ACIT, New Delhi V. M/s. SBC India Ltd., Delhi

ITA 1869/DEL/2015

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 5532 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-04-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Assessment Year: 2006-2007
• Appeal Filed On: 01-04-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KAUSHLENDRA TIWARI
• Assessee Lawyers: KAPIL GOYAL
• Keywords: Reopening of assessment; Gift; Tangible material; Accommodation entries
• Section: 143(3); 14A; 133(6); 147; 131

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH G NEW DLEHI BEFORE SHRI N.K. SAINI, ACCOUNTANT MEMBER AND SHRI K. NARSIMHA CHARY, JUDICIAL MEMBER I.T.A. NO.1869/DEL/2015 ASSESSMENT YEAR: 2006-07 ASSTT. COMMISSIONER OF INCOME-TAX, VS M/S SBC INDIA LTD., CIRCLE 22(2), NEW DELHI. 101, 1 ST FLOOR, ADITYA COMPLEX 12,PREET VIHAR DELHI. (PAN: AAGCS4260F) (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI KAUSHLENDRA TIWARI, SR. DR RESPONDENT BY: SHRI KAPIL GOYAL ORDER DATE OF HEARING: 09.04.2018 DATE OF PRONOUNCEMENT: 13 .04.2018 PER K. NARSIMHA CHARY, JM AGGRIEVED BY THE ORDER DATED 4.01.2015 IN APPEAL NO .82/13-14 PASSED BY THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) 8, NEW DELHI (FOR SHORT CIT(A)}), REVENUE PREFERRED THIS APPEAL. 2. THE ASSESSEE IS A COMPANY ENGAGED IN THE BUSINESS OF CONSTRUCTION. FOR THE ASSTT. YEAR 2006-07, THEY HAVE FILED THEIR RETURN OF INCOME ON 29.11.2006 DECLARING A TOTAL INCOME OF RS.7,14,507/-. DURING THE SCRUTINY, IT WAS NOTICED THAT THE BALANCE SHEET FILED BY THE ASSESSEE WAS TALLIED AT RS.1,64,89,615.97. THE SHARE CAPITAL OF THE ASSESSEE DURING THE YEAR UNDER CONSIDERATION IS 2 RS.30,27,000/- AND SHARE CAPITAL AS ON 31.3.2005 WA S RS.20,27,000/- AND DURING THE PREVIOUS YEAR RELEVANT FOR THE ASSTT. YEAR 2006- 07 SUBSCRIBED SHARE CAPITAL OF THE COMPANY WAS INCREASED TO RS.30,27,000/-. ON THE NEW SHARES ALLOTTED SHARE PREMIUM OF RS.40 LACS WAS RECEIVED AND 1 LAC SHARES OF RS.10 EACH WERE ALLOTTED TO ONE GEEFCEE FINANCE LTD. AFTER NOTICING ALL THE SE FACTS AND REFERRING TO THEM IN THE ORDER, THE LD. AO PASSED THE ORDER DATED 29.12. 2008 U/S 143(3) OF THE ACT WHILE MAKING CERTAIN ADDITIONS TO THE TOTAL INCOME OF THE ASSESSEE. 3. HOWEVER, ON 28.3.2012, LEARNED AO REOPENED THE P ROCEEDINGS AFTER RECORDING THE FOLLOWING REASONS: 'DIT(INV.) DURING THE COURSE OF THE INVESTIGATIO N IN THE CASE OF SH.TARUN GOYAI CA 13/34, WEA, ARYA SAMAJ ROAD, KAROL BAGH, NEW DELHI FOUND THAT SH. TARUN GOYA! HAD CREATED A NUMBER OF PRIVAT E LTD. COMPANIES WERE HIS EMPLOYEES WHO WORKED IN HIS OFFICE AS PEON S RECEPTIONISTS ETC. ALL THE DOCUMENTS WERE GOT SIGNED FROM THESE E MPLOYEES. A NUMBER OF BANK ACCOUNTS IN VARIOUS BANKS WERE OPENE D IN THE NAMES OF THESE COMPANIES AND HIS EMPLOYEES, IN WHICH HUGE CASH DEPOSITS WERE MADE. LETER CHEQUES WERE ISSUED TO VARIOUS BEN EFICIARIES, DISGUISING THE WHOLE TRANSACTION AS GENUINE. DURING THE COURSE OF SEARCH IT WAS ESTABLISHED THAT SH. TARUN GOYA! HAS FLOATED ABOUT 90 COMPANIES FOR THE PURPOSE OF PROVIDING ACCOMMODATIO N ENTRIES. IT WAS FURTHER ESTABLISHED THAT ALL THE COMPANIES FLOA TED BY SH. TARUN GOYAL ARE NOT CARRYING OUT ANY GENUINE ACTIVITY AND ARE MERELY BEING USED TO PROVIDE ACCOMMODATION ENTRIES. HENCE, ALL TH E COMPANIES OF SH. TARUN GOYAL ARE 'BOGUS .' THE OPERATOR OPENED MULTIPLE ACCOUNTS IN VARIOUS BRANCHES TO PLOUGH BACK UNACCOUNTED BLACK M ONEY FOR THE PURPOSE OF BUSINESS OR FOR PERSONAL NEEDS SUCH AS P URCHASES OF ASSETS ETC. IN THE FORM OF GIFTS, SHARE APPLICATION MONEY L OANS ETC. DURING THE COURSE OF INVESTIGATION BY THE DIT (INV.) IT WAS DI SCOVERED THAT THE ASSESSEE WHO HAVE UNACCOUNTED MONEY (HEREINAFTER CA LLED AS ENTRY TAKER OR BENEFICIARY). AND WANT TO INTRODUCE THE SA ME IN THE BOOKS OF ACCOUNTS WITHOUT PAYING TAX APPROACH ANOTHER PERSON (ENTRY OPERATOR) AND HAND OVER CASH (PLUS COMMISSION) AND TAKE CHEQUE/DD/POS. THE CASH IS DEPOSITED BY THE NAME OF RELATIVE/FRIENDS OR OTHER PERSON HIRED BY HIM, FOR THE PURPOSE OF OPE NING BANK ACCOUNT. THE ENTRY OPERATOR THEREAFTER ISSUES CHEQU E/DD/PO IN THE NAME OF THE BENEFICIARY FROM THE TRANSFERRED THROUG H CLEARING IN TWO OR MORE STAGES. THE BENEFICIARY IN TURN DEPOSITS TH ESE INSTRUMENTS IN 3 HIS BANK ACCOUNTS AND THE MONEY COMES TO HIS REGULA R BOOKS OF ACCOUNTS IN THE FORM OF GIFT, SHARE APPLICATION MONE Y, LOAN ETC. THROUGH BANKING CHANNELS AND THE TRANSACTIONS LOOKS GENUINE. IT IS NOTICED FROM THE LIST OF BENEFICIARIES THAT THE ASS ESSEE HAS TAKEN / GIVEN FROM M/S GEEFCEE FINANCE LTD AN AMOUNT OF RS. 50,00,000/- AS ACCOMMODATION ENTRY. IN VIEW OF THE FINDINGS OF THE INVESTIGATION REPORT, THE ACCOMMODATION ENTRY HAS BEEN TAKEN BY TH E ASSESSEE BY PAYING AN UNACCOUNTED MONEY OF RS.50,00,000/- ALONG W ITH THE PREMIUM FOR OBTAINING THE ENTRY. 4. AFTER HEARING THE ASSESSEE AND BRUSHING ASIDE TH E OBJECTIONS OF THE ASSESSEE THAT IN ORDER TO REOPEN THE CONCLUDED PROC EEDINGS AFTER FOUR YEARS, THE TWO CONDITIONS, VIZ., THERE MUST EXIST A REASONABLE BELIEF ON THE PART OF THE AO AND THAT THERE MUST A FAILURE ON THE PART OF THE AS SESSEE TO FULLY AND TRULY DISCLOSE ALL MATERIAL FACTS MUST BE SATISFIED, LEARNED AO PR OCEEDED TO ADD RS.50 LACS TO THE INCOME OF THE ASSESSEE. 5. MATTER WAS CARRIED IN APPEAL TO THE LEARNED CIT( A) AND BY WAY OF IMPUGNED ORDER, LEARNED CIT(A) OBSERVED THAT THE TWIN CONDIT IONS REQUIRED BY THE PROVISO TO SECTION 147 ARE NOT SATISFIED AND THE AO HAS NOT RE ACHED ANY INDEPENDENT SATISFACTION TO REOPEN THE PROCEEDINGS. LEARNED CI T(A) FURTHER OBSERVED THAT ALL THE MATERIAL AND DETAILS REGARDING THE SHARE APPLIC ATION AMOUNT AND PREMIUM RECEIVED BY THE ASSESSEE WERE DISCLOSED BEFORE THE A O AND FOR THAT MATTER THE ORIGINAL ASSESSMENT ORDER DISCLOSES SAID FACT. WHI LE RELYING UPON THE DECISION OF THE HONBLE HIGH COURT IN THE CASE OF SIGNATURE HOT ELS P. LTD. VS ITO (2011) 338 ITR 51 (DEL), LEARNED CIT(A) REACHED TO THE CONCLUS ION THAT THE REOPENING OF ASSESSMENT U/S 147 WAS NOT JUSTIFIED. 6. FURTHER, IN RESPECT OF THE MERITS, LEARNED CIT(A ) OBSERVED THAT NO ADVERSE MATERIAL WAS COLLECTED BY THE AO AND THE LEARNED AO HAS NOT COMMENTED ANYTHING ADVERSE ON THE DETAILS FURNISHED BY THE ASSE SSEE DURING THE ASSESSMENT 4 PROCEEDINGS. BESIDES THAT, THE LEARNED AO DID NOT MAKE ANY VERIFICATION AS TO THE TRUTH OR OTHERWISE OF THE MATERIAL PRODUCED ON BEHA LF OF THE ASSESSEE AND TO KNOW THE REAL NATURE OF THE TRANSACTIONS BUT WITHOU T DOING SO, IN A PERFUNCTORY MANNER MADE THE ADDITION SOLELY PLACING RELIANCE ON THE INFORMATION GATHERED BY THE DIT(INVESTIGATION). ON THIS PREMISE, LEARNED C IT(A) DELETED THE ADDITION OF RS.50 LACS. 7. REVENUE IS, THEREFORE, IN THIS APPEAL CHALLENGIN G THE OBSERVATIONS OF THE LEARNED CIT(A) AND STATING THAT THE INFORMATION REC EIVED FROM THE DIT(INVESTIGATION) ITSELF CONSTITUTES THE MATERIAL SUPPORTING THE REOPENING AND INASMUCH AS THE ASSESSEE NEVER REVEALED THE MODUS O PERANDI OF RECEIVING SHARE CAPITAL WITH PREMIUM, THE INFORMATION FURNISHED BY THE DIT (INV.) FORM THE BASIS FOR THE LD. AO TO FORM THE SATISFACTION THAT INCOME HAD ESCAPED THE ASSESSMENT. 8. LEARNED DR PLACED RELIANCE ON THE DECISION REPOR TED IN THE CASE OF HONDA SIEL POWER PRODUCTS LTD. V. DV. CIT {2012} 340 ITR 64 (SC); HONDA SIEL POWER PRODUCTS LTD. V. DV. CIT 340 ITR 53 (DEL); NEW DEL HI TELEVISION LTD. VS DCIT (2017} 84 TAXMANN.COM 136 (DELHI); CIT VS P.V.S. BEEDIES (P.) LTD. (1991) 103 TAXMAN (1991) 237 ITR 13 (SC); CIT VS KIRANBHAI JAMNADAS SHETH (HUF) (2013) 39 TAXMANN.COM 116 (GUIARAT); AND DISHMAN PHARMACEUTI CALS & CHEMICALS LTD. VS CIT (2012) 346 ITR 228 (GUI) FOR THE PROPOSITION T HAT ASSESSEE HAVING NOT POINTED OUT DURING ASSESSMENT PROCEEDINGS ABOUT EXPENSES IN CURRED RELATABLE TO TAX FREE INCOME U/S 14A THERE WAS OMISSION AND FAILURE ON IT S PART TO DISCLOSE FULLY AND TRULY MATERIAL FACTS AND HENCE REOPENING OF ASSESSME NT WAS JUSTIFIED. 9. PER CONTRA, IT IS THE ARGUMENT OF THE LEARNED AR THAT THE ASSTT. ORDER DATED 29.11.2008 CLEARLY REVEALS THAT THE LEARNED AO FULLY AWARE OF THE FACTUM OF SHARE 5 APPLICATION MONEY AND THE RECEIPT OF PREMIUM AT THE TIME OF THE SCRUTINY U/S 143(3) OF THE INCOME-TAX ACT, 1961 (THE ACT) AND SUCH DETAILS ARE TO BE FOUND IN THE ASSESSMENT ORDER AND IN THE ABSENCE OF ANY FRESH TANGIBLE MATERIAL COMING INTO THE POSSESSION OF THE LEARNED AO SUGGESTING TH AT THE ASSESSEE IS GUILTY OF NOT FURNISHING TRUE AND FULL PARTICULARS OF INCOME, THE REOPENING IS NOT JUSTIFIED. MOREOVER, THE LEARNED AO BLINDLY RELIED UPON THE INF ORMATION RECEIVED FROM THE DIT(INV) AND RECORDED NO REASONS AS TO HOW SUCH INF ORMATION TOOK HIM TO THE CONCLUSION THAT THE INCOME HAS ESCAPED FROM ASSESSM ENT. IN THE ABSENCE OF ANY REASONS ACTING ON THE INTIMATION THAT THE CONCLUSIO N RECORDED, THE REOPENING IS BAD. 10. IN SO FAR AS THE MERITS ARE CONCERNED, IT IS TH E ARGUMENT OF THE LEARNED AR THAT WHEN THE ASSESSEE HAD FURNISHED SO MUCH OF INF ORMATION AS RECORDED BY THE LEARNED CIT IN HIS ORDER IN PARA 3, IT IS INCUMBENT UPON THE LEARNED AO TO VERIFY THE GENUINENESS OF THE TRANSACTION BY TAKING SUCH ST EPS UNDER THE LAW EITHER U/S 131 OR 133(6) OF THE ACT BUT WITHOUT STRAINING HIS NERVES, LEARNED AO STRAIGHT AWAY JUMPED TO THE CONCLUSION THAT SINCE THE REPORT OF THE DIT(INV.) REVEALS THAT MR. TARUN DAYAL FURNISHED ACCOMMODATION ENTRIES, THE ASSESSEE WAS BELIEVED TO HAVE RECEIVED SUCH ENTRY AND FASTENED WITH THE ADDIT ION, WHICH IS BAD IN LAW. 11. WE HAVE PERUSED THE MATERIAL IN THE LIGHT OF TH E SUBMISSION ON EITHER SIDE. THE ORDER DATED 26.2.2013 PASSED UNDER SECTION 147 READ WITH 143(3) OF THE ACT BY THE LEARNED AO UNMISTAKABLY ESTABLISHES THAT THE S OLE BASIS FOR HIS SATISFACTION IS THE REPORT OF THE DIT(INV.). THE ENTIRE ORDER D OES NOT REVEAL HOW SUCH INTIMATION/INFORMATION LEAD HIM TO BELIEVE THAT THE ASSESSEE IS GUILTY OF RECEIVING THE ACCOMMODATION ENTRY FROM SHRI TARUN DAYAL. IT IS PERTINENT TO NOTE THAT THE 6 REASONS RECORDED IN THE PENULTIMATE LINE READS THAT IT IS NOTICED FROM THE LIST OF BENEFICIARIES THAT THE ASSESSEE HAS TAKEN/GIVEN FRO M M/S GEEFRCEE FINANCE LTD. AN AMOUNT OF RS.50 LACS AS ACCOMMODATION ENTRY. WHE N THE INFORMATION IS NOT CLEAR AS TO WHETHER THE ASSESSEE HAS RECEIVED THE A CCOMMODATION ENTRY OR PROVIDED THE ACCOMMODATION ENTRY, WE DO NOT KNOW THE EXERCISE UNDERTAKEN BY THE LEARNED AO TO DECIPHER THE MODUS OPERANDI OF TH E ASSESSEE RECEIVING RS.50 LACS BY WAY OF ACCOMMODATION ENTRY. NO DATE NOR MODE OR METHOD OF ACCOMMODATION ENTRY COULD BE SPELT OUT BY THE LEARNED AO AND HE DOES NOT SEEMS TO HAVE TAKEN ANY STEPS FOR GATHERING SUCH INF ORMATION WHICH WOULD THROW SOME LIGHT AS TO THE APPLICABILITY OF THE INTIMATION RECEIVED FROM DIT(INV.) TO THE CASE OF THE ASSESSEE. ON THIS ASPECT, WE ARE IN AG REEMENT WITH THE OBSERVATIONS OF THE LEARNED CIT(A) THAT MERELY BECAUSE THE ASSESS EE HAS RECEIVED A CHEQUE FROM SOME PARTY, WHOM THE DEPARTMENT DOUBTS TO BE AN ENTRY OPERATOR ITSELF IS NOT SUFFICIENT TO REACH THE CONCLUSION THAT THE AMO UNT RECEIVED BY THE ASSESSEE IS ALSO IN THE FORM OF ACCOMMODATION ENTRY WITHOUT BEIN G ANY FURTHER DETAIL TO REACH SUCH A CONCLUSION. IN ALL FAIRNESS, THE AO S HOULD HAVE TAKEN STEPS TO KNOW WHETHER THIS AMOUNT IS IN THE FORM OF SHARE APPLICA TION MONEY OR LOAN AND WHETHER THIS AMOUNT IS SHOWN IN THE BOOKS OF ACCOUN TS OR NOT ETC. 12. FURTHER, THE REVENUE HAS NOT DISPUTED THE OBSER VATIONS OF THE LEARNED AO IN THE ORDER DATED 29.11.2008 PASSED U/S 143(3) AND EXTRACTED BY THE LEARNED CIT(A) IN THE FIRST PARAGRAPH OF HIS ORDER. THERE IS A DISCUSSION ON THE ASPECT OF SHARE APPLICATION MONEY AND MORE PARTICULARLY TO RS.5 0 LACS BEING 1 LAC SHARES OF RS.10 EACH ALLOTTED TO M/S GEEFRCEE WITH A PREMIUM OF RS.40 LACS. THIS ASPECT WAS CONSIDERED AND ACCEPTED BY THE LEARNED AO IN THE ASSESSMENT U/S 143(3) OF THE ACT. WHEN THAT WAS CONSIDERED AND ACCEPTED EARL IER, IN THE ABSENCE OF ANY 7 FRESH TANGIBLE MATERIAL MUCH LESS INCRIMINATORY MATE RIAL, SUGGESTING THAT THE ASSESSEE IS GUILTY OF NOT PROVIDING TRUE AND FULL P ARTICULARS OF INCOME, REOPENING OF THE CONCLUDED PROCEEDINGS IN NOT JUSTIFIED. WE, TH EREFORE, AGREE THAT THE FINDINGS OF THE LEARNED CIT(A) THAT WITHOUT THE AO RECORDING THE NATURE OF MATERIAL FACTS WHICH THE ASSESSEE DID NOT DISCLOSE TRULY AND FULLY, REOPENING OF CONCLUDED PROCEEDINGS BASING ON THE FACTS WHICH WERE AVAILABL E BEFORE HIM AND WERE DISCUSSED AS A MATTER OF FACT IN THE ORDER, IS BAD IN LAW. 13. INFORMATION PER SE IS NOT INCRIMINATORY. LD. A O HAS TO PROVE FROM THE RECEIPT OF INFORMATION TO THE CONCLUSION THAT PURSU ANT TO SUCH INFORMATION, ESCAPEMENT OF INCOME WAS DETECTED. UNFORTUNATELY, I N THIS CASE, IT IS NOT SO. AS IT HAS ALREADY BEEN RECORDED, AO DID NOT STRAIN HIS NE RVE TO SEE THAT PURSUANT TO THE INFORMATION RECEIVED FROM DIT(INV.), HE VERIFIED AN Y RECORD OR CAME TO POSSESSION OF NEW FACTS WHICH SUGGEST THAT DUE TO THE CONDUCT OF THE ASSESSEE NOT DISCLOSING THE MATERIAL FACTS TRULY AND FULLY, SOME INCOME HAS E SCAPED ASSESSMENT AND THAT MAY NECESSITATED THE REOPENING PROCEEDINGS. AO CANN OT SUBSTITUTE THE INTIMATION RECEIVED FROM DIT (INV.) TO THE SATISFAC TION HE HAS TO REACH AFTER RECEIPT OF SUCH INFORMATION. WE, THEREFORE, HOLD THAT THE MECHANICAL ACCEPTANCE OF THE INTIMATION AS TRUE AND CORRECT TO REACH CONCLUSION THAT THE INCOME ESCAPED ASSESSMENT, CANNOT BE SUSTAINED. FOR THESE REASONS, WE ARE OF THE CONSIDERED OPINION THAT THERE IS NOTHING ILLEGAL OR IRREGULAR IN THE FINDING RECORDED BY THE LEARNED CIT(A) THAT THE FACTS AND CASE LAW DO NOT S UPPORT THE REOPENING OF THE PROCEEDINGS, AS SUCH, REOPENING OF ASSESSMENT PROCE EDINGS U/S 147 IS BAD IN LAW. 14. NOW COMING TO THE MERITS OF THE CASE, BEFORE TH E LEARNED CIT(A) ALSO THE ASSESSEE FURNISHED THE DOCUMENTS LIKE MCA, BANK STA TEMENT, ITR , PAN FORM 2, 8 SHARE ALLOTMENT RETURN AND SHARE APPLICATION FORM E TC. IT WAS ALSO CONTENDED BY THE ASSESSEE BEFORE THE LEARNED CIT(A) THAT THE LEA RNED AO HAS NOT DONE ANY ENQUIRY MUCH LESS ANY MEANINGFUL ENQUIRY TO REBUT SUC H AN EVIDENCE PLACED ON RECORD. LEARNED CIT(A) ALSO RECORDED THAT NO ADVER SE MATERIAL WAS COLLECTED BY THE AO AND EVEN IN RESPECT OF THE DETAILS FURNISHED BY THE LEARNED AR, LD. AO HAS NOT COMMENTED ADVERSELY. CIT(A) NOTICED THE FOLLOWI NG OBSERVATIONS OF THE AO: 'THE COMPANY WAS INCORPORATED ON 11-04-1996. IT I S ENGAGED IN THE BUSINESS OF CONSTRUCTION. IN REPLY FILED BY THE ASS ESSEE HE HAS TRIED T EXPLAIN VARIOUS QUERIES RAISED FROM TIME TO TIME. THE BALANCE SHEET FILED BY THE ASSESSEE IS TALLIED AT RS.1,64,89,615.97 P. THE SHARE CAPITAL OF THE ASSESSEE DURING THE YEAR UNDER CONSIDERATION IS RS.30,27,000/- AND SHARE CAPITAL AS ON 31.3.05 WAS RS.20,27,000/-. D URING THE YEAR SUBSCRIBED SHARE CAPITAL OF THE COMPANY INCREASED T O RS.30,27,000/- FROM RS.20,27,000/-. ON THE NEW SHARES ALLOTTED SHARE PREMIUM OF RS.40,00,000/- WAS ALSO RECEIVED. DURING THE YEAR 1 L AC SHARES OF RS. 10/- EACH WERE ALLOTTED TO GEEFCEE FINANCE LTD. DUR ING THE YEAR THE PROJECTS IN HAND WERE NABHGANGA BUILD WELL P. LTD., SITE-C, SECTOR -18, VASUNDHARA, GHAZIABAD, NATIONAL BUILDING CONSTRUCTION CORPN. LTD. SITE - ADMINISTRATIVE BLOCK AND HOSTEL BLOCK STAFF TRAININ G COLLEGE, CANARA BANK WORKS, PLOT NO.80 SECTOR -18, GURGAON (HARYANA). DURING THE YEAR CONTRACT RECEIPTS DECLARED OF RS.2,24,90,344/- AND OTH ER INCOME OF RS.4,94,191/-.' 15. LEARNED CIT(A), THEREFORE, CONCLUDED THAT IN VI EW OF THE ABOVE, LEARNED AO BLINDLY ACCEPTED THE REPORT OF THE INVESTIGATION WIN G AND WHILE BASING ON THE MODUS OPERANDI DISCLOSED BY THE REPORT, OPINED THAT ALL THE COMPANIES FLOATED BY TARUN DAYAL ARE BOGUS AND THE ASSESSEE HAD RECEIVED ACCOMMODATION ENTRY. 16. ON A CAREFUL CONSIDERATION OF THIS FACT, WE ARE INCLINED TO AGREE WITH THE LEARNED CIT(A) ON THIS ASPECT ALSO BECAUSE, IN SPIT E OF AVAILABILITY OF THE DOCUMENTS WITH HIM, LEARNED AO DID NOT TAKE ANY STEP S WHATSOEVER TO VERIFY THE GENUINENESS OF THE TRANSACTIONS INSTEAD OF REITERAT ING THE CONTENTS OF THE REPORT OF DIT(INV.). ACT PROVIDES HIM WITH THE MACHINERY F OR SUCH VERIFICATION. WE FIND 9 SUPPORT IN THE ARGUMENT OF THE LEARNED AR THAT THE AO COULD HAVE RESORTED TO THE PROVISIONS OF SECTION 131 OR 133(6) OF THE ACT TO V ERIFY THE GENUINENESS OF THE TRANSACTIONS. WITHOUT FOLLOWING THE PROCEDURE ESTAB LISHED UNDER LAW, THE LEARNED AO SIMPLY MADE THE MODUS OPERANDI OF TARUN DAYAL AS R EVEALED IN THE REPORT OF THE DIT (INV.) THE BASIS TO MAKE THE ADDITION. 17. WE, THEREFORE, DO NOT FIND ANY REASON TO SUSTAIN THE ADDITION MADE BY THE LD. AO OR TO INTERFERE WITH THE ORDER OF THE LEARNE D CIT(A) IN THIS RESPECT. WE ACCORDINGLY UPHOLD THE IMPUGNED ORDER AND FIND THE G ROUNDS OF APPEAL AS DEVOID OF MERITS. THE APPEAL IS, THEREFORE, LIABLE TO BE DISMISSED. WE ORDER ACCORDING. 18. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISS ED. ORDER PRONOUNCED IN THE OPEN COURT ON 13 TH APRIL, 2018. SD/- SD/- (N.K. SAINI) (K. NARSIMHA CHARY) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 13 TH APRIL, 2018 VJ COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT BY ORDER ASSTT. REGISTRAR