Modern Cement Indus. Ltd., Dist. Panchmahals V. The ACIT., Panchmahal Range, Godhra

ITA 2506/AHD/2006

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 6219 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 7 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-06-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Next Hearing Date: 20-12-2010
• Assessment Year: 1992-1993
• Appeal Filed On: 23-11-2006
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Bogus Share capital; Depreciation; Income from undisclosed sources; Opportunity of being heard; Deemed to accrue or arise in india; Question of law; Corroborative evidences; Capital receipt; Set aside
• Section: 143(3); 205; 195; 80IA; 68; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH C BEFORE SHRI G.D. AGARWAL, VICE-PRESIDENT (AZ) AND SHRI MUKUL KR. SHRAWAT, JUDICIAL MEMBER DATE OF HEARING : 04/03/2011 DRAFTED ON: 18/ 05/2011 APPEAL(S) BY SL. NO(S). ITA NO(S) ASSESSMENT YEAR APPELLANT (S) RESPON- DENT(S) 1. 2506/AHD/2006 1992-93 MODERN CEMENT INDS. LTD. VILLAGE POPATPURA TAL: GODHRA DIST.PANCHMAHALS PAN: AABCM2771L THE ACIT PANCH- MAHAL RANGE GODHRA 2. 1673/AHD/2007 1992-93 ASSESSEE REVENUE 3. 404/AHD/2008 1992-93 ASSESSEE REVENUE ASSESSEE BY : SHRI SAKAR SHARMA REVENUE BY : SHRI SHELLEY JINDAL, CIT-DR O R D E R PER SHRI MUKUL KR. SHRAWAT, JUDICIAL MEMBER : THESE THREE APPEALS HAVE BEEN FILED BY THE ASSESSE E ARISING FROM THE DISTINCT ORDERS OF LEARNED CIT(APPEALS) PASSED FOR ASSESSMENT YEAR 1992-93. BASIC FACTS INVOLVED IN ALL THE THREE APPE ALS BEING COMMON HENCE THESE APPEALS ARE CONSOLIDATED AND HEREBY DEC IDED BY THIS SINGLE ORDER. A) ITA NO.2506/AHD/2006 FOR A.Y. 1992-93 2. THIS IS AN APPEAL AT THE BEHEST OF THE ASSESSEE WH ICH HAS EMANATED FROM THE ORDER OF THE LEARNED CIT(APPEALS)-XIX, AHM EDABAD DATED ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 2 - 29/09/2006 AND THE SUBSTANTIAL GROUND ARGUED BEFORE US IS REPRODUCED BELOW :- 2. THE LD. CIT(APPEAL) ERRED IN HOLDING THAT THE A PP COMPANY HAD FAILED TO PROVE THAT THE SHARE APPLICATION MONEY HA VE BEEN RECEIVED FROM ALLEGED SHAREHOLDERS. 3. THE LD. CIT(APPEAL) ERRED IN HOLDING THAT YOUR APP COULD NOT ESTABLISHED (SIC.) THE EXCEEDING, CREDITWORTHINESS AND GENUINENESS OF THE SHAREHOLDERS BOTH AT THE ASSESSMENT STAGE AN D AT THE APPELLATE STAGE. 4. THE LD. CIT(APPEAL) ERRED IN CONFIRMING ADDITIO N OF RS.5956000/- BEING SHARE APPLICATION MONEY R ECEIVED FROM VARIOUS SHAREHOLDERS. 2.1. FACTS IN BRIEF AS EMERGED FROM THE CORRESPONDI NG ASSESSMENT ORDER PASSED 143(3) R.W.S. 255(4) OF THE I.T.ACT, 1961 DA TED 31.3.2005 WERE THAT FOR THE YEAR UNDER CONSIDERATION IN ASSESSEES CASE THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD B BENCH BEARING ITA NO.4173/AHD/95 VIDE ITS ORDER DATED 22.07.2003, REPORTED AS 90 ITD 170 (AHD.)(TM) , HAD SET ASIDE THE ORDER AND RESTORED THE MATTER BAC K TO THE FILE OF AO. THIS WAS A THIRD MEMBER DECISION AND THE RESPECTED MEMBER HAS OPINED AS UNDER:- 8. I HAVE CONSIDERED THE RIVAL SUBMISSIONS AND GON E THROUGH THE RECORD. DIFFERENCE OF THE TWO MEMBERS IN THIS CASE IS WHETHER THE AMOUNT CREDITED BY THE ASSESSEE IN SHAR E CAPITAL IN PROMOTERS QUOTA OF RS.59,56,000 IS TO BE DELETED ON THE MATERIAL ON RECORD OR IT REQUIRES TO BE SET ASIDE FOR FURTHE R VERIFICATION AND GATHER MATERIAL TO COME TOT A CONCLUSION, ONE WAY OR THE OTHER. THE AO SAYS ASSESSEE HAS NOT FILED CONFIRMATIONS W ITH REGARD TO ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 3 - INVESTMENT OF RS.59,56,000 AND ON FIELD ENQUIRIES 2 0 OUT OF 50 ALLOTTEES WERE NOT FOUND EVEN EXISTING AT THE GIVEN COMMON ADDRESS 18, SEMI BASEMENT, PARADISE COMPLEX, SAYAJI GUNJ, BARODA 390 005, THOUGH FOR 30, HE ACCEPTS, HAVE CON FIRMED THEIR INVESTMENT. THE CIT(A) SAYS NECESSARY DETAILS WERE GIVEN BY ASSESSEE TO AO AND IN A CHANGE FROM BEFORE HIM, I. E. THE COPIES OF APPLICATION FORMS SUBMITTED BY THEM TO ASSESSEE-COM PANY AND ON HAVING SAME MADE AVAILABLE, THE AO DID NOT ADVANCE ANY ADVERSE COMMENT ON MERITS EXCEPT OBJECTING FOR ADMISSION OF EVIDENCE ON THE GROUND OF ITS BEING NEW. THE CIT(A) ALSO CLAIM S TO HAVE VERIFIED AND STATES ALL THE FORMS SUBMITTED CARRY S IGNATURE AND HOLDS THE AO TO BE WRONG IN OBSERVING THAT SOME OF THE FORMS DID NOT CARRY ANY SIGNATURE. . 10. IN MY VIEW, IT IS A FIT CASE FOR FURTHER VER IFICATION FIRSTLY ONLY THE DETAILS GIVING ADDRESS AND AMOUNT INVESTED BY ALL 373 ALLOTTEES WAS GIVEN TO THE AO; SECONDLY, THOUGH COP IES OF 20 PERSONS FORMS OF APPLICATION WAS GIVEN, BUT I FIND SOME OF WHICH AS RIGHTLY OBSERVED BY THE AO CARRY NO SIGNATURE. TO CITE : S.NO.561 SHRI MUKESH PATEL, S.NO.507 SHRI O.MEHTA, S.NO.452 SHRI CHANDRAKANT PATEL AND S.NO.396 SHRI A.MEHTA. THE CIT(A), IT IS EVIDENT, WRONGLY ASSUMED THAT ALL THE FORMS W ERE SIGNED; THIRDLY, THAT IT WAS A CASE OF PRIVATE PLACEMENT BY PROMOTERS WHICH HAS TO BE FROM THEIR FRIENDS AND RELATIVES AND THE QUESTION OF THEIR INVESTMENT THROUGH BROKER DOES NOT SEEM TO BE PROBA BLE; FOURTHLY THE FIELD ENQUIRIES CONDUCTED AT THE BACK OF THE AS SESSEE HAD TO BE MADE AVAILABLE TO THE ASSESSEE FOR HIS COMMENTS; FI FTHLY IF ASSESSEE CLAIMS THAT THE INVESTMENT WAS THROUGH BROKER HE MA Y PRODUCE THE BROKER FOR EXAMINATION BY AO, IF HE IS SO ADVISED A ND SIXTHLY, IN ANY CASE THE SUBMISSION OF FORMS BY ITSELF DOES NOT ESTABLISH THE IDENTITY OF THE ALLOTTEES AND THOSE INVESTMENTS MAD E BY THEM UNLESS THE DOCUMENTS ARE PROVED BY CONFIRMATION OF THE PARTIES AND SOURCES OF INVESTMENT BY THEM. I HOWEVER, FEEL THAT IT SHOULD BE LEFT TO THE ASSESSEE AS TO HOW HE PROVES THAT AN D WE SHOULD REFRAIN OURSELVES TO RESTRICT THE WAY AND MODE OF E NQUIRY OF MATERIAL TO BE GATHERED OR PRODUCED BY THE PARTIES. THE AO WOULD READJUDICATE THE ISSUE ON THE BASIS OF MATERI AL BROUGHT AND ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 4 - SUFFICIENTLY THEREOF IN THE LIGHT OF THE PROVISIONS OF S.68 OF THE ACT, THE APPLICABILITY OF WHICH IS AGREED TO BY BOTH THE MEMBERS. 2. SINCE THE MATTER WAS RESTORED BACK TO THE FILE O F THE AO, THEREFORE, COMPLYING WITH THOSE DIRECTIONS THE AO H AD MADE THE REQUISITE ENQUIRIES AGAIN, AS IS EVIDENT FROM THE I MPUGNED ASSESSMENT ORDER NOW UNDER APPEAL. THE AO HAD MADE AN ELABORATE DISCUSSION ABOUT THE NOTICES SENT TO SEVERAL SHARE APPLICANTS. IT IS WORTH TO MENTION THAT ON THE BASIS OF THE COMPLIANC E MADE THE A.O. HAD KEPT THOSE INVESTORS UNDER DIFFERENT CATEGORIE S. THE FIRST CATEGORY IS OF THOSE INVESTORS WHO HAVE MADE THE PROPER COMPLIANCE THEREFORE AT THE FIRST ROUND ITSELF AS P ER THE ORIGINAL ASSESSMENT THEIR INVESTMENT WAS ACCEPTED. SECOND CATEGORY WAS STATED TO BE OF THOSE INVESTORS TO WHOM LETTERS WER E SENT BUT RECEIVED BACK UN-SERVED AS THEY WERE NOT FOUND TO BE AVAILAB LE AT THE ADDRESS GIVEN IN THE APPLICATION FORM. IN THIS CATEGORY, THERE WERE 18 PERSONS, EACH OF THEM HAVE INVESTED RS.10,000/-. L IST OF THESE 18 PERSONS IS AS PER PAGE NO.2 OF THE ASSESSMENT ORDER , FOR THE SAKE OF BREVITY, NEED NOT TO REPRODUCE THE ENTIRE LIST. THE THIRD CATEGORY ARE IN RESPECT OF THOSE INVESTORS OF BARODA ON WHOM THE NOTICES WERE SERVED BUT NO REPLY WAS RECEIVED. UNDER THIS CATEGORY, THERE ARE THREE PERSONS, EACH OF THEM HAVE INVESTED RS.10 ,000/-. THE FOURTH CATEGORY IS OF TWO PERSONS, EACH ONE OF THEM HAVE ALLEGEDLY INVESTED RS.5,000/-, HOWEVER, THEY HAVE DENIED THE IMPUGNED INVESTMENT. AS PER AO, THEY HAVE DENIED OF HAVING PURCHASED ANY SHARES OF THE ASSESSEE. THE FIFTH CATEGORY ARE OF THOSE PERSONS WHO ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 5 - HAVE RECEIVED THE NOTICES BUT RETURNED BACK THE LET TERS SENT BY THE AO BY STATING THAT THE MATTER WAS OLD, HENCE DID NO T REMEMBER ABOUT THE TRANSACTION. LIST OF SUCH 10 PERSONS W HO HAVE GIVEN THEIR CONFIRMATION LETTERS BUT DID NOT APPEAR WERE AS FOL LOWS:- 1. SHRI OM SHANKAR BIYANI RS.5,000/- 2. SMT. BINA DEVI BIYANI RS.5,000/- 3. SHRI AMRITLAL M. JAIN RS.5,000/- 4. SHRI KAMALKUMAR AGRAWAL RS.5,000/- 5. SMT. KAILASHBEN G. GANDHI RS.5,000/- 6. SHRI NIRBHAYKUMAR JAIN RS.5,000/- 7. SHRI RAJAN K.DESAI RS.1,00,000/- 8. SHRI ARMIN DESAI RS.5,00,000/- 9. SMT. KASHMIRA KATPITIA RS.5,00,000/- 10. SHRI MEHRA KATPITIA RS.5,00,000/- 2.1. THE SIXTH CATEGORY WERE OF THOSE 32 PERSONS WHO WERE NOT RESIDENT OF VADODARA AND THEY WERE NOT FOUND AT THE ADDRESS MENTIONED IN THE SHARE APPLICATION. THE AO HAS RE MARKED THAT THE LETTERS WERE SENT WITH COMPLETE POSTAL ADDRESS BUT THOSE REGISTERED LETTERS WERE RECEIVED BACK UN-SERVED, THEREFORE IT HAD INDICATED THAT THE ASSESSEE HAD ARRANGED BOGUS SHARE APPLICANTS. 2.2. THE SEVENTH CATEGORY WERE OF THOSE PERSONS WHO HAVE CONFIRMED THE INVESTMENT AND SUBMITTED THEIR REPLY, STATED TO BE FOUR IN NUMBER WHO HAVE INVESTED THE AMOUNTS AS FOLLOWS: - A. SHRI RAJAN DESAI RS.10 LACS B. ARMIN DESAI RS. 5 LACS C. MEHRA KATPITIA RS. 5 LACS D. KASHMIRA KATPITIA RS. 5 LACS ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 6 - 2.3. AN EXPLANATION WAS OFFERED IN RESPECT OF THE P ERSONS WHO HAVE NOT COMPLIED WITH THE NOTICES WAS THAT AFTER THE LA PSE OF 13 YEARS SOME PERSONS HAVE DIED AND SOME OF THEM MIGHT HAVE SHIFTED THEIR RESIDENCES. IT WAS INFORMED THAT ONE OF THE INVEST ORS, AN UNCLE OF THE DIRECTOR, MR.MOHAMAD K.DADI HAD EXPIRED. IT WAS AL SO INFORMED THAT ONE OF THE RELATIVES OF THE DIRECTOR, MRS. NAS EEM R.DADI SHIFTED TO CANADA. IT HAS ALSO BEEN ARGUED BEFORE THE AO T HAT SHARE APPLICATION FORMS OF ALL THE 373 SUBSCRIBERS WAS FU RNISHED WHICH WAS DULY SIGNED BY THOSE INVESTORS, THEREFORE THE A SSESSEE HAD DISCHARGED ITS ONUS. IT HAS ALSO INFORMED THAT IN RESPECT OF AN AMOUNT TOTALLING TO RS.18,41,000/- THE SUBSCRIBERS WERE VERY SMALL AND MADE INVESTMENT IN THE RANGE OF RS.5,000/- TO RS.19,000/-. HOWEVER, THEY WERE CAPABLE FOR INVESTING THE AMOUNT AND IDENTIFIABLE. IN THIS REGARD, IT IS WORTH TO REP RODUCE SOME OF THE OBSERVATION OF THE AO THROUGH WHICH IT COULD BE GAT HERED THAT SOME OF THE INVESTORS HAVE FURNISHED THEIR CONFIRMATIONS AND ALSO FURNISHED SUPPORTING EVIDENCE. THE DOCUMENTARY EV IDENCES IN RESPECT OF AN AMOUNT OF INVESTMENT OF RS.23,05,800/ - WAS STATED TO BE AVAILABLE BECAUSE THOSE SHARE APPLICANTS WERE T HE FRIENDS AND RELATIVES OF THE DIRECTORS. LETTERS TO THOSE 21 P ERSONS WERE ISSUED AND THEIR CONFIRMATIONS WERE RECEIVED BY THE AO AS IS NOTED VIDE FOLLOWING PARAGRAPH:- IT WAS FURTHER CLAIMED THAT THE CONFIRMATIONS WERE FILED BY THE SAID PERSONS. NO DOUBT THE LETTERS SENT BY THI S OFFICE WERE ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 7 - RECEIVED BACK WITH THE REMARK THAT I CONFIRM. BU T PERUSAL OF THESE CONFIRMATORY LETTERS INDICATE THAT THEY HA VE SIMPLY CONFIRMED THAT THEY HAVE MADE INVESTMENT IN SHARES AND DOCUMENTARY EVIDENCE IN SUPPORT OF THEIR CLAIM HAS NOT BEEN FILED. CONFIRMATION FROM BANK REGARDING THE INVEST MENT OR SOURCE OF INVESTMENT HAS NOT BEEN GIVEN IN THE LETT ER. DETAILS REGARDING THERE INCOME-TAX ASSESSMENT ARE ALSO NOT THERE WITH THE ALLEGED CONFIRMATORY LETTERS. IN THESE CIRCUMS TANCES THE CLAIM MADE BY THE ASSESSEE CANNOT BE ADMITTED. SIN CE THE ASSESSEE HAS FAILED TO PROVE ITS CASE WITH THE HELP OF DOCUMENTARY EVIDENCE RS.23,05,800/- IS TREATED HAS INVESTED BY THE ASSESSEE IN THE NAMES OF BOGUS PERSONS OUT O F ITS INCOME FROM UNDISCLOSED SOURCES. 2.4. HOWEVER, THE AO WAS NOT CONVINCED AND BY PLACI NG RELIANCE ON SOFIA FINANCE LTD. 205 ITR 98 (DEL.) AND HINDUST AN TEA TRADING CO.LTD. VS. CIT 263 ITR 289(CAL.) HAS REPEATED THE ADDITION AS IT WAS DONE IN THE PAST OF RS.59,56,000/-. THE SAID A DDITION WAS AGAIN CONTESTED BEFORE THE FIRST APPELLATE AUTHORITY. 3. THE LD.CIT(A) HAS AFFIRMED THE ACTION OF THE AO WITH THE REMARK THAT HE HAD ALSO GIVEN OPPORTUNITY TO THE AUTHORIZED REPRESENTATIVE BUT IT WAS ALSO NOT COMPLIED WITH. RELEVANT PORTIONS ARE REPRODUCED BELOW: 2. DURING THE COURSE OF APPELLATE PROCEEDINGS, THE AUTHORISED REPRESENTATIVE OF THE APPELLANT FILED AN APPLICATION WHEREIN HE HAD ASSURED TO PRODUCE ALL THE DIRECTORS AND RELATIVES IN WHOSE NAMES SHARES HAVE BEEN ALLOTTED. IT IS STATED THAT CONFIRMATIONS OF ALL THE DIRECTO RS AND RELATIVES HAVE ALREADY BEEN FILED BEFORE THE AS SESSING OFFICER. HOWEVER, DUE TO MISINTERPRETATION OF ASSE SSING OFFICERS QUERY LETTER, PROPER REPLY COULD NOT BE S UBMITTED. ALL THE DIRECTORS AND RELATIVES ARE STATED TO HAVE BEEN ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 8 - ASSESSED TO INCOME-TAX AND THE AUTHORISED REPRESENT ATIVE HAS PROMISED TO PRODUCE THEM BEFORE THE ASSESSING O FFICER FOR EXAMINATION. THEREFORE, THIS OFFICE HAS DIRECTED THE ASSESSING OFFICER U/S.250(4) OF THE I.T. ACT TO EXA MINE THESE PERSONS, BY GIVING PROPER OPPORTUNITY OF BEING HEARD AND SEND HIS PRECISE REPORT INDICATING THE FACTS EM ERGE ON EXAMINATION OF SHARE HOLDERS. 5. I HAVE CAREFULLY CONSIDERED THE FACTS OF THE CA SE. I HAVE ALSO GONE THROUGH THE ITATS ORDER AS WELL AS THE ASSESSMENT ORDER. I HAVE GIVEN DUE THOUGH TO THE JUDICIAL DECISIONS CITED BY THE ASSESSING OFFICER WHILE ADDI NG THE AMOUNT OF RS.59,56,000/- BY WAY OF SHARE SUBSCRIPTI ONS OR SHARE APPLICATION MONEY AS UNEXPLAINED CREDIT OUT O F INCOME FROM UNDISCLOSED SOURCES OF THE APPELLANT CO MPANY. THE SUBMISSION OF THE AUTHORISED REPRESENTATIVE IS ALSO CONSIDERED BUT NOT FOUND SATISFACTORY. THE APPELLANT COULD NOT FURNISH THE CONFIRMATIONS WITH REGARD TO THE INVESTMENT OF SHARE HOLDERS AND THE SOURCES OF ACQU ISITIONS OF SHARES. SO FAR AS THE EXISTENCE OF ALLEGED SHARE HOLDERS IS CONCERNED, THE APPELLANT COULD NOT ESTABLISH EVEN THE EXISTENCE, CREDITWORTHINESS AND GENUINENESS OF THE SHARE HOLDERS BOTH AT THE ASSESSMENT STAGE AND AT THE APP ELLATE STATE. 8. AS PER THE DIRECTION OF HON'BLE ITAT, THE APPEL LANT HAD BEEN GIVEN PROPER OPPORTUNITY OF BEING HEARD TO PRO VE THE CREDITWORTHINESS OF THE INDIVIDUAL SHARE HOLDERS AN D CONSEQUENTLY THE GENUINENESS OF THE INVESTMENT RECO RDED IN THE BOOKS OF ACCOUNT IN THEIR NAMES BUT THE APPELLANT FAILED TO DISCHARGE ITS ONUS EITHER ONE WAY OR THE OTHER BY TAKING PLEA THAT SHARE HOLDERS ARE FROM DIFFERENT PLACES A ND IT WOULD NOT BE POSSIBLE TO PRESENT THEM BEFORE THE AS SESSING OFFICER. IN THE CASE OF CIT VS. PRECISION FINANCE (P) LTD. [208 ITR 465], THE HON'BLE CALCUTTA HIGH COURT HAS HELD THAT IT IS FOR THE ASSESSEE TO PROVE THE IDENTITY OF THE CREDITORS AND THEIR CREDITWORTHINESS AND GENUINENES S OF THE TRANSACTION. MERE FURNISHING OF PARTICULARS IS NOT ENOUGH. ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 9 - THE DECISIONS OF HON'BLE DELHI HIGH COURT AND CALCU TTA HIGH COURT [SUPRA] ARE SQUARELY APPLICABLE IN THE C ASE OF THE APPELLANT COMPANY AND THE ASSESSING OFFICER IS, THEREFORE, JUSTIFIED IN COMING TO THE CONCLUSION TH AT THE ALLEGED SHARE APPLICATION MONEY REPRESENT THE APPEL LANT COMPANYS DEEMED INCOME U/S.68 OF THE INCOME TAX AC T. 9. IN VIEW OF THESE FACTS, THE ASSESSING OFFICER HA S NO OTHER ALTERNATIVE BUT TO RESTORE THE ORIGINAL ADDIT ION MADE IN ASSESSMENT ORDER. AS THE APPELLANT FAILED TO DISCHARGE ITS ONUS, BEFORE ASSESSING OFFICER AS WELL AS BEFORE ME , HENCE, I DECLINE TO INTERFERE IN THE ACTION OF THE ASSESSI NG OFFICER. THE ASSESSING OFFICER HAS CORRECTLY INVOKED THE PRO VISION OF SECTION 68 AND MADE ADDITION OF RS.59,56,000/-, WHI CH IS HEREBY CONFIRMED. 4. WITH THIS BRIEF BACKGROUND, WE HAVE HEARD BOTH THE SIDES AND ALSO PERUSED THE VOLUMINOUS MATERIAL PLACED BEFORE US. THE COMPILATION CONSISTED THE COPIES OF SHARE APPLICATION FORMS, NO TICES ISSUED U/S.133(6), LETTERS ISSUED BY THE DEPARTMENT AND SEVERAL CASE L AWS. FROM THE SIDE OF THE APPELLANT THE MAIN STRESS WAS ON THE DECISION O F HONBLE SUPREME COURT IN THE CASE OF CIT VS. LOVELY EXPORTS PVT.LT D. REPORTED AT 6 DTR 308 (SC) :: 216 CTR (SC) 195 AND AN ANOTHER CASE OF CIT VS. STELLAR INVESTMENT LTD. REPORTED AT 251 ITR 263 (SC). 4.1. FROM THE SIDE OF THE REVENUE LD. DR MR. SHELLEY J INDAL HAS VEHEMENTLY CONTESTED THAT THE SAID DECISION WAS NOT IN RESPECT OF A PRIVATE LIMITED COMPANY A ND THE ASSESSEE BEING A PVT. LTD. CO. THEREFORE NOT APPLICABLE. AS WELL AS THE SAID DECIS ION OF HONBLE SUPREME COURT HAVE NOT DEALT WITH THE CIRCUMSTANCES UNDER W HICH A COMPANY HAD COLLECTED THE MONEY ON PRIVATE PLACEMENT, AS IT WAS DONE BY THE ASSESSEE. ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 10 - 4.2. ON THE OTHER HAND FROM THE SIDE OF THE ASSESSEE , LD.AR MR.SAKAR SHARMA HAS PLEADED THAT A PART RELIEF BE GRANTED I N RESPECT OF THOSE APPLICANTS WHO HAVE APPEARED OR FILED CONFIRMATIONS . A CHART WAS GIVEN ONLY TO PLEAD THAT IN SOME OF THE CASES THE AO HAS NOT TAKEN DUE COGNIZANCE OF THE COMPLIANCE MADE BY THOSE INVESTOR S. 5. WE HAVE DULY CONSIDERED THE RIVAL SUBMISSIONS. AS PER THE ABOVE DISCUSSION, IT IS EVIDENT THAT THIS IS AN OLD APPEA L PERTAINING TO THE ASSESSMENT YEAR 1992-93 BECAUSE OF THIS REASON, AS PLEADED BEFORE US, IT COULD BE POSSIBLE THAT THE APPELLANT MIGHT HAVE BEE N FACING SOME DIFFICULTY IN COLLECTING THE REQUISITE INFORMATION AS IT WAS EXPECTED BY THE REVENUE DEPARTMENT. IN THIS SECOND ROUND, THE AO WAS EXPECTED TO PROCEED IN THE LIGHT OF THE DIRECTION GIVEN BY THE RESPECTED COORDINATE BENCH VIDE ORDER CITED SUPRA DATED 22/07/2003. PR IMARILY, THE TRIBUNAL HAS MADE AN OBSERVATION THAT THE SUBMISSION OF SHAR E APPLICATION FORMS BY ITSELF DID NOT ESTABLISH THE IDENTITY OF THE ALL OTTEES UNLESS PROVED BY THE CONFIRMATIONS OF THE PARTIES. THEREFORE, THE TRI BUNAL HAS LEFT IT TO THE ASSESSEE AS TO HOW TO GATHER AND COLLECT THE REQUI SITE INFORMATION. ON THE OTHER HAND, THE AO WAS DIRECTED TO RE-ADJUDICAT E THE ISSUE ON THE BASIS OF THE MATERIAL TO BE BROUGHT ON RECORD. W E ARE OF THE VIEW THAT BECAUSE OF THE SAID RESTORATION, AS DIRECTED BY THE RESPECTED THIRD MEMBER, THIS ASSESSEE GOT A GOOD OPPORTUNITY TO PLA CE ON RECORD THE REQUISITE INFORMATION. NOW WE SHALL EXAMINE THE FA CTUAL ASPECT IN RESPECT OF THE FUNDS COLLECTED AND THE EFFORTS MADE BY THE ASSESSEE TO ESTABLISH THE CREDENTIALS OF THOSE INVESTORS AS PRE SCRIBED U/S.68 OF THE I.T. ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 11 - ACT. AS A MATTER OF FACT, THE SHARE APPLICATION MONEY WAS COLLECTED AS A PRIVATE PLACEMENT OUT OF PROMOTERS QUOTA. FACTS HAVE ALSO REVEALED THAT, IN THIS REGARD, THE ASSESSEE-COMPANY HAS INVI TED FRIENDS AND RELATIVES OF THE DIRECTORS, THEREFORE, THE SHARE AP PLICATION MONEY CONTRIBUTED BY THOSE FRIENDS AND RELATIVES WERE FOU ND TO BE GENUINE AND ACCEPTED BY THE DEPARTMENT. THERE IS NO DENIAL O F THIS FACT THAT THE TOTAL SHARE CAPITAL COLLECTED WAS AT RS.98,99,300/-. OU T OF THE SAID TOTAL SHARE CAPITAL, AT THE ORIGINAL STAGE ITSELF, THE SHARE CA PITAL INTRODUCED BY PROMOTERS AND RELATIVES BY 22 PARTIES AMOUNTING TO RS.22,75,500/- WAS ACCEPTED BY THE REVENUE DEPARTMENT AND HELD AS GENU INE CONTRIBUTION IN THE ORIGINAL ASSESSMENT ITSELF. IT IS ALSO WORTH TO MENTION THAT IN RESPECT OF AS MANY AS 106 PARTIES, THE AO WAS CONVINCED AND DECIDED NOT TO ISSUE SHOW-CAUSE NOTICE AND NO ADDITION WAS MADE IN RESPECT OF THE SHARE APPLICATION MONEY CONTRIBUTED BY THOSE PARTIES AMOU NTING TO RS.8,26,000/-. IN SHORT, AFTER THE RELIEF ALREADY GRANTED IN THE FIRST ROUND OF ASSESSMENT, AS ALSO AFTER THE ACCEPTANCE OF GENU INENESS OF SOME OF THE PARTIES IN THE SECOND ROUND ITSELF, THE ISSUE REMA INED IN CONTROVERSY IS IN RESPECT OF THE ALLEGED UNEXPLAINED AMOUNT OF RS.59, 56,000/- CONSEQUENCE UPON THE APPLICABILITY OF THE PROVISIONS OF SECTION 68 OF THE I.T. ACT. 6. BEFORE WE PROCEED FURTHER OUR ATTENTION HAS BEEN DRAWN ON A DOCUMENT SUBMITTED ON 28/11/2001 TITLED AS DISCUSS ION PAPER RELATING TO FORMATION OF SEBI WITH REFERENCE TO PRIVATE PLACEME NT STEPS TAKEN BY THE GOVERNMENT. THE PAPER SAYS, QUOTE THE REGULATORY CONTROL OVER PRIVATE PLACEMENT IN PRACTICALLY NIL. SEBIS GUID ELINES FOR DISCLOSURE AND INVESTOR PROTECTION DO NOT APPLY TO PRIVATE PLA CEMENT. THE ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 12 - DISCLOSURES ARE ESSENTIALLY DISCUSSED ACROSS THE TA BLE. THE SUBSCRIBERS ARE ALSO COMFORTABLE WITH THIS ARRANGEMENT SINCE TH EY COULD SEEK BETTER INFORMATION AND WARRANTIES. THEY COULD EVEN PUT IN PLACE SEPARATE SHAREHOLDERS AGREEMENT WHICH MIGHT ENSURE PROPER U TILIZATION OF THE FUNDS RAISED BY THE ISSUER. SO IF SHAREHOLDERS CAN TAKE CARE OF THEIR INTEREST, THEN SEBI SHOULD NOT HAVE ANY ROLE TO PLA Y THEREIN. UNQUOTE. IN THAT PAPER IT WAS COMMENTED THAT ALL IS NOT WELL WITH PRIVATE PLACEMENT. THROUGH PRIVATE PLACEMENT RETAIL INVEST ORS ARE INVITED FOR PARTICIPATION. THOSE INVESTORS ARE SOLICITED THROU GH CIRCULARS MARKED AS FOR PRIVATE CIRCULATION ONLY. THESE GUIDELINES A RE AN EYE OPENER TO DEAL WITH THE ISSUE IN HAND. IN THAT PAPER THERE WAS AN ANOTHER OBSERVATION IN THE FOLLOWING PARAGRAPH, QUOTE BUT ALL IS NOT WELL WITH PRIVATE PLACEMENT . FIRSTLY, IT DRIVES OUT RETAIL INVESTOR PARTICIP ATION. SECONDLY, EVEN THOUGH SEBI GUIDELINES BAR SOLICITIN G OF SUBSCRIPTION FROM THE PUBLIC, IN PRACTICE ISSUERS SOLICIT THROUG H CIRCULARS, MARKED FOR PRIVATE CIRCULATION ONLY FORM PERSONS OTHER THAN F RIENDS, RELATIVES AND BUSINESS ASSOCIATES OF ISSUER . THIS WAS THE REASON WHY THE INFORMAL GROUP APPOINTED BY THE HIGH LEVEL COMMITTEE RECOMME NDED THAT PRIVATE PLACEMENT RESULTING IN SUBSCRIPTION BY 100 OR MORE PERSONS SHOULD BE TREATED AS PUBLIC ISSUE. UNQUOTE. ON ONE HAND, THE SEBI HAS TRIED TO PROTECT THE INTEREST OF THE SMALL INVESTOR S, HOWEVER, ON THE OTHER HAND, THE SEBI HAS ALSO SENT SIGNAL TO WATCH CAREF ULLY THE PRIVATE PLACEMENT. FROM THE POINT OF VIEW OF THE INCOME TAX DEPARTMENT THE APPREHENSION IS ABOUT THE INTRODUCTION OF BLACK MON EY IN THE NAME OF PRIVATE PLACEMENT BY INTRODUCING THE BOGUS NAMES OF SEVERAL SMALL INVESTORS. THIS APPREHENSION OF THE REVENUE DEPART MENT WAS A CAUSE OF ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 13 - CONCERN AND IN THE PAST DEALT WITH BY THE HONBLE C OURTS AND THOSE DECISIONS ARE TO BE REFERRED TO ARRIVE AT THE CORRE CT CONCLUSION. BUT FROM THE SIDE OF THE ASSESSEE, IT WAS QUOTED WITH THE PU RPOSE THAT IF THE PLACEMENT IS HIGH IN NUMBER AS THE SUBSCRIBERS ARE MORE THAN 100 THEN IT SHOULD BE TREATED AS PUBLIC ISSUE. THIS ASPECT OF PUBLIC ISSUE HAS BEEN DEALT WITH BY NUMBER OF HONBLE COURTS. THE HISTOR ICAL BACKGROUND OF THOSE CASES IS THEREFORE DISCUSSED HEREINBELOW BELO W IN SHORT. 6.1. A DECISION OF HONBLE DELHI HIGH COURT PRONOUNCED ON 16/04/1991 IN THE CASE OF CIT VS. STELLAR INVESTMEN T LTD. 192 ITR 287(DEL.) HAS HELD THAT, EVEN IF IT BE ASSUMED THAT THE SUBSCRIBERS TO THE INCREASED SHARE CAPITAL WERE NOT GENUINE, UNDER NO CIRCUMSTANCES COULD THE AMOUNT OF SHARE CAPITAL BE REGARDED AS UNDISCLO SED INCOME OF THE COMPANY. NO QUESTION OF LAW AROSE OUT OF THE TRIBU NALS ORDER. THE ISSUE WAS LIMITED BEFORE THE HONBLE COURT BECAUSE THE INCOME TAX OFFICER HAS ACCEPTED THE INCREASE IN THE SUBSCRIBED CAPITAL, WHICH WAS SUBJECT TO REVIEW BY THE LD.COMMISSIONER U/S.263 WHO HAS HELD THAT THE AO DID NOT CARRY OUT A DETAILED INVESTIGATION INASM UCH AS THERE HAD BEEN A DEVICE OF CONVERTING BLACK MONEY INTO WHITE WHILE ISSUING SHARES WITH THE HELP OF FORMATION OF AN INVESTMENT COMPANY. TH E COMMISSIONER FURTHER HELD THAT THE AO DID NOT MAKE ENQUIRIES WIT H REGARD TO THE GENUINENESS OF THE SUBSCRIBERS OF THE SHARE CAPITAL . EVEN IN THAT CASE, THE HONBLE COURT HAS MADE AN OBSERVATION, QUOTE IF THE ASSESSMENT OF THE PERSONS WHO ARE ALLEGED TO HAVE REALLY ADVANCED THE MONEY IS SOUGHT TO BE REOPENED, THAT WOULD HAVE MADE SOME SENSE BUT WE FAIL TO UNDERSTAND AS TO HOW THIS AMOUNT OF INCREASED SHARE CAPITAL CA N BE ASSESSED IN THE ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 14 - HANDS OF THE COMPANY ITSELF. UNQUOTE. THE DIFFICULTY IN THE PRESENT APPEAL IS THAT THOUGH THE SHARE APPLICATIONS WERE ON RECORD BUT SOME OF THE INVESTORS WERE NOT AVAILABLE AT THE ADDRESSES GIVEN. HENCE, IN RESPECT OF FEW INVESTORS IT WAS NOT POSSIBLE FOR T HE REVENUE TO ASSESS THEIR INVESTMENT IN THEIR RESPECTIVE HANDS. 6.2. A FULL BENCH OF DELHI HIGH COURT WAS CONSTITUTED AND VIDE AN ORDER DATED 27/08/1993 IN THE CASE OF CIT VS. SOPHI A FINANCE LTD. 205 ITR 98(DEL.)[FB], THE AFORECITED DECISION OF CIT VS . STELLAR INVESTMENT LTD.(SUPRA) WAS REVERSED. THERE WAS A PETITION BEF ORE THE HONBLE DELHI HIGH COURT U/S.256(2) WHICH HAS BEEN REFERRED TO TH E FULL BENCH BECAUSE THE CORRECTNESS OF THE OBSERVATIONS IN THE JUDGMENT OF A DIVISION BENCH IN THE CASE OF CIT VS. STELLAR INVESTMENT LTD. 192 ITR 287 WAS DOUBTED. THE CRUX OF THIS DECISION OF THE FULL BENCH WAS THA T IF THE SHAREHOLDERS ARE IDENTIFIED AND IT IS ESTABLISHED THAT THEY HAVE INVESTED MONEY IN THE PURCHASE OF SHARES, THEN THE AMOUNT RECEIVED BY THE COMPANY WOULD BE REGARDED AS A CAPITAL RECEIPT AND TO THAT EXTENT TH E OBSERVATION IN STELLAR INVESTMENT LTD.(SUPRA) WAS HELD AS CORRECT. THE HO NBLE FULL BENCH HAS FURTHER SAID THAT IF THE SUBSCRIBERS TO THE CAPITAL WERE NOT GENUINE, THEN UNDER NO CIRCUMSTANCES THE AMOUNT OF SHARE CAPITAL BE REGARDED AS DISCLOSED INCOME OF THE COMPANY. IT WAS A CASE OF A LIMITED COMPANY IN THE BUSINESS OF STOCKS AND FINANCING. BY INVOKING THE PROVISIONS OF SECTION 263 THE COMMISSIONER HAS ARRIVED AT THE CON CLUSION THAT THERE WAS LACK OF ENQUIRY BY THE ITO. IT WAS HELD THAT I T WAS THE DUTY OF THE ITO TO ENQUIRE INTO THE GENUINENESS OF THE SHAREHOL DERS AND DIRECTED TO ENQUIRE WHETHER THE SO-CALLED SHAREHOLDERS WERE ACT UALLY IN EXISTENCE OR ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 15 - NOT. THE TRIBUNAL HAS FOUND THAT THE COMPANY HAD FILED A LARGE NUMBER OF ENCLOSURES ALONGWITH ITS RETURN INCLUDING THE LI ST OF SHAREHOLDERS, FORMS CONTAINING THE FULL ADDRESSES AS WELL AS THE ALLOTMENT LETTERS BEFORE THE ITO. THE TRIBUNAL CAME TO THE CONCLUSION THAT THE COMPANY WAS INCORPORATED AND THE MONEY WAS RECEIVED IMMEDIATELY ON INCORPORATION WOULD SHOW THAT EVEN U/S.68 NO ASSESSMENT COULD B E MADE IN THE HANDS OF THE COMPANY. RELEVANT OBSERVATION IS WORTH RE PRODUCTION: IT IS NEITHER NECESSARY NOR DESIRABLE TO GIVE EXA MPLES TO INDICATE UNDER WHAT CIRCUMSTANCE SECTION 68 OF THE ACT CAN O R CANNOT BE INVOKED. WHAT IS CLEAR, HOWEVER, IS THAT SECTION 68 CLEARLY PERMITS AN INCOME-TAX OFFICER TO MAKE ENQUIRIES WITH REGARD TO THE NATURE AND SOURCE OF ANY OR ALL THE SUMS CREDITED IN THE B OOKS OF ACCOUNT OF THE COMPANY IRRESPECTIVE OF THE NOMENCLATURE OR THE SOURCE INDICATED BY THE ASSESSEE. IN OTHER WORDS, THE TRUT HFULNESS OF THE ASSERTION OF THE ASSESSEE REGARDING THE NATURE AND THE SOURCE OF THE CREDIT IN ITS BOOKS OF ACCOUNT CAN BE GONE INTO BY THE INCOME- TAX OFFICER. IN THE CASE OF STELLAR INVESTMENT LTD. [1991] 192 ITR 287 (DELHI), THE INCOME-TAX OFFICER HAD ACCEPTED TH E INCREASED SUBSCRIBED SHARE CAPITAL. SECTION 68 OF THE ACT WAS NOT REFERRED TO AND THE OBSERVATIONS IN THE SAID JUDGMENT CANNOT ME AN THAT THE INCOME-TAX OFFICER CANNOT OR SHOULD NOT GO INTO THE QUESTION AS TO WHETHER THE ALLEGED SHAREHOLDERS ACTUALLY EXISTED O R NOT. IF SHAREHOLDERS ARE IDENTIFIED AND IT IS ESTABLISHED T HAT THEY HAVE INVESTED MONEY IN THE PURCHASE OF SHARES THEN THE A MOUNT RECEIVED BY THE COMPANY WOULD BE REGARDED AS CAPITAL RECEIPT AND TO THAT EXTENT THE OBSERVATIONS IN THE CASE OF STELLAR INVE STMENT LTD. [1991] 192 ITR 287 (DELHI), ARE CORRECT BUT IF, ON THE OTHER HAND, THE ASSESSEE OFFERS NO EXPLANATION AT ALL OR THE EX PLANATION OFFERED IS NOT SATISFACTORY THEN, THE PROVISIONS OF SECTION 68 MAY BE INVOKED. IN THE LATTER CASE SECTION 68, BEING A SUB STANTIVE SECTION, EMPOWERS THE INCOME-TAX OFFICER TO TREAT SUCH A SUM AS INCOME OF THE ASSESSEE WHICH IS LIABLE TO BE TAXED IN THE PRE VIOUS YEAR IN WHICH THE ENTRY IS MADE IN THE BOOKS OF ACCOUNT OF THE ASSESSEE. ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 16 - THE HONBLE FULL BENCH HAS ALSO MADE CLEAR THAT IT WAS NOT THEIR INTENTION TO DECIDE AS TO WHAT EXTENT THE ONUS IS W HEN AN AMOUNT IS CREDITED IN THE BOOKS OF ACCOUNT IN SHARE CAPITAL A ND WHEN DOES THAT ONUS STAND DISCHARGED BECAUSE THAT WILL DEPEND ON THE FA CTS OF EACH CASE. THUS FULL BENCH DECISION HAS MADE CLEAR THAT IF THE ASSESSEE OFFERS NO EXPLANATION OR THE EXPLANATION OFFERED IS NOT SATIS FACTORY, THEN SECTION 68 HAS TO BE INVOKED, BEING A SUBSTANTIVE SECTION AND EMPOWERS THE ITO TO TREAT SUCH AMOUNT AS THE INCOME OF THE ASSESSEE, LI ABLE TO BE TAXED IN THE PREVIOUS YEAR IN WHICH THE ENTRY IS MADE IN THE BOO K OF ACCOUNT. SINCE IN THE PRESENT APPEAL, FACTS HAVE REVEALED THAT NO EXP LANATION WAS OFFERED AND THE NOTICES COULD NOT BE SERVED THEN THE PROVIS IONS OF SECTION 68 WERE INVOKED TO ASSESS THE IMPUGNED AMOUNT IN THE HANDS OF THE ASSESSEE. 6.3. THEREAFTER, THE AFORESAID DECISION OF STELLAR INVE STMENT LTD. HAS REACHED BEFORE THE HONBLE SUPREME COURT AND VIDE A N ORDER DATED 20/07/2000 TITLED AS CIT VS. STELLAR INVESTMENT LTD . 251 ITR 263(SC) THE QUESTION AS REFERRED BY THE REVENUE WAS NOT ADMITTE D AND HELD THAT THE TRIBUNAL CAME TO THE CONCLUSION ON FACTS HENCE NO I NTERFERENCE WAS CALLED FOR. 6.4. FROM THE SIDE OF THE ASSESSEE, A DECISION OF HONB LE SUPREME COURT IN THE CASE OF LOVELY EXPORTS PVT.LTD . 216 CTR 195 DATED 11/01/2008 IS CITED. IN THIS CASE THE SLP OF THE REVENUE DEPARTMENT WAS DISMISSED, BUT AN IMPORTANT OBSERV ATION WAS MADE THAT IF THE SHARE APPLICATION MONEY IS RECEIVED BY THE A SSESSEE-COMPANY FROM ALLEGED BOGUS SHAREHOLDERS, WHOSE NAMES ARE GIVEN T O THE AO, THEN THE ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 17 - DEPARTMENT IS FREE TO PROCEED TO REOPEN THEIR INDIV IDUAL ASSESSMENTS IN ACCORDANCE WITH LAW. RELEVANT PORTION REPRODUCED BELOW:- ORDER BY THE COURT:- DELAY CONDONED. 2. CAN THE AMOUNT OF SHARE MONEY BE REGARDED AS UNDISCLOSED INCOME UNDER S.68 OF IT ACT, 1961? WE FIND NO MERIT IN THIS SPECIAL LEAVE PETITION FOR TH E SIMPLE REASON THAT IF THE SHARE APPLICATION MONEY I S RECEIVED BY THE ASSESSEE COMPANY FROM ALLEGED BOGUS SHAREHOLDERS, WHOSE NAMES ARE GIVEN TO THE AO, THEN THE DEPARTMENT IS FREE TO PROCEED TO REOPEN THEIR INDIVIDUAL ASSESSMENTS IN ACCORDANCE WITH LAW. HENCE, WE FIND NO INFIRMITY WITH THE IMPUGNED JUDGEMENT. 3. SUBJECT TO THE ABOVE, SPECIAL LEAVE PETITION IS DISMISSED. 6.5. ON THE OTHER HAND, FROM THE SIDE OF THE REV, A DECISION OF HONBLE CALCUTTA HIGH COURT DATED 11-12/03/2003 IN THE CASE OF HINDUSTAN TEA TRADING CO.LTD. VS. CIT REPORTED AT 263 ITR 289 IS CITED WHEREIN IN AN OBSERVATION ABOUT THE PRECEDENTS REFE RRED WAS AS FOLLOWS:- 7. THE DECISION IN CIT VS. STELLAR INVESTMENT LTD. (1991) 192 ITR 287 (DELHI) CITED BY MR. PAL IS NO LONGER A GOOD LA W IN VIEW OF THE DECISION IN CIT VS. SOPHIA FINANCE LTD. (1994) 205 ITR 98 (DEL)(FB). BUT MR. PAL CONTENDED THAT SOPHIA FINANC E LTD.'S CASE (1994) 205 ITR 98 (DEL)(FB) IS NO MORE A GOOD LAW S INCE STELLAR INVESTMENT LTD.'S CASE (1991) 192 ITR 287 (DELHI) W AS AFFIRMED BY THE APEX COURT IN CIT VS. STELLER INVESTMENT LTD. (2001) 251 ITR 263. BUT THIS VIEW DOES NOT SEEM TO BE CORRECT. IN STELLER INVESTMENT LTD.'S CASE(2001) 251 ITR 263, THE APEX COURT HAD PASSED THE FOLLOWING ORDER (PAGE 263) : 'WE HAVE RE AD THE QUESTION WHICH THE HIGH COURT ANSWERED AGAINST THE REVENUE. WE ARE IN AGREEMENT WITH THE HIGH COURT. PLAINLY, THE TRIBUNAL CAME TO A CONCLUSION ON FACTS AND NO INTERFERENCE IS CAL LED FOR. THE ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 18 - APPEAL IS DISMISSED. NO ORDER AS TO COSTS.' FROM TH E ABOVE OBSERVATION, IT APPEARS THAT THE SUPREME COURT HAS NOT ENTERED INTO THE QUESTION INVOLVED OR HAS NOT DECIDED THE R ATIO LAID DOWN. IT HAD PLAINLY HELD THAT IT WAS A QUESTION OF FACT. THE SUPREME COURT HAS NOT LAID DOWN ANY PROPOSITION WITH REGARD TO THE QUESTION. IT WAS PURELY A QUESTION OF FACT WITH WHI CH THE APEX COURT HAD DEALT WITH AND WAS IN AGREEMENT WITH THE HIGH COURT ON CONCLUSION OF FACTS. THEREFORE, IT CANNOT BE SAID T HAT THE SUPREME COURT ANSWERED THE RATIO LAID DOWN AS SOUGHT TO BE PROPOUNDED BY THE DELHI HIGH COURT IN STELLAR INVESTMENT LTD.'S C ASE (1991) 192 ITR 287. A DECISION BECOMES BINDING AS A PRECEDENT ONLY WHEN THE COURT DECIDES A PARTICULAR QUESTION OF LAW OR LAYS DOWN THE RATIO THROUGH CONSCIOUS ADJUDICATION. AGREEMENT WITH THE FINDING OF FACT WITHOUT ADVERTING TO THE RATIO LAID DOWN DOES NOT C REATE A PRECEDENT. IN ORDER TO SUPPORT THIS VIEW, WE MAY RE FER TO THE DECISIONS IN MUNICIPAL CORPORATION OF DELHI V. GUR NAM KAUR (1989) AIR 1989 SC 38 (PARA.11); GANGADHARAN VS. JA NARDHANA MALLAN AIR 1996 SC 2127 (PARA-9) AND DIRECTOR OF SE TTLEMENT V. M.R. APPARAO (2002) (4) SCC 638,. 650 (PARA 7). WE ARE, THEREFORE, UNABLE TO AGREE WITH THE CONTENTION OF M R. PAL THAT THE DECISION IN SOPHIA FINANCE LTD.'S CASE (1994)205 IT R 98 (DELHI)[FB] IS NO LONGER GOOD LAW. THE FINDING IN THIS DECISION WAS THAT IT IS OPE N TO THE AO TO ENQUIRE INTO THE IDENTITY OF THE SHAREHOLDERS AND T HEIR CREDITWORTHINESS AND AVAILABILITY OF FUNDS FOR SUBSCRIBING THE FUND. THE REVENUE AUTHORITY CAN FIND OUT AS TO WHETHER THE SHAREHOLDE R EXISTED. THE SAID APPEAL WAS REMANDED FOR FRESH DECISION BY THE LD.TR IBUNAL BUT WITH THE REMARK THAT THE TRIBUNAL IN TURN WILL REMIT THE MAT TER TO THE AO FOR MAKING AN ENQUIRY IN RESPECT OF THE INCOME TAX FILE S OF THE SUBSCRIBERS WHO HAVE NOT RESPONDED EARLIER AND TO SEE WHETHER T HE AMOUNT WAS DISCLOSED AND TO EXAMINE THE OTHER EVIDENCE. THE HONBLE CALCUTTA HIGH COURT HAS ALSO FIXED A TIME OF THREE MONTHS TO SUBMIT THE REPORT TO ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 19 - THE TRIBUNAL AND THEN IT WAS EXPECTED THAT THE TRIB UNAL WOULD DECIDE THE MATTER WITHIN A PERIOD OF SIX MONTHS FROM THE DATE OF COMMUNICATION. WE ARE REFERRING THE CONCERN SHOWN BY THE HONBLE C OURT DUE TO THAT REASON THE RESPECTED THIRD MEMBER OF AHMEDABAD TRI BUNAL IN ASSESSEES OWN CASE HAS REFERRED THE ISSUE FOLLOWIN G THOSE VERY GUIDELINES AND DIRECTED THE ASSESSEE TO AVAIL THE O PPORTUNITY TO FURNISH THE REQUISITE INFORMATION. 7. IN A LATEST DECISION OF HONBLE DELHI HIGH COURT PRONOUNCED IN THE CASE OF CIT VS. OASIS HOSPITALIT IES P.LTD. REPORTED AT [2001]333 ITR 19 (DEL.), THE HONBLE COURT HAS HELD AS UNDER: THE INITIAL BURDEN IS UPON THE ASSESSEE TO EXPLAIN THE NATURE AND SOURCE OF THE SHARE APPLICATION MONEY RECEIVED BY THE ASSESSE E. IN ORDER TO DISCHARGE THIS BURDEN, THE ASSESSEE IS REQUIRED TO PROVE (I) THE IDENTITY OF THE SHARE- HOLDER, (II) THE GENUINENESS OF THE TRANSACTION, AN D (C) THE CREDITWORTHINESS OF THE SHAREHOLDERS. IN CASE THE INVESTOR/SHAREHOLDER IS AN INDIVIDUAL, SOME DOCUMENTS WILL HAVE TO BE FILED OR THE SHAREHOLDER WILL HAVE TO BE PRODUCED BEFORE THE ASSESSING OFFICER TO PROVE HIS IDENTITY. IF THE CREDITOR/SUBSCRIBER IS A COMPANY, THEN THE DETAILS IN THE FORM OF REGISTER ED ADDRESS OR PAN IDENTITY, ETC., CAN BE FURNISHED. WHEN THE MONEY IS RECEIVED BY CHEQUE AND IS TRANSMITTED THROUGH BANKING OR OTHER INDISPUTABLE C HANNELS, THE GENUINENESS OF THE TRANSACTION WOULD BE PROVED. OTHER DOCUMENTS SHOWING THE GENUINENESS OF THE TRANSACTION COULD BE COPIES OF T HE SHAREHOLDERS REGISTER, SHARE APPLICATION FORMS, SHARE TRANSFER REGISTER, E TC. AS FAR AS THE CREDITWORTHINESS OR FINANCIAL STRENGTH OF THE CREDI TOR/SUBSCRIBER IS CONCERNED, THAT CAN BE PROVED BY PRODUCING THE BANK STATEMENT OF THE CREDITORS/SUBSCRIBERS SHOWING THAT IT HAD SUFFICIEN T BALANCE IN ITS ACCOUNTS TO ENABLE IT TO SUBSCRIBE TO THE SHARE CAPITAL. ONCE T HESE DOCUMENTS ARE PRODUCED, THE ASSESSEE WOULD HAVE SATISFACTORILY DI SCHARGED THE ONUS CAST UPON HIM. THEREAFTER, IT IS FOR THE ASSESSING OFFIC ER TO SCRUTINISE THE SAME AND IN CASE HE NURTURES ANY DOUBT ABOUT THE VERACIT Y OF THESE DOCUMENTS, TO PROBE THE MATTER FURTHER. HOWEVER, TO DISCREDIT THE DOCUMENTS PRODUCED BY THE ASSESSEE ON THE ASPECTS, THERE HAVE TO BE SOME COGENT REASONS AND MATERIALS FOR THE ASSESSING OFFICER AND HE CANNOT G O INTO THE REALM OF SUSPICION. ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 20 - THE ASSESSING OFFICER NOTICED THAT THE ASSESSEE HAD RECEIVED SHARE APPLICATION MONEY OF RS. 3 LAKHS EACH FROM SIX PRIV ATE LIMITED COMPANIES DURING THE YEAR RELEVANT TO THE ASSESSMENT YEAR 200 4-05. NOTICE UNDER SECTION 148 WAS ISSUED IN RESPECT OF THE ASSESSMENT YEAR 2003-04 AND REASSESSMENT DONE. THE ASSESSING OFFICER MADE ADDIT ION OF RS. 18 LAKHS TO THE INCOME OF THE ASSESSEE ON PROTECTIVE BASIS IN T HE ASSESSMENT YEAR 2004- 05. ON APPEAL : _HELD,_ DISMISSING THE APPEAL, THAT THE ASSESSEE HA D FILED COPIES OF PAN, ACKNOWLEDGMENT OF FILING INCOME-TAX RETURNS OF THE COMPANIES, THEIR BANK ACCOUNTS STATEMENTS FOR THE RELEVANT PERIOD BUT HAD NOT PRODUCED THE DIRECTORS OF THE COMPANIES. THE ADDITION MADE BY TH E ASSESSING OFFICER COULD NOT BE SUSTAINED AS THE PRIMARY ONUS WAS DISCHARGED BY THE ASSESSEE. THE ASSESSING OFFICER HAD NOT INVESTIGATED WHETHER THE MODUS OPERANDI BY THE ENTRY OPERATOR DISCUSSED BY THE INVESTIGATION WING EXISTED IN THE CASE OR NOT. EVEN THE BANK STATEMENTS AS CLAIMED BY THE ASSESSIN G OFFICER REVEALED THAT THE ASSESSEE HAD RECEIVED CHEQUES FROM THE SHAREHOL DERS. THE ASSESSEE RECEIVED RS. 99.18 LAKHS ON ACCOUNT OF SHARE APPLICATION MONEY. IT FILED CONFIRMATIONS FROM 30 PARTIES. NOTI CES ISSUED WERE RETURNED UNSERVED ON 22 OUT OF 30 PARTIES AND THE REMAINING 8 PARTIES DID NOT RESPOND. THE INSPECTOR MADE LOCAL INQUIRIES WHICH REVEALED T HAT THE PARTIES DID NOT EXIST AT THE GIVEN ADDRESSES. ON ENQUIRIES FROM THE BANK, THE ASSESSING OFFICER FOUND VARIOUS DISCREPANCIES BETWEEN THE STA TEMENT SENT BY THE BANK AND THE STATEMENT PROCURED BY THE ASSESSEE. THE ASS ESSING OFFICER CONFRONTED THE ENTIRE MATERIAL TO THE ASSESSEE AND ALLOWED VARIOUS OPPORTUNITIES BUT THE ASSESSEE DID NOT PRODUCE A SI NGLE PARTY. THEREFORE, THE ASSESSING OFFICER MADE AN ADDITION OF RS. 99.18 LAK HS ON ACCOUNT OF UNEXPLAINED SHARE CAPITAL UNDER SECTION 68. SIMILAR LY, THE ASSESSING OFFICER ALSO MADE ADDITION OF RS. 3.10 LAKHS ON ACCOUNT OF UNEXPLAINED CREDIT UNDER SECTION 68. THE COMMISSIONER (APPEALS) DELETED THE ADDITION. THIS WAS CONFIRMED BY THE TRIBUNAL. ON APPEAL : _HELD,_ DISMISSING THE APPEAL, THAT THE ADDITION WA S RIGHTLY DELETED BY THE COMMISSIONER (APPEALS) AND THE TRIBUNAL. REQUISITE DOCUMENTS WERE F- URNISHED SHOWING THE EXISTENCE OF THE SHAREHOLDERS FROM ACCOUNTS AND EVEN THEIR INCOME-TAX DETAILS. FROM BANK ACCOUNTS OF THE SE SHAREHOLDERS, IT WAS FOUND THAT THEY HAD DEPOSITED CERTAIN CASH AND THE SOURCE THEREOF WAS QUESTIONABLE. THE ASSESSING OFFICER SHOULD HAVE MADE FURTHER PROB E WHICH HE FAILED TO DO. MOREOVER, THE REMEDY WITH TH E DEPARTMENT LAY IN REOPENING THE CASE OF THE INVESTORS AND THE ADDITIO N COULD NOT BE MADE IN THE HANDS OF THE ASSESSEE. _HELD,_ALSO, THAT IN SO FAR AS THE STATEMENTS OF TH E PERSONS WHO WERE PRODUCED WERE CONCERNED, THEY WERE GONE INTO AND AN ALYSED BY THE THREE AUTHORITIES BELOW ON THE BASIS OF WHICH FINDING OF FACT WAS ARRIVED AT THAT NEITHER THEIR IDENTITY WAS ESTABLISHED NOR THEIR CA PACITY TO INVEST THIS KIND OF MONEY WAS PROVED. THEY WERE ALL AGRICULTURISTS AND HAD NOT PRODUCED A SINGLE DOCUMENT TO SUPPORT THEIR VERSION. THE ASSES SEE HAD NOT BEEN ABLE TO ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 21 - DISCHARGE THE ONUS AND THE ADDITION WAS RIGHTLY MAD E. THIS WAS A CASE WHERE THE ASSESSEE COULD NOT DISCHARGE THE ONUS BUT IT COULD NOT BE SAID THAT IT WAS THE CASE OF CONCEALMENT OF INCOME. THE TRIBU NAL RIGHTLY DELETED THE PENALTY. 7.1. THE SALIENT FEATURE OF THIS JUDGEMENT AND THE OTHER JUDGEMENTS AS CITED HEREINABOVE ARE THAT THE INITIAL BURDEN AND T HE PRIMARY ONUS IS UPON THE ASSESSEE TO ESTABLISH THE SOURCE OF SHARE APPLI CATION MONEY RECEIVED. IN ORDER TO DISCHARGE THIS BURDEN, IT IS REQUIRED T O PLACE ON RECORD THE IDENTITY OF THE SHARE HOLDERS AND THE DETAILS OF T HE TRANSACTION. IN THIS REGARD, PROVISIONS OF SECTION 68 ARE TO BE FOLLOWED . ONCE THOSE DOCUMENTS ARE PRODUCED, THEN IT CAN BE SAID THAT TH E REQUISITE PRIMARY ONUS AS CASTED UPON AN ASSESSEE HAS BEEN DISCHARGED . THEREAFTER, IT IS FOR THE AO TO SCRUTINIZE THOSE DETAILS. THE COUR TS HAVE SUGGESTED THAT IF THE AO HAD MADE CERTAIN ENQUIRIES AND NURTURES ANY DOUBT ABOUT THE CREDITWORTHINESS OF THOSE INVESTORS, THEN HE IS FRE E TO TAKE APPROPRIATE ACTION IN THEIR RESPECTIVE HANDS. HOWEVER, IT IS NECESSARY THAT TO PROBE FURTHER THERE MUST BE BASIC INFORMATION IN POSSESS ION OF THE AO. THOSE BASIC INFORMATION CAN BE SAID TO BE THE CORRECT ADD RESSES OF THE INVESTORS, SO THAT FURTHER ACTION CAN BE TAKEN AGAINST THEM. MEANING THEREBY SUCH INVESTORS SHOULD HAVE RESPONDED THE NOTICES ISSUED TO THEM AND ATLEAST HAVE FURNISHED THEIR RESPECTIVE CONFIRMATION LETTER S. IF AT LEAST THAT INFORMATION IS WITH THE REVENUE DEPARTMENT, THEN TH E REVENUE DEPARTMENT IS IN A POSITION TO FOLLOW THE VERDICT O F THE HONBLE COURTS THAT APPROPRIATE ACTION CAN BE TAKEN BY THE REVENUE DEPARTMENT AGAINST THOSE VERY INVESTORS. KEEPING THESE GUIDELINES AND THE LAW LAID DOWN BY THE HONBLE COURTS, WE HAVE TO EXAMINE THE NATURE O F COMPLIANCE EITHER MADE BY THE ASSESSEE OR THOSE INVESTORS DURING ASSE SSMENT PROCEEDINGS. ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 22 - 8. (A) IN THE LIGHT OF THE ABOVE DISCUSSION, IT IS WORTH TO MENTION, THOUGH AT THE COST OF SOME REPETITION, THAT THE ASS ESSEE-COMPANY WAS INCORPORATED ON 27/11/1998 TO CARRY ON BUSINESS OF MANUFACTURING AND SELLING OF CEMENT. THE ASSESSEE-COMPANY RAISED SHA RE-CAPITAL AMOUNTING TO RS.98,99,300/- FROM 373 ALLOTTEES BY WAY OF PRIV ATE PLACEMENT. AS PER RETURN ALLOTMENT FILED WITH THE OFFICE OF ROC SHARE S TO THESE PERSONS WERE ALLOTTED ON 31/01/1992. AT THE TIME OF ORIGI NAL ASSESSMENT, THE ASSESSING OFFICER SOUGHT DETAILS OF SHARES ALLOTTED BY WAY OF PRIVATE PLACEMENT AND CLASSIFIED UNDER THE HEAD PROMOTERS QUOTA IN THE PROSPECTUS. THE ASSESSING OFFICER, THEREAFTER, SOU GHT PERSONAL PRESENCE OF VARIOUS SHAREHOLDERS TOGETHER WITH CONFIRMATIONS . THE ASSESSING OFFICER FINALLY INTERROGATED 50 PERSONS OUT OF 373 PERSONS TO WHOM SHARES HAD BEEN ALLOTTED UNDER PRIVATE PLACEMENT. THROUGH FILED INQUIRIES, 30 OUT OF 50 PERSONS CONFIRMED THEIR INV ESTMENTS. HOWEVER, BALANCE 20 PERSONS WAS NOT FOUND AT THE COMMON ADD RESS GIVEN I.E. 18, SEMI BASEMENT, PARADISE COMPLEX, SAYAJIGUNJ, BARODA 380 005. AS PER ORIGINAL ASSESSMENT ORDER, FIELD INQUIRIES REVEALED THAT NO SUCH PERSONS EVER EITHER RESIDED OR WORKED AT SUCH PREMISES. AS PER ASSESSING OFFICER THAT INVESTMENT IN THE NAME OF 20 PERSONS WAS BENAM I INVESTMENT OF ASSESSEE-COMPANY AS ENTIRE SHARE APPLICATION MONEY BROUGHT ON THE BOOKS IN CASH ON A SINGLE DAY I.E. 20.10.1992. THE ASSESSING OFFICER FINALLY GAVE CREDIT IN RESPECT OF SHARE CAPITAL OF RS.39,43,300/- FOR WHICH ASSESSEE FURNISHED CONFIRMATION LETTERS AND BALANCE SHARE CAPITAL OF RS.59,56,000/- WAS ADDED AS INCOME OF THE ASSESSEE- COMPANY. ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 23 - HEREINAFTER, WE ARE CONFINED WITH THE ADDITION REMA INED SUSTAINED OF RS.59,56,000/- AS PER THE IMPUGNED ASSESSMENT ORDER NOW UNDER APPEAL. 8. (B) IN THE FIRST CATEGORY OF INVESTORS, THERE WAS A LIST OF 49 INVESTORS WITH THEIR NAMES ALSO THE REFERENCE OF TH EIR SERIAL NUMBER(S) OF THE LIST OF THE SHAREHOLDERS AND THE LISTED SERIAL NUMBER OF SHOW-CAUSE NOTICES. THERE IS ALSO A REFERENCE OF PAPER-BOOK N UMBERS WHEREIN THE CONFIRMATION LETTERS OF THESE PARTIES ARE PLACED. THE AO HAS ISSUED ENQUIRY LETTERS U/S.133(6) WHICH WAS SERVED ON THEM . THEIR CONFIRMATION LETTERS WERE RECEIVED. SINCE THEIR GENUINENESS AND IDENTITY WERE DISCLOSED BY THE ASSESSEE, THEREFORE OUT OF THE TOT AL ADDITION MADE U/S.68 OF THE ACT, WE HEREBY HOLD THAT A SUM OF RS.11,52,000/- SHOULD NOT BE TAXED IN THE HANDS OF THE ASSESSEE FOLLOWING TWO DE CISIONS OF THE HONBLE SUPREME COURT AS CITED SUPRA, NAMELY, LOVEL Y EXPORTS PVT.LTD. (216 CTR 195)[SC] AND STELLER INVESTMENT LTD. (251 ITR 263)[SC]. IT IS TO BE NOTED THAT PART OF THIS AMOUNT HAS ALRE ADY BEEN CONSIDERED IN THE ORIGINAL ASSESSMENT ORDER AND ACC ORDINGLY RELIEF WAS GRANTED. 8. 1. THERE WERE SECOND CATEGORY OF INVESTORS ON WHOM THE NOTICES OF ENQUIRY WERE SERVED. IN COMPLIANCE TO NOTICE U/S.1 33(6) OF THE ACT, THEY HAVE RESPONDED THAT THE MATTER BEING VERY OLD, THE REFORE THEY DID NOT REMEMBER THE TRANSACTION. HOWEVER, THEY HAVE AFFI RMED ABOUT THE TRANSACTION. IN THIS CATEGORY OF INVESTORS WHICH ARE 10 IN NUMBER AT THE TIME OF ORIGINAL ASSESSMENT AS WELL AS AT THE TIME OF SET ASIDE ASSESSMENT THEIR CONFIRMATIONS WERE FURNISHED. THE INVESTMENT OF THOSE ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 24 - INVESTORS AMOUNTED TO RS.25,35,000/-. SINCE THE REQUISITE INFORMATION ABOUT THEIR ADDRESSES AND IDENTITY WAS VERY MUCH WI TH THE REVENUE DEPARTMENT, THEREFORE FOLLOWING THE AFORE CITED DEC ISIONS WE HEREBY HOLD THAT THERE IS NO OCCASION TO TAX THE IMPUGNED SHARE APPLICATION MONEY IN THE HANDS OF THE ASSESSEE-COMPANY A ND THE AO IS FREE TO ADOPT THE LEGAL RECOURSE AS SUGGESTED IN THE PRECEDENTS CITED . IT IS TO BE NOTED THAT PART OF THIS AMOUNT OF THE INVESTORS HAS ALREADY BE EN CONSIDERED WHILE GRANTING PART RELIEF AS PER THE ORIGINAL ASSESSMEN T ORDER. 8.2. THERE WAS A THIRD CATEGORY OF INVESTORS, ONLY THREE IN NUMBER WHO HAVE MADE COMPLIANCE IN THE PAST, THEREFORE IN THE ORIGINAL ASSESSMENT THEIR INVESTMENT WAS ACCEPTED, HOWEVER, DURING SET ASIDE ASSESSMENT PROCEEDINGS IN THE IMPUGNED ASSESSMENT O RDER THEIR DEPOSITS WERE PARTLY TREATED AS UNEXPLAINED. IT IS PLEADED BEFORE US THAT SINCE THESE PERSONS ARE THE PROMOTERS AND THEY HAVE ESTAB LISHED THEIR IDENTITY AND COMPLIED WITH THE NOTICE OF ENQUIRY U/S.133(6), THEREFORE THE TOTAL AMOUNT OF THESE THREE PERSONS OF RS.15,92,800/- SHOULD NOT BE TAXED IN THE HANDS OF THE ASSESSEE-COMPANY. WE HOLD ACCORDI NGLY AND DIRECT TO GIVE THE RELIEF A S HELD IN THE PRECEDENTS CITED. THIS IS TO BE CLARI FIED THAT PART OF THE ABOVE AMOUNT WAS ALREADY SUBJECT TO REL IEF AS PER THE ORIGINAL ASSESSMENT ORDER. 8.3. THERE IS AN ANOTHER FOURTH CATEGORY OF INVESTORS ON WHOM THE LETTERS OF ENQUIRY WERE SERVED BUT THEY HAVE NOT RE SPONDED TO THOSE NOTICES. THIS IS A LIST OF 132 PERSONS WHO HAVE INVESTED SMALL AMOUNTS IN THE RANGE OF RS.15,000/- TO RS.5,000/- ONLY. IN RESPECT OF THOSE ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 25 - INVESTORS IT IS PLEADED BEFORE US THAT THE NOTICES HAVE BEEN SERVED ON THEM, THEREFORE THEIR IDENTITY IS KNOWN TO THE REVE NUE DEPARTMENT FOR THE PURPOSE OF TAKING A LEGAL ACTION IF AT ALL DECIDED BY THE REVENUE DEPARTMENT. THE TOTAL AMOUNT OF THESE 132 INVESTORS WAS RS.9,82,000/- . IN RESPECT OF THESE PERSONS THERE IS NO SPECIF IC OBSERVATION BY THE AO THAT THE NOTICES WERE PROPERL Y SERVED UPON THEM. RATHER IN THE ASSESSMENT ORDER AT SOME PLACES THE A O HAS MADE AN OBSERVATION THAT THE LETTERS WERE SENT THROUGH POST AND EVEN REGISTERED LETTERS WERE ISSUED BUT THOSE APPLICANTS HAVE NOT C ONFIRMED THEIR DEPOSITS. IN SUCH A PECULIAR SITUATION, WHEN THE INVESTORS ARE NOT COOPERATING ON ONE HAND AND THE ASSESSEE IS ALSO NO T READY TO PLACE ON RECORD THEIR CONFIRMATIONS ALONG WITH THEIR CORRECT POSTAL ADDRESSES, WE ARE OF THE VIEW THAT IT IS VERY DIFFICULT FOR THE R EVENUE DEPARTMENT TO PROCEED AGAINST THEM IN ANY MANNER IN FUTURE. IT IS NOT FAIR TO DIRECT THE REVENUE DEPARTMENT TO PROCEED IN THE DARK, THER EFORE WE HEREBY HOLD THAT THE TOTAL AMOUNT OF THESE 132 PERSONS OF RS.9,82,000/- WAS ALTOGETHER NOT SUBSTANTIATED, HENCE SUBJECT TO TAX U/S.68 OF THE I.T. ACT. 8.4. THERE IS AN ANOTHER FIFTH CATEGORY OF PERSONS AGAINST WHOM THE ENQUIRY LETTERS U/S.133(6) OF THE ACT WERE ISSUED B UT EVEN COULD NOT BE SERVED. THE ADMITTED FACTUAL POSITION IS THAT THE POSTAL D EPARTMENT HAS RETURNED THE NOTICES UN-SERVED DUE TO NON-AVAIL ABILITY OF THE PERSONS. IN THIS CATEGORY, IN ALL, THERE WERE 47 INVESTORS A ND THE TOTAL AMOUNT INVESTED BY THEM WAS AT RS.5,06,000/-. SINCE THE IDENTITY AND EVEN THEIR EXISTENCE COULD NOT BE VERIFIED, THEREFORE IN THE L IGHT OF THE OBSERVATIONS ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 26 - MADE BY THE HONBLE COURT, WE ARE OF THE VIEW THAT THE REVENUE DEPARTMENT IS HELPLESS TO TAKE ANY LEGAL RECOURSE A GAINST THEM. WITH THE RESULT, WE HEREBY HOLD THAT THE IMPUGNED AMOUNT OF RS.5,06,000/- HAS TO BE ASSESSED U/S.68 OF THE ACT IN THE HANDS O F THE ASSESSEE- COMPANY. 8 .5. AS PER SIXTH CATEGORY OF INVESTORS WHO WERE PROMOTERS AND TWO IN NUMBER ON WHOM LETTERS COULD NOT BE SERVED SINCE THEY WERE SHIFTED OUTSIDE INDIA. IT HAS ALSO BEEN INFORMED THAT THEY HAVE NOW EXPIRED. HOWEVER, IT IS STRANGE THAT THOUGH THEY WERE THE P ROMOTERS BUT THEIR WHEREABOUTS AND THEIR VERIFICATIONS COULD NOT BE PL ACED BY THE ASSESSEE- COMPANY ON RECORD. WE THEREFORE HOLD THAT THE IMPUGNED TOTAL AMOUNT OF RS.20,000/- WAS NOT GENUINE, THEREFORE S UBJECT TO TAX U/S.68 OF THE ACT IN THE HANDS OF THE ASSESSEE-COMP ANY. 8 .6. THERE WAS A LAST CATEGORY OF INVESTORS WHICH ARE TWO IN NUMBER WHO HAVE CATEGORICALLY DENIED OF ANY SUCH INVESTMENT. THE AMOUNT IN QUESTION WAS RS.10,000/ - WHICH HAS TO BE TAXED BECAUSE OF THE SPECIFIC DENIAL OF THOSE PERSONS. 9. THE SUMMARY OF THE ABOVE DISCUSSION IS THAT OUT OF THE TOTAL ADDITION OF RS.59,56,000, AN ADDITION OF RS.15,18, 000 IS HEREBY CONFIRMED AND REST OF THE AMOUNT, FOLLOWING THE CAS E LAWS CITED HEREIN- ABOVE , NOT TO BE TAXED IN THE HANDS OF THE ASSESS EE. THE GROUNDS RAISED IN RESPECT OF THIS ISSUE IS HEREBY PARTLY ALLOWED. ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 27 - 10. IN THE RESULT, ASSESSEES APPEAL, I.E.ITA NO.2 506/AHD/2006 IS PARTLY ALLOWED. (B) ITA NO.1673/AHD/2007 FOR A.Y. 1992-93 11. THIS IS AN APPEAL AGAINST THE ORDER PASSED U /S.263(1) OF THE I.T.ACT DATED 30/03/2007. SEVERAL GROUNDS HAVE BEEN RAISE D, HOWEVER, THE MAIN CONTENTION IS IN RESPECT OF THE GRANT OF DEDUCTION U/S.80I AGAINST THE ADDITION MADE U/S.68 OF I.T. ACT. THE OBSERVATION OF THE LD. CIT WAS THAT THE AO HAS ALLOWED DEPRECIATION AND A DEDUCTIO N @ 30% U/S.80I OF THE ACT. THE WORKING OF THE DEDUCTION U/S.80I WAS BASED UPON THE UNDERSTANDING THAT THE INCOME ASSESSED WAS THAT INC OME FROM INDUSTRIAL ACTIVITY. AS AGAINST THAT THE LD. CIT HAS FOUND TH AT THE IMPUGNED ADDITION OF RS.59,56,000/- WAS MADE AS UNEXPLAINED SHARE APP LICATION MONEY THEREFORE THE SAID ADDITION WAS NOT RELATED TO ANY INDUSTRIAL ACTIVITY OF THE ASSESSEE. 12. WE HAVE HEARD BOTH THE SIDES. AS PER THE RECOR DS AVAILABLE BEFORE US WE HAVE GATHERED THE FOLLOWING INFORMATION: (I) FIRST ASSESSMENT WAS MADE U/S.143(3) OF THE ACT DATED 28/03/1995 FOR AY 1992-93. AS PER THIS ORDER AN ADDITION OF RS.59,56,000/- WAS MADE IN RESPECT OF THE UNVERI FIED SHARE APPLICATION MONEY RECEIVED BY THE ASSESSEE. IN THIS ORDER, THE AO HAS GRANTED RELIEF U/S.80IA OF THE AC T @ 30% CALCULATED ON THE TOTAL ASSESSED INCOME INCLUSIVE O F THE AFORESAID ADDITION. AN AMOUNT OF RS.15,88,490/- WA S ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 28 - COMPUTED @ 30% ON THE SAID TOTAL INCOME AND THEREUP ON DEDUCTION U/S 80IA WAS GRANTED. (II) THE MATTER REACHED UP TO THE TRIBUNAL AND THE ONLY ISSUE RAKED UP WAS IN RESPECT OF THE ADDITION MADE UNDER SECTION 68 OF THE I.T.ACT, 1961. THE TRIBUNAL VIDE AN ORDER DATED 25/07/2003 (SUPRA) HAS RESTORED THE SAID ISSUE BACK TO THE FIL E OF THE AO. THE DIRECTIONS WERE ONLY IN RESPECT O F THE AMOUNT COLLECTED BY THE ASSESSEE-COMPANY ON PRIVATE PLACEMENT OUT OF PROMOTERS QUOTA, CONSEQUENTLY INV ITED SHARE APPLICATION MONEY. NO OTHER ISSUE WAS REFERR ED BACK TO A.O. FOR RECONSIDERATION OR REINVESTIGATION. (III) ACCORDINGLY A SECOND ASSESSMENT ORDER WAS PASSED U/S.143(3) R.W.S.255(4) OF I.T. ACT DATED 31/03/200 5 AND IN THE SECOND ROUND OF ASSESSMENT IDENTICALLY ON THE T OTAL INCOME THE AO HAD GRANTED DEDUCTION U/S.80I @ 30% O F THE TOTAL INCOME INCLUSIVE OF THE INCOME ASSESSED U/S.6 8 OF THE I.T. ACT. (IV) THIS LATEST ORDER OF THE AO DATED 31/03/2005 W AS THE SUBJECT MATTER OF REVIEW BY INVOKING THE PROVISIONS OF SEC TION 263 OF THE I.T.ACT BY THE LD.COMMISSIONER VIDE AN ORDER PASSED ON 30.3.2007. ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 29 - 12.1. NOW THE QUESTION IS THAT AS PER THE PROVISIO NS OF SECTION 263 OF THE ACT A LIMITATION IS PRESCRIBED UNDER SUB-SECTION(2) OF SECTION 263 THAT NO ORDER SHALL BE MADE AFTER THE EXPIRY OF TWO YEAR S FROM THE END OF THE FINANCIAL YEAR IN WHICH THE ORDER SOUGHT TO BE REVISED WAS PASSED. IN THIS REGARD, THE HONBLE SUPREME COURT IN THE CASE OF CIT VS. ALAGENDRAN FIANNCE LTD. 293 ITR 01 (SC) HAS STATED THAT THE ORDER SOUGHT TO BE REVISED CAN BE THAT ORDER IN RESPECT O F WHICH AN ISSUE IS THE SUBJECT MATTER OF RE-ASSESSMENT. IN OTHER WORDS, T HE HONBLE SUPREME COURT HAS SAID THAT IN RESPECT OF AN ISSUE WHICH WA S NOT THE SUBJECT MATTER OF RE-ASSESSMENT, LIMITATION U/S.263(2) OF THE ACT WOULD RUN FROM THE DATE OF ORIGINAL ASSESSMENT AND REVISIONAL PROCEEDINGS I NITIATED IN RESPECT OF SUCH ISSUE BEYOND THE PERIOD OF TWO YEARS FROM THE DATE OF ORIGINAL ASSESSMENT WERE BARRED BY LIMITATION. IN THE PRES ENT CASE AS WELL, THE ISSUE WHICH HAD ARISEN FROM THE ORIGINAL ASSESSMENT WAS IN RESPECT OF AN ADDITION MADE U/S.68 OF THE I.T. ACT. ONLY THAT I SSUE WAS RESTORED BACK FOR RE-CONSIDERATION AND RE-INVESTIGATION BY THE AO. NO OTHER ISSUE WAS EVER CHALLENGED FROM EITHER SIDE. THE ORIGINAL ASSESSMENT WAS SET ASIDE AND THE MATTER WAS RESTORED BACK TO THE FILE OF THE AO WITH THE LIMITED SCOPE OF THE ASSESSABILITY OF THE ADDITION MADE U/S.68 OF THE ACT. THE SUBJECT MATTER OF RE-CONSIDERATION WAS DISTINCT AND DIFFERENT THAN THE QUESTION OF CORRECTNESS OF THE DEDUCTION U/S.80I OF THE I.T.ACT. THE SUBSEQUENT EVENTS WERE IN RESPECT OF THE MATTER OTH ER THAN THE ALLOWANCE OF DEDUCTION U/S.80I OF THE ACT. IT IS NOT THE CAS E WHERE THE SUBJECT MATTER OF AFRESH ASSESSMENT AND THE QUESTION OF COM PUTATION OF TOTAL ASSESSABLE INCOME WERE THE SAME. THEY WERE NOT, BE CAUSE THE ALLOWANCE OF DEDUCTION U/S.80I AS GRANTED ORIGINALLY VIDE ORD ER DATED 28/03/1995 ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 30 - HAD MERGED WITH THE ORDER OF THE CIT(A) AND FINALLY WITH THE ORDER OF THE TRIBUNAL. IF AT ALL THE LD.COMMISSIONER WANTED TO INVOKE THE PROVISIONS OF SECTION 263 OF THE ACT, THEN HE HAD TO EXERCISE THE JURISDICTION WITHIN TWO YEARS FORM THE DATE OF THE SAID ORDER AS PRESCR IBED U/S.263(2) OF THE I.T.ACT. HOWEVER, THE IMPUGNED ORDER U/S.263(1) OF THE ACT OF THE LD.COMMISSIONER IS DATED 30/03/2007, I.E. MUCH BEYO ND THE LIMITATION PRESCRIBED. WE ARE OF THE OPINION THAT THE LD.COMMISISONER HAS ACTED BEYOND THE LIMITATION PRESCRIBED, THEREFORE, THIS O RDER PASSED U/S.263 DESERVES TO BE QUASHED. WE HOLD ACCORDINGLY AND GROUNDS RAISED ARE ALLOWED. 13. IN THE RESULT, ASSESSEES APPEAL (ITA NO.1673/A HD/2007) IS ALLOWED. (C) ITA NO.404/AHD/2008 FOR A.Y. 1992-93 14. ASSESSEES APPEAL ARISING FROM THE ORDER OF CIT (A)-VII BARODA DATED 15/10/2007. A PENALTY U/S.271(1)(C) OF THE ACT OF RS.34,24,700/- WAS IMPOSED VIDE ORDER U/S.271(1)(C) DATED 28/02/2 007 BY THE AO WHICH WAS CONFIRMED BY THE LD.CIT(A) THEREFORE THE SUBJECT MATTER OF APPEAL BEFORE US. 15. THE COMPANY HAS RECEIVED CONTRIBUTION THROUGH PRIVATE PLACEMENT IN THE PROMOTERS QUOTA OF RS.98,99,300/- FROM 373 A PPLICANTS. THE AO HAD CALLED UPON THE ASSESSEE TO PRODUCE PERSONS TO WHOM PREFERENTIAL SHARES WERE ALLOTTED. ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 31 - 16. THE AO WHILE IMPOSING THE PENALTY HAS NOTICED T HAT MULTI-FACETED ENQUIRIES WERE MADE DURING THE COURSE OF ASSESSMENT TO ENQUIRE ABOUT THE PRIVATE PLACEMENTS MADE BY SEVERAL SHARE APPLICANTS . THE ASSESSEE COULD FURNISH THE CONFIRMATION IN RESPECT OF THE IN VESTMENTS UPTO RS.39,43,300/- OUT OF THE TOTAL ALLOTMENT OF SHARES OF RS.98,99,300/-. THE ASSESSEE WAS UNABLE TO DISCHARGE ITS OBLIGATION IN RESPECT OF THE BALANCE SHARE ALLOTMENT TO THE EXTENT OF RS.59,56, 000/-. THE AO HAS REPRODUCED THE DETAILS OF THE PERSONS ON WHOM THE N OTICES WERE ISSUED BUT RETURNED BACK UNSERVED WITH THE REMARK THAT TH E ADDRESSEE WAS NOT PRESENT AT THE ADDRESS. FEW PERSONS HAVE EVEN DE NIED OF HAVING PURCHASED ANY SHARE OF THE ASSESSEE-COMPANY. FEW PERSONS HAVE RETURNED THE LETTERS WITH THE COMMENT THAT THEY DID NOT REMEMBER THE TRANSACTION ENQUIRED ABOUT. AS MANY AS 32 PERSONS WHO WERE RESIDING OUTSIDE BARODA WERE NOT FOUND AT THE ADDRESS GIVEN AND THE LETTERS WERE RECEIVED BACK UNSERVED. THERE WAS AN ANOTHER LI ST OF FOUR PERSONS WHO HAVE INVESTED RS.25 LACS BUT THAT TOO WAS NOT CONFI RMED IN THE ABSENCE OF ANY CERTIFICATE FROM BANK AUTHORITY. IT WAS ALSO NOTED BY THE AO THAT SOME OF THE INVESTORS HAVE MADE THE INVESTMENT IN CASH THAT TOO ON ONE DAY, I.E. 20/1/1992. AS PER AO, THE ASSESSEE COULD NOT ESTABLISHED THE EXISTENCE OF SHARE-HOLDERS AND THEREFORE FAILED TO ESTABLISH THE IDENTITY, THE CREDITWORTHINESS AND GENUINENESS OF THOSE SHARE -HOLDERS. THE EXPLANATION OFFERED BY THE ASSESSEE WAS FOUND TO BE FALSE. THE ASSESSEE HAD IN ITS BOOKS OF ACCOUNT A SUM OF RS.59,56,000/- BY WAY OF SHARE APPLICATION MONEY FOR WHICH THE ASSESSEE HAD FAILED TO GIVE ANY PLAUSIBLE EXPLANATION THEREFORE LIABLE TO BE PENALIZED U/S.27 1(1)(C) OF THE ACT AND ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 32 - ACCORDINGLY THE AO HAD IMPOSED A MINIMUM PENALTY OF RS.34,24,700/-. THE MATTER WAS CARRIED BEFORE THE FIRST APPELLATE A UTHORITY. 17. THE LD.CIT(A) HAS PERUSED THE ORDERS PASSED PRE VIOUSLY AND ALSO DISCUSSED FEW CASE LAWS AND THEREAFTER ARRIVED AT T HE CONCLUSION THAT THE ASSESSEE HAS FAILED TO ESTABLISH THE BONA FIDE IN R EGARD TO THE INVESTMENT IN SHARE CAPITAL. THE ADDITION HAS BEEN CONFIRMED IN THE PAST BY THE APPELLATE AUTHORITY AND EVEN AFTER THE MATTER WAS R ESTORED FOR A FRESH CONSIDERATION THE ASSESSEE WAS UNABLE TO SUBSTANTIA TE ITS CASE. WITH THE RESULT, THE ACTION OF THE AO WAS CONFIRMED. 18. WE HAVE HEARD BOTH THE SIDES AT CONSIDERABLE LE NGTH. THE ISSUE IN RESPECT OF SHARE APPLICATION MONEY RECEIVED BY THE ASSESSEE FROM AS MANY AS 373 APPLICANTS HAD SEVERAL ROUNDS OF PROCEE DINGS. IN THE FIRST ROUND OF PROCEEDINGS, AS PER THE ORIGINAL ASSESSMEN T ORDER ASSESSEE GOT SUBSTANTIAL RELIEF IN RESPECT OF THE INVESTMENT UPT O RS.39,43,300/-. THEREAFTER, AS PER THE DIRECTIONS OF THE TRIBUNAL T HE ASSESSEE WAS REQUIRED TO COMPLY WITH THE NOTICES OF THE A.O. TO ESTABLISH THE IDENTITY OF REST OF THE INVESTORS. THEREFORE , THE REMAINING AMOUNT IN QUESTION WAS RS.59,56,000/-. IN RESPECT OF THIS BALANCE AMOUNT , NOW WE HAVE TAKEN A DECISION THAT ONLY RS.15,18,000/- REMAINED UNSUBSTA NTIATED AND THE ASSESSEE WAS NOT ABLE TO EVEN ESTABLISH THE BASIC R EQUIREMENT OF IDENTITY OF THOSE INVESTORS. WE HAVE FOUND THAT THE ASSES SEE HAS FAILED TO ESTABLISH THE EXISTENCE OF THE SHARE-HOLDERS, WHAT TO SAY ABOUT THEIR CREDITWORTHINESS AND THE GENUINENESS OF THE TRANSAC TION. THE ASSESSEE HAD THEREFORE FAILED TO ADVANCE ANY PLAUSIBLE EXPLA NATION ABOUT THEIR NON- ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 33 - COOPERATION OR NON-ATTENDANCE IN COMPLIANCE OF THE NOTICES. FROM THESE ADMITTED FACTS A FAIR CONCLUSION CAN BE DRAWN THAT IN RESPECT OF THE TRANSACTION, WHICH IS HEREBY CONFIRMED, THE ASSESSE E HAD MADE BOGUS CREDIT ENTRY IN THE BOOKS OF ACCOUNTS. THE ASSES SEE HAD GIVEN SUFFICIENT OPPORTUNITY TO PRODUCE THOSE INVESTORS BUT FAILED. EVEN THE ATTEMPTS OF THE REVENUE DEPARTMENT TO TRACE THOSE APPLICANTS HA VE FAILED. WE, THEREFORE, HOLD THAT CONCEALMENT PENALTY DESERVES T O BE LEVIED IN RESPECT OF THE BALANCE AMOUNT WHICH IS NOW CONFIRMED VIDE T HIS ORDER. ACCORDINGLY, PART RELIEF IS GRANTED AND WE HEREBY D IRECT THE A.O. TO RE- COMPUTE THE QUANTUM OF PENALTY. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. 19. WE SUMMARIZE THE RESULT AS UNDER:- (I) ASSESSEES APPEAL, ITA NO.2506/AHD/2006 FOR A. Y.1992-93 IS PARTLY ALLOWED. (II) ASSESSEES APPEAL, ITA NO.1673/AHD/2007 FOR A.Y.1992-93 IS ALLOWED. (II) ASSESSEES APPEAL, ITA NO.404/AHD/2008 FOR A.Y.1992-93 IS PARTLY ALLOWED. ORDER SIGNED, DATED AND PRONOUNCED IN THE COURT ON 30 TH JUNE, 2011. SD/- SD/- ( G.D. AGARWAL ) ( MUKUL KR. SHRAWAT ) VICE PRESIDENT (AZ) JUDICIAL ME MBER AHMEDABAD; DATED 30 / 6 /2011 T.C. NAIR, SR. PS ITA NO S.2506A/06, 1673/A/07 & 404/A/08 M/S.MODERN CEMENT INDS. LTD. VS. ACIT ASST.YEAR - 1992-93 - 34 - COPY OF THE ORDER FORWARDED TO : 1. THE ASSESSEE. 2. THE DEPARTMENT. 3. THE CIT CONCERNED. 4. THE LD. CIT(APPEALS)-XIX, AHMEDABAD 5. THE DR, AHMEDABAD BENCH 6. THE GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT.REGISTRAR), ITAT, AHMEDABAD 1. DATE OF DICTATION..16.5.2011 & 29/6/11 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 18.05.2011 & 30.6.11 OTHER MEMBER 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S.. 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S30/6/11 6. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 30/6/11 7. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 8. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 9. DATE OF DESPATCH OF THE ORDER