2005 REVENUES APPEAL FOR AY 2005- -- -06 : 06 : 06 : 06 :- -- - 23. THE ONLY GROUND RAISED IN THIS APPEAL BY THE REVE NUE READS AS UNDER:- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.3,79,00,000/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF ISSUE OF BOGUS SHARE APPLICATION MONEY. 24. THE FACTS OF THE CASE ARE THAT FOR THE YEAR UNDER CONSIDERATION, THE ASSESSEE HAD FILED THE ORIGINAL RETURN ON 30 TH OCTOBER, 2005 DECLARING TOTAL INCOME OF `2,04,80,490/-. THE SAME WAS ASSESSED U/S 143(3) VIDE ORDER DATED 24 TH DECEMBER, 2006 AT THE TAXABLE INCOME OF `2,08,86,122/-. AFTER THE SEARCH, IN RESPONSE TO NOTI CE U/S 153A, THE ASSESSEE FILED THE RETURN DECLARING INCOME OF `2,04,80, 490/- I.E. THE INCOME DECLARED IN THE ORIGINAL RETURN. THE ASSESSMENT U/S 153A WAS COMPLETED ON 30 TH DECEMBER, 2010 AT THE TOTAL INCOME OF `5,87,86,122/- IN WHICH THE ASSESSING OFFICER MADE THE ADDITION OF `3,79,00,000/- IN RESPECT OF SHARE APPLICATION MONEY. THE SAME WAS DELETED BY THE LEARNED CIT(A). HENCE, THIS APPEAL B Y THE REVENUE. 25. AT THE TIME OF HEARING BEFORE US, LEARNED DR STAT ED THAT HIS ARGUMENTS MAINLY REMAIN THE SAME AS WERE ADVANCED IN ASSESSMENT YEAR 2004-05. IN ADDITION, HE POINTED OUT THAT FOR THE YEAR UNDER CONSIDERATION, THE ASSESSING OFFICER MADE THE ADDITION I N RESPECT OF SHARE APPLICATION MONEY RECEIVED FROM FOLLOWING TWO PARTIES :- (I) CHURU TRADING CO. P.LTD. : `2,52,00,000/- (II) VANDANA LABORATORIES P.LTD. : `1,27,00,000/- ITA-14/DEL/2012 & 6 OTHERS 18 26. HE STATED THAT THE ISSUE OF CHURU TRADING CO. P.LT D. IS ALREADY DISCUSSED IN ASSESSMENT YEAR 2004-05. IN RESPECT OF VANDA NA LABORATORIES P.LTD., HE REFERRED TO THE ASSESSMENT ORDER PAGE 9 AND POINTED OUT THAT IN RESPECT OF SEARCH AT THE PREMISES O F BEST GROUP OF CASES, IT WAS GATHERED THAT SUCH GROUP WAS TAKING ACCOMM ODATION ENTRIES MAINLY IN THE FORM OF SHARE CAPITAL. M/S VAN DANA LABORATORIES P.LTD. IS ONE OF THE COMPANIES WHICH WAS PROVIDING ACC OMMODATION ENTRIES. THUS, IN THE CASE OF M/S VANDANA LABORATORIES P.LTD., ENOUGH EVIDENCE HAS BEEN BROUGHT BY THE REVENUE ON RECORD I N POST-SEARCH ENQUIRY THAT THE SAID COMPANY WAS AN ENTRY PROVIDER. IN VIEW OF THE ABOVE, LEARNED CIT(A) WAS NOT JUSTIFIED IN ACCEPTING THE SHARE APPLICATION MONEY RECEIVED FROM M/S VANDANA LABORATO RIES P.LTD. TO BE GENUINE. 27. LEARNED COUNSEL FOR THE ASSESSEE, ON THE OTHER HAND, RELIED UPON THE ORDER OF LEARNED CIT(A) AND HIS ARGUMENTS ADVANCE D WHILE HEARING THE APPEAL FOR ASSESSMENT YEAR 2004-05. HE FURTHER SUB MITTED THAT AS PER THE DECISION OF HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF KABUL CHAWLA (SUPRA) AND RRJ SECURITIES LTD. (SUPRA), THE ADDITION CAN BE MADE U/S 153A ONLY IF INCRIMINATING MATERIAL WAS FOUND AND SEIZED DURING THE COURSE OF SEARCH OF THE ASSESSEE. ADMITTEDLY , IN THE CASE OF SEARCH OF THE ASSESSEE, NO INCRIMINATING MATERIAL WAS FO UND AND SEIZED SO AS TO ESTABLISH THAT M/S VANDANA LABORATORIES P.LTD. W AS AN ENTRY PROVIDER. THE ASSESSING OFFICER HAS REFERRED TO SOME IN VESTIGATION CARRIED OUT BY THE INVESTIGATION WING DURING THE COU RSE OF SEARCH OF BEST GROUP OF CASES. HOWEVER, IN RESPECT OF SUCH AVERME NT IN THE ASSESSMENT ORDER, NO MATERIAL HAS BEEN CONFRONTED TO THE ASSESSEE AND NO MATERIAL IS EVEN PRODUCED BEFORE THE ITAT. T HAT IF THE DEPARTMENT HAS CLAIMED TO HAVE GATHERED SOME MATERIAL DURING THE COURSE OF INVESTIGATION OF SOME OTHER ASSESSEE WHICH IS USE D AGAINST ITA-14/DEL/2012 & 6 OTHERS 19 THE ASSESSEE, A COPY OF SUCH MATERIAL SHOULD HAVE BEEN PR OVIDED TO THE ASSESSEE. EVEN OTHERWISE, THE ORDER OF THE ASSESSING OF FICER IS VAGUE AND GENERAL IN NATURE. HE HAS NOT REFERRED TO ANY SPECIFIC FINDING OR ANY STATEMENT HAVING BEEN GIVEN BY THE DI RECTOR OF M/S VANDANA LABORATORIES P.LTD. THAT IT HAS GIVEN ACCOMMO DATION ENTRIES TO THE ASSESSEE, I.E., M/S SUNCITY PROJECTS PVT.LTD. HE PRODUCED BEFORE US THE COPY OF THE ORDER OF ITAT IN THE CASE OF M/S VA NDANA LABORATORIES P.LTD. FOR ASSESSMENT YEAR 2003-04 IN WHICH THE REVENUE HAD CHALLENGED THE DELETION OF VARIOUS ADDITIONS. TH AT THOSE ADDITIONS WERE TO THE TUNE OF `70,70,000/- BY WAY OF FIRST GRO UND, `56,00,000/- BY WAY OF SECOND GROUND AND `41,50,000/- BY WAY OF FIFTH GROUND. FROM A READING OF THE ORDER OF THE ITAT, IT WOULD B E CLEAR THAT M/S VANDANA LABORATORIES P.LTD. IS A GENUINE COMPANY WHIC H IS CARRYING ON THE BUSINESS AND NOT AN ENTRY PROVIDER AS ALLEGED BY TH E ASSESSING OFFICER IN THE ASSESSMENT ORDER. 28. WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF BOTH THE SIDES AND HAVE PERUSED THE MATERIAL PLACED BEFORE US. WE H AVE ALREADY DISCUSSED AT LENGTH THE SCOPE OF ASSESSMENT U/S 153A SPECIAL LY WHEN THE ORIGINAL ASSESSMENT WAS ALREADY COMPLETED U/S 143(3) WHILE DECIDING THE REVENUES APPEAL FOR ASSESSMENT YEAR 2004- 05. IN THE LIGHT OF THE ABOVE LEGAL POSITION AS ALREADY DISCUSSED B Y US, LET US EXAMINE WHETHER IN RESPECT OF M/S VANDANA LABORATORIE S P.LTD., IT CAN BE SAID THAT THE REVENUE HAS FOUND ANY INCRIMINATING MATERIAL IN THE COURSE OF SEARCH. ADMITTEDLY, NO INCRIMINATING MATER IAL RELATING TO M/S VANDANA LABORATORIES P.LTD. WAS FOUND AT THE TIME OF SEARCH OF THE ASSESSEES PREMISES. THE DETAILS MENTIONED BY THE ASSESSING OF FICER AT PAGE 9 & 10 OF HIS ORDER RELATING TO M/S VANDANA L ABORATORIES P.LTD. ARE REPRODUCED BELOW FOR READY REFERENCE :- ITA-14/DEL/2012 & 6 OTHERS 20 II. M/S VANDANA LABORATORIES LTD. THE ASSESSEE HAS INTRODUCED A SUM OF RS.1,27,00,000/- AS SHARE APPLICATION MONEY AND SHARE PREMIUM IN THE NAME OF M/S VANDANA LABORATORIES LTD. THE SUMMON SENT TO THE ASSESSEE FOR PERSONAL ATTENDANCE HAS NOT BEEN COMPLIED WITH. HOWEVER, BEFORE THE CLO SE OF THE PROCEEDINGS, ON 22-2-2010, THE COMPANY HAS FURNISH ED A COPY OF BALANCE SHEET WHICH IS ANALYZED. THE ONLY SOURCE OF THE INCOME OF THE COMPANY IN THE AY 2006-0 7 IS RS.2500/- AS INTEREST INCOME FOR WHICH THE SOURCE IS NOT CLEAR. THE TOTAL EXPENDITURE OF THE COMPANY IS RS.29 57/-. FURTHER, IN THE IMMEDIATE PRECEDING YEAR IN WHICH T HE SHARE APPLICATION MONEY HAS BEEN GIVEN THE TOTAL INCO ME OF THE COMPANY IS RS.15347/- AS INTEREST ON INCOME TAX REFUND AND RS.2861/- AS INTEREST ON FDR. AGAINST THIS INCOME, THE EXPENDITURE OF THE COMPANY IS RS.19078/-. IN THE EXPENDITURE OF THE COMPANY THERE IS NEITHER ANY SALARY NOR ANY ELECTRIC BILL NOR ANY ESTABLISHMENT EXPENDITU RE. ONLY ESSENTIAL EXPENDITURE LIKE PAYMENT OF AUDITOR FE E IS INCLUDED IN THE TOTAL EXPENDITURE. BOTH THE INCOME AS WELL AS EXPENDITURE COMPONENT ARE SELF EXPLANATORY ABOUT T HE FINANCIAL STATUS OF THE COMPANY AND ITS CREDITWORTHINE SS. OBVIOUSLY, THE COMPANY HAS BEEN USED AS A CONDUIT TO TRANSFER THE MONEY. FURTHER, IT HAS ALSO COME TO NOTICE THAT A SEARCH U/S 132 WAS CONDUCTED ON 15-09-2008 ON BEST GROUP OF CASES AND IT CAME TO NOTICE THAT A LARGE NUMBER OF COMPAN IES ARE PROVIDING ACCOMMODATION ENTRIES MAINLY IN THE FO RM OF SHARE CAPITAL AND SHARE PREMIUM TO BEST GROUP OF COMPANIES. THE MODUS OPERANDI OF THESE COMPANIES WAS TO ACCEPT THE CASH FROM THE BENEFICIARY AND DEPOSIT T HIS CASE IN DIFFERENT PAPER COMPANIES. AFTER ROTATING TH E AMOUNT FROM DIFFERENT COMPANIES, THE SAME IS TRANSFERRE D TO THE BENEFICIARY COMPANY IN THE FORM OF SHARE CAP ITAL OR SHARE APPLICATION MONEY. THE ADIT(INV) FOUND THAT T HE CORPORATE STATUS OF THESE COMPANIES IS NOT GENUINE. FROM THE DETAILED FINDING OF THE SEARCH IT CAME TO NOTICE THAT A LARGE NUMBER OF PRIVATE LIMITED COMPA NIES AND FIRMS WERE PROVIDING ACCOMMODATION ENTRIES. THE DIRECTORS OF THESE COMPANIES WERE 5-6 SAME PEOPLE WHO WORKED IN SAME PREMISES. A NUMBER OF BANK ACCOUNTS IN VARIOUS BANKS WERE OPENED IN THE NAMES OF THESE COMPANIES. A COMPREHENSIVE LIST OF SUCH COMPANIES FROM ITA-14/DEL/2012 & 6 OTHERS 21 WHOM ACCOMMODATION ENTRIES WERE OBTAINED WAS PROVIDED BY ADIT(INV) DURING SEARCH AND RELEVANT PORTION OF T HE LIST IS GIVEN HEREUNDER: S.NO. NAME AND ADDRESS OF THE COMPANY/FIRM NAME OF DIRECTORS BANK A/C DETAILS BANK A/C NO. 67. VANDANA GOYAL FAMILY TRUST; 13/34, WEA, ARYA SAMAJ ROAD, KAROL BAGH TRUSTEES : 1. TARUN GOYAL 2. VANDANA GOYAL 1. AXIS BANK, KAROL BAGH 223010100074777 68. VANDANA LABORATORIES PVT.LTD.; 13/34, WEA, ARYA SAMAJ ROAD, KAROL BAGH 1. RAJES H PRASAD 2. JITENDER KUMAR 1. ABN AMRO BANK, B.K. ROAD 2. STANDARD CHARTERED 751481 52205031591 69. VENUS INSEC PVT.LTD.; 13/34, WEA, ARYA SAMAJ ROAD, KAROL BAGH 1. RITU SAXENA 2. PRAMOD KUMAR 1. KOTAK MAHINDRA BANK, K.G. MARG 172200002779 FROM THE ABOVE, IT IS ALSO EVIDENT THAT A NUMBER OF PAPER COMPANIES HAVE BEEN FLOATED TO PROVIDE ACCOMMODATION ENTRIES AND SECONDLY, IT IS ALSO EVIDENT THAT M/S VANDANA LABORATORIES (P) LTD. IS ALSO ONE SUCH COMPANY. FROM THE ABOVE ENQUIRIES, THE FOLLOWING FACTS HAVE COME TO NOTICE: (A) THE COMPANY FROM WHOM THE ASSESSEE HAS SHOWN HUGE SHARE PREMIUM AND SHARE APPLICATION MONEY IS CONTROLLED BY THE DIRECTORS WHO HAVE ALSO STATED THAT A LARGE NUMBER OF COMPANIES OPERATED BY THEM ARE SIMPLY FOR NAME SAKE AS THEY ARE NOT CARRYING OUT ANY BUSINESS ACTIVITY. THERE IS ALSO AN ADMISSION THAT THESE ARE PAP ER ENTITIES FLOATED FOR THE PURPOSE OF PROVIDING ACCOMMODATION ENTRIES. (B) THE FACTS OF THE PRESENT CASE HAS MUCH RELEVANCE BECAUSE THE CASE IS PECULIAR AS THE PERSON WHO IS MANAGING THE AFFAIRS OF THESE COMPANIES HAS ADMITTED BEFORE THE DEPARTMENT THAT HE WAS MANAGING THESE COMPANIES ONLY FOR THE PURPOSE OF PROVIDING ACCOMMODATION ENTRIES. (C) THE ASSESSEE WAS MADE AWARE OF THE OUTCOME OF THE INVESTIGATION OF THE DEPARTMENT AND HE WAS ASKED TO PRODUCE DIRECTOR OF THESE COMPANIES SO AS TO EXAMINE THEIR CREDITWORTHINESS BUT HE HAS FAILED TO DISCHARGE H IS ITA-14/DEL/2012 & 6 OTHERS 22 ONUS. THE SUMMONS ISSUED TO THESE COMPANIES AT THE ADDRESSES GIVEN BY THE ASSESSEE HAVE BEEN RECEIVED BACK WITH THE POSTAL REMARKS THAT THE COMPANY DO NOT EXIST AT THE GIVEN ADDRESS. IN VIEW OF THESE FACTS, IT CANNOT B E SAID THAT THE IDENTITY AND THE CREDITWORTHINESS OF THE COM PANY HAS BEEN ESTABLISHED. 29. FROM PARAGRAPH 1 OF THE ORDER, IT IS EVIDENT THA T ASSESSING OFFICER HAS MADE ENQUIRY DIRECTLY FROM M/S VANDANA LA BORATORIES P.LTD. BY ISSUING SUMMONS TO THE SAID PARTY, IN RESPONSE TO WHICH , THE SAID COMPANY HAD FURNISHED A COPY OF THE BALANCE SHEET. O N ANALYSIS OF THIS BALANCE SHEET, THE ASSESSING OFFICER FOUND THAT THE COMPANY HAD A MEAGER INCOME AND EXPENDITURE. IN PARAGRAPH 2, THE ASSESSING OFFICER HAS DISCUSSED THE SEARCH PROCEEDINGS U/S 132 ON 15 TH SEPTEMBER, 2008 AT BEST GROUP OF CASES. AS PER ASSESSING OFFICER, DURING T HE COURSE OF SEARCH AT BEST GROUP OF CASES, IT CAME TO THE NOTICE TH AT LARGE NUMBER OF COMPANIES ARE PROVIDING ACCOMMODATION ENTRIES MAIN LY IN THE FORM OF SHARE CAPITAL AND SHARE PREMIUM TO BEST GROUP OF CO MPANIES. AS PER ASSESSING OFFICER, THE INVESTIGATION WING HAS PROVIDE D A COMPREHENSIVE LIST OF SUCH COMPANIES FROM WHOM ACCOMMOD ATION ENTRIES WERE OBTAINED BY BEST GROUP OF COMPANIES AND T HE LIST INCLUDED THE NAME OF M/S VANDANA LABORATORIES P.LTD. FROM WHOM THE ASSESSEE HAD CLAIMED TO HAVE RECEIVED THE SHARE APPLICATION M ONEY. HOWEVER, THE ASSESSING OFFICER HAS NOT MENTIONED WHETHER THE STAT EMENT OF DIRECTOR OF M/S VANDANA LABORATORIES P.LTD. WAS RECORD ED AND IF IT WAS RECORDED, WHETHER ANY ENQUIRY WAS MADE WITH REGARD TO SHARE APPLICATION MONEY GIVEN BY THEM TO M/S SUNCITY PROJE CTS PVT.LTD. I.E., THE ASSESSEE. THE ALLEGED REPORT OF ADIT, INVESTIGATION IN THE CASE OF BEST GROUP OF CASES HAS NOT BEEN PRODUCED ON RECORD. THE STATEMENT, IF ANY, OF THE DIRECTOR OF M/S VANDANA LABORATORIES P .LTD., HAS ALSO NOT BEEN PRODUCED ON RECORD. THEREFORE, IN OUR OPINION , THE DETAILS MENTIONED BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDER ARE ITA-14/DEL/2012 & 6 OTHERS 23 COMPLETELY VAGUE AND ON THE BASIS OF ABOVE, AN OPINI ON CANNOT BE FORMED THAT M/S VANDANA LABORATORIES P.LTD. IS PROVID ING ACCOMMODATION ENTRIES. MOREOVER, DURING THE COURSE O F ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER ISSUED SUMMONS TO M/S VAND ANA LABORATORIES P.LTD. WHICH WAS DULY RESPONDED BY THE SAI D COMPANY. THEREFORE, IF ASSESSING OFFICER HAD ANY DOUBT THAT M/S V ANDANA LABORATORIES P.LTD. IS ENTRY PROVIDER, HE COULD HAVE VERIFIED THE SAME FROM THE SAID COMPANY. 30. THE ASSESSEE HAS PRODUCED BEFORE US THE ORDER OF THE ITAT IN THE CASE OF M/S VANDANA LABORATORIES P.LTD. FOR ASSESSMENT YEA R 2003-04 VIDE ITA NO.1789/DEL/2009. IT WAS THE REVENUES APPE AL BEFORE THE ITAT AND FOLLOWING GROUNDS WERE RAISED:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD.CIT(A) HAS ERRED IN DELETING AN ADDITION OF RS.70,70,000/- ESPECIALLY WHEN THE GENUINENESS OF TRANSACTION, CREDITWORTHINESS AND IDENTITY OF THE PART IES WAS NOT ESTABLISHED. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD.CIT(A) HAS ERRED IN DELETING AN ADDITION OF R S.56 LACS MADE BY THE AO ON ACCOUNT OF UNEXPLAINED INVESTMENT U/S 69A OF IT ACT, 1961 IGNORING THE FACT THAT THE TRAN SACTION WAS NOT SUPPORTED BY ANY INDEPENDENT EVIDENCE. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD.CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.3 LACS MADE U/S 68 OF THE INCOME-TAX ACT, 1961. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD.CIT(A) HAS ERRED IN DELETING AN ADDITION OF RS.51,780/- MADE BY THE AO ON ACCOUNT OF UNEXPLAINED INVESTMENT U/S 69A OF IT ACT. 5. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD.CIT(A) HAS ERRED IN DELETING DISALLOWANCE OF RS.41,50,000/- ON ACCOUNT OF BAD DEBTS IGNORING THE F ACT ITA-14/DEL/2012 & 6 OTHERS 24 AND EVEN THE AMENDED PROVISIONS OF SECTION 36(1)(VII) AND 36(2) HAVE NOT TAKEN AWAY THE POWER OF THE AO TO EN QUIRE THAT THE DEBT HAS BECOME BAD. 31. WHILE DEALING WITH GROUND NO.5, THE ITAT HELD A S UNDER:- 20. APROPOS GROUND NO.5 I.E. BAD DEBTS, THE SAME IS SUPPORTED BY RESOLUTION OF BOARD OF DIRECTORS, THE AMO UNT HAS BEEN ACTUALLY WRITTEN OFF IN ASSESSEES BOOKS OF ACCOUNTS WHICH WAS DUE FROM M/S VERTEX DRUGS AS TRADE DEBT ON ACCOUNT OF PURCHASES EFFECTED IN 1997-98 WHIC H HAVE NOT BEEN DISPUTED. THE AMOUNT BEING A TRADE DE BT CONSIDERED AS IRRECOVERABLE AND ACTUALLY WRITTEN OFF, RELYING ON HON'BLE DELHI HIGH COURT JUDGMENT IN THE CASE OF MORGAN SECURITIES AND CREDITS (P) LTD. AND AUTOMETERS (SUPRA) P.LTD. (SUPRA), WE UPHOLD THE ORDER OF CIT(A) DELETING THE ADDITION. 32. FROM THIS ORDER OF THE ITAT, IT IS EVIDENT THAT M /S VANDANA LABORATORIES P.LTD. IS A GENUINE COMPANY WHICH IS CARR YING ON THE BUSINESS SINCE LONG BECAUSE, AS PER ORDER OF THE ITAT, M/ S VANDANA LABORATORIES P.LTD. WAS TO RECEIVE THE SUM OF `41,50,0 00/- IN RESPECT OF A TRADING TRANSACTION BETWEEN THEM AND M/S VERTEX DRU GS IN THE YEAR 1997-98. THUS, M/S VANDANA LABORATORIES P.LTD. IS IN T HE BUSINESS AT LEAST FROM THE YEAR 1997-98. THE APPEAL BY THE ITAT IS DECIDED ON 19 TH FEBRUARY, 2010. THUS, THE EXISTENCE OF M/S VANDANA LA BORATORIES P.LTD. AND CARRYING ON OF THE BUSINESS BY IT IS PROVED BEYOND DOUBT. THE ALLEGATIONS MADE BY THE ASSESSING OFFICER IN THE ASSES SMENT ORDER ARE NOT SUPPORTED WITH ANY EVIDENCE, AT LEAST NO EVI DENCE IS CONFRONTED TO THE ASSESSEE OR BROUGHT ON RECORD BEFORE US. IN VIEW OF THE ABOVE, WE ARE OF THE OPINION THAT EVEN IN RESPEC T OF SHARE APPLICATION MONEY FROM M/S VANDANA LABORATORIES P.LT D., THE DECISION OF HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF K ABUL CHAWLA (SUPRA) AND RRJ SECURITIES LTD. (SUPRA) WOULD BE SQUARELY APPL ICABLE BECAUSE NO INCRIMINATING MATERIAL RELATING TO SHARE APPLICAT ION MONEY FROM M/S ITA-14/DEL/2012 & 6 OTHERS 25 VANDANA LABORATORIES P.LTD. WAS FOUND DURING THE COUR SE OF SEARCH OF THE ASSESSEES PREMISES OR DURING THE COURSE OF POST-SEARCH INVESTIGATION IN THE CASE OF THE ASSESSEE. 33. SINCE, IN OUR OPINION, THE ADDITION OF SHARE APP LICATION MONEY AMOUNTING TO `3,79,00,000/- IS OUT OF THE PURVIEW OF ADDITION U/S 153A, WE DO NOT GO INTO THE MERITS OF THE ADDITION MADE BY THE ASSESSING OFFICER AND DELETED BY LEARNED CIT(A). WE, RESPECTF ULLY FOLLOWING THE DECISION OF HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF KABUL CHAWLA (SUPRA) AND RRJ SECURITIES LTD. (SUPRA), HOLD T HAT IN THE ABSENCE OF ANY INCRIMINATING MATERIAL FOUND DURING THE COUR SE OF SEARCH OF ASSESSEES PREMISES, COMPLETED ASSESSMENT CANNOT BE INTERFERED WITH. ACCORDINGLY, THE ORDER OF LEARNED CIT(A) IS UPHELD. ITA NO.46/DEL/2012 ITA NO.46/DEL/2012 ITA NO.46/DEL/2012 ITA NO.46/DEL/2012 REVENUES APPEAL REVENUES APPEAL REVENUES APPEAL REVENUES APPEAL FOR AY 2006 FOR AY 2006 FOR AY 2006 FOR AY 2006- -- -07 : 07 : 07 : 07 :- -- - 34. THE ONLY GROUND RAISED IN THIS APPEAL BY THE REVE NUE READS AS UNDER:- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.35,00,000/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF ISSUE OF BOGUS SHARE APPLICATION MONEY. 35. THE FACTS OF THE CASE ARE THAT FOR THE YEAR UNDER CONSIDERATION, THE ORIGINAL RETURN OF INCOME WAS FILED ON 7 TH DECEMBER, 2006 DECLARING TAXABLE INCOME OF `6,19,38,793/- WHICH WAS ACCEPTED U/S 143(1). AFTER THE SEARCH, NOTICE U/S 153A WAS ISSUED AND IN THE ASSESSMENT COMPLETED U/S 153A READ WITH SECTION 143(3), THE ASSESSM ENT WAS COMPLETED AT `6,54,38,793/-. WHILE MAKING THE ASSESSM ENT, THE ASSESSING OFFICER MADE THE ADDITION OF `35,00,000/- IN RESPECT OF SHARE APPLICATION MONEY FROM CHURU TRADING CO. P.LTD. TH E SAME WAS DELETED BY THE LEARNED CIT(A). HENCE, THIS APPEAL B Y THE REVENUE. ITA-14/DEL/2012 & 6 OTHERS 26 36. AT THE TIME OF HEARING BEFORE US, BOTH THE PARTI ES FAIRLY AGREED THAT THE ISSUE INVOLVED IS IDENTICAL TO THE ISSUE IN THE REVENUES APPEAL FOR ASSESSMENT YEAR 2004-05 BECAUSE, IN THAT YEAR ALSO, THERE WAS CREDIT IN THE FORM OF SHARE APPLICATION MONEY FROM CHURU TRADING COMPANY. THEREFORE, BOTH THE PARTIES AGREED THAT TH EIR ARGUMENTS REMAIN THE SAME AS WERE ADVANCED WHILE ARGUING APPEAL FOR ASSESSMENT YEAR 2004-05. 37. WE HAVE ALREADY CONSIDERED THE ARGUMENTS OF BOTH THE PARTIES WHILE CONSIDERING THE REVENUES APPEAL FOR ASSESSMENT YEA R 2004-05. FOR THE DETAILED DISCUSSION THEREIN, WE UPHOLD THE ORD ER OF LEARNED CIT(A) AND REJECT THE REVENUES APPEAL. ITA NO.47/DEL/2012 ITA NO.47/DEL/2012 ITA NO.47/DEL/2012 ITA NO.47/DEL/2012 REVENUES APPEAL FOR AY 2007 REVENUES APPEAL FOR AY 2007 REVENUES APPEAL FOR AY 2007 REVENUES APPEAL FOR AY 2007- -- -08 : 08 : 08 : 08 :- -- - 38. THE ONLY GROUND RAISED IN THIS APPEAL BY THE REVE NUE READS AS UNDER:- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.3,25,00,000/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF ISSUE OF BOGUS SHARE APPLICATION MONEY. 39. THE FACTS OF THE CASE ARE THAT FOR THE YEAR UNDER CONSIDERATION, THE ASSESSEE FILED THE ORIGINAL RETURN OF INCOME ON 6 TH NOVEMBER, 2007 DECLARING NET TAXABLE INCOME OF `19,58,85,803/-. T HE SAME WAS ACCEPTED U/S 143(1). AFTER THE SEARCH, NOTICE U/S 153 A WAS ISSUED, IN RESPONSE TO WHICH, THE ASSESSEE FILED THE RETURN OF INCOM E ON 9 TH MARCH, 2010 DECLARING THE SAME INCOME I.E., `19,58,8 5,803/-. ASSESSMENT U/S 153A READ WITH SECTION 14393) WAS COMPLETE D BY ITA-14/DEL/2012 & 6 OTHERS 27 MAKING THE ADDITION OF `3,25,00,000/- IN RESPECT OF SHARE APPLICATION MONEY RECEIVED FROM THE FOLLOWING TWO PARTIES:- (I) M/S DAUPHIN CABLES (P) LTD. : `3,00,00,000/- (II) M/S DISHA IMPEX (P) LTD. : `25,00,000/- 40. LEARNED CIT(A) HAD DELETED THE ADDITION. HENCE , THIS APPEAL BY THE REVENUE. 41. AT THE TIME OF HEARING BEFORE US, BOTH THE PARTI ES RELIED UPON THEIR ARGUMENTS ADVANCED WHILE ARGUING THE REVENUES APPEAL FOR ASSESSMENT YEAR 2004-05. 42. WE HAVE ALREADY DEALT WITH THE ARGUMENTS OF BOTH THE PARTIES WHILE DECIDING THE REVENUES APPEAL FOR ASSESSMENT YEAR 2004-05. LET US EXAMINE THE FACTS OF THIS YEAR SO AS TO ASCERTAIN WHET HER ANY INCRIMINATING MATERIAL RELATING TO DAUPHIN CABLES (P ) LTD. AND DISHA IMPEX (P) LTD. WAS FOUND AT THE TIME OF SEARCH AT THE ASSESSEES PREMISES. WITH REGARD TO DAUPHIN CABLES (P) LTD., THE ASSESSING OFFICER HAS DISCUSSED THE FACTS FROM PAGE 10 TO 14 OF TH E ASSESSMENT ORDER. IT HAS BEEN MENTIONED BY THE ASSESSING OFFICER T HAT A DETAILED ENQUIRY HAS BEEN CONDUCTED BY THE INVESTIGATION WING IN THE CASE OF DAUPHIN CABLES (P) LTD. IN WHICH IT WAS REVEALED THAT DAUPHIN CABLES (P) LTD. HAS RAISED MONEY FROM A NUMBER OF ENTITIES WH ICH WERE NOT FOUND TO BE GENUINE. WHEN DDIT(INVESTIGATION) ASKED DAUPHIN CABLES (P) LTD. TO PROVE THE GENUINENESS AND CREDITWORTHINESS OF THE PERSONS WHO HAVE GIVEN SHARE APPLICATION MONEY DURING THE Y EAR 2002-03 AND 2003-04, THE PARTY HAS SUBMITTED A LETTER DATED 13 TH MARCH, 2009. THE ASSESSING OFFICER HAS REPRODUCED SUCH LETTER ON PAGE 13 O F THE ITA-14/DEL/2012 & 6 OTHERS 28 ASSESSMENT ORDER AND, FOR READY REFERENCE, THE SAME IS R EPRODUCED BELOW:- IN THIS RESPECT, IT IS HUMBLY SUBMITTED THAT THE SHARE WERE ALLOTTED TO THEM AGAINST SUBSCRIPTIONS MADE BY THEM BY A/C PAYEE CHEQUES AND ALL THE ABOVE PARTIES ARE TAX PAYEES. PLEASE NOTE THAT THESE SHARES WERE ALLOTTED TO THEM DURING FINANCIAL YEARS 2002-03 AND 2003-04. IT IS SUBMITTED THAT ALL THE ABOVE MENTIONED SUBSCRIPTIONS OF SHARES WERE GENUINE TRANSACTIONS. PLEASE NOTE THAT SINC E THESE ARE OLD TRANSACTIONS, IT WILL NOT BE FEASIBLE FO R THE COMPANY TO PRODUCE ALL THE PERSONS TO YOUR GOOD OFFIC E FOR VERIFICATION AT YOUR END ON SUCH SHORT NOTICE. HOWEVER, IT IS SUBMITTED THAT IN CASE THE COMPANY IS NO T IN A POSITION TO EXPLAIN THE GENUINENESS OF THE ABOVE TRANSACTIONS, IT WILL INCLUDE THE RESPECTIVE AMOUNTS IN ITS INCOME FOR THE RELEVANT ASSESSMENT YEARS AND PAY TAX ON THE SAME. THIS INCLUSION OF INCOME WILL BE WITHOUT PREJUDICE TO THE FACT THAT THESE AMOUNTS REPRESENT THE GENUINE TRANSACTIONS AND THE PAYMENT OF TAX ON THE SAM E BY THE COMPANY BY WAY OF INCLUDING IN THE INCOME IN THE RELEVANT YEARS WILL BE ONLY TO BUY PEACE AND AVOID PROTRACTED LITIGATION WITH THE DEPARTMENT. PLEASE NOTE THAT THESE WERE BUSINESS LOSS IN THE COMPANY FOR ASSESSMENT YEAR 2003-04 AND 2004-05, THE COPIES OF INCOME TAX RETURN AND BALANCE SHEETS OF DAUPHIN CABL ES PVT.LTD. FOR THE YEAR 31.03.2003 & 31.03.2004 ARE ENCLOSED. IT IS SUBMITTED FOR THE SAKE OF ARGUMENT THA T EVEN IF THE ASSESSEE COMPANY WILL OFFER THE ABOVE AMOUN T OF SHARE CAPITAL AS ITS INCOME, STILL NO TAX SHALL BE PA YABLE BY THE COMPANY. THIS WILL BE CLEAR FROM THE FOLLOWI NG : ASSTT. YEAR BUSINESS LOSS AS PER RETURN SHARE CAPITAL NET LOSS 2003 - 04 30,52,451 2,30,000 28,22,451 2004 - 05 29,00,807 26,00,000 3,00,807 59,53,258 28,30,000 31,23,258 ITA-14/DEL/2012 & 6 OTHERS 29 43. THE ABOVE FACTS MENTIONED BY THE ASSESSING OFFICER CANNOT BE SAID TO BE INCRIMINATING MATERIAL FOUND AS A RESULT O F POST-SEARCH ENQUIRY IN THE CASE OF THE ASSESSEE BECAUSE THE ABOVE INV ESTIGATION IS RELATED TO THE SHARE APPLICATION MONEY IN THE HANDS O F DAUPHIN CABLES (P) LTD. IN FACT, THE SURRENDER OF THE SHARE APPLICA TION MONEY BY DAUPHIN CABLES (P) LTD. IN ITS HANDS ONLY PROVES THE GE NUINENESS OF DAUPHIN CABLES (P) LTD. IN ANY CASE, THE ABOVE DETAI LS MENTIONED IN THE ASSESSMENT ORDER NOWHERE INDICATE ANY INCRIMINATING MATERIAL FOUND AGAINST THE RECEIPT OF SHARE APPLICATION MONEY BY THE ASSESSEE FROM DAUPHIN CABLES (P) LTD. 44. IN THE CASE OF DISHA IMPEX (P) LTD. ALSO, THE ASSESSI NG OFFICER HAS NOT POINTED OUT THAT ANY INCRIMINATING MATERIAL WAS FOUND AT THE TIME OF SEARCH IN RESPECT OF SHARE APPLICATION MONEY RECEIV ED FROM DISHA IMPEX (P) LTD. THE ASSESSING OFFICER TREATED THE SHARE APPLICATION MONEY RECEIVED FROM DISHA IMPEX (P) LTD. AS UNEXPLAI NED ON THE GROUND THAT SUMMON ISSUED U/S 131A TO THE COMPANY WAS RE TURNED UNSERVED AND THE ASSESSEE DID NOT PRODUCE THE DIRECTOR O F DISHA IMPEX (P) LTD. THUS, THERE IS NO REFERENCE TO ANY INCRIMIN ATING MATERIAL FOUND AT THE TIME OF SEARCH IN THE ASSESSMENT ORDER. AT THE T IME OF HEARING BEFORE US ALSO, THE LEARNED DR WAS UNABLE TO POINT OUT ANY INCRIMINATING MATERIAL FOUND AT THE TIME OF SEARCH I N RESPECT OF SHARE APPLICATION MONEY RECEIVED FROM DAUPHIN CABLES (P) L TD. OR DISHA IMPEX (P) LTD. IN VIEW OF THE ABOVE, WE ARE OF THE OPINION THAT THE DECISIONS OF HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF KABUL CHAWLA (SUPRA) AND RRJ SECURITIES LTD. (SUPRA) WOULD B E SQUARELY APPLICABLE. RESPECTFULLY FOLLOWING THE SAME, WE UPHO LD THE ORDER OF LEARNED CIT(A) ON THIS POINT. ITA NO.48/DEL/2012 ITA NO.48/DEL/2012 ITA NO.48/DEL/2012 ITA NO.48/DEL/2012 REVENUES APPEAL FOR AY 2008 REVENUES APPEAL FOR AY 2008 REVENUES APPEAL FOR AY 2008 REVENUES APPEAL FOR AY 2008- -- -09 : 09 : 09 : 09 :- -- - ITA-14/DEL/2012 & 6 OTHERS 30 45. THE ONLY GROUND RAISED BY THE REVENUE IN THIS APP EAL READS AS UNDER:- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.10,63,00,000/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF ISSUE OF BOGUS SHARE APPLICATION MONEY. 46. THE FACTS OF THE CASE ARE THAT FOR THE YEAR UNDER CONSIDERATION, THE ASSESSEE FILED THE RETURN OF INCOME ON 9 TH MARCH, 2010 DECLARING TAXABLE INCOME OF `40,95,03,401/-. THE ASSESSING OFFIC ER COMPLETED THE ASSESSMENT U/S 153A READ WITH SECTION 143(3) BY MAKI NG THE ADDITION OF `10,63,00,000/- IN RESPECT OF SHARE APPLI CATION MONEY RECEIVED FROM FOLLOWING TWO PARTIES :- (I) CHURU TRADING CO. P.LTD. : `10,50,00,000/- (II) BLUE LINE MOTORS PVT.LTD. : `13,00,000/- 47. LEARNED CIT(A) DELETED THE ADDITION. HENCE, TH IS APPEAL BY THE REVENUE. 48. AT THE TIME OF HEARING BEFORE US, BOTH THE PARTI ES FAIRLY AGREED THAT FOR THE YEAR UNDER CONSIDERATION, RETURN OF INC OME WAS FILED AFTER THE SEARCH AND, THEREFORE, EXAMINATION OF GENUINENES S OF SHARE APPLICATION MONEY WAS WELL WITHIN THE POWERS OF THE A SSESSING OFFICER WHILE MAKING THE ASSESSMENT U/S 153A AND THEREFORE, WHET HER THE ASSESSEE HAS DISCHARGED THE ONUS TO PROVE THE CREDIT IN TH E FORM OF SHARE APPLICATION MONEY IS TO BE EXAMINED ON MERITS. LEARNED DR STATED THAT THE COMPANY HAS RECEIVED HUGE AMOUNT OF SH ARE APPLICATION MONEY FROM CHURU TRADING CO. P.LTD. YEA R AFTER YEAR BEGINNING FROM ASSESSMENT YEAR 2004-05. IN THIS YEAR A LONE, THE ITA-14/DEL/2012 & 6 OTHERS 31 ASSESSEE HAS RECEIVED HUGE SUM OF `10,50,00,000/- AND THE TOTAL SUM RECEIVED IN ALL THE SIX YEARS UNDER CONSIDERATION IS AB OUT `20,00,00,000/- FROM ONE PARTY ALONE I.E., CHURU TR ADING CO. P.LTD. THE ASSESSING OFFICER HAS ISSUED NOTICE U/S 133(6) TO CHURU TRA DING CO. P.LTD. REQUIRING IT TO FURNISH COPIES OF INCOME TAX R ETURN, BALANCE SHEET, BANK ACCOUNT ETC. IN RESPONSE TO THE NOTICE, THE SAID COMPANY HAS NEITHER FURNISHED THE DOCUMENTS NOR GAVE ANY REPLY. THEREAFTER, THE ASSESSING OFFICER ASKED THE ASSESSEE TO PRODUCE THE DIRECTOR OF THE COMPANY I.E., CHURU TRADING CO. P.LTD. THE ASSESSEE HA S NOT PRODUCED THE DIRECTOR OF THE COMPANY. THEREFORE, THE ASSESSING OFFICER HAS RIGHTLY CONCLUDED THAT IT IS A CASE WHERE THE ASSESSEE HA S NEITHER PROVED THE IDENTITY OF THE CREDITOR NOR THE CREDITW ORTHINESS OF THE CREDITOR. HE FURTHER STATED THAT ALMOST SIMILAR ARE THE FACTS WITH REGARD TO BLUE LINE MOTORS PVT.LTD. IN THE SAID CASE ALSO, TH E SUMMON ISSUED U/S 133(1A) WAS RECEIVED BACK AND THE ASSESSEE DID NOT PR ODUCE THE DIRECTOR OF THE SAID COMPANY. HE, THEREFORE, SUBMITT ED THAT THE ASSESSING OFFICER RIGHTLY TREATED THE SHARE APPLICATION MONEY RECEIVED FROM CHURU TRADING CO. P.LTD. AND BLUE LINE MOTORS P VT.LTD. AS UNEXPLAINED. HE, THEREFORE, REQUESTED THAT THE ORDE R OF THE CIT(A) SHOULD BE REVERSED AND THAT OF THE ASSESSING OFFICER MAY BE RESTORED. 49. LEARNED COUNSEL FOR THE ASSESSEE, ON THE OTHER HAND, POINTED OUT THAT DURING ASSESSMENT PROCEEDINGS, VIDE LETTER DATED 1 5 TH DECEMBER, 2010, THE ASSESSEE PRODUCED THE CONFIRMATION FROM CHURU TRADING CO. P.LTD. IT HAS ALSO FURNISHED THE BANK STATEMENT OF CHU RU TRADING CO. P.LTD., COPY OF THEIR INCOME TAX RETURN, COPY OF TH EIR AUDITED BALANCE SHEET, COPY OF SHARE APPLICATION FORM, MEMORANDUM AND ARTICLES OF ASSOCIATION OF THE SAID COMPANY, COPY OF SAID COMPANY S DETAILS WITH ROC AND LIST OF DIRECTORS OF THE COMPANY. HE ALSO STAT ED THAT WHEN THE ASSESSING OFFICER POINTED OUT THAT THE DIRECTOR OF CHUR U TRADING CO. ITA-14/DEL/2012 & 6 OTHERS 32 P.LTD. HAS NOT REPLIED TO THE SUMMONS ISSUED BY THE DEP ARTMENT, THE ASSESSEE CONTACTED CHURU TRADING CO. P.LTD. AND THEREAF TER, CHURU TRADING CO. P.LTD. HAD SUPPLIED DETAILS TO THE ASSESSING OFFICER THROUGH BLUE DART. IN SUPPORT OF THIS CONTENTION, HE PRODUC ED THE DELIVERY CERTIFICATE FROM BLUE DART, AS PER WHICH, AN ENVELOP E FROM ZEE ENTERTAINMENT WAS DELIVERED ON 20 TH DECEMBER, 2010 AT 11.27 AM TO SHRI J.C. BINDRA IN JHANDEWALAN EXTENSION, NEW DELHI . HE STATED THAT CHURU TRADING CO. P.LTD. IS A GROUP COMPANY OF ZEE E NTERTAINMENT. IN SUPPORT OF THIS CONTENTION, HE FURNISHED THE CONFIRMA TION FROM ZEE ENTERTAINMENT AFFIRMING THAT CHURU TRADING CO. P.LT D. IS ONE OF THEIR GROUP COMPANIES. SIMILAR INFORMATION AND EVIDENCES WERE FURNISHED WITH REGARD TO BLUE LINE MOTORS PVT.LTD. WITH THESE EVIDENCES, THE ASSESSEE HAS DULY DISCHARGED THE ONUS OF PROVING THE CASH C REDIT WHICH LAY UPON IT. IN SUPPORT OF THIS CONTENTION, TH E LEARNED COUNSEL RELIED UPON THE FOLLOWING DECISIONS:- (I) CIT VS. RAKAM MONEY MATTERS PVT.LTD. ITA NO.778 OF 2015 DATED 13.10.2015 (DELHI). (II) CIT VS. VRINDAVAN FARMS (P) LIMITED ITA NO.71/ DEL/2015 (DELHI). (III) CIT VS. FAIR FINVEST LTD. [2013] 357 ITR 146 (DELHI). (IV) CIT VS. GOEL SONS GOLDEN ESTATE P.LTD. ITA NO.2 12/2012 (DELHI). (V) CIT VS. GANGESHWARI METAL PVT.LTD. [2014] 361 I TR 10 (DELHI). (VI) CIT, ORISSA VS. ORISSA CORPORATION P.LTD. [1986] 159 ITR 78 (SC). 50. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED RELEVANT MATERIAL PLACED BEFORE US. THE ASSESSING OFFICER, AT PA GE 7 PARAGRAPH 4.9 OF HIS ORDER, HAS MENTIONED THE ASSESSEE HAS FILED ITS REPLY DATED 15-12-2010 ALONGWITH DOCUMENTS STATED THEREIN AND TH E SAME HAS BEEN DULY EXAMINED AND PLACED ON RECORDS OF EACH ASSES SMENT YEAR . ITA-14/DEL/2012 & 6 OTHERS 33 COPY OF THE LETTER OF THE ASSESSEE DATED 15 TH DECEMBER, 2010 ADDRESSED TO THE ASSESSING OFFICER READS AS UNDER:- THE DCIT CENTRAL CIRCLE-1, NEW DELHI. SUB : IN THE CASE OF M/S SUNCITY PROJECTS (P) LTD. ASSESSMENT YEAR : 2008-09 PAN : AABCS8906K. SIR, WITH REFERENCE TO THE DISCUSSIONS HELD AT THE TIME OF L AST HEARING AND CLARIFICATIONS SOUGHT BY YOUR GOODSELF REGARDING SHARE APPLICATION/SHARE CAPITAL RECEIVED F ROM FOLLOWING COMPANIES, WE WISH TO SUBMIT AS UNDER: 01. M/S CHURU TRADING CO.(P) LTD. IN SUPPORT OF SHARE APPLICATION MONEY RECEIVED FROM M /S CHURU TRADING CO.(P) LTD., WE HAVE ALREADY FILED CONFIRMATION IN THE FORM OF CONFIRMED COPY OF ACCOU NT FOR FINANCIAL YEAR 2007-08, COPY OF THEIR BANK STATEMENT S FROM WHERE THEY HAVE MADE THE PAYMENT TO US INDICATING SOU RCE OF MAKING PAYMENT, COPY OF THEIR AUDITED ANNUAL ACC OUNTS FOR FINANCIAL YEAR 2007-08, COPY OF SHARE APPLICATI ON FORMS, M/A AND PROOF OF FILING I.T. RETURN FOR ASSESSMENT YEAR 2008-09, STATUS REPORT AS PER ROC SITE ETC. THE WHOLE SHARE APPLICATION MONEY OF RS.10,50,00,000/- WAS RECEI VED THROUGH ACCOUNT PAYEE CHEQUE ONLY AND CREDITED TO O UR BANK ACCOUNT. OUT OF THE WHOLE SHARE APPLICATION MO NEY, RS.1,00,00,000/- WAS REFUNDED THROUGH ACCOUNT PAYEE CHEQUE AND BALANCE REMAINS OUTSTANDING AS AT 31.03.200 8 & 31.03.2009. 02. M/S BLUE LINE MOTORS (P) LTD. IN SUPPORT OF SHARE APPLICATION MONEY RECEIVED FROM M /S BLUE LINE MOTORS (P) LTD., WE HAVE ALREADY FILED CONFIRMATION IN THE FORM OF CONFIRMED COPY OF ACCOU NT FOR FINANCIAL YEAR 2007-08, COPY OF THEIR BANK STATEMENT FROM WHERE THEY HAVE MADE PAYMENT TO US INDICATING SOURCE OF ITA-14/DEL/2012 & 6 OTHERS 34 MAKING PAYMENT, COPY OF THEIR AUDITED ANNUAL ACCOUN TS FOR FINANCIAL YEAR 2007-08, COPY OF SHARE APPLICATION FO RM, M/A AND PROOF OF FILING I.T. RETURN FOR ASSESSMENT YEAR 20 08-09, STATUS REPORT AS PER ROC SITE ETC. THE WHOLE SHARE APPLICATION MONEY OF RS.13,00,000/- WAS RECEIVED THRO UGH ACCOUNT PAYEE CHEQUE ONLY AND CREDITED TO OUR BANK ACCOUNT. THE WHOLE SHARE APPLICATION MONEY WAS REFUN DED DURING THE SAME FINANCIAL YEAR THROUGH ACCOUNT PAYEE CHEQUE AND NO BALANCE WAS OUTSTANDING AS AT 31.03.2008 . WE ARE AGAIN ENCLOSING HEREWITH COPY OF ALL THE AFOR ESAID DOCUMENTS RELATING TO AFORESAID ENTITIES FOR YOUR READ Y REFERENCE AND RECORD. THANKING YOU, YOURS FAITHFULLY, FOR SUNCITY PROJECTS PVT.LTD., (AUTHORIZED REPRESENTATIVE) ENCL. AS ABOVE. 51. THUS, ADMITTEDLY, THE ASSESSEE HAS FILED THE CONFIRMA TION, BANK STATEMENT, COPY OF AUDITED ANNUAL ACCOUNTS, COPY OF SH ARE APPLICATION FORM, PROOF OF FILING OF INCOME TAX RETURN AND STATU S REPORT AS PER ROC SITE IN RESPECT OF BOTH THE SHARE APPLICANTS. WITH THI S FACTUAL BACKGROUND, LET US CONSIDER THE CASES RELIED UPON BY TH E LEARNED COUNSEL IN SUPPORT OF HIS CONTENTION. LEARNED COUNSEL FOR THE ASSESSEE HAS RELIED UPON THE DECISION OF HONBLE APEX COURT IN THE CASE OF ORISSA CORPORATION P. LTD. (SUPRA). IN THE SAID CASE, T HE ASSESSEE FURNISHED BEFORE THE ASSESSING OFFICER LETTERS OF CONFIRM ATION AND GAVE THE PARTICULARS OF INCOME TAX NUMBER OF THE CREDITOR S. THE ASSESSING OFFICER ISSUED SUMMONS U/S 131 TO THE CREDITOR WHICH WER E RETURNED UNSERVED WITH THE REMARK LEFT. THEREFORE, THE ASSESSI NG OFFICER MADE THE ADDITION OF `1,50,000/- AS UNEXPLAINED CASH CREDIT. THE TRIBUNAL DELETED THE ADDITION HOLDING THAT MERELY B ECAUSE THE ASSESSEE COULD NOT PRODUCE THE PARTIES, IT DID NOT FOLLO W AUTOMATICALLY THAT AN ADVERSE INFERENCE SHOULD BE DRAWN AGAINST THE ASSESSEE. ITA-14/DEL/2012 & 6 OTHERS 35 WHEN THE REVENUE TOOK UP THE MATTER TO HON'BLE SUPR EME COURT, HONBLE APEX COURT HELD :- THAT IN THIS CASE THE RESPONDENT HAD GIVEN THE NAMES A ND ADDRESSES OF THE ALLEGED CREDITORS. IT WAS IN THE KNOWL EDGE OF THE REVENUE THAT THE SAID CREDITORS WERE INCOME-TA X ASSESSEES. THEIR INDEX NUMBERS WERE IN THE FILE OF THE REVENUE. THE REVENUE, APART FROM ISSUING NOTICES UND ER SECTION 131 AT THE INSTANCE OF THE RESPONDENT, DID NOT PURSUE THE MATTER FURTHER. THE REVENUE DID NOT EXAM INE THE SOURCE OF INCOME OF THE SAID ALLEGED CREDITORS TO FIND OUT WHETHER THEY WERE CREDITWORTHY. THERE WAS NO EF FORT MADE TO PURSUE THE SO-CALLED ALLEGED CREDITORS. IN TH OSE CIRCUMSTANCES, THE RESPONDENT COULD NOT DO ANYTHING FURTHER. IN THE PREMISES, IF THE TRIBUNAL CAME TO TH E CONCLUSION THAT THE RESPONDENT HAD DISCHARGED THE BURD EN THAT LAY ON IT, THEN IT COULD NOT BE SAID THAT SUCH A CONCLUSION WAS UNREASONABLE OR PERVERSE OR BASED ON NO EVIDENCE. IF THE CONCLUSION WAS BASED ON SOME EVIDENCE ON WHICH A CONCLUSION COULD BE ARRIVED AT, NO QUESTIO N OF LAW AS SUCH AROSE. THE HIGH COURT WAS RIGHT IN REFUSIN G TO STATE A CASE. 52. HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF RAKAM MONEY MATTERS PVT.LTD. (SUPRA) HELD AS UNDER:- 13. IT IS NOT IN DISPUTE THAT EXTENSIVE MATERIAL WAS PRODUCED BY THE ASSESSEE IN THE PRESENT CASE TO PROVE TH E IDENTITY, GENUINENESS AND CREDITWORTHINESS OF THE COMPANIES WHO HAD SUBSCRIBED TO ITS SHARES. AMONG THE MATERIALS PRODUCED WERE THE INCOME TAX RETURNS AND TH E PAN CARD DETAILS OF THE EIGHT COMPANIES. EVEN IF THE DIRECTORS OF THESE COMPANIES DID NOT RESPOND TO THE SUMMONS ISSUED BY THE AO, IT WAS NOT IMPOSSIBLE FOR THE AO TO MAKE PROPER ENQUIRIES TO ASCERTAIN THE GENUINEN ESS OF THESE ENTITIES AND SATISFY HIMSELF OF THEIR CREDITWORTHINESS. AS POINTED OUT BY THE CIT(A), THE A O FAILED TO MAKE ANY EFFORT IN THAT DIRECTION. HE DI D NOT TAKE TO THE LOGICAL END THE HALF-HEARTED ATTEMPT AT GETT ING THE DIRECTORS TO APPEAR BEFORE HIM. HE DID NOT EVEN SEEK THE ITA-14/DEL/2012 & 6 OTHERS 36 ASSISTANCE OF THE AOS OF THE CONCERNED COMPANIES WHOSE ITRS AND PAN CARD COPIES HAD BEEN PRODUCED. 53. IN THE CASE OF VRINDAVAN FARMS (P) LTD. (SUPRA), H ON'BLE JURISDICTIONAL HIGH COURT HELD AS UNDER:- 3. THE ITAT HAS IN THE IMPUGNED ORDER NOTICED THAT IN THE PRESENT CASE THE REVENUE HAS NOT DOUBTED THE IDENT ITY OF THE SHARE APPLICANTS. THE SOLD BASIS FOR THE REVENUE TO DOUBT THEIR CREDITWORTHINESS WAS THE LOW INCOME AS REFLECTED IN THEIR INCOME TAX RETURNS. THE ENTIRE D ETAILS OF THE SHARE APPLICANTS WERE MADE AVAILABLE TO THE AO BY THE ASSESSEE. THIS INCLUDED THEIR PAN NUMBERS, CONFIRMATIONS, THEIR BANK STATEMENTS, THEIR BALANCE SHEETS AND PROFIT AND LOSS ACCOUNTS AND THE CERTIFICATES OF INCORPORATION ETC . IT WAS OBSERVED BY THE ITAT THAT THE AO HAD NOT UNDERTAK EN ANY INVESTIGATION OF THE VERACITY OF THE ABOVE DOCUM ENTS SUBMITTED TO HIM. IT HAS BEEN RIGHTLY COMMENTED BY T HE ITAT THAT WITHOUT DOUBTING THE DOCUMENTS, THE AO COMPLETED THE ASSESSMENT ONLY ON THE PRESUMPTION THAT LOW RETURN OF INCOME WAS SUFFICIENT TO DOUBT THE CRED IT WORTHINESS OF THE SHARE HOLDERS. 4. THE COURT IS OF THE VIEW THAT THE ASSESSEE BY PRODUCED SUFFICIENT DOCUMENTATION DISCHARGED ITS INITI AL ONUS OF SHOWING THE GENUINENESS AND CREDITWORTHINESS OF THE SHARE APPLICANTS. IT WAS INCUMBENT TO THE AO TO H AVE UNDERTAKEN SOME INQUIRY AND INVESTIGATION BEFORE COMI NG TO A CONCLUSION ON THE ISSUE OF CREDITWORTHINESS. IN PA RA 39 OF THE DECISION IN NOVA PROMOTERS (SUPRA), THE COURT HAS TAKEN NOTE OF A SITUATION WHERE THE COMPLETE PARTICU LARS OF THE SHARE APPLICANTS ARE FURNISHED TO THE AO AND THE A O FAILS TO CONDUCT AN INQUIRY. THE COURT HAS OBSERVED T HAT IN THAT EVENT NO ADDITION CAN BE MADE IN THE HANDS OF T HE ASSESSEE UNDER SECTION 68 OF THE ACT AND IT WILL BE OPE N TO THE REVENUE TO MOVE AGAINST THE SHARE APPLICANTS IN ACCORDANCE WITH LAW. 5. IN THE FACTS AND CIRCUMSTANCES OF THE PRESENT APPEALS, THE COURT IS SATISFIED THAT NO SUBSTANTIAL QUEST ION OF LAW ARISES. THE APPEALS ARE DISMISSED. ITA-14/DEL/2012 & 6 OTHERS 37 54. IN THE CASE OF GOEL SONS GOLDEN ESTATE P. LTD. (SUP RA), HON'BLE JURISDICTIONAL HIGH COURT HELD AS UNDER:- WE HAVE EXAMINED THE SAID CONTENTION AND FIND THAT THE ASSESSEE DURING THE COURSE OF ASSESSMENT PROCEEDINGS HAS FILED CONFIRMATION LETTERS FROM THE COMPANIES, THEIR PAN NUMBER, COPY OF BANK STATEMENTS, AFFIDAVITS AND BALANC E SHEET. THEREAFTER THE ASSESSING OFFICER HAD ASKED THE ASSESSEE TO PRODUCE THE SAID DIRECTORS/PARTIES. ASSESSEE EXPRESSED ITS INABILITY TO PRODUCE THEM. THE ASSESSING OFFICER DID NOT CONSEQUENT THERETO CONDUCT ANY INQU IRY AND CLOSED THE PROCEEDINGS. THIS IS A CASE WHERE THE ASSESSING OFFICER HAS FAILED TO CONDUCT NECESSARY INQUIRY, VERIF ICATION AND DEAL WITH THE MATTER IN DEPTH SPECIALLY AFTER TH E AFFIDAVIT/CONFIRMATION ALONG WITH THE BANK STATEMENT S ETC. WERE FILED. IN CASE THE ASSESSING OFFICER HAD CONDUCTED THE SAID ENQUIRIES AND INVESTIGATION PROBABLY THE CHAL LENGE MADE BY THE REVENUE WOULD BE JUSTIFIED. IN THE ABSE NCE OF THESE INQUIRIES AND NON-VERIFICATION OF THE DETAILS AT THE TIME OF ASSESSMENT PROCEEDINGS, THE FACTUAL FINDINGS RECORDED BY THE ASSESSING OFFICER WERE INCOMPLETE AND SPARSE. THE IMPUGNED ORDER PASSED CANNOT BE TREATED A ND REGARDED AS PERVERSE. THE APPEAL IS DISMISSED AS NO SUBSTANTIAL QUESTION OF LAW ARISES. 55. THAT THE ABOVE DECISIONS OF HON'BLE JURISDICTIONAL HIGH COURT AND HONBLE APEX COURT WOULD BE SQUARELY APPLICABLE TO THE FACTS OF THE ASSESSEES CASE. THE ASSESSEE HAS PRODUCED THE CONFIRMATION O F CAPITAL CONTRIBUTION BY THE INVESTOR COMPANY, INCOME TAX DETAILS OF THE INVESTOR COMPANY, COPY OF INCOME TAX RETURN, BANK ST ATEMENT AND BALANCE SHEET OF THE INVESTOR COMPANY AND PRESENT STAT US OF THE INVESTOR COMPANY FROM THE ROC WEBSITE. FROM THE BALA NCE SHEET OF CHURU TRADING CO. P.LTD. WHICH IS PLACED IN THE ASSESSEE S PAPER BOOK, WE FIND THAT THE SHARE CAPITAL OF THE COMPANY INCLU DING RESERVES AND SURPLUS AS ON 31 ST MARCH, 2008 IS `392.17 CRORES. AS AGAINST THE HUGE SHARE CAPITAL OF `392 CRORES, THE TOTAL SHARE APPLICAT ION MONEY GIVEN TO THE ASSESSEE COMPANY IN ALL THE YEARS TAKEN TOGETHER IS LESS THAN `20 ITA-14/DEL/2012 & 6 OTHERS 38 CRORES. M/S CHURU TRADING CO. P.LTD. IS A GROUP CONC ERN OF ZEE ENTERTAINMENT WHICH IS EVIDENT FROM THE CERTIFICATE ISSUED BY THEM AFFIRMING THAT CHURU TRADING CO. P.LTD. IS A GROUP C ONCERN OF ZEE ENTERTAINMENT AND ALSO AFFIRMING THE DETAILS SENT BY T HEM TO DCIT SHRI J.C. BINDRA. THE CONFIRMATION IS REPRODUCED BELOW F OR READY REFERENCE:- TO WHOMSOEVER IT MAY CONCERN THIS IS TO CERTIFY THAT ON 16-12-2010 WE HAVE RECEIVE D DOCUMENTS FROM M/S CHURU TRADING CO.PVT.LTD., WHICH I S ONE OF OUR GROUP COMPANY HAVING SAME OFFICE ADDRESS 135, CONTINENTAL BUILDING, DR. A.B. ROAD, WORLI, MU MBAI, AND THE SAME HAD BEEN COURIERED TO MR. JC BINDRA, DC IT, CENTRAL CIRCLE-1, E-2, ARA CENTRE, JHANDEWALAN EXT, NEW DELHI THROUGH BLUE DART ON 16-12-2010 VIDE RECEIPT NO.13070323781. THE BLUE DART HAD ISSUED RECEIPT NO.13070323781 IN THE NAME OF M/S ZEE ENTERTAINMENT, AS WE HAVE A CENTRALIZED AGREEMENT WITH THE COURIER CO MPANY FOR ALL OUR GROUP COMPANIES AT CONTINENTAL BUILDING. THE SAID DOCUMENTS WERE DELIVERED TO MR. J.C. BINDRA , DCIT, CENTRAL CIRCLE-1, E-2, ARA CENTRE, JHANDEWALAN EXT, NEW DELHI ON 20-12-2010. FOR ZEE ENTERTAINMENT ENTERPRISES LTD. AUTHORIZED SIGNATORY. 56. SIMILAR DETAILS WERE FURNISHED BY THE ASSESSEE WITH R EGARD TO BLUE LINE MOTORS P. LTD. AS PER AUDITED BALANCE SHEET OF THE SAID COMPANY, THE SHARE CAPITAL OF THE COMPANY INCLUDING RESERVES AND SURPLUS IS `42.78 LAKHS WHILE THE SHARE APPLICATION MONE Y GIVEN BY THEM TO THE ASSESSEE COMPANY IS `13 LAKHS ONLY. 57. ON THESE FACTS, THE DECISION OF HONBLE APEX COURT AS WELL AS HON'BLE JURISDICTIONAL HIGH COURT RELIED UPON BY THE LEARNED COUNSEL WOULD BE SQUARELY APPLICABLE. SIMILAR TO THE ASSESSEE S CASE, IN THE ITA-14/DEL/2012 & 6 OTHERS 39 CASE OF RAKAM MONEY MATTERS PVT.LTD. ALSO, THE DIRECTO R OF THE SHAREHOLDER COMPANIES DID NOT RESPOND TO THE SUMMON ISSU ED BY THE ASSESSING OFFICER. HOWEVER, HON'BLE JURISDICTIONAL HIGH COURT HELD THAT IF THE ASSESSING OFFICER DID NOT MAKE PROPER ENQUIRIES O N THE BASIS OF INCOME TAX RETURNS AND PAN DETAILS OF SHARE APPLICANT COMPANIES, THE ADDITION FOR UNEXPLAINED CREDIT CANNOT BE SUSTAINED. IN THE CASE OF THE ASSESSEE, THE FACTS ARE IDENTICAL. THE ASSESSEE PRODUCED CO NFIRMATION, INCOME TAX RETURN, BALANCE SHEET AND BANK STATEMENT O F SHARE APPLICANT COMPANIES. THE ASSESSING OFFICER DID NOT MAKE ANY EFFORT TO EXAMINE THOSE EVIDENCES PRODUCED BY THE ASSESSEE. THEREF ORE, THE ABOVE DECISION OF HON'BLE DELHI HIGH COURT WOULD BE SQUARELY APPLICABLE. 58. SIMILAR VIEWS ARE EXPRESSED BY THEIR LORDSHIPS IN TH E CASE OF VRINDAVAN FARMS (P) LTD. (SUPRA). IN THE SAID CASE ALSO , THE ASSESSEE PRODUCED PERMANENT ACCOUNT NUMBERS, CONFIRMATIONS, BA NK STATEMENT, BALANCE SHEET AND CERTIFICATE OF INCORPORATION OF SHA RE APPLICANT COMPANIES. THE ASSESSING OFFICER, WITHOUT UNDERTAKING A NY INVESTIGATION ON THESE DOCUMENTS, MADE ADDITION ON THE GROUND THAT THOSE COMPANIES HAD VERY LOW INCOME. HON'BLE JURISDIC TIONAL HIGH COURT WAS OF THE VIEW THAT BY PRODUCING SUFFICIENT DO CUMENTS, ASSESSEE HAD DISCHARGED ITS INITIAL ONUS OF SHOWING THE GEN UINENESS AND CREDITWORTHINESS OF SHARE APPLICANTS. THE FACTS I N THE CASE OF THE ASSESSEE ARE IDENTICAL, THEREFORE, THE ABOVE DECISION OF HON'BLE JURISDICTIONAL HIGH COURT WOULD BE SQUARELY APPLICABL E. 59. IN VIEW OF THE ABOVE, RESPECTFULLY RELYING UPON THE DECISION OF HONBLE APEX COURT IN THE CASE OF ORISSA CORPORATION P .LTD. (SUPRA), AND THE DECISIONS OF HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF RAKAM MONEY MATTERS PVT.LTD. (SUPRA), VRINDAVAN FARMS (P) LTD. ITA-14/DEL/2012 & 6 OTHERS 40 (SUPRA) AND GOEL SONS GOLDEN ESTATE P. LTD. (SUPRA), WE UPHOLD THE ORDER OF LEARNED CIT(A) ON THIS POINT. ITA NO.49/DEL/2012 ITA NO.49/DEL/2012 ITA NO.49/DEL/2012 ITA NO.49/DEL/2012 REVENUES APPEAL FOR AY 2009 REVENUES APPEAL FOR AY 2009 REVENUES APPEAL FOR AY 2009 REVENUES APPEAL FOR AY 2009- -- -10 : 10 : 10 : 10 :- -- - 60. THE ONLY GROUND RAISED IN THIS APPEAL BY THE REVE NUE READS AS UNDER:- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.4,99,00,000/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF ISSUE OF BOGUS SHARE APPLICATION MONEY. 61. AT THE TIME OF HEARING BEFORE US, BOTH THE PARTI ES FAIRLY ADMITTED THAT ALL THE FACTS RELATING TO THIS YEAR ARE IDENTICA L TO THE FACTS IN THE REVENUES APPEAL FOR ASSESSMENT YEAR 2008-09 WITH THE ON LY MODIFICATION THAT AS AGAINST THE SHARE CAPITAL OF `10 ,63,00,000/- IN ASSESSMENT YEAR 2008-09, THIS YEAR, THE SHARE CAPITAL OF `4,99,00,000/- WAS RECEIVED. BOTH THE PARTIES STATED THAT THEIR ARGU MENTS ADVANCE FOR ASSESSMENT YEAR 2008-09 WOULD BE SQUARELY APPLICABLE . 62. WE HAVE ALREADY CONSIDERED THE ARGUMENTS OF BOTH THE SIDES AND THE LEGAL POSITION IN THE LIGHT OF THE CASE LAW RELI ED UPON BEFORE US. WE FIND THAT IN THIS YEAR, THE ASSESSING OFFICER HAS MADE TH E ADDITION OF `4,99,00,000/- IN RESPECT OF SHARE APPLICATION MONEY RECEIVED FROM FOLLOWING THREE PARTIES :- (I) CHURU TRADING CO. PVT.LTD. : `2,80,00,000/- (II) TASHI DELEK GAMING SOLUTIONS : `2,00,00,000/ - (III) ANTRIKSH HOUSING P.LTD. : `19,00,000/- 63. THE FACTS RELATING TO CHURU TRADING CO. PVT.LTD. HAVE ALREADY BEEN DISCUSSED BY US. WITH REGARD TO TASHI DELEK GAMING SOLUTIONS AND ANTRIKSH HOUSING P.LTD., WE FIND THAT THE ASSESSEE VI DE LETTER DATED ITA-14/DEL/2012 & 6 OTHERS 41 15 TH DECEMBER, 2010 HAS FURNISHED THE CONFIRMATION OF SHAR E CAPITAL CONTRIBUTION FROM THE INVESTOR COMPANY, THE BANK STAT EMENT, INCOME TAX RETURN AND THE AUDITED BALANCE SHEET OF THE INVE STOR COMPANY, AND PRESENT STATUS OF THE INVESTOR COMPANY FROM ROC WEBSITE. THE ASSESSING OFFICER HAS NOT ACCEPTED THE CREDIT OF THESE CO MPANIES ON THE GROUND THAT THE NOTICE U/S 133(6) ISSUED TO THE IN VESTOR COMPANY REMAINS UNCOMPLIED WITH AND THE ASSESSEE COULD NOT PROD UCE THE DIRECTOR OF THE SAID COMPANY. BOTH THESE ISSUES HAVE AL READY BEEN CONSIDERED BY US WHILE CONSIDERING THE REVENUES APPEA L FOR ASSESSMENT YEAR 2008-09 AND, FOR THE DETAILED DISCUSSION T HEREIN, WE DO NOT FIND ANY JUSTIFICATION TO INTERFERE WITH THE ORDER OF LEARNED CIT(A). THE SAME IS SUSTAINED. 64. IN THE RESULT, THE APPEALS OF THE REVENUE FOR THE ALL THE YEARS ARE DISMISSED AND THE APPEAL OF THE ASSESSEE FOR ASSESSMENT YEAR 2 004-05 IS ALLOWED. DECISION PRONOUNCED IN THE OPEN COURT ON 21.03.2016. SD/- SD/- (CHANDRA MOHAN GARG (CHANDRA MOHAN GARG (CHANDRA MOHAN GARG (CHANDRA MOHAN GARG ) )) ) ( (( ( G.D. AGRAWAL G.D. AGRAWAL G.D. AGRAWAL G.D. AGRAWAL ) )) ) JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT VK. COPY FORWARDED TO: - 1. ASSESSEE : M/S SUNCITY PROJECT M/S SUNCITY PROJECT M/S SUNCITY PROJECT M/S SUNCITY PROJECTS PVT.LTD., S PVT.LTD., S PVT.LTD., S PVT.LTD., N NN N- -- -49, FIRST FLOOR, CONNAUGHT PLACE, 49, FIRST FLOOR, CONNAUGHT PLACE, 49, FIRST FLOOR, CONNAUGHT PLACE, 49, FIRST FLOOR, CONNAUGHT PLACE, NEW DELHI NEW DELHI NEW DELHI NEW DELHI 110 001. 110 001. 110 001. 110 001. 2. REVENUE : ASSISTANT COMMISSIONER OF INCOME T AX, ASSISTANT COMMISSIONER OF INCOME TAX, ASSISTANT COMMISSIONER OF INCOME TAX, ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE CENTRAL CIRCLE CENTRAL CIRCLE CENTRAL CIRCLE- -- -1, NEW DELHI. 1, NEW DELHI. 1, NEW DELHI. 1, NEW DELHI. 3. CIT 4. CIT(A) 5. DR, ITAT ASSISTANT REGISTRAR