M/s. Vishwanath Fincap Pvt. Ltd., New Delhi V. DCIT, New Delhi

ITA 1528/DEL/2017

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 2185 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 5 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-08-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2006-2007
• Appeal Filed On: 15-03-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: ASHOK MALIK
• Keywords: Accommodation entries; Reason to believe
• Section: 143(3); 142(1); 147; 131; 68; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH SMC, NEW DELHI BEFORE SHRI R. K. PANDA, ACCOUNTANT MEMBER ITA NO.1528/DEL/2017 ASSESSMENT YEAR : 2006-07 VISHWANATH FINCAP PVT. LTD., MODI FLOUR MILLS, OKHLA INDUSTRIAL ESTATE, NEW DELHI. VS. DCIT, CIRCLE- 17(1), NEW DELHI. PAN : AAACV3916H (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI ASHOK MALIK, FCA DEPARTMENT BY : SHRI ATIQ AHMED, SR. DR DATE OF HEARING : 30-07-2018 DATE OF PRONOUNCEMENT : 31-08-2018 O R D E R PER R. K. PANDA, AM : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER DATED 09.12.2016 OF CIT(A)- 9, NEW DELHI RELATING TO ASSE SSMENT YEAR 2006-07. 2. FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESS EE IS A PRIVATE LIMITED COMPANY AND FILED ITS RETURN OF INCOME ON 22.11.200 6 DECLARING TOTAL INCOME OF RS.3,77,255/-. SUBSEQUENTLY, THE ASSESSING OFFICER ISSUED NOTICE U/S 148 BY REOPENING THE ASSESSMENT AFTER RECORDING THE FOLLOW ING REASONS :- REASON FOR THE BELIEF THAT INCOME HAS ESCAPED ASSE SSMENT IN THE CASE OF M/S VISHWANATH FINCAP PVT. LTD. FOR AY- 2006-07 M/S VISHWANATH FINCAP PVT. LTD. IS ASSESSED TO TAX WITH CIRCLE-17(1), NEW DELHI. ENQUIRIES OF INVESTIGATION WING. DELHI OF TH E DEPARTMENT HAVE UNEARTHED HUGE ACCOMMODATION ENTRY RACKET BEING OPERATED BY ACCOMM ODATION ENTRY OPERATOR SH. SURENDRA KR. JAIN BY WAY OF MORE THAN 100 COMPANIES /FIRMS ETC. THE INVESTIGATION WING HAS COMPILED A REPORT & DATA. OF THE BENEFICIA RIES OF SUCH ENTRIES. THE NAME OF THE ASSESSEE FIGURES IN THE LIST OF BENEFICIARIES O F SHARE CAPITAL PREMIUM/LOAN. 2 ITA NO.1528/DEL/2017 I HAVE GONE THROUGH THE REPORT AND DATA SENT BY THE INVESTIGATION WING. THE REPORT CLEARLY INDICATES THAT ACCOMMODATION ENTRIES HAVE BEEN TAKEN TO PLOUGH BACK UNCOUNTED BLACK MONEY FOR THE PURPOSE OF BUSINESS O R FOR PERSONAL NEEDS SUCH AS PURCHASE OF ASSETS ETC., IN THE FORM SHARE APPLICAT ION MONEY LOANS ETC AND EVEN DESCRIBES THE MODUS OPERANDI OF THIS SCAM. THE INVESTIGATION WING'S LIST OF BENEFICIARIES (OF SUCH ACCOMMODATION ENTRIES) GIVES COMPREHENSIVE DETAILS OF BENEFICIARIES NAME, ENTITY FROM WHERE ENTRY RECEIVED, BANK, CHEQUE/RTGS DATE AND EVEN THE MIDDLEMAN THROU GH WHICH SUCH ENTRY IS RECEIVED. THIS LIST CONTAINS THE NAME OF M/S VISHWA NATH FINCAP PVT. LTD. WHICH HAS TAKEN SUCH ACCOMMODATION ENTRIES. FOUR ENTRIES OF R S.15,60,000/- EACH HAVE BEEN RECEIVED AS PER THE FOLLOWING DETAILS: S. COMPANY NAME FROM WHOM INSTRUMENT DATE AMOUNT BANK NO. RECEIVED NUMBER (IN RS.] NAME L. WINDSOR PET PLAS INDIA PVT. LTD. 045170 02-11-200 5 390000 KOTAK 2. UGS FINANCE PVT. LTD. 045172 02-11-2005 3900 00 KOTAK 3. PELICON FINANCE & LEASE LTD. 045171 02-11-2005 375000 KOTAK 4. S. R. CABLE PVT. LTD. 003430 02-11-2005 405000 UTI COPIES OF HANDWRITTEN PAPERS SEIZED FROM RESIDENCE OF SH. S K JAIN HAVE ALSO BEEN FORWARDED FROM THE WING. THE MIDDLEMAN INVOLVE D IN HELPING THE ASSESSEE TAKE THESE ENTRIES HAS BEEN NAMED AS MR. YKG. THUS, THE ASSESSEE HAS PLOUGHED BACK UNACCOUNTED MO NEY OF RS.15,60,000/- IN ITS BUSINESS THROUGH THE CHANNEL OF ACCOMMODATION E NTRY. THE ASSESSEE HAS ALSO PAID CERTAIN AMOUNT OF COMMISSION IN CASH ON THE SAME. T HEREFORE, IT IS FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY ALL MAT ERIAL FACTS NECESSARY FOR ITS ASSESSMENT, FOR THE ASSESSMENT YEAR 2006-07 AND HAS NOT PAID TAX ON SUCH AMOUNT, THE UNACCOUNTED MONEYS WHICH SHOULD HAVE BEEN CHARGED T O TAX ARE BEING PLOUGHED BACK TO BUSINESS WITHOUT PAYING DUES TAX ON IT. IN VIEW OF THE ABOVE FACTS, I HAVE REASONS TO BELIEVE THAT INCOME TO THE TUNE OF RS.15,60,000/-, OF THE ASSESSEE COMPANY FOR AY- 2006-07, HAS ESCAPED ASSESSMENT. THEREFORE IN ACCORDANCE WITH THE PROVISIONS OF SECTION 151(2) OF IT ACT, SANCTION FOR ISSUE OF NOTICE U/S 148 OF THE ACT IS BEING SOUGHT. YOURS FAITHFULLY, SD/- (N.D. GUPTA) DCIT, CIRCLE- 17(1), NEW DELHI. 3. THE ASSESSEE COMPANY OBJECTED TO THE REOPENING O F THE ASSESSMENT. THE ASSESSING OFFICER VIDE ORDER DATED 23.01.2014 DISPO SED OF SUCH OBJECTIONS BY PASSING A SPEAKING ORDER. SUBSEQUENTLY, THE ASSESS ING OFFICER ASKED THE ASSESSEE TO EXPLAIN THE AMOUNT OF RS.15,60,000/- RE CEIVED BY IT ON ACCOUNT OF 3 ITA NO.1528/DEL/2017 SHARE APPLICATION/SHARE PREMIUM FROM DIFFERENT COMP ANIES. THE ASSESSING OFFICER SIMULTANEOUSLY ISSUED SUMMONS U/S 131 TO FO UR COMPANIES FROM WHOM THE ASSESSEE RECEIVED SHARE APPLICATION MONEY. HOW EVER, THE SUMMONS TO M/S WINDSOR PET PLAS INDIA PVT. LTD. AND M/S S.R. CABLE PVT. LTD. WERE RETURNED BACK UNSERVED BY THE POSTAL AUTHORITIES WITH REMARK LEFT WITHOUT ADDRESS WHEREAS THE SUMMONS TO TWO OTHER PARTIES REMAINED U N-COMPLIED WITH TILL THE DATE OF COMPLETION OF THE ASSESSMENT. THE ASSESSIN G OFFICER DIRECTED THE WARD INSPECTOR, SHRI ANKIT KUMAR TO SUBMIT HIS REPORT ON THE FOLLOWING POINTS :- (A) DETAILS OF BUSINESS ACTIVITIES CARRIED ON BY A BOVE NOTED COMPANIES SEPARATELY. (B) AS TO WHETHER ANY SUCH COMPANIES EXIST AT THE G IVEN ADDRESS IF YES, THE PREMISES ON RENT DETAILS THEREOF, WHO IS THE OWNER OF PREMISES, MONTHLY REND PAID. (C) DETAILS OF PERSONS/STAFF AT THE PREMISES WHO HA NDLES ACTIVITIES OF THE COMPANY AND WHAT TYPE OF RECORDS ARE AVAILABLE AT THE SPOT. (D) NAME AND ADDRESS OF THE DIRECTORS OF THE COMPA NY AND WHAT TYPE OF BUSINESS ACTIVITIES IS DONE BY THEM FROM THE ABOVE NOTED ADD RESSES. (E) OBTAIN COPY OF BANK A/C OF THE CO. FOR THE RELE VANT A.Y. 2006-07. (F) BRIEF HISTORY OF THE COMPANY DATE OF INCORPORAT ION AND PRESENT POSITION REGARDING ACTIVITIES DONE BY THE COMPANIES. (G) AS PER THE LOCAL ENQUIRY THE FINANCIAL POSITION OF THE CO. HAS ALSO TO BE ASCERTAINED I.E. AS TO WHETHER THE ABOVE NOTED COMP ANIES ARE IN POSITION TO MAKE SUBSTANTIAL INVESTMENT WITH THE ASSESSEE COMPA NY IN THE FORM OF SHARE CAPITAL/SHARE PREMIUM. 4. THE INSPECTOR SUBMITTED HIS REPORT WHICH HAS BEE N REPRODUCED BY THE ASSESSING OFFICER IN THE BODY OF THE ASSESSMENT ORD ER WHICH READS AS UNDER :- AS PER THE DIRECTIONS GIVEN IN THE OFFICE ORDER OF THE DY. COMMISSIONER OF INCOME TAX, CIRCLE- 17(1), NEW DELHI DATED 03.02.2014, I V ISITED THE PREMISES OF THE FOLLOWING COMPANIES AS PROVIDED IN THE OFFICE ORDER & OBSERVED THE FOLLOWING :- (1) M/S M/S S.R. CABLE PVT. LTD. AT DEMAND AD, B-5/ 8 DOUBLE STOREY, RAMESH NAGAR, MAI NAJAFGARH ROAD, RAJA GARDEN CHOWK, NEW D ELHI. 4 ITA NO.1528/DEL/2017 NO SUCH COMPANY WAS EXISTED AT THE GIVEN ADDRESS T HE PREMISES/DOOR OF THE COMPANY AT THE GIVEN ADDRESS WAS FOUND LOCKED AND N O BOARD IS BEARING THE NAME AND ADDRESS OF THE COMPANY WAS LOCATED ON THE DOOR/SHUTTER/WALLS AT THE GIVEN ADDRESS. (2) M/S WINDSOR PET PLAS INDIA PVT. LTD., ARORA BHA WAN T-235, A-14/1, HILL MARG, BALJEET NAGAR, NEW DELHI. THE GIVEN ADDRESS IS WRONG. ON ENQUIRIES FROM THE PEOPLE AROUND THEY EXPRESSED THAT THE GIVEN ADDRESS SHOULD HAVE BLOCK MENTIONED AS NO SUCH ADDRESS IS THERE. (3) M/S PELICON FINANCE & LEASING LTD., 104, SINGLE STOREY, RAMESH NAGAR, NEW DELHI. THE GIVEN ADDRESS IS WRONG. ON ENQUIRIES FROM THE PEOPLE AROUND THEY EXPRESSED THAT THE GIVEN ADDRESS SHOULD HAVE BLOCK MENTIONED AS NO SUCH ADDRESS IS THERE. (4) UGS FINANCE PVT. LTD., 3198, 4 TH FLOOR, GALI NO.1, SANGATRASHAN PAHARGANJ, NEW DELHI. THE GIVEN ADDRESS IS WRONG. ON ENQUIRIES FROM THE PEOPLE AROUND THEY EXPRESSED THAT THE GIVEN ADDRESS SHOULD HAVE BLOCK MENTIONED AS NO SUCH ADDRESS IS THERE. 5. THE ASSESSING OFFICER ISSUED NOTICE U/S 142(1) A ND ASKED THE ASSESSEE TO SUBSTANTIATE THE SHARE APPLICATION MONEY/PREMIUM OF RS.15,60,000/- RECEIVED BY IT. HE ALSO ASKED THE ASSESSEE TO PRODUCE THE DIRE CTORS OF THE COMPANIES FROM WHOM IT HAS RECEIVED THE SO-CALLED SHARE APPLICATIO N/SHARE PREMIUM. HOWEVER, INSTEAD OF PRODUCING THE DIRECTORS OF THE INVESTOR COMPANIES, THE ASSESSEE RELIED ON VARIOUS DECISIONS AND ARGUED THAT SINCE THE SHAR EHOLDERS OF THOSE COMPANIES ARE NO LONGER THE SHAREHOLDER OF THE PRESENT COMPAN Y, THEREFORE, AFTER A GAP OF FOUR YEARS THEY CANNOT FORCE THE ATTENDANCE OF THE DIRECTORS OF THOSE COMPANIES AS THEY DO NOT HAVE ANY CONTROL OVER THEM. THE ASS ESSEE SIMPLY PROVIDED THE CONFIRMATIONS AND PAN NUMBER OF THE PARTIES CONCERN ED. SINCE THE NOTICE U/S 131 WERE REMAINED UN-COMPLIED WITH AND THE ASSESSEE FAILED TO PRODUCE THE DIRECTORS OF THOSE INVESTOR COMPANIES, THEREFORE, T HE ASSESSING OFFICER REJECTED 5 ITA NO.1528/DEL/2017 THE VARIOUS EXPLANATIONS GIVEN BY THE ASSESSEE. RE LYING ON VARIOUS DECISIONS THE ASSESSING OFFICER MADE ADDITION OF RS.15,60,000 /- TO THE TOTAL INCOME OF THE ASSESSEE ON ACCOUNT OF SHARE APPLICATION/SHARE PREM IUM BY INVOKING THE PROVISIONS OF SECTION 68 OF THE I.T. ACT, 1961. HE ALSO ADDED AN AMOUNT OF RS.54,600/- ON ACCOUNT OF COMMISSION PAID FOR ARRAN GING THE ABOVE SHARE APPLICATION/SHARE PREMIUM. 6. BEFORE THE LD. CIT(A), THE ASSESSEE APART FROM C HALLENGING THE ADDITION ON MERIT ALSO CHALLENGED THE VALIDITY OF THE REOPENING OF THE ASSESSMENT ON THE GROUND THAT THE REOPENING IS VOID AB-INITIO SINCE THE ORIGINAL ASSESSMENT WAS COMPLETED U/S 143(3) AND THE NOTICE U/S 148 R.W.S. 147 WAS ISSUED AFTER A PERIOD OF FOUR YEARS WHEN THERE WAS NO FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS REQUIRED FOR COM PLETING THE ASSESSMENT. 7. IN APPEAL, THE LD. CIT(A) DISMISSED THE GROUND R ELATING TO VALIDITY OF REOPENING OF THE ASSESSMENT AFTER A PERIOD OF FOUR YEARS WHEN THE ORIGINAL ASSESSMENT WAS COMPLETED U/S 143(3) AND THERE WAS N O ALLEGATION ON FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRUL Y ALL MATERIAL FACTS NECESSARY FOR COMPLETION OF ASSESSMENT. SO FAR AS MERIT OF THE C ASE IS CONCERNED, HE ALSO DECIDED THE SAME AGAINST THE ASSESSEE. 8. AGGRIEVED WITH SUCH ORDER OF THE LD. CIT(A), THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL BY RAISING THE FOLLOWING GROUND S :- 6 ITA NO.1528/DEL/2017 1. THE LD. CIT(A) HAS GROSSLY ERRED IN LAW IN UPHO LDING THE ACTION OF THE A.O. IN REOPENING THE COMPLETED ASSESSMENT U/S 143(3) AFTER 4 YEARS BY ISSUING NOTICE U/S 148 R.W.S. 147. WITHOUT PROVING AND MENTIONING THAT TH ERE WAS ANY FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY ALL MATERI AL FACTS REQUIRED FOR COMPLETING THE ASSESSMENT, IN THE REASON RECORDED OR IN THE ASSESS MENT ORDER, THEREFORE INITIATION OF PROCEEDINGS U/S 147 OF THE INCOME TAX ACT, 1961 IS BAD AND INVALID. 2. THE LD. CIT(A) HAS GROSSLY ERRED IN UPHOLDING TH E ADDITION OF RS.15,60,000/- IN THE INCOME OF THE ASSESSEE U/S 68 OF THE INCOME TAX ACT, 1961 ON THE ARBITRARY GROUNDS. 3. THE APPELLANT SEEKS LEAVE TO ADD OR TO AMEND THE FORGOING GROUNDS OF APPEAL, IF IT BECOMES NECESSARY TO DO SO IN THE INTEREST OF JUSTICE. 9. THE LD. COUNSEL FOR THE ASSESSEE REFERRING TO PA GE 76 AND 76 OF THE PAPER BOOK DREW THE ATTENTION OF THE BENCH TO THE ASSESSM ENT ORDER PASSED BY THE ASSESSING OFFICER U/S 143(3) ON 26.12.2008 DETERMIN ING THE TOTAL INCOME OF THE ASSESSEE AT RS.4,16,520/-. REFERRING TO THE NOTICE U/S 148, COPY OF WHICH IS PLACED AT PAGE 1 OF THE PAPER BOOK, HE SUBMITTED TH AT THE NOTICE U/S 148 WAS ISSUED ON 21.03.2013 WHICH IS BEYOND A PERIOD OF FO UR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR. HE SUBMITTED THAT THE RE OPENING WAS BASED ON THE REPORT OF THE INVESTIGATION WING AND THERE WAS NO F AILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY ALL MATERIAL F ACTS NECESSARY FOR COMPLETION OF THE ASSESSMENT. REFERRING TO THE NOTICE ISSUED U/S 142(1) ON 23.04.2008, COPY OF WHICH IS PLACED IN THE PAPER BOOK AT PAGE 32, HE SUBMITTED THAT THE ASSESSING OFFICER IN THE SAID NOTICE HAS ASKED THE ASSESSEE T O SUBMIT THE DETAILS AS PER THE QUESTIONNAIRE ENCLOSED. REFERRING TO PAGE 33 34 OF THE PAPER BOOK, HE DREW THE ATTENTION OF THE BENCH TO THE QUESTIONNAIRE ISS UED BY THE ASSESSING OFFICER WHEREIN THE ASSESSING OFFICER HAS SPECIFICALLY ASKE D THE COMPLETE DETAILS OF THE 7 ITA NO.1528/DEL/2017 PERSONS WHO HAVE INVESTED IN THE SHARE CAPITAL AND SHARE APPLICATION MONEY WITH THEIR NAMES AND ADDRESS, COPY OF STATEMENT AND INCOME TAX PARTICULARS, COPY OF BANK STATEMENT ETC. REFERRING TO PAGE 35 T O 74 OF THE PAPER BOOK, LD. COUNSEL FOR THE ASSESSEE DREW THE ATTENTION OF THE BENCH TO THE REPLIES GIVEN BY THE ASSESSEE ON VARIOUS DATES WHEREIN THE ISSUE OF SHARE APPLICATION AND SHARE PREMIUM WAS EXPLAINED. THEREFORE, IN ABSENCE OF AN Y FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY ALL MATERIAL F ACTS NECESSARY FOR COMPLETION OF ASSESSMENT, THE REOPENING OF THE ASSESSMENT AFTER A PERIOD OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR IS VOID AS PER PROVISO TO SECTION 147 OF THE I.T. ACT, 1961. RELYING ON VARIOUS DECISIONS, HE SUBMITTED THAT THE REOPENING OF THE ASSESSMENT BEYOND A PERIOD OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR IS VOID AB-INITIO . THEREFORE, THE SUBSEQUENT PROCEEDINGS ARE ALSO TO BE HELD AS VOID. 10. THE LD. DR ON THE OTHER HAND HEAVILY RELIED ON THE ORDER OF THE LD. CIT(A). HE SUBMITTED THAT THE ASSESSING OFFICER HA S RECEIVED SPECIFIC INFORMATION REGARDING THE ACCOMMODATION ENTRIES REC EIVED BY THE ASSESSEE FROM S.K. JAIN GROUP OF COMPANIES WHO ARE FAMOUS ENTRY O PERATORS AND THE ASSESSEE HAS RECEIVED AN AMOUNT OF RS.15,60,000/- AS SHARE A PPLICATION MONEY/SHARE PREMIUM DURING THE YEAR. THIS FACT OF ACCOMMODATIO N ENTRIES AND THE BOGUS TRANSACTION OF SHARE CAPITAL WAS NOT AVAILABLE WITH THE ASSESSING OFFICER AT THE TIME OF THE ORIGINAL ASSESSMENT COMPLETED U/S 143(3 ) OF THE I.T. ACT. BASED ON 8 ITA NO.1528/DEL/2017 CREDIBLE INFORMATION AND VERIFICATION FROM THE RECO RD, THE ASSESSING OFFICER HAS REASON TO BELIEVE THAT THE INCOME OF THE ASSESSEE H AS ESCAPED ASSESSMENT WHICH IS MORE THAN RS.1,00,000/-. THEREFORE, THE ASSESSI NG OFFICER WAS FULLY JUSTIFIED IN REOPENING THE ASSESSMENT. 11. REFERRING TO THE DECISION OF THE HONBLE GUJARA T HIGH COURT IN THE CASE OF PUSHPAK BULLION (P.) LTD. VS. DCIT REPORTED IN 85 T AXMANN.COM 84, HE SUBMITTED THAT HON'BLE HIGH COURT IN THE SAID DECIS ION HAS HELD THAT WHERE INVESTIGATION WING OF THE DEPARTMENT HAD DURING COU RSE OF INVESTIGATION IN CASE OF A THIRD PARTY FOUND THAT HE WAS INDULGED IN PROV IDING ACCOMMODATION ENTRIES AND BOGUS BILLS AND ASSESSEE HAD MADE SIZEABLE PURC HASES FROM HIM, REOPENING NOTICE AGAINST THE ASSESSEE WAS JUSTIFIED. 12. REFERRING TO THE DECISION OF THE HONBLE ALLAHA BAD HIGH COURT IN THE CASE OF PCIT VS. LIGHT CARTS (P.) LTD. REPORTED IN 85 TA XMANN.COM 331, HE SUBMITTED THAT THE HON'BLE HIGH COURT IN THE SAID DECISION HA S HELD THAT WHERE THE ASSESSEE HAS DISCLOSED ALL MATERIAL FACTS NECESSARY FOR ASSE SSMENT, THE ASSESSING OFFICER COULD NOT REOPEN ASSESSMENT AFTER EXPIRY OF FOUR YE ARS FROM THE END OF RELEVANT ASSESSMENT YEAR MERELY ON THE BASIS OF INFORMATION SUPPLIED BY THE INVESTIGATION WING OF THE DEPARTMENT THAT CERTAIN I NCOME EARNED BY THE ASSESSEE HAD ESCAPED ASSESSMENT. 13. SO FAR AS MERIT OF THE CASE IS CONCERNED, HE SU BMITTED THAT SINCE THE ASSESSEE FAILED TO PROVE THE IDENTITY AND CAPACITY OF THE SHARE APPLICANTS TO PAY 9 ITA NO.1528/DEL/2017 SHARE APPLICATION MONEY AND THE GENUINENESS OF THE TRANSACTIONS, THEREFORE, THE AMOUNT SO RECEIVED WAS LIABLE TO BE TAXED U/S 68 OF THE I.T. ACT. FOR THE ABOVE PROPOSITION, HE RELIED ON THE FOLLOWING DECISIONS : - (I) CIT VS. NIPUN BUILDERS & DEVELOPERS (P.) LTD., 350 ITR 407. (II) CIT VS. NOVA PROMOTERS & FINLEASE (P.) LTD., 342 ITR 169. (III) CIT VS. N.R. PORTFOLIO PVT. LTD., 29 TAXMANN .COM 291. (IV) CIT VS. MAF ACADEMY (P.) LTD., 361 ITR 258. HE ACCORDINGLY SUBMITTED THAT THE ORDER OF THE LD. CIT(A) BE UPHELD. 14. I HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY B OTH THE SIDES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IT IS AN ADMITTE D FACT THAT THE ORIGINAL ASSESSMENT IN THE INSTANT CASE WAS COMPLETED U/S 14 3(3) ON 26.12.2008 DETERMINING THE TOTAL INCOME AT RS.4,16,520/- AS AG AINST THE RETURNED INCOME OF RS.3,77,255/-. I FIND FROM THE NOTICE ISSUED U/S 1 42(1) ALONG WITH QUESTIONNAIRE, COPY OF WHICH IS PLACED AT PAGE 32 34 OF THE PAPE R BOOK THAT THE ASSESSING OFFICER, DURING THE COURSE OF ORIGINAL ASSESSMENT P ROCEEDINGS, HAD ASKED THE ASSESSEE TO PROVIDE COMPLETE DETAILS OF SHARE CAPIT AL AND SHARE APPLICATION MONEY WITH THEIR NAMES AND ADDRESS, COPY OF STATEME NT OF INCOME TAX PARTICULARS, COPY OF BANK STATEMENTS, ETC. I FIND THE ASSESSEE VIDE HIS VARIOUS REPLIES GIVEN TO THE ASSESSING OFFICER DURING THE O RIGINAL ASSESSMENT PROCEEDINGS, COPIES OF WHICH ARE PLACED AT PAGE 35 TO 74 OF THE PAPER BOOK, HAD GIVEN THE REQUISITE DETAILS AS ASKED FOR BY THE ASS ESSING OFFICER. THE REOPENING OF THE ASSESSMENT IN THE INSTANT CASE WAS MADE ON T HE BASIS OF THE REPORT OF THE 10 ITA NO.1528/DEL/2017 INVESTIGATION WING. IN MY OPINION, THERE IS NO FAI LURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY ALL MATERIAL F ACTS NECESSARY FOR COMPLETION OF THE ASSESSMENT AT THE TIME OF ORIGINAL ASSESSMENT. THEREFORE, THE PROVISO TO SECTION 147 WILL BE APPLICABLE TO THE FACTS OF THE PRESENT CASE, ACCORDING TO WHICH, WHERE AN ASSESSMENT U/S 143(3) HAS BEEN MADE FOR THE RELEVANT ASSESSMENT YEAR, NO ACTION SHALL BE TAKEN UNDER THE PROVISIONS OF SECTION 147 AFTER EXPIRY OF FOUR YEARS FROM THE END OF THE RELE VANT ASSESSMENT YEAR UNLESS AN INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT FOR SUCH ASSESSMENT YEAR BY REASON OF THE FAILURE ON THE PART OF THE ASSESSEE T O DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS NECESSARY FOR HIS ASSESSMENT. EVEN THE DECISION OF THE HONBLE ALLAHABAD HIGH COURT IN THE CASE OF PCIT VS. LIGHT CARTS (P.) LTD. (SUPRA) RELIED ON BY THE LD. DR SUPPORTS THE CASE OF THE ASSESSEE WHERE IT HAS BEEN HELD THAT WHERE THE ASSESSEE DISCLOSED ALL MATERIAL FACTS NEC ESSARY FOR ASSESSMENT, THE ASSESSING OFFICER COULD NOT REOPEN THE ASSESSMENT A FTER EXPIRY OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR MERELY ON THE BASIS OF INFORMATION SUPPLIED BY THE INVESTIGATION WING OF THE DEPARTMEN T THAT CERTAIN INCOME EARNED BY THE ASSESSEE HAD ESCAPED ASSESSMENT. SIN CE IN THE INSTANT CASE ADMITTEDLY THE ASSESSMENT HAS BEEN REOPENED ON THE BASIS OF REPORT OF THE INVESTIGATION WING AFTER A PERIOD OF FOUR YEARS FRO M THE END OF THE RELEVANT ASSESSMENT YEAR AND THE ASSESSEE HAD SUPPLIED ALL R EQUISITE DETAILS DURING THE COURSE OF ORIGINAL ASSESSMENT PROCEEDINGS AND THE A SSESSMENT WAS COMPLETED 11 ITA NO.1528/DEL/2017 U/S 143(3), THEREFORE, THE REOPENING OF THE ASSESSM ENT AFTER A PERIOD OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR IS BARRED BY LIMITATION AND, THEREFORE, BAD IN LAW. I, THEREFORE, QUASH THE REA SSESSMENT PROCEEDINGS AND THE GROUNDS RAISED BY THE ASSESSEE ON THIS ISSUE ARE AL LOWED. 15. SINCE THE ASSESSEE SUCCEEDS ON THIS LEGAL GROUN D, THE GROUND CHALLENGING THE ADDITION ON MERIT IS NOT BEING ADJUDICATED BEIN G ACADEMIC IN NATURE. 16. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 31 ST AUGUST, 2018. SD/- (R. K. PANDA) ACCOUNTANT MEMBER DATED: 31-08-2018. SUJEET COPY OF ORDER TO: - 1) THE APPELLANT 2) THE RESPONDENT 3) THE CIT 4) THE CIT(A) 5) THE DR, I.T.A.T., NEW DELHI BY ORDER //TRUE COPY// ASSISTANT REGISTRAR ITAT, NEW DELHI