Mrs. Sonia Chowdhary, New Delhi V. ITO, New Delhi

ITA 2037/DEL/2010

• Counselvise Citation: [2016] 121 COUNSELVISE.COM (IT) 4275 (ITAT-DELHI)
• Duration Of Justice: 6 year(s) 5 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-10-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 21-09-2016
• Assessment Year: 2003-2004
• Appeal Filed On: 03-05-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SATPAL GULATI
• Keywords: Question of law; Tangible material; Accommodation entries; Reason to believe; Reassessment proceedings
• Section: 143(3); 234B; 147; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH G : NEW DELHI) BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI O.P. KANT, ACCOUNTANT MEMBER ITA NOS. 2036 & 2037/DEL/2010 ASSESSMENT YEARS: 2002-03 & 2003-04 MRS. SONIA CHOWDHRY, VS. ITO, WARD 47(1), E-78, GREATER KAILASH-I, ROOM NO. 425, NEW DELHI MAYUR BHAWAN, NEW DELHI (PAN: AACPC5227H) (APPELLANT) (RESPONDENT) ASSESSEE BY : SH. SALIL KAPOOR, ADV. REVENUE BY : SH. SATPAL GULATI, CIT(DR) DATE OF HEARING : 22-09-2016 DATE OF ORDER : 07-10-2016 ORDER PER H.S. SIDHU, J.M. THE ASSESSEE HAS FILED THESE TWO APPEALS AGAINST T HE SEPARATE ORDERS BOTH DATED 26.2.2010 OF THE LD. CIT(A)-XXX, NEW DELHI PERTAINING TO ASSESSMENT YEARS 2002-03 & 2003-04. S INCE THE ISSUES INVOLVED IN THESE APPEALS ARE COMMON, THEREFORE, TH E SAME ARE BEING CONSOLIDATED BY THIS COMMON ORDER FOR THE SAKE OF C ONVENIENCE, BY DEALING WITH ITA NO. 2036/DEL/2010 (AY 2002-03). 2. THE FOLLOWING GROUNDS RAISED IN ITA NO. 2036/DEL /2010:- 2 1. ACTION OF THE CIT(A) IN CONFIRMING THE ASSESSMEN T MADE BY THE AO U/S. 148 OF THE I.T. ACT IN RESPECT OF INCOME ALREADY DISCLOSED IN THE ORIGINAL RETURN AND TAXES PAID THEREON AS APPLICABLE IS UNJUST, ILLEGAL, ARB ITRARY AND AGAINST THE FACTS AND CIRCUMSTANCES OF THE CASE. 2. ACTION OF THE CIT(A) IN CONFIRMING THE TREATMENT OF SHORT TERM CAPITAL GAIN OF RS. 3,505,986/- AS INCOM E FROM OTHER SOURCES BY THE AO IS UNJUST, ILLEGAL, AR BITRARY AND AGAINST THE FACTS AND CIRCUMSTANCES OF THE CASE . 3. ACTION OF THE CIT(A) IN CONFIRMING THE ADDITION OF RS. 3,50,986/- MADE BY AO BASED UPON THE PRESUMPTIO N THAT THE APPELLANT HAS TAKEN ACCOMMODATION ENTRY AN D IGNORING ALL THE DOCUMENTARY EVIDENCE FILED BY THE APPELLANT IN THIS REGARD AND WITHOUT CONFRONTING TH E APPELLANT WITH THE DOCUMENTARY EVIDENCE AND STATEME NTS RELIED UPON BY THE AO IS UNJUST, ILLEGAL, ARBITRARY AND AGAINST THE FACTS AND CIRCUMSTANCES OF THE CASE. 4. ACTION OF THE CIT(A) IN CONFIRMING THE CHARGE OF INTEREST OF RS. 782,818/- U/S. 234B OF THE I.T. BY THE AO IS UNJUST, ILLEGAL, ARBITRARY AND AGAINST THE FACTS AND CIRCUMSTANCES OF THE CASE. 3. THE FOLLOWING GROUNDS RAISED IN ITA NO. 2037/DE L/2010:- 1. ACTION OF THE CIT(A) IN CONFIRMING THE ASSESSMEN T MADE BY THE AO U/S. 148 OF THE I.T. ACT IN RESPECT OF 3 INCOME ALREADY DISCLOSED IN THE ORIGINAL RETURN AND TAXES PAID THEREON AS APPLICABLE IS UNJUST, ILLEGAL, ARB ITRARY AND AGAINST THE FACTS AND CIRCUMSTANCES OF THE CASE. 2. ACTION OF THE CIT(A) IN CONFIRMING THE TREATMENT OF SHORT TERM CAPITAL GAIN OF RS. 98,219/- AS INCOME F ROM OTHER SOURCES BY THE AO IS UNJUST, ILLEGAL, ARBITRA RY AND AGAINST THE FACTS AND CIRCUMSTANCES OF THE CASE. 3. ACTION OF THE CIT(A) IN CONFIRMING THE ADDITION OF RS. 98,219/- MADE BY AO BASED UPON THE PRESUMPTION THAT THE APPELLANT HAS TAKEN ACCOMMODATION ENTRY AN D IGNORING ALL THE DOCUMENTARY EVIDENCE FILED BY THE APPELLANT IN THIS REGARD AND WITHOUT CONFRONTING TH E APPELLANT WITH THE DOCUMENTARY EVIDENCE AND STATEME NTS RELIED UPON BY THE AO IS UNJUST, ILLEGAL, ARBITRARY AND AGAINST THE FACTS AND CIRCUMSTANCES OF THE CASE. 4. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E HAD FILED HER RETURN OF INCOME ON 30.10.2002 DECLARING INCOME OF RS. 80,390/- FOR THE AY 2002-03. THE PROCEEDINGS U/S 147 OF THE I.T. ACT WERE INITIATED BY THE AO. NOTICE U/S. 148 WAS ISSUED AND SERVED UPON THE ASSESSEE AND DURING THE ASSESSMENT PROCEEDINGS IT W AS FOUND BY THE AO THAT THE ASSESSEE HAD SHOWN SHORT TERM CAPITAL G AIN OF RS. 35,11,354/- AND AGAINST IT ADJUSTED LONG TERM CAPIT AL GAIN OF RS. 35,09,903/- FOR THE AY 2000-01 OUT OF WHICH ALLEGED SHORT TERM CAPITAL GAIN OF RS. 35,11,354/-, RS. 4,99,630/- HAS BEEN SHOWN AS 4 RECEIVED BY JRD STOCK BROKERS P LTD. AND RS. 30,06, 356/- FROM MKN FINSEC. LTD. THE AO COMPLETED THE ASSESSMENT U/S. 147/143(3) OF THE I.T. ACT AT AN INCOME OF RS. 35,83,920/- WHERE ADDITION OF RS. 35,05,986/- HAS BEEN MADE BY THE AO AS INCOME FROM OTHER SOURCES VIDE HIS ORDER DATED 27.12.2007. 5. AGAINST THE ORDER OF THE LD. AO, ASSESSEE APPEAL ED BEFORE THE LD. CIT(A), WHO VIDE IMPUGNED ORDER DATED 26.2.2010 HAS DISMISSED THE APPEAL OF THE ASSESSEEE. 6. AGGRIEVED WITH THE AFORESAID ORDER OF THE LD. C IT(A), ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 7. LD. COUNSEL FOR THE ASSESSEE HAS ONLY ARGUED THE LEGAL GROUND RAISED VIDE GROUND NO. 1 STATING THAT THE PROVI SIONS OF SECTION 147/148 OF THE I.T. ACT WERE NOT APPLICABLE TO THE FACTS OF THE ASSESSEES CASE AND THEREFORE, THE ISSUE OF NOTICE U/S. 147/148 WAS ILLEGAL AND CONSEQUENTLY, THE IMPUGNED ASSESSMENT ORDER AS PASSED U/S. 147/143(3) IS UNLAWFUL AND UNJUST AND THEREFOR E THE SAME DESERVED TO BE ANNULLED / CANCELLED. IN SUPPORT OF HIS CONTENTION HE FILED THE VARIOUS PAPER BOOKS ENCLOSING THEREWITH T HE ASSESSMENT AND APPELLATE RECORDS AND A COMPILATION OF VARIOUS CASE LAWS HAVING PAGES 1 TO 123 INCLUDING THE COPY OF NOTICE U/S. 14 8 ALONGWITH THE REASONS RECORDED. HE FURTHER STATED THAT LD. CIT( A) HAS ERRED IN CONFIRMING THE ACTION OF THE AO IN FRAMING THE IMP UGNED ASSESSMENT ORDER WITHOUT ASSUMING JURISDICTION U/S. 147 AND TH AT TOO WITHOUT COMPLYING WITH THE MANDATORY CONDITIONS AS PRESCRIB ED UNDER SECTION 5 147 TO 151 OF THE I.T. ACT, 1961 AND THE REASONS RE CORDED ARE INVALID AND CONTRARY TO LAW AND FACTS. HE FURTHER DRAW OUR ATTENTION TOWARDS THE COPY OF REASONS FOR REOPENING THE CASE U/S. 148 AND STATED THAT NO PROPER REASONS WERE RECORDED; NO NEXUS BETWEEN T HE MATERIALS RELIED UPON AND THE BELIEF FORMED FOR ESCAPEMENT OF INCOME; NO APPLICATION OF MIND; NO PROPER SATISFACTION WAS REC ORDED BEFORE ISSUE OF NOTICE U/S. 148; NO INDEPENDENT CONCLUSION THAT THERE WAS ESCAPEMENT OF INCOME. IT WAS FURTHER STATED THAT THE CASE WAS REOPENED ONLY ON THE BASIS OF INVESTIGATION WING IN FORMATION WHICH SUFFERS WITH SERIOUS DEBILITY AND LACKS DEFINITENES S, WITHOUT DESCRIBING THE BASIC ASPECTS OF ALLEGED TRANSACTION AND IN TH E ABSENCE OF THE SAME, WHOLE ACTION OF THE AO GETS VITIATED. TO SU PPORT HIS CONTENTION HE SUBMITTED THAT THE ISSUE IN DISPUTE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE BY THE ITAT DECISION DATE D 09.1.2015 IN THE CASE OF G&G PHARMA INDIA LIMITED VS. ITO PASSED IN ITA NO. 3149/DEL/2013 (AY 2003-04) IN WHICH THE JUDICIAL M EMBER IS THE AUTHOR. HE FURTHER STATED THAT THE ABOVE DECISION OF THE ITAT DATED 9.1.2015 HAS BEEN UPHELD BY THE HONBLE JURISDICTIO NAL HIGH COURT IN ITS DECISION DATED 08.10.2015 IN ITA NO. 545/2015 I N THE CASE OF PR. CIT-4 VS. G&G PHARMA INDIA LTD. IN THIS BEHALF, HE FILED THE COPY OF THE ORDER DATED 9.1.2015 OF THE ITAT, DELHI BENCH P ASSED IN THE CASE OF G&G PHARMA INDIA LTD VS. ITO (SUPRA). IN THIS R EGARD, HE FILED THE COPIES OF THE AFORESAID DECISIONS BEFORE THE TRIBUN AL. IN VIEW OF THE ABOVE, HE REQUESTED THAT BY FOLLOWING THE AFORESAID PRECEDENTS THE 6 REASSESSMENT PROCEEDINGS OF THE AO MAY BE QUASHED B Y ACCEPTING THE APPEAL FILED BY THE ASSESSEE. 8. ON THE CONTRARY, LD. DR RELIED UPON THE ORDERS P ASSED BY THE AUTHORITIES BELOW AND STATED THAT THE AO HAS PROPER LY RECORDED THE REASONS FOR REOPENING BY DUE APPLICATION OF MIND, H ENCE, THE APPEAL OF THE ASSESSEE MAY BE DISMISSED. 9. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE RELEVANT RECORDS AVAILABLE WITH US, ESPECIALLY THE ORDERS OF THE REVENUE AUTHORITIES AND THE CASE LAWS CITED BY THE ASSESSEE S COUNSEL. FOR THE SAKE OF CLARITY, WE WOULD LIKE TO REPRODUCE TH E REASONS RECORDED FOR REOPENING THE CASE AS UNDER:- DURING THE COURSE OF INVESTIGATION CARRIED OUT AND ENQUIRIES MADE BY THE DIT(INV.) WING, NEW DELHI IT IS OBSERVED THAT VARIOUS PERSONS AND PARTIES WERE BENEFICIARIES OF THE BOGUS TRANSACTIONS / ACCOMMODA TION ENTRIES. THE ABOVE NAMED ASSESSEE WAS ALSO OF THE BENEFICIARIES AS SHE HAD TAKEN ACCOMMODATION ENTRY OF RS. 35,05,986/-(RUPEES..) FROM MKM FINSEC LTD. ON DIFFERENT DATES FROM ITS BANK ACCOUNT AS MENTIONED BELOW:- S.NO. VALUE OF ENTRY TAKEN DATE OF WHICH ENTRY TAKEN BANK FROM WHICH ENTRY GIVEN BRANCH ENTRY GIVING BANK A/C NO. ENTRY GIVING BANK 7 1 490327 29.8.01 CORP. BANK KAROL BAGH CCSDL 13 2 343168 9.11.01 S.B. OF MYSORE -DO- 6612 3 301115 9.11.01 S.B. OF MYSORE -DO- -DO 4 399815 1.09.01 CORP. BANK -DO- CSDL 13 5 228962 11.10.01 -DO- -DO- -DO- 6 261712 11.10.01 -DO- -DO- -DO- 7 494262 12.11.01 S.B. OF MYSORE -DO- 6612 8 485597 23.8.01 CORP. BANK -DO- CCSDL 13 9 501028 6.9.01 -DO- -DO- -DO- 3505986 TOTAL SUM OF RS. 35.05 LACS HAS BEEN DEPOSITED BY THE A IN HER BANK ACCOUNT 12424 WITH PNB, NEHRU P LACE, ND (SOURCE OF INFORMATION FLOPPY DISC OF DIT (INV.) -I, NEW DELHI). SUCH ENTIRES ARE ONLY IN THE FORM OF ACCOMMODATION ENTRIES WHICH WERE TAKEN BY THE A EITHER AGT. CASH PAYMENT OR IN THE FORM OF BOGUS SA LE/ PURCHASE OF SHARES AND SHARE CAPITAL. SINCE THE AMOUNT OF RS. 35.05 LACS HAS ESCAPED ASSESSMENT WITHIN THE MEANING OF SECTION 147 OF THE I.T. ACT IN THE HANDS OF THE A FOR THE AY 2002-03, THE REFORE, I HAVE REASON TO BELIEVE THAT IT IS A FIT CASE FOR ISSUE OF NOTICE U/S. 148 FOR ISSUE OF NOTICE U/S. 148 FOR TA KING 8 NECESSARY ACTION U/S. 147 OF THE I.T. ACT FOR THE F .Y. ENDING 31.3.03 PERTAINING TO ASSESSMENT YEAR 2002-0 3. 9.1 ON GOING THROUGH THE ABOVE REASONS RECORDED BY THE AO, WE ARE OF THE VIEW THAT AO HAS NOT APPLIED HIS MIND SO AS TO COME TO AN INDEPENDENT CONCLUSION THAT HE HAS REASON TO BELIEV E THAT INCOME HAS ESCAPED DURING THE YEAR. IN OUR VIEW THE REASON S ARE VAGUE AND ARE NOT BASED ON ANY TANGIBLE MATERIAL AS WELL AS A RE NOT ACCEPTABLE IN THE EYES OF LAW. THE AO HAS MECHANICALLY ISSUED NOTICE U/S. 148 OF THE ACT, ON THE BASIS OF INFORMATION ALLEGEDLY R ECEIVED BY HIM FROM THE DIRECTORATE OF INCOME TAX (INVESTIGATION)-I, NE W DELHI. KEEPING IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE PRESE NT CASE AND THE CASE LAW APPLICABLE IN THE CASE OF THE ASSESSEE, WE ARE OF THE CONSIDERED VIEW THAT THE REOPENING IN THE CASE OF T HE ASSESSEE FOR THE ASSTT. YEAR IN DISPUTE IS BAD IN LAW AND DESERV ES TO BE QUASHED. OUR VIEW IS SUPPORTED BY THE FOLLOWING JUDGMENTS/DE CISIONS:- (A) PR. CIT VS. G&G PHARMA INDIA LTD. IN ITA NO. 545/2015 DATED 8.10.2015 OF THE DELHI HIGH COURT WHEREIN THE HONBLE COURT HAS ADJUDICATED THE ISSUE AS UNDER:- 12. IN THE PRESENT CASE, AFTER SETTING OUT FOUR ENTRIES, STATED TO HAVE BEEN RECEIVED BY THE ASSESSEE ON A SINGLE DATE I.E. 10TH FEBRUARY 2003, FROM FOUR ENTITIES WHICH WERE TERMED AS 9 ACCOMMODATION ENTRIES, WHICH INFORMATION WAS GIVEN TO HIM BY THE DIRECTORATE OF INVESTIGATION, THE AO STATED: 'I HAVE ALSO PERUSED VARIOUS MATERIALS AND REPORT FROM INVESTIGATION WING AND ON THAT BASIS IT IS EVIDENT THAT THE ASSESSEE COMPANY HAS INTRODUCED ITS OWN UNACCOUNTED MONEY IN ITS BANK ACCOUNT BY WAY OF ABOVE ACCOMMODATION ENTRIES.' THE ABOVE CONCLUSION IS UNHELPFUL IN UNDERSTANDING WHETHER THE AO APPLIED HIS MIND TO THE MATERIALS THAT HE TALKS ABOUT PARTICULARLY SINCE HE DID NOT DESCRIBE WHAT THOSE MATERIALS WERE. ONCE THE DATE ON WHICH THE SO CALLED ACCOMMODATION ENTRIES WERE PROVIDED IS KNOWN, IT WOULD NOT HAVE BEEN DIFFICULT FOR THE AO, IF HE HAD IN FACT UNDERTAKEN THE EXERCISE, TO MAKE A REFERENCE TO THE MANNER IN WHICH THOSE VERY ENTRIES WERE PROVIDED IN THE ACCOUNTS OF THE ASSESSEE, WHICH MUST HAVE BEEN TENDERED ALONG WITH THE RETURN, WHICH WAS FILED ON 14TH NOVEMBER 2004 AND WAS PROCESSED UNDER SECTION 143(3) OF THE ACT. WITHOUT FORMING A PRIMA FACIE OPINION, ON THE BASIS OF SUCH MATERIAL, IT WAS NOT POSSIBLE FOR THE AO TO HAVE SIMPLY CONCLUDED: 'IT IS EVIDENT THA T THE ASSESSEE COMPANY HAS INTRODUCED ITS OWN 10 UNACCOUNTED MONEY IN ITS BANK BY WAY OF ACCOMMODATION ENTRIES'. IN THE CONSIDERED VIEW OF THE COURT, IN LIGHT OF THE LAW EXPLAINED WITH SUFFICIENT CLARITY BY THE SUPREME COURT IN THE DECISIONS DISCUSSED HEREINBEFORE, THE BASIC REQUIREMENT THAT THE AO MUST APPLY HIS MIND TO THE MATERIALS IN ORDER TO HAVE REASONS TO BELIEVE THAT THE INCOME OF THE ASSESSEE ESCAPED ASSESSMENT IS MISSING IN THE PRESENT CASE. 13. MR. SAWHNEY TOOK THE COURT THROUGH THE ORDER OF THE CIT(A) TO SHOW HOW THE CIT (A) DISCUSSED THE MATERIALS PRODUCED DURING THE HEARING OF THE APPEAL. THE COURT WOULD LIKE TO OBSERVE THAT THIS I S IN THE NATURE OF A POST MORTEM EXERCISE AFTER THE EVENT OF REOPENING OF THE ASSESSMENT HAS TAKEN PLACE. WHILE THE CIT MAY HAVE PROCEEDED ON THE BASIS THAT THE REOPENING OF THE ASSESSMENT WAS VALID, THIS DOES NOT SATISFY THE REQUIREMENT OF LAW THAT PRIOR TO THE REOPENING OF THE ASSESSMENT, THE AO HAS TO, APPLYING HIS MIND TO THE MATERIALS, CONCLUDE THAT HE HAS REASON TO BELIEVE THAT INCOME OF THE ASSESSEE HAS ESCAPED ASSESSMENT. UNLESS THAT BASIC JURISDICTIONAL REQUIREMENT IS SATISFIED A 11 POST MORTEM EXERCISE OF ANALYSING MATERIALS PRODUCED SUBSEQUENT TO THE REOPENING WILL NOT RESCUE AN INHERENTLY DEFECTIVE REOPENING ORDER FROM INVALIDITY . 14. IN THE CIRCUMSTANCES, THE CONCLUSION REACHED BY THE ITAT CANNOT BE SAID TO BE ERRONEOUS. NO SUBSTANTIAL QUESTION OF LAW ARISES. 15. THE APPEAL IS DISMISSED. (B) SIGNATURE HOTELS (P)_ LTD. VS. ITO AND ANOTHER REPORTED IN 338 ITR 51 (DEL) HAS UNDER SIMILAR CIRCUMSTANCES AS FOLLOWS:- FOR THE A.Y. 2003-04, THE RETURN OF INCOME OF THE ASSESSEE COMPANY WAS ACCEPTED U/S.143(1) OF THE INCOME-TAX ACT, 1961 AND WAS NOT SELECTED FOR SCRUT INY. SUBSEQUENTLY, THE ASSESSING OFFICER ISSUED NOTICE U /S.148 WHICH WAS OBJECTED BY THE ASSESSEE. THE ASSESSING OFFICER REJECTED THE OBJECTIONS. THE ASSESSEE COMPA NY FILED WRIT PETITION AND CHALLENGED THE NOTICE AND T HE ORDER ON OBJECTIONS. THE DELHI HIGH COURT ALLOWED THE WRIT PETITION AND HELD AS UNDER: (I) SECTION 147 OF THE INCOME-TAX ACT, 1961, IS WI DE BUT NOT PLENARY. THE ASSESSING OFFICER MUST HAVE REASO N TO 12 BELIEVE THAT INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT. THIS IS MANDATORY AND THE REASON TO BELIEVE ARE REQUIRED TO BE RECORDED IN WRITING BY THE ASSESSING OFFICER. (II) A NOTICE U/S.148 CAN BE QUASHED IF THE BELIEF IS NOT BONA FIDE, OR ONE BASED ON VAGUE, IRRELEVANT AND NO N- SPECIFIC INFORMATION. THE BASIS OF THE BELIEF SHOUL D BE DISCERNIBLE FROM THE MATERIAL ON RECORD, WHICH WAS AVAILABLE WITH THE ASSESSING OFFICER, WHEN HE RECOR DED THE REASONS. THERE SHOULD BE A LINK BETWEEN THE REA SONS AND THE EVIDENCE/MATERIAL AVAILABLE WITH THE ASSESS ING OFFICER. (III) THE REASSESSMENT PROCEEDINGS WERE INITIATED O N THE BASIS OF INFORMATION RECEIVED FROM THE DIRECTOR OF INCOME-TAX (INVESTIGATION) THAT THE PETITIONER HAD INTRODUCED MONEY AMOUNTING TO RS.5 LAKHS DURING F.Y . 2002-03 AS STATED IN THE ANNEXURE. ACCORDING TO THE INFORMATION, THE AMOUNT RECEIVED FROM A COMPANY, S, WAS NOTHING BUT AN ACCOMMODATION ENTRY AND THE ASSESSEE WAS THE BENEFICIARY. THE REASONS DID NOT S ATISFY THE REQUIREMENTS OF SECTION 147 OF THE ACT. THERE W AS NO REFERENCE TO ANY DOCUMENT OR STATEMENT, EXCEPT THE ANNEXURE. THE ANNEXURE COULD NOT BE REGARDED AS A MATERIAL OR EVIDENCE THAT PRIMA FACIE SHOWED OR 13 ESTABLISHED NEXUS OR LINK WHICH DISCLOSED ESCAPEMEN T OF INCOME. THE ANNEXURE WAS NOT A POINTER AND DID NOT INDICATE ESCAPEMENT OF INCOME. (IV) FURTHER, THE ASSESSING OFFICER DID NOT APPLY H IS OWN MIND TO THE INFORMATION AND EXAMINE THE BASIS AND MATERIAL OF THE INFORMATION. THERE WAS NO DISPUTE T HAT THE COMPANY, S, HAD A PAID UP CAPITAL OF RS.90 LAKH S AND WAS INCORPORATED ON JANUARY 4, 1989, AND WAS ALSO ALLOTTED A PERMANENT ACCOUNT NUMBER IN SEPTEMBER 2001. THUS, IT COULD NOT BE HELD TO BE A FICTITIOUS PERSON. THE REASSESSMENT PROCEEDINGS WERE NOT VALID AND WER E LIABLE TO THE QUASHED. 10. IN VIEW OF ABOVE, WE ARE OF THE CONSIDERED VIEW THAT THE AFORESAID ISSUE IN DISPUTE IS EXACTLY THE SIMILAR A ND IDENTICAL TO THE ISSUE INVOLVED IN THE PRESENT APPEAL AND IS SQUAREL Y COVERED BY THE AFORESAID DECISIONS OF THE HONBLE HIGH COURT OF DE LHI IN THE CASE OF G&G PHARMA (SUPRA) & SIGNATURES HOTELS (P) LTD. (SU PRA). HENCE, RESPECTFULLY FOLLOWING THE ABOVE PRECEDENTS IN THE CASE OF PR. CIT-4 VS. G&G PHARMA INDIA LTD. (SUPRA) AND SIGNATURE HOT ELS (P) LTD. VS. ITO, WE DECIDE THE LEGAL ISSUE IN DISPUTE IN FAVOR OF THE ASSESSEE AND AGAINST THE REVENUE AND ACCORDINGLY QUASH THE REASS ESSMENT PROCEEDINGS AND ALLOW THE LEGAL GROUND NO. 1 RAISED BY THE ASSESSEE 14 IN ITS APPEAL. SINCE WE HAVE QUASHED THE REASSESS MENT PROCEEDINGS, AS AFORESAID, THE OTHER ISSUES ARE NOT BEING DEALT WITH. 11. AS REGARDS THE ITA NO. 2037/DEL/2010 (AY 2003-0 4) IS CONCERNED, FOLLOWING THE CONSISTENT VIEW, AS TAKEN IN ITA NO. 2036/DEL/2010 (AY 2002-03), AS AFORESAID, THE ITA N O. 2037/DEL/2010 (AY 2003-04) ALSO STANDS ALLOWED. 12. IN THE RESULT, BOTH THE APPEALS OF THE ASSESSEE ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 07/10/2016. SD/- SD/- [O.P. KANT] [H.S. SIDHU] ACCOUNTANT MEMBER JUDICIAL MEMBER DATE 07/10/2016 SRBHATNAGAR COPY FORWARDED TO: - 1. APPELLANT - 2. RESPONDENT - 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENCHES