M/s. Neelkanth Town Planners Pvt. Ltd., New Delhi V. DCIT, New Delhi

ITA 2943/DEL/2015

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 4464 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 8 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-02-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Assessment Year: 2005-2006
• Appeal Filed On: 13-05-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SURENDER PAL
• Keywords: Unexplained cash credit; Search and seizure; Document seized; Opportunity of being heard; Principle of natural justice; Tangible material; Difference of opinion; Deemed dividend; Validity of assessment; Accommodation entries; Documents seized; Change of opinion; Reassessment proceedings
• Section: 143(3); 133A; 153A; 2(22)(e); 234B; 147; 131; 68; 148; 263; 132; 15

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : F : NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI L.P. SAHU, ACCOUNTANT MEMBER ITA NO. 2943/DEL/2015 ASSESSMENT YEAR : 2005-06 NEELKANTH TOWN PLANNERS PVT. LTD. G-36, 2 ND FLOOR, OUTER CIRCLE, CONNAUGHT PLACE, NEW DELHI 110 001 (PAN: AAACN2742D) VS. DCIT, CENTRAL CIRCLE-27, NEW DELHI (ASSESSEE) ( RESPONDENT) ASSESSEE BY : SH. SALIL AGGARWAL, SH. MADHUR AGGARWAL, SH. R.P. MALL, ADVOCATES DEPARTMENT BY : SH. SURENDER PAL, SR. DR. ORDER PER H.S. SIDHU, JM THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER PASSED BY THE LD. CIT(A)-29, NEW DELHI ON 07.04.2015 IN RE LATION TO THE ASSESSMENT YEAR 2005-06 ON THE FOLLOWING GROUNDS:- 1 THAT THE LEARNED COMMISSIONER INCOME TAX (APPEALS) HAS GROSSLY ERRED BOTH IN LAW AND ON FACTS IN MAKING AN ASSESSMENT UNDER SECTION 148/143(3) OF THE ACT AT AN INCOME OF RS.1,40,00,000/- AS AGAINST RETURNE D INCOME OF NIL, WHICH WAS ASSESSED AT NIL VIDE ASSESSMENT ORDER U/S 143 (3) DATED 31.12.2010. 2 2 THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED BOTH IN LAW AND ON FACTS IN INITIA TING THE PROCEEDINGS UNDER SECTION 147 OF THE ACT AND, FURTHE R COMPLETION OF ASSESSMENT UNDER SECTION 143(3)/147 OF THE ACT WITHOUT SATISFYING THE STATUTORY PRE-CONDITIONS FOR INITIATION OF THE PROCEEDINGS AND, COMPLETION OF ASSESSMEN T UNDER THE ACT. 3 THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS FURTHER ERRED IN LAW AND ON FACTS IN INI TIATING PROCEEDINGS U/S 147 OF THE ACT ON THE BASIS OF INFORMATI ON RECEIVED FROM DIT (INVESTIGATION) MECHANICALLY AND WITH OUT INDEPENDENT APPLICATION OF MIND. 3.1 THAT FURTHER, THE REASONS RECORDED WERE MERE REASONS TO SUSPECT AND WERE JUST TO MAKE FISHING AND ROVING ENQUIRIES, AS NO INDEPENDENT ENQUIRY WAS CONDUCTED BY THE ASSESSING OFFICER BEFORE ISSUING SUCH NOTICE UNDER SECTION 148 AND AS SUCH THE PROCEEDING INITIATED UNDER SECTION 148 WAS A MERE PRETENCE. 4 THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS FURTHER ERRED IN LAW AND ON FACTS BY IGN ORING THE BASIC FACT THAT ASSESSMENT WAS ALREADY FINALIZED UNDER SECTION 143 (3) OF THE ACT ON THE ASSESSEE COMPANY, WHEREIN, ASSESSEE COMPANY MADE FULL AND TRUE DISCLOSURE OF ITS AFFAIRS AND AS SUCH, THE REASONS RECORDED BY LEARNE D ITO ARE MERE REASONS TO SUSPECT AND IS A CLEAR CASE OF CHANGE OF OPINION, AND AS SUCH, PROCEEDINGS UNDER SECTION 147 ARE MISCONCEIVED AND MISPLACED IN LAW AND IS LIABLE TO BE DISMISSED AS SUCH. 3 5 THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS FURTHER ERRED BOTH IN LAW AND ON FACTS I N SUSTAINING AN ADDITION OF RS. 1, 20, 00, 000/- AS ALLEG ED ACCOMMODATION ENTRY RECEIVED FROM SH. S.K. GUPTA, AND HELD TO BE UNEXPLAINED CASH CREDIT U/S 68 OF THE ACT. 5.1 THAT IN DOING SO, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ARBITRARILY BRUSHED ASIDE THE NECESSARY DOCUMENTS/ EVIDENCES WHICH WERE FILED BEFORE HIM EXPLAINING THE FACT THAT THE APPELLANT COMPANY HA S RECEIVED ADVANCE AMOUNTING TO RS. 1, 20, 00, 000/- FRO M M/S VIJAY SHINES PVT. LTD., WHICH WAS DULY REFLECTED I N THE APPELLANT COMPANYS BANK ACCOUNT. 5.2 THAT FURTHER THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) IGNORED THE BASIC FACT THAT NO AMOUNT W AS EVER RECEIVED FROM SH. S.K. GUPTA (THE ALLEGED ACCOMMODATION ENTRY OPERATOR), RATHER RS.1, 40, 00, 00 0/- WAS RECEIVED FROM M/S VIJAY SHINES PVT. LTD., AND ALL NECESSARY DETAILS REGARDING THE SAID TRANSACTIONS WERE FILE D BEFORE LEARNED DCIT, WHICH WERE TOTALLY IGNORED BY T HE LEARNED DCIT, THUS, ADDITION SO MADE BY LEARNED DCIT WAS CLEARLY BASED ON SUSPICIONS AND SURMISES AND IS LIABLE TO BE DELETED AS SUCH. 6 THAT FURTHER THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) IGNORED THE BASIC FACT THAT UNDISPUTEDLY , THE ASSESSEE APPELLANT HAD FILED ITS OBJECTIONS BEFORE THE ASSESSING OFFICER VIDE LETTER DATED 22.03.2013, MAKING A SPECIFIC REQUEST TO FURNISH THE COPIES OF ANY MATERIAL AVAILABLE WITH HIM FOR REBUTTAL TO THE ASSESSEE. THE 4 ASSESSING OFFICER, HOWEVER, DID NOT FURNISH ANY MATERIAL TO THE ASSESSEE FOR REBUTTAL. THE ADDITION WAS MADE RELYING ON A MERE GENERAL STATEMENT RECORDED AT THE BACK OF TH E ASSESSEE AND WITHOUT PROVIDING THE ASSESSEE ANY OPPORTUNITY TO CROSS-EXAMINE THE DEPONENT, I.E., SHRI S.K. GUPTA. THUS, THE SAID ADDITION HAS NO LEGS TO STAND AND IS LIABLE TO BE DELETED AS SUCH FOLLOWING THE JUDICIAL MA NDATE OF HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS ASHWA NI GUPTA REPORTED IN 322 ITR 396. 7 THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS FAILED IN CONDUCTING ANY FURTHER INQUIRY I.E. NEVER ASKED THE ASSESSEE COMPANY TO PRODUCE THE SAID PARTY NOR ISSUED SUMMONS UNDER SECTION 131 TO THE SAID PARTY, WHEREAS ALL THE NECESSARY DOCUMENTS WERE FILED BEFORE HIM. THUS, IT WOULD BE CLEAR THAT THE ORDER P ASSED BY THE LEARNED DCIT IS CLEARLY PERVERSE AND NOT BACKED BY PROPER INVESTIGATION AND VERIFICATION AND AS SUCH IS LI ABLE TO BE DISMISSED FOLLOWING THE JUDGMENT OF HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS GOEL SONS GOLDEN ESTATE PVT. LTD. IN ITA 2012. 8 THAT THE LEARNED DEPUTY COMMISSIONER OF INCOME TAX HAS ERRED IN LAW AND ON FACTS IN MAKING ADDITIONS IN THE HANDS OF ASSESSEE COMPANY, WITHOUT GIVING ANY FAIR AND PROPER OPPORTUNITY OF BEING HEARD TO THE APPELL ANT COMPANY. THEREBY, VIOLATING THE PRINCIPLES OF NATURAL JUSTICE. 5 9 THAT THE LEARNED INCOME TAX OFFICER HAS FURTHER ERRED BY LEVYING INTEREST U/S 234B OF THE ACT, WHICH I S NOT LEVIABLE ON THE FACTS OF THE APPELLANT COMPANY. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE ENGAGE D IN THE BUSINESS OF REAL ESTATE. THE ORIGINAL ASSESSMENT IN THIS CASE WAS COMPLETED UNDER SECTION 153C/143(3) OF THE INCOME TAX ACT, 1961 ( IN SHORT ACT) VIDE ORDER DATED 31.12.2010 AT AN INCOME AT NIL INCOME AGA INST THE RETURNED INCOME OF RS. NIL. SUBSEQUENTLY, INFORMATION WAS RECEIV ED FROM ACIT, CC- 22, NEW DELHI HAVING JURISDICTION OVER THE CASE OF SH. SK GUPTA AN ENTRY OPERATOR THAT THE ASSESSEE COMPANY M/S NEELKANTH TOWN PLA NNERS PVT. LTD. HAS BEEN THE BENEFICIARY OF ACCOMMODATION ENTRIES OBTAIN ED FROM SH. SK GUPTA THROUGH VARIOUS CONCERNS FLOATED BY HIM FOR THIS P URPOSE. THEREFORE, NOTICE U/S. 148 OF THE ACT WAS ISSUED ON 30.3.2012, REQU IRING THE ASSESSEE TO FILE ITS RETURN OF INCOME FOR THE AY 2005-06 AND A SSESSMENT, THEREAFTER, WAS FRAMED UNDER SECTION 148/143(3)OF THE ACT ON 25.03. 2013, MAKING AN ADDITION OF RS.1,40,00,000/-, ON ACCOUNT OF ALLEGED ACCO MMODATION ENTRY RECEIVED BY THE ASSESSEE COMPANY. AGAINST THE ASSESSMENT ORD ER DATED 25.3.2013, ASSESSEE APPEALED BEFORE THE LD. CIT(A), WHO VIDE HIS IMPUGNED ORDER DATED 07.04.2015 HAS GAVE RELIEF OF RS. 20,00,0 00/- TO THE ASSESSEE COMPANY ON ACCOUNT OF DUPLICATION OF ENTRIES ADDED BY AO . HOWEVER, HE SUSTAINED AN ADDITION OF A SUM OF RS. 1,20,00,000/- A ND ALSO UPHELD THE ACTION OF AO IN FRAMING THE ASSESSMENT UNDER SECTION 147 O F THE ACT. 6 AGGRIEVED WITH THE IMPUGNED ORDER DATED 7.4.2015, ASSESSEE APPEALED BEFORE US. 3. DURING THE COURSE OF HEARING LD. COUNSEL FOR THE A SSESSEE, SH. SALIL AGGARWAL, HAS STATED THAT GROUND NO. 2 TO 4 MAY BE D ECIDED FIRST WHICH ARE IN LEGAL NATURE AND GOES TO THE ROOT OF THE MATTER. HE STATED THAT SINCE THE ORIGINAL ASSESSMENT WAS FRAMED UNDER SECTION 153C/143(3) O F THE ACT, WHEREIN, THE SCOPE OF ASSESSMENT WAS LIMITED TO THE SEIZED DOCUMENTS OR INCRIMINATING MATERIAL FOUND AS A RESULT OF SEARCH ON TA NEJA PURI GROUP OF CASES BELONGING TO ASSESSEE COMPANY. HE FURTHER SUBMITTED THA T ADMITTEDLY NO ADDITION WAS MADE BY THE AO DURING THE SAID PROCEED INGS, AS NO DOCUMENT WAS FOUND MUCH LESS INCRIMINATING AS A RESULT OF SE ARCH ON TANEJA PURI GROUP OF CASES BELONGING TO ASSESSEE COMPANY SO AS TO M AKE ADDITIONS UNDER SECTION 153C OF THE INCOME TAX ACT BY BRINGING TO TAX ANY UNDISCLOSED INCOME. HE FURTHER ARGUED THAT THE AO BY ISSUING OF NO TICE U/S. 148 OF THE ACT, HAD REOPENED THE ASSESSMENT PROCEEDINGS WHICH WERE ALR EADY FINALIZED UNDER SECTION 153C OF THE ACT, AS IS ALSO EVIDENT FROM P AGE 3 OF THE ORDER OF ASSESSMENT, WHEREIN, PRIOR APPROVAL OF CIT (CENTRAL) III, NEW DELHI UNDER SECTION 151 OF THE ACT WAS OBTAINED BY AO. THUS, ONCE THE SCOPE OF ORIGINAL ASSESSMENT PROCEEDINGS UNDER SECTION 153C OF THE ACT WAS ONL Y WITH RESPECT TO INCRIMINATING MATERIAL FOUND AS A RESULT OF SEARCH ON TANEJA PURI GROUP OF CASES BELONGING TO ASSESSEE COMPANY, THEN ADMITTEDLY, THE SCO PE OF ASSESSMENT COULD NOT BE ENLARGED BY ISSUING NOTICE UNDER SE CTION 148 OF THE 7 ACT, IN ABSENCE OF ANY INCRIMINATING MATERIAL FOUND AS A RESULT OF SEARCH ON TANEJA PURI GROUP OF CASES BELONGING TO ASSESSEE COMPANY AN D AS SUCH, ANY ADDITION SO MADE BY LEARNED AO IS BEYOND THE PURVIEW OF REASSESSMENT PROCEEDINGS UNDER SECTION 148 OF THE ACT. IN SUPPORT OF T HE AFORESAID PROPOSITION, HE RELIED ON THE FOLLOWING CASE LAWS AND FILED THE COPIES THEREOF. - COPY OF ORDER OF HONBLE ITAT DELHI IN THE CASE OF M AHESH KUMAR GUPTA VS CIT IN ITA NO. 1347/DEL/2014. - COPY OF ORDER OF HONBLE ITAT DELHI IN THE CASE OF S MC POWER GENERATION LTD. VS PCIT IN ITA NO. 2161/DEL/20 16. - COPY OF JUDGMENT OF HONBLE HIGH COURT OF DELHI IN THE CASE OF PCIT VS MAHESH KUMAR GUPTA IN ITA NO. 810/2016. - COPY OF JUDGMENT OF HONBLE HIGH COURT OF DELHI IN THE CASE OF PCIT VS SMC POWER GENERATION LTD. IN ITA NO. 603/2017. 4. ON THE CONTRARY, LD. DR HAS RELIED UPON THE ORDER S OF THE AUTHORITIES BELOW AND THAT THE ADDITION IN DISPUTE IS BASED ON FR ESH TANGIBLE MATERIAL AND AS SUCH, THE PROCEEDINGS UNDER SECTION 148 OF THE ACT H AVE BEEN RIGHTLY INITIATED BY THE AO, WHICH DOES NOT NEED ANY INTERFER ENCE. IN SUPPORT OF HIS CONTENTION, HE RELIED UPON FOLLOWING CASES LAWS:- 8 - PR. CIT VS. NDR PROMOTERS PVT. LTD. ITA 49/2008 DAT ED 31.10.2018. - SONIA GANDHI & ORS. VS. ACIT & ORS. DELHI HIGH COURT DECISION DATED 10.9.2018 IN WP 8482/2018, CM APPL. 32580-32582/2018. - HONBLE SUPREME COURT DECISION IN THE CASE OF PHOOL CH AND BAJRANG LAL AND OTHERS VS. ITO & ANR. 2002-TIOL-794-S C- IT. - ITO VS. SELECTED DALURBAND COAL CO. PVT. LTD. (2002 -TIOL- 2198-SC-IT) - RAJAT EXPORT IMPORT INDIA (P) LTD. VS. ITO (2012) 18 TAXMANN.COM 311 (DELHI). - YUVRAJ VS. UOI (2009) 315 ITR 84 (BOMBAY). - ITAT, DELHI BENCH DECISION DATED 23.8.2018 IN THE CASE OF PEER AAR SECURITIES LTD. VS. DCIT IN ITA NO. 4978/DEL/2014 (AY 2005-06). - CIT VS. PARAMOUNT COMMUNICATION (P) LTD. (2017-TIOL- 253-SC-IT) - INDU LATA RANGWALA VS. DCIT (2017 80 TAXMANN.COM 10 2 (DELHI) 9 - THAKORBHAI MANGANBHAI PATEL VS. ITO (2017) 78 TAXMANN.COM 201 SC - ARAVALI INFRAPOWER LTD. VS. DCIT (2017-TIOL-42-SC -IT). - RAYMOND WOOLEN MILLS LTD. VS. ITO & ORS. 236 ITR 34 - RK MALHOTRA ITO VS. KASTURBA LALBAHI (1977) 109 I TR 537 (SC) - ACIT VS. RAJESH JHAVERI STOCK BROKERS (P) LTD. (2007 ) 161 TAXMAN 316 (SC) - ANKIT FINANCIAL SERVICSE LTD. VS. DCIT (2017) 78 TAXMANN.COM 58 (GUJARAT) 5. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATER IAL ON RECORD. WE FIND THAT GROUND NOS. 2 TO 4 RAISED BY THE ASSESSEE A RE LEGAL GROUNDS CHALLENGING THE VALIDITY OF ASSESSMENT UNDER SECTION 148 O F THE ACT AND THE SAME GOES TO THE ROOT OF THE MATTER AND THEREFORE, NE EDS TO BE ADJUDICATED FIRST, AS THE ISSUES ON MERITS WILL ONLY ARISE ONCE WE ARE NOT SATISFIED WITH THE LEGAL GROUNDS SO RAISED BY THE ASSESSEE COMPANY. THUS, WE AR E DECIDING THE LEGAL GROUNDS FIRST. ON GOING THROUGH THE PAPER BOOKS SO FILED BY THE ASSESSEE COMPANY, IT BECOMES EVIDENT THAT ORIGINAL ASSESSMENT WAS FRAMED UNDER SECTION 153C/143(3) OVER THE ASSESSEE COMPANY VIDE O RDER DATED 31.12.2010, WHEREIN, RETURNED INCOME OF THE ASSESSEE COM PANY WAS ACCEPTED, AS SUCH. WE FURTHER NOTE THAT THE AO VIDE ISSU ING OF NOTICE UNDER 10 SECTION 148 OF THE ACT DATED 30.03.2012 HAS REOPENED TH E ASSESSMENT SO FRAMED UNDER SECTION 153C OF THE ACT, WHICH IS EVIDENT F ROM READING OF AOS ORDER, WHEREIN, APPROVAL OF CIT (CENTRAL) III, NE W DELHI WAS TAKEN PRIOR TO ISSUANCE OF NOTICE UNDER SECTION 148 OF THE ACT, WHICH SHOW S THAT THE APPROVAL HAS BEEN TAKEN AS PER PROVISO TO SECTION 151(1 ) OF THE ACT AND AS SUCH, IT IS PROCEEDINGS ALREADY FINALIZED UNDER SECTION 15 3C OF THE ACT, WHICH HAVE BEEN REOPENED BY THE AO. WE FURTHER FIND THAT THE AO HAS REOPENED THE ASSESSMENT FINALIZED UNDER SECTION 153C OF THE ACT, NO W, THE QUESTION THAT WE NEED TO DECIDE IS WHETHER, THE AO IS ALLOWED IN LAW TO MAKE ADDITIONS UNDER SECTION 148/ 147 PROCEEDINGS, WHICH HE WA S OTHERWISE PRECLUDED TO MAKE IN ORIGINAL PROCEEDINGS UNDER SECTION 153C OF THE ACT. IN SHORT, IF AO IS ALLOWED TO MAKE ADDITIONS UNDER SECTION 148 OF THE ACT, IT WOULD TANTAMOUNT TO ALLOW HIM TO GAIN A BACK DOOR EN TRY TO FRAME ASSESSMENT WHICH HE WAS NOT LEGALLY PERMITTED TO DO SO AS P ER THE PROVISIONS OF SECTION 153C OF THE ACT, AS SOMETHING WHICH COULD NOT HAVE BEEN ASSESSED ORIGINALLY DUE TO LACK OF INCRIMINATING MAT ERIAL FOUND AS A RESULT OF SEARCH ON TANEJA PURI GROUP OF CASES BELONGING TO ASSESSEE, WOULD THUS, BE ALLOWED UNDER SECTION 148 OF THE ACT. AT THIS J UNCTURE, IT WOULD BE APPROPRIATE TO EXTRACT THE REASONS RECORDED SO RECORDED B Y AO IN ORDER TO REOPEN THE IMPUGNED PROCEEDINGS UNDER SECTION 147 OF TH E ACT: 11 A SEARCH & SEIZURE ACTION U/S 132 WAS CARRIED OUT IN M/S T DI GROUP OF CASES ON 05.01.2009. THE CASE WAS CENTRALIZED WI TH CENTRAL CIRCLE-16. 2 THE ASSESSMENT IN THE CASE OF M/S NEELKANTH TOWN PLA NNERS PVT.LTD. WAS COMPLETED VIDE ORDER U/S 153C/143(3) OF THE ACT, 1961 DATED 31.12.2010 AT RETURNED INCOME OF RS. NIL. 3. A LETTER HAS BEEN RECEIVED FROM THE CIT (CENTRA L)-III, NEW DELHI FORWARDING THEREWITH COPY OF LETTER OF THE ACI T, CENTRAL CIRCLE -22, NEW DELHI. AS PER INFORMATION VIDE THIS LE TTER (SUPRA), A SURVEY U/S 133A WAS CONDUCTED ON 20.11.2007 IN THE CASE OF SH. S.K. GUPTA AND THE COMPANIES OPERATED BY HIM AT 3 08, ARUNACHAL BUILDING, 19, BARAKHAMBA ROAD, NEW DELHI-1 10001. S.K. GUPTA BASICALLY A CHARTERED ACCOUNTED BUT HE IS FOUN D TO HAVE BEEN INDULGED IN PROVIDING ACCOMMODATION ENTRIES TO THE DIFFERENT PARTIES THROUGH THE BANK ACCOUNTS OPERATED B Y HIM IN THE NAME OF DIFFERENT COMPANIES, INDIVIDUAL AND OTHE RS, REPORTED TO BE MORE THAN 30 IN NUMBER. AS PER THE PRINT OUT T AKEN FROM ANNEXURE A-14, (LAPTOP) IMPOUNDED DURING THE COURSE O F SURVEY, THERE WERE HUGE CASH FOUND TO HAVE BEEN DEPOSITED IN V ARIOUS LEDGER ACCOUNTS. SH. S.K. GUPTA IS THE MAIN PERSON CONTRO LLING THE CONCERN OF THIS GROUP. 12 4. THIS FACT WAS CONFRONTED TO SH. S.K. GUPTA WHO, VI DE HIS STATEMENT ON 26.12.2008 HAS ADMITTED AS UNDER:- Q2. INVESTIGATION WING OF THE INCOME TAX DEPART MENT HAS REPORTED THAT TRANSACTION UNDERTAKEN THROUGH THESE COM PANIES WERE NOT GENUINE. THEY WERE MERE ENTRIES GIVEN FOR E QUIVALENT CASH AND YOU CHARGED CERTAIN COMMISSION FOR THOSE TRANSACTIO NS. ANS. YES, I AGREE WITH ABOVE STATEMENT EXCEPT FOR SOME GENUINE WORK OF SHARE BROKERAGE, OTHER TRANSACTION DON E ARE NOT GENUINE. CASH WAS TAKEN AND CHEQUES WERE ISSUED FROM DIF FERENT COMPANIES. THE EXACT DETAILS OF EACH PARTY ARE RECORDED IN THE COMPUTER SEIZED BY THE DEPARTMENT IN THE SURVEY OPERAT IONS ON 20.11.2007 AT MY PREMISES. DETAILS OF PREMIUM EARNED B Y ME ARE ALSO RECORDED THERE. THE COMMISSION INCOME EARNED BEL ONGS TO ME AND SHOULD BE TAXED IN MY HANDS. DETAILS OF THE ENTRIES GIVEN OVER IN DIFFERENT YEARS LIKE ADDRESSES OF BENEFICI ARIES AND NATURE OF TRANSACTION WILL BE SUPPLIED FROM TO TIME. 5. A LIST OF BENEFICIARIES OF ACCOMMODATION ENTRI ES PROVIDED BY SH. SURESH KUMAR GUPTA FOR A.Y. 2005-2006 IS ALSO E NCLOSED WITH THE LETTER (SUPRA), A PERUSAL OF THE LIST ENCLOSED WITH THE LETTER OF THE ACIT, CC-22, NEW DELHI REVEALS THAT M/ S NEELKANTH TOWN PLANNRSPVT. LTD. WHO IS ASSESSED TO TAX WITH THIS C IRCLE, IS 13 ONE OF THE BENEFICIARIES AND HAS RECEIVED ACCOMMODATION E NTRIES AS PER DETAILS GIVEN BELOW: S.NO DATE OF ENTRY IN BOOKS CH.NO./PO/DD CH.DATE COMPANY FROM WHOM ISSUING BANK PARTY TO WHOM ISSUED AMOUNT 1 15.06.04 754930 15.06.04 VIJAYA SHINES SIB NEEL KANTH TOWN PLANNERS PVT.LTD. 1000000 2 17.06.04 754931 16.06.04 VIJAYA SHINES SIB NEEL KANTH TOWN PLANNERS PVT.LTD. 2000000 3 21.06.04 754939 19.06.04 VIJAYA SHINES SIB NEEL KANTH TOWN PLANNERS PVT.LTD. 2000000 4 21.06.04 754940 19.06.04 VIJAYA SHINES SIB NEEL KANTH TOWN PLANNERS PVT.LTD. 1500000 5 21.06.04 754941 19.06.04 VIJAYA SHINES SIB NEEL KANTH TOWN PLANNERS PVT.LTD. 500000 6 24.06.04 754946 20.06.04 VIJAYA SHINES SIB NEEL KANTH TOWN PLANNERS PVT.LTD. 3000000 7 04.06.04 754939 19.06.04 VIJAYA SHINES SIB NEEL KANTH TOWN 2000000 14 PLANNERS PVT.LTD. 7 24.06.04 754947 20.06.04 VIJAYA SHINES SIB NEEL KANTH TOWN PLANNERS PVT.LTD. 200000 6. IN VIEW OF THIS, I AM SATISFIED THAT THE IN COME TO THE TUNE OF RS. 1,22,00,000/- HAS ESCAPED ASSESSMENT BY REASON OF THE FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS NECESSARY FOR ITS ASSESSMENT FOR THE ASSESSMENT YEAR 2005-2006. SD/- (FARHAT KHAN) ACIT, CENTRAL CIRCLE-18, NEW DELHI 5.1 AFTER PERUSING THE REASONS RECORDED, IT IS CRYSTAL C LEAR THAT THE MAIN BASIS FOR AO TO REOPEN THE COMPLETED ASSESSMENT UNDER SECTIO N 153C OF THE ACT WAS SURVEY CONDUCTED ON SH. S.K. GUPTA ON 20.11.200 7 AND STATEMENT OF SH. S.K. GUPTA RECORDED ON 26.12.2008, WHICH CANNOT BE REGARDED BY ANY STRETCH OF IMAGINATION TO BE DOCUMENT BELONGING TO THE ASSESSEE COMPANY AND THAT TOO INCRIMINATING IN NATURE SO AS TO MAKE ANY ADDITION AND THE AO HAD RIGHTLY MADE NO ADDITION IN THE HANDS OF ASSESSEE CO MPANY WHILE FRAMING ASSESSMENT UNDER SECTION 153C OF THE ACT. 15 5.2 IN THIS REGARD, WE FIND THAT THE ISSUE AT HAND IS NO MORE RES INTEGRA, AS IN FOLLOWING CASES HONBLE JURISDICTIONAL HIGH COURT AN D ALSO COORDINATE BENCHES OF TRIBUNAL HAVE DEALT THE INSTANT ISSUE AND H AVE DECIDED THE SAME IN FAVOUR OF THE ASSESSEE. OUR AFORESAID VIEW IS FORTIF IED BY THE FOLLOWING JUDGMENTS/DECISIONS:- (I) PCIT VS MAHESH KUMAR GUPTA IN ITA NO. 810/2016 (D ELHI HIGH COURT). PARA 4. THERE IS NO DISPUTE THAT THE SEARCH AND SEIZURE PROCEEDINGS IN THIS CASE DID NOT RESULT IN ANYTHING, THEREFORE, MATERIAL EITHER IN THE FORM OF BOOKS OF ACCOUNT OR OTHER DOCUMENTS RELATED TO THE ISSUE OF DEEMED DIVIDEND UNDER SECTION 2(22) OF THE ACT. THE AMOUNTS PAID WERE IN FACT ORIGINALLY DECLARED IN THE ASSESSMENT RETURNS OF THE ASSESSEE. THE CIT, THEREFORE, HAD OPPORTUNITY TO EXERCISE HIS POWERS AS IT WERE ON THE BASIS OF RETURNS AS FILED ORIGINALLY AND VALIDLY UNDER SECTION 263 OF THE ACT. PARA 5. IN THE CIRCUMSTANCES IN THE ABSENCE OF ANY MATERIAL DISCLOSING THAT THE ISSUE OF DEEMED DIVIDEND HAD BEEN WILFULLY DERIVED OR HAD BEEN DEEMED OR OTHERWISE WITHHELD FROM THE ASSESSMENT AN ADDITION 16 UNDER SECTION 153A WAS WARRANTED BASED ON THE PROPOSITION TAUGHT BY THIS COURT IN JUDGMENT DATED 28.08.2015 IN ITA 707/2014 TITLED: CIT VS KABUL CHAWLA. THEREFORE, WE CONCUR WITH THE ITATS OPINION IN THIS REGARD. THE SEARCH AND SEIZURE PROCEEDINGS IN SUCH CASES ARE UNDOUBTEDLY MEANT TO BRING TO TAX AMOUNT THAT ARE TO BE DETERMINED ON THE BASIS OF MATERIALS SEIZED IN THE COURSE OF SUCH SEARCHES; PERMITTING ANYTHING OVER AND ABOVE THAT WOULD VIRTUALLY AMOUNT TO LETTING THE REVENUE HAVE A THIR D OR FOURTH OPINION AS IT WERE. SEARCHES TO QUOTE THE VIEW OF ATTORNEY-GENERAL (NSW) VS QUIN (1990) HCA 21 IN ANOTHER CONTEXT ARE NOT THE KEY WHICH UNLOCKS THE TREASURY OF THE REVENUES JURISDICTION IN REGARD TO MATTERS THAT HAD ATTRACTED ATTENTION IN THE REGULA R COURSE OF ASSESSMENT. (II) SMC POWER GENERATION LTD. VS PCIT IN ITA NO. 2161/DEL/2016 (ITAT DELHI). 8. WE HAVE CAREFULLY CONSIDERED THE RIVAL CONTENTIONS. ON THE BASIS OF RECORDS PRODUCED BEFORE 17 US THERE ARE TWO ORDERS PASSED IN THIS CASE, ONE U/S 143(3) OF THE ACT ON 22.12.2010 AND SECOND U/S 153A OF THE ACT DATED 31.3.2014. ADMITTEDLY, THE ORIGINAL ORDER PASSED U/S 143(3) OF THE ACT CANNOT BE REVISED AS TIME LIMIT FOR ITS REVISION WAS GOT OVER ON 31.3.2013. THEREFORE, HERE THE ATTEMPT WAS MADE TO REVISE THE ASSESSMENT ORDER PASSED U/S 153A OF THE ACT 31.3.2014. IT IS AN ADMITTED FACT THAT ORIGINAL ASSESSMENT WAS MADE U/S 153A OF THE ACT IS REQUIRED TO BE MADE ON THE BASIS OF INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH. ACTION U/S 263 OF THE ACT CAN BE PERMITTED OF SUCH ORDER ONLY IF THE INCRIMINATING DOCUMENTS FOUND DURING THE COURSE OF SEARCH BASED ON WHICH ORDER U/S 153A OF THE ACT MADE BY THE ASSESSING OFFICER IS FOUND TO BE ERRONEOUS SO FAR AS IT IS PREJUDICIAL TO THE INTEREST O F REVENUE. THE LD CIT HAS ATTEMPTED TO REVISE THE ORDER ON THE GROUND THAT ASSESSEE HAS ACCEPTED SHARE APPLICATION MONEY IN THE IMPUGNED ASSESSMENT YEAR WHICH WAS NOT PROPERLY VERIFIED BY THE LD AO. HENCE IN THE PRESENT CASE THE LD CIT HAS NOT REFERRED TO ANY DOCUMENT WHICH WAS FOUND 18 DURING THE COURSE OF SEARCH RELATING TO SHARE APPLICATION MONEY AMOUNTING TO RS. 30 CRORES BASED ON WHICH THE ASSESSMENT IS SOUGHT TO BE REVISED U/S 263 OF THE INCOME TAX ACT. THE COORDINATE BENCH HAS DECIDED THE IDENTICAL ISSUE IN ITA NO. 1347/DEL/.2014 WHEREIN IT HAS BEEN HELD AS UNDER:- THUS, IN THE PRESENT CASE THE ISSUE OF DEEMED DIVIDEND DOES NOT ARISE FROM THE PROVISIONS OF SECTION 153A OF THE ACT AND THERE IS NO SEIZED MATERIAL UNEARTHED AT THE RELEVANT TIME. THUS, IT IS BEYOND ASSESSING OFFICERS POWER TO ADDRESS THE SAID ISSUE IN PROCEEDINGS INITIATED UNDER SECTION 143(3) READ WITH SECTION 153A OF THE ACT. THE CIT WAS WRONG IN DIRECTING THE EXAMINATION OF TAXABILITY OF DEEMED DIVIDEND UNDER SECTION 2(22)(E) OF THE ACT, IN THE PROCEEDINGS U/S 153A OF THE ACT WHILE PASSING ORDER U/S 263 OF THE ACT WHEN THE PROCEEDINGS U/S 153A ITSELF HAS NOT UNEARTHED THE SAID ISSUE. THUS, THE CIT DO NOT HAVE POWER UNDER SECTION 263 OF THE ACT TO GIVE ITS OWN OPINION WHEN THERE IS NO NEW 19 MATERIAL UNEARTHED. THE ISSUE TAKEN UP BY THE CIT WAS NOT WITHIN THE PURVIEW OF THE ASSESSING OFFICER AT THE INCEPTION OF ASSESSMENT PROCEEDINGS. 9. THE LD DR COULD NOT CONTROVERT THE ABOVE DECISION OR ALSO COULD NOT CITE ANY OTHER DECISION OF HIGHER FORUM, WHICH COULD JUSTIFY THE ACTION OF THE LD. CIT. THE POWER FOR REVISION U/S 263 OF THE ACT VEST WITH THE CIT WHEN HE FINDS THAT ORDER PASSED BY THE ASSESSING OFFICER IS ERRONEOUS AS FAR AS IT IS PRE JUDICIAL TO THE INTEREST OF REVENUE. THE PROVISIONS OF SECTION 153A PROVIDES FOR FRAMING A ASSESSMENT IN SEARCH CASE ON THE BASIS OF INCRIMINATING DOCUMENTS FOUND DURING THE COURSE OF SEARCH. THEREFORE, THE PROVISIONS OF SECTION 263 CAN BE APPLIED IN ASSESSMENT-FRAMED U/S 153A OF THE ACT ONLY WHEN THE ORDER FRAMED U/S 153A IS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE IN IGNORANCE O F INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH. NO DOUBT ORIGINAL ASSESSMENT MADE U/S 143(3) CAN BE REVISED U/S 263 OF THE ACT DESPITE THE ASSESSMENT U/S 153A OF THE ACT FOR THE SAME 20 ASSESSMENT YEAR, PROVIDED THE TIME LIMIT PRESCRIBED U/S 263 ( 2) OF THE ACT IS AVAILABLE. IN THIS CASE, IT HAS ALREADY EXPIRED ON 31.3.2013. FURTHER, WHILE PASSING IMPUGNED ORDER U/S 263 OF THE ACT LD CIT HAS NOT MADE ANY REFERENCE TO INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH BUT IT IS ADMITTEDLY MADE ON ACCOUNT OF OBSERVATION OF THE LD CIT(A) WHILE DISPOSING OF APPEAL OF THE ASSESSEE FOR AY 2009-10. IN VIEW OF THIS RESPECTFULLY FOLLOWING THE DECISION OF COORDINATE BENCH, WE ALSO HOLD THAT THE LD CIT(A) HAS ERRED IN ASSUMING JURISDICTION U/S 263 OF THE ACT. 6. THAT ON GOING THROUGH THE REASONS RECORDED IN THE I NSTANT CASE AND ALSO THE AFORESAID JUDGMENT/DECISION RELIED UPON BY TH E LD. COUNSEL FOR THE ASSESSEE, WE HAVE NO HESITATION IN QUASHING THE IMPUGNED REASSESSMENT PROCEEDINGS INITIATED UNDER SECTION 148/147 OF THE ACT A S ON PERUSAL OF REASONS RECORDED IT IS EVIDENT THAT AO HAS NOT MADE ANY REFERENCE TO ANY DOCUMENT MUCH LESS ANY INCRIMINATING MATERIAL FOUND BEL ONGING TO ASSESSEE COMPANY DURING THE COURSE OF SEARCH ON TANEJA PURI GROUP OF CASES ON 05.01.2009 WHICH COULD CLOTHE THE AO WITH JURISDICTION T O REOPEN THE ALREADY CONCLUDED ASSESSMENTS UNDER SECTION 153C OF THE ACT. HOWEVER, THE DECISIONS RELIED UPON BY THE LD. DR ARE ON DISTINGUISHE D FACTS. ALSO LD. D.R. 21 COULD NOT CONTROVERT THE AFORESAID FACTS AND THE RELIAN CE PLACED ON AFORESAID DECISIONS RELIED UPON BY THE LD. COUNSEL FOR THE ASSESSEE. , AS TO HOW THE SAID ISSUE IS NOT SQUARELY COVERED BY THE AFORESAID DECISIO N OF THE HONBLE JURISDICTIONAL HIGH COURT. THEREFORE RESPECTFULLY FOLLOW ING THE AFORESAID DECISIONS, WE QUASH THE REASSESSMENT MADE BY THE ASSESSING OF FICER U/S. 148/ 147 OF THE ACT. ACCORDINGLY, GROUND NOS. 2 TO 4 OF THE APPEAL RAISED BY THE ASSESSEE ARE ALLOWED. SINCE WE HAVE ALLOWED THE LE GAL GROUNDS NO. 2 TO 4 AS AFORESAID, THE OTHER GROUNDS RAISED BY THE ASSESSEE O N MERITS ARE NOT BEING ADJUDICATED. 7. IN THE RESULT APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED ON 08-02-2019. SD/- SD/- [L.P. SAHU] [H.S. SIDHU] ACCOUNTANT MEMBER JUDICIAL MEMB ER DATED: 08-02-2019 SRBHATNAGAR COPY FORWARDED TO: 1. ASSESSEE 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT AR, ITAT, NEW DELHI.