ITO 4(1)(3), MUMBAI V. AGARWAL CLOTH AGENCY P.LTD, MUMBAI

ITA 2969/MUM/2017

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 4169 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 3 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-08-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2007-2008
• Appeal Filed On: 25-04-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N PADMANABAN
• Assessee Lawyers: ANKUSH AGARWAL
• Keywords: Bogus purchase; Unexplained cash credit; Unexplained expenditure; Search and seizure; Principle of natural justice; Opportunity of cross examination; Validity of assessment; Accommodation entries; Retraction
• Section: 69C; 147; 131; 148; 37; 132; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A, BENCH M UMBAI BEFORE SHRI G. MANJUNATHA, ACCOUNTANT MEMBER & SHRI RAM LAL NEGI, JUDICIAL MEM BER ITA NO.2969/MUM/2017 ( ASSESSMENT YEAR :2007-08 ) ITO-4(1)(3) ROOM NO.637A, 6 TH FLOOR AAYKAR BHAWAN M.K.ROAD MUMBAI-400 020 VS. M/S AGARWAL CLOTH AGENCY PVT.LTD. 122, ZAVERI BAZAR TRISHALA BUILDING,5 TH FLOOR OPP. KHARAKUA MUMBAI-400 002 PAN/GIR NO. AAECA6963D APPELLANT ) .. RESPONDENT ) ASSESSEE BY VISHNU AGARWAL & ANKUSH AGARWAL REVENUE BY N.PADMANABAN DATE OF HEARING 24/07/2019 DATE OF PRONOUNCEMENT 23/ 0 8 /201 9 / O R D E R PER G.MANJUNATHA (A.M) : THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAINS T THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)9, MUMBAI, DATED 16/01/2017 AND IT PERTAINS TO THE ASSESSMENT YEAR 2 007-08. 2. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL:- 1. 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD CIT(A) HAS ERRED IN DIRECTING THE AO TO DELETE T HE ADDITION MADE TOWARDS UNEXPLAINED CASH CREDIT OF RS.1,25,00,000/- U/S. 68 OF THE I. T. ACT.' 2. 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD. CIT(A) ERRED HAS ERRED IN NOT APPRECIATING THE FACTS OF THE CASE THAT THE ASSESSEE HAS FAILED TO PROVE THE IDENTITY, GENU INENESS AND CREDIT ITA NO.2969/MUM/2017 AGARALCLOTH AGENCY PVT.LTD. 2 WORTHINESS OF LENDER PARTIES, INVESTED AS SHARE APP LICATION MONEY IN THE ASSESSEE COMPANY. 3. 'THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER AN Y GROUND OR ADD NEW GROUND WHICH MAY BE NECESSARY.' 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E COMPANY IS ENGAGED IN THE BUSINESS OF TRADING OF CLOTHS AND W HOLESALERS, FILED ITS RETURN OF INCOME FOR AY 2007-08 ON 25/10/2017, DECLARING TOTAL INCOME OF RS. 3,76,660/-. THEREAFTER, THE CASE HAS BEEN REOPENED U/S 147 OF THE I.T.ACT, 1961, ON THE BASIS OF INFOR MATION RECEIVED FROM THE DGIT(INV.), MUMBAI, AS PER WHICH A SEARCH AND SEIZURE ACTION U/S 132 WAS CARRIED OUT, IN THE CASE OF SHRI PRAVEEN KUMAR JAIN, WHERE IT WAS REVEALED THAT HE WAS INVOLVED IN PROVIDING ACCOMMODATION ENTRIES OF BOGUS PURCHASES, UNSECURED LOANS AND SHARE CAPITAL ECT. IT WAS FURTHER, OBSERVED THAT SH RI PRAVEEN KUMAR JAIN, THROUGH HIS SHELL COMPANIES ISSUED ACCOMMODAT ION ENTRIES OF SHARE CAPITAL TO VARIOUS BENEFICIARIES AND ACCORDIN GLY, IT WAS OBSERVED THAT THE ASSESSEE M/S AGARWAL CLOTH AGENC Y PVT.LTD. IS ONE OF THE BENEFICIARIES, WHO HAD OBTAINED ACCOMMOD ATION ENTRIES OF SHARE CAPITAL FROM M/S NAKSHATRA BUSINESS PVT.LT D., M/S OLIVE OVERSEAS PVT.LTD. AND M/S LEXUSS INFOTEC LTD. AMOUN TING TO RS. 1,25,00,000/-,WHICH RESULTED IN UNDER ASSESSMENT OF INCOME CHARGEABLE TO TAX, ACCORDINGLY NOTICE U/S 148 OF TH E I.T.ACT, 1961, DATED 26/03/2014 WAS ISSUED. IN RESPONSE, THE ASSES SEE HAS FILED A ITA NO.2969/MUM/2017 AGARALCLOTH AGENCY PVT.LTD. 3 LETTER DATED 07/07/2014 AND REQUESTED TO TREAT RETU RN ORIGINALLY FILED ON 25/10/2007 IS RETURN FILED IN COMPLIANCE TO 148 NOTICE. THE ASSESSEE HAS ALSO ASKED FOR REASONS RECORDED FOR RE OPENING OF ASSESSMENT. THEREAFTER, THE CASE HAS BEEN SELECTED FOR SCRUTINY AND DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO CALLED UPON THE ASSESEE TO PRODUCE NECESSARY EVIDENCES, IN RESP ECT OF SHARE CAPITAL RECEIVED FROM THREE COMPANIES, MORE PARTICU LARLY IN THE BACKDROP OF INFORMATION RECEIVED FROM DGIT(INV.). IN RESPONSE , THE ASSESSEE HAS FILED CONFIRMATION FROM THE PARTIES AL ONG WITH LEDGER ACCOUNT, BANK STATEMENT AND COPY OF THE RETURN OF INCOME FILED BY ABOVE COMPANIES. 4. THE LD. AO AFTER CONSIDERING RELEVANT SUBMISSION S OF THE ASSESSEE AND ALSO TAKEN NOTE OF INFORMATION RECEIVE D FROM DGIT(INV.), CAME TO THE CONCLUSION THAT ALTHOUGH, A SSESEE HAS FILED CONFIRMATION ALONG WITH OTHER DETAILS, IN ORDER TO, PROVE THE IDENTITY OF THE PARTIES, BUT FAILED TO PROVE GENUINENESS OF TRA NSACTIONS AND CREDIT WORTHINESS OF PARTIES, MORE PARTICULARLY IN THE BACKDROP OF CLEAR FINDING BY THE DDIT(INV.) UNIT 3(2), MUMBAI, DURING THE COURSE OF SEARCH IN THE CASE OF SHRI PRAVEEN KUMAR JAIN TH AT HE AND HIS ASSOCIATES WERE INVOLVED IN PROVIDING ACCOMMODATION ENTRIES TO VARIOUS BENEFICIARIES THROUGH A WEB OF COMPANIES. T HE AO, FURTHER ITA NO.2969/MUM/2017 AGARALCLOTH AGENCY PVT.LTD. 4 OBSERVED THAT NO DOUBT, THE ASSESEE HAS FILED CONFI RMATION AND OTHER DETAILS, BUT WHEN A SHADOW IS COST ON GENUINENESS OF TRANSACTIONS, IT IS FOR THE ASSESSE TO DISCHARGE, THE SHADOW BY F ILING CONCLUSIVE EVIDENCES TO PROVE GENUINENESS OF TRANSACTIONS. MER E, FURNISHING CONFIRMATION LETTERS AND INCOME TAX RETURNS COPIES OF SHAREHOLDERS IS NOT SUFFICIENT ENOUGH TO COME OUT OF THE PROVISION OF SECTION 68 OF THE I.T.ACT, 1961. THEREFORE, HE OPINED THAT WHEN, A PERSON PROVIDED ACCOMMODATION ENTRIES CATEGORICALLY ADMITTED THAT T HE ASSESSEE IS ONE OF THE BENEFICIARIES OF ACCOMMODATION ENTRIES O F SHARE CAPITAL, MERELY FOR THE REASON OF FILING CONFIRMATION, THE S AID CONFESSIONAL STATEMENT CANNOT BE DISOWNED. ACCORDINGLY, HE MADE ADDITIONS OF RS. 1,25,00,000/- U/S 68 OF THE I.T.ACT, 1961, AS U NEXPLAINED CASH CREDIT. 5. AGGRIEVED BY THE ASSESSMENT ORDER, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE LD. CIT(A). BEFORE THE LD.CIT(A), THE ASSESEE SUBMITTED THAT IT HAS DISCHARGED ONUS COST UPON U/S 68 OF THE I.T.ACT, 1961, BY THE FILING ENORMOUS DOCUMENTS INCLUDING CO NFIRMATION FROM THE PARTIES, NAME AND ADDRESS AND PAN NUMBER OF THE SHAREHOLDERS, INCOME TAX ACKNOWLEDGMENT OF THE SHAR EHOLDERS, CIN MASTER DATA, SHARE APPLICATION FORMS, BOARD RESOLUT ION, RETURN FILED IN ROC AND BANK STATEMENT TO PROVE IDENTITY, GENUIN ENESS OF ITA NO.2969/MUM/2017 AGARALCLOTH AGENCY PVT.LTD. 5 TRANSACTIONS AND CREDIT WORTHINESS OF THE PARTIES. THE ASSESSEE HAS ALSO FILED AFFIDAVIT FROM THE SHAREHOLDERS, WHERE T HEY HAVE CATEGORICALLY ADMITTED THAT INVESTMENT IN SHARES OF ASSESSEE COMPANY IS A GENUINENESS TRANSACTIONS. THE LD. CIT( A), AFTER CONSIDERING RELEVANT SUBMISSIONS OF THE ASSESSEE AN D ALSO TAKEN NOTE OF VARIOUS EVIDENCES FILED, IN SUPPORT OF SHAR E CAPITAL RECEIVED FROM THREE COMPANIES HELD THAT THE ASSESSEE HAS DIS CHARGED THREE INGREDIENTS PROVIDED U/S 68 OF THE ACT, INCLUDING I DENTITY BY FILING ENORMOUS DETAILS. THE LD. CIT(A), FURTHER OBSERVED THAT WHEN, THE ASSESSEE HAS FILED NECESSARY DOCUMENTS AND DISCHARG ED ITS ONUS THEN, THE ONUS SHIFTED TO THE AO, IN SUCH CIRCUMSTA NCES, IT IS FOR THE AO TO CARRY OUT FURTHER ENQUIRIES IN LIGHT OF INFOR MATION RECEIVED FROM DGIT(INV.) TO ASCERTAIN TRUE NATURE OF TRANSACTIONS BETWEEN THE PARTIES. IN THIS CASE, THE LD. AO NEVER ASKED FOR ANY FURTHER MATERIAL, THOUGH TIME AND AGAIN THE ASSESSEE ASKED IN THEIR SUBMISSIONS. THIS LEADS TO INESCAPABLE CONCLUSION T HAT THE AO COULD NOT THINK OF ANY FURTHER MATERIAL TO ASK FOR AND PR OCEEDED TO REJECT, THE CLAIM OF THE ASSESSEE ONLY ON THE BASIS OF INFO RMATION, WHICH HE NEVER EVEN BROUGHT TO THE NOTICE TO THE ASSESEE FOR ANY REBUTTAL. THEREFORE, HE OPINED THAT THERE IS NO REASON FOR TH E AO TO MAKE ADDITIONS TOWARDS SHARE CAPITAL RECEIVED FROM THREE COMPANIES U/S 68 OF THE I.T. ACT, 1961,AND ACCORDINGLY, DELETED A DDITIONS MADE BY ITA NO.2969/MUM/2017 AGARALCLOTH AGENCY PVT.LTD. 6 THE AO TOWARDS UNEXPLAINED CASH CREDIT U/S 68 OF TH E I.T.ACT,1961. THE RELEVANT FINDINGS OF THE LD.CIT(A) ARE AS UNDER :- 5.3.23. THUS, IT HAS TO BE SAID THAT THE APPELLANT HAD DONE EVERYTHING IN ITS POWER TO PROVE THE 3 INGREDIENTS REQUIRED TO PR OVE THE SATISFACTORY NATURE OF THE LOAN TRANSACTIONS. IN THESE CIRCUMSTA NCES, THE ONUS HAD SHIFTED TO THE AO. IF THE AO WAS STILL NOT SATISFIE D, HE HAD THE OPTION OF MAKING INQUIRIES FROM THE ALLEGED SHARE APPLICANTS BY SUMMONING THEM. HOWEVER, AS SEEN FROM THE ASSESSMENT ORDER, HE DID NOT ANY SUCH THING, FURTHER, IF THE AO WAS NOT SATISFIED WITH WHAT HAD BEEN GIVEN TO HIM BY THE APPELLANT, HE WAS DUTY BOUND TO SPECIFY WHAT MO RE MATERIAL HE WANTED THE APPELLANT TO FURNISH. THE AO NEVER ASKED FOR ANY FURTHER MATERIAL, THOUGH TIME AND AGAIN THE APPELLANT ASKED IN THEIR SUBMISSIONS. THIS LEADS TO THE INESCAPABLE CONCLUSION THAT THE A O COULD NOT THINK OF ANY FURTHER MATERIAL TO ASK FOR AND PROCEEDED TO RE JECT THE APPELLANT'S CLAIMS, RELYING UPON THE INFORMATION/ MATERIAL, WHI CH HE NEVER EVEN BROUGHT TO THE NOTICE OF THE APPELLANT FOR ANY REBU TTAL. THE UNEQUIVOCAL CONCLUSION IS THAT ALL THE 3 INGREDIENTS HAVING BEE N SATISFIED, THE IMPUGNED SHARE APPLICATION MONEY HAVE TO BE TREATED AS EXPLAINED SATISFACTORILY AND THE AO WAS NOT JUSTIFIED IN HAVI NG DISREGARDED OVERWHELMINGLY SUPPORTIVE EVIDENCE. NO COGENT MATE RIAL WAS ADDUCED BY HIM TO SHOW THAT LOANS WERE UNEXPLAINED. THERE FORE, THE IMPUGNED ADDITION OF UNDER THE HEADING SHARE APPLICATION MON EY AS MADE IN THE ASSESSMENT ORDER, FAILS ON SEVERAL COUNTS-(1) RELIA NCE ON EVIDENCE THAT IS TOTALLY INADEQUATE; (2) FAILURE TO MAKE AVAILABLE I NCRIMINATING MATERIAL (REPORTS STATEMENTS ETC.) FORMING BASIS FOR ACTION BY THE AO; (3) FAILURE TO GIVE DUE OPPORTUNITY TO THE APPELLANT TO CROSS EXAM INE WITNESSES, WHOSE STATEMENT MIGHT HAVE BEEN RELIEF UPON; AND (4) FAIL URE TO RECOGNIZE THE SATISFACTORY NATURE OF THE EXPLANATION /EVIDENCE TE NDERED BY THE APPELLANT TO EXPLAIN IDENTITY OF CREDITORS, CREDITWORTHINESS OF THE CREDITORS AND THE GENUINENESS OF THE JOAN TRANSACTIONS. HENCE THE IMP UGNED ADDITION CANNOT BE SUSTAINED. 5.3.24. IN VIEW OF THE FACTS AND CIRCUMSTANCES OF T HE CASE AS WELL AS JUDICIAL PRONOUNCEMENTS REFERRED AND RELIED ABOVE B Y ME AND A/SO CERTAIN JUDICIAL PRONOUNCEMENTS RELIED UPON BY THE APPELLANT IN ITS WRITTEN SUBMISSION WHICH HAS BEEN PRODUCED ABOVE, ADDITION MADE BY THE AO UNDER THE HEADING SHARE CAPITAL/ SHARE APPLICATION MONEY AMOUNT CANNOT BE SUSTAINED AND THEREFORE THE AO IS DIRECTED TO DE LETE THE AMOUNT OF RS 1,25,00,000/- 6. THE LD. DR SUBMITTED THAT LD.CIT(A) DELETED ADDI TIONS MADE BY THE AO TOWARDS SHARE CAPITAL RECEIVED FROM THREE COMPANIES BELONGS TO SHRI PRAVEEN KUMAR JAIN, WITHOUT APPRECI ATING THE FACT ITA NO.2969/MUM/2017 AGARALCLOTH AGENCY PVT.LTD. 7 THAT THE ASSESSEE HAS FAILED TO PROVE THE IDENTITY, GENUINENESS AND CREDIT WORTHINESS OF THE SHAREHOLDERS. THE LD. DR, FURTHER SUBMITTED THAT WHEN THE DEPARTMENT HAS COLLECTED SUFFICIENT E VIDENCES DURING SEARCH PROCEEDINGS, IN THE CASE OF SHRI PRAVEEN KU MAR JAIN AND ALSO, HE HAD ADMITTED IN HIS STATEMENT U/S 132(4) T HAT HE WAS INVOLVED IN PROVIDING ACCOMMODATION ENTRIES OF SHAR E CAPITAL TO VARIOUS BENEFICIARIES , THE LD. CIT(A) WAS ERRED IN DELETING ADDITIONS ONLY ON THE BASIS OF EVIDENCES FILED BY THE ASSESEE , INCLUDING CONFIRMATION IGNORING , THE CRUCIAL ACCEPT OF THE C ASE THAT IN ALL SHELL COMPANIES/ENTRY PROVIDER CASES, THE DOCUMENTATION I S ARRANGED IN A SUCH MANNER THAT THERE SHOULD NOT BE ANY DOUBT , I N RESPECT OF GENUINENESS OF TRANSACTIONS. IN THIS CASE ALTHOUGH, THE AO HAS BROUGHT OUT CLEAR FACTS IN LIGHT OF STATEMENT OF S HRI PRAVEEN KUMAR JAIN, THE LD. CIT(A) DISREGARDED ALL EVIDENCES AND DELETED ADDITIONS ONLY ON THE BASIS OF EVIDENCES FILED BY THE ASSESSE E. IN THIS REGARD, HE RELIED UPON THE DECISION OF HONBLE GUJARAT HIGH COURT IN THE CASE OF PAVAN KUMAR M SANGHVI VS ITO (2018 90 TAXMANN.C OM 386). THE LD. DR HAS RELIED UPON THE DECISION OF HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS BIKRAM SINGH (2017) 399 ITR 4 07. 7. THE LD. AR FOR THE ASSESSEE, ON THE OTHER HAND, STRONGLY SUPPORTING ORDER OF THE LD.CIT(A) SUBMITTED THAT TH E ASSESSEE HAS ITA NO.2969/MUM/2017 AGARALCLOTH AGENCY PVT.LTD. 8 DISCHARGED ITS ONUS BY FILING ENORMOUS DOCUMENTS, W HICH IS EVIDENT FROM THE FACT THAT THE LD. CIT(A) HAS THOROUGHLY DI SCUSSED, THE ISSUE IN LIGHT OF VARIOUS JUDICIAL PRECEDENTS TO COME TO THE CONCLUSION THAT WHEN, INITIAL ONUS HAS BEEN DISCHARGED BY THE ASSES SEE, THEN ONUS SHIFTS TO THE AO TO PROVE OTHERWISE. THE LD.AR, FUR THER SUBMITTED THAT THE AO HAS MADE ADDITIONS ONLY ON THE BASIS OF INFORMATION RECEIVED FROM DGIT(INV.) WITHOUT CARRYING OUT ANY FURTHER ENQUIRIES IN LIGHT OF EVIDENCES FILED BY THE ASSESEE TO ASCER TAIN TRUE NATURE OF TRANSACTIONS. FURTHER, THE AO NOT EVEN PROVIDED, TH E COPIES OF STATEMENT RECORDED FROM SHRI PRAVEEN KUMAR JAIN, EV EN THOUGH, THE SAME WAS SPECIFICALLY REQUESTED, DURING THE ASSESSM ENT PROCEEDINGS BY THE ASSESSEE. WHEN THE ASSESSEE HAS FILED NECESSARY DETAILS, IT IS THE OBLIGATION OF THE AO T O VERIFY THOSE DETAILS BEFORE COMING TO THE CONCLUSION THAT TRANSACTIONS B ETWEEN THE PARTIES ARE NOT GENUINE. IN THIS CASE, THE ASSESSE E HAS FILED VARIOUS DETAILS, INCLUDING CONFORMATION LETTERS FROM THE PA RTIES AND ALSO FILED AFFIDAVIT OF SHRI PRAVEEN KUMAR JAIN, WHERE HE HAS RETRACTED FROM HIS STATEMENT GIVEN DURING THE COURSE OF SEARCH. WH EN A PERSON RETRACTED HIS STATEMENT BY A SWORN AFFIDAVIT, THEN THERE IS NO EVIDENCERY VALUE FOR SUCH STATEMENT. THE LD. CIT(A) AFTER CONSIDERING ALL THESE FACTS HAS RIGHTLY COME TO THE CONCLUSION THAT THE ITA NO.2969/MUM/2017 AGARALCLOTH AGENCY PVT.LTD. 9 ASSESSEE DISCHARGED ITS ONUS AND ACCORDINGLY, DELET ED THE ADDITIONS MADE BY THE AO AND THEREFORE, HIS ORDER SHOULD BE UPHELD. 8. WE HAVE HEARD BOTH THE PARTIES, PERUSED THE MATE RIALS AVAILABLE ON RECORD AND GONE THROUGH ORDERS OF THE AUTHORITIES BELOW. THE PROVISION OF SECTION 68 OF THE I.T.ACT, 1961, DEALS WITH A CASES, WHERE ANY SUM FOUND CREDITED IN THE BOOKS OF ACCOUNTS OF AN ASSESSEE, FOR WHICH NO EXPLANATION IS OFFERED OR EX PLANATION OFFERED BY THE ASSESSEE IS NOT IN THE OPINION OF THE AO IS SATISFACTORY, THEN SUM SO FOUND CREDITED MAY BE TREATED AS INCOME OF T HAT YEAR. A PLAIN READING OF SECTION 68 OF THE ACT, MAKES IT VE RY CLEAR THAT IN ORDER TO BRING ANY CREDITS WITHIN THE AMBIT OF SEC TION 68 OF THE ACT, THE AO SHOULD PROVE THAT THE CREDIT FOUND IN THE BO OKS OF ACCOUNTS OF THE ASSESSEE IS UNEXPLAINED AND ALSO THE ASSESSEE H AS FAILED TO PROVE IDENTITY, GENUINENESS OF TRANSACTIONS AND CRE DIT WORTHINESS OF THE PARTIES. IN THIS LEGAL BACKGROUND, IF YOU EXAMI NE, THE CREDITS FOUND IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE IN F ORM OF SHARE CAPITAL RECEIVED FROM THREE PARTIES, WE FOUND THAT THE ASSESSEE HAS FILED ENORMOUS DETAILS IN ORDER TO DISCHARGED ITS O NUS CAST UPON U/S 68 OF THE ACT. THE ASSESSEE HAS FILED VARIOUS DOCU MENTS, INCLUDING CONFIRMATION FROM THE SHAREHOLDERS ALONG WITH THEIR PAN NUMBER AND INCOME TAX ACKNOWLEDGEMENT AND CIN MASTER DATA, SHA RE ITA NO.2969/MUM/2017 AGARALCLOTH AGENCY PVT.LTD. 10 APPLICATION FORMS, BOARD RESOLUTION, RETURN FILED I N ROC IN FORM NO. 2, BANK STATEMENTS. THE ASSESSEE HAS ALSO FILED AFFIDA VIT FILED BY THE PRAVIN KUMAR JAIN, ALONG WITH LETTER OF RETRACTIONS FILED BEFORE THE DEPARTMENT FROM HIS STATEMENTS RECORDED, DURING COU RSE OF SEARCH PROCEEDINGS. THESE DOCUMENTS ARE PART OF ASSESSMENT PROCEEDINGS. THE AO NEVER DISPUTED THE FACT THAT THE ASSESEE HAS DISCHARGED ITS ONUS BY FILING VARIOUS DOCUMENTS. THE AO HAS ALSO N EVER DISPUTED THE FACT THAT THE ASSESEE HAS FILED VARIOUS DOCUMEN TS TO PROVE IDENTITY OF THE PARTIES, BUT DOUBTED GENUINENESS OF TRANSACTIONS AND CREDIT WORTHINESS OF THE PARTIES, ON THE BASIS OF I NFORMATION RECEIVED FROM DGIT(INV.), AS PER WHICH, SHRI PRAVEEN KUMAR J AIN, DURING SEARCH PROCEEDINGS IN HIS CASE ADMITTED THE FACT TH AT HE WAS INVOLVED IN PROVIDING ACCOMMODATION ENTRIES OF SHAR E CAPITAL TO VARIOUS BENEFICIARIES. WE FURTHER NOTED THAT WHEN, THE AO HAS NOT DOUBTED IDENTITY OF THE SHAREHOLDERS, THEN IT IS TH E DUTY OF THE AO TO CARRYOUT ,FURTHER ENQUIRIES, IN ORDER TO ASCERTAIN GENUINENESS OF TRANSACTIONS AND CREDITWORTHINESS OF THE PARTIES. I N THIS CASE, THE AO HAS NOT CARRIED OUT ANY FURTHER ENQUIRY IN LIGHT OF EVIDENCES FILED BY THE ASSESSEE TO REACH TO A CONCLUSION THAT TRANSACT IONS BETWEEN THE PARTIES ARE NOT GENUINE AND THE PARTIES DOES NOT HA VE CAPACITY TO SUBSCRIBE SHARE CAPITAL TO ASSESSEE COMPANY, BUT HE WENT ON TO DECIDE THE ISSUE ONLY ON THE BASIS OF STATEMENT OF SHRI PRAVEEN ITA NO.2969/MUM/2017 AGARALCLOTH AGENCY PVT.LTD. 11 KUMAR JAIN, IGNORING THE CRUCIAL ASPECT OF THE CASE THAT THE PERSON ,WHO GAVE STATEMENT HAS BEEN RETRACTED FROM HIS STA TEMENT BY FILING SWORN AFFIDAVIT. WE, FURTHER NOTED THAT WHEN, THE A SSESEE HAS SPECIFICALLY ASKED FOR COPIES OF STATEMENT RECORDED FROM SHRI PRAVEEN KUMAR JAIN, AND ALSO WANTED TO AVAIL CROSS- EXAMINATION OF THE PERSON, WHO GAVE STATEMENT, THE LD. AO HAS DENI ED THE OPPORTUNITY OF CROSS EXAMINATION TO THE ASSESSEE AN D ALSO NOT FURNISHED STATEMENT OF SHRI PRAVEEN KUMAR JAIN, FOR ITS REBUTTAL. WHEN, THE AO HAS RELIED UPON THIRD PARTY INFORMATIO N TO DRAW AN ADVERSE INFERENCE AGAINST THE ASSESSE, IT IS THE DU TY OF THE AO TO PROVIDE SAID INFORMATION TO THE ASSESSEE AND ALSO A LLOW OPPORTUNITY OF CROSS EXAMINATION, IF SUCH OPPORTUNITY WAS ASKED BY THE ASSESSEE SPECIFICALLY. IN ABSENCE OF SAID INFORMATION WAS AV AILABLE TO THE ASSESSEE AND ALSO OPPORTUNITY OF CROSS EXAMINATION WAS NOT GIVEN TO THE ASSESSEE, THEN ADDITIONS MADE ON THE BASIS OF T HIRD PARTY INFORMATION AMOUNTS TO GROSS VIOLATION OF PRINCIPLE S OF NATURAL JUSTICE, AS HELD BY THE HONBLE SUPREME COURT IN THE CASE O F KISHANCHAND CHELLARAM VS CIT 1980 125 ITR 713 (SC). THEREFORE, WE ARE OF THE CONSIDERED VIEW THAT THE LD.AO WAS ERRED MAKING AD DITIONS TOWARDS SHARE CAPITAL RECEIVED FROM THREE COMPANIES, EVEN T HOUGH THE ASSESEE HAS DISCHARGED, ITS ONUS CAST UPON U/S 68 O F THE ACT, ON THE BASIS OF THIRD PARTY INFORMATION WITHOUT PROVIDING SUCH INFORMATION TO ITA NO.2969/MUM/2017 AGARALCLOTH AGENCY PVT.LTD. 12 THE ASSESSEE AND ALSO TO PROVIDE CROSS-EXAMINATION OF THE PERSON, WHO GAVE STATEMENT. FURTHER, AS REGARDS, THE ADDITI ONS TOWARDS SHARE CAPITAL, ONCE THE ASSESSEE HAS DISCHARGED ITS ONUS BY FILING VARIOUS DOCUMENTS, THEN THE ONUS SHIFTS TO THE AO T O PROVE OTHERWISE. UNLESS, THE AO HAS DISCHARGES ITS ONUS, BY CONDUCTING NECESSARY ENQUIRIES, HE CANNOT PROCEED TO MAKE ADD ITIONS ONLY ON THE BASIS OF INFORMATION RECEIVED FROM THIRD PARTY 9. COMING TO THE CASE LAWS, RELIED UPON BY THE ASSE SSEE. THE ASSESSEE HAS RELIED UPON PLETHORA OF JUDICIAL PRECE DENTS, INCLUDING DECISION OF THE HONBLE SUPREME COURT IN THE CASE O F M/S LOVELY EXPORTS PVT.LTD. (2008) 2016 CTR 195. WE FOUND THAT THE HONBLE SUPREME COURT IN THE CASE OF CIT VS. LOVELY EXPORT S PVT.LTD. (SUPRA) HAD CONSIDERED AN IDENTICAL ISSUE AND HELD THAT IF, THE SHARE APPLICATION MONEY IS RECEIVED BY THE ASSESSE COMPAN Y FROM ALLEGED BOGUS SHAREHOLDERS, WHOSE NAME ARE GIVEN TO THE AO, THEN THE DEPARTMENT IS FREE TO PROCEED TO REOPEN THEIR INDIV IDUAL ASSESSMENTS, IN ACCORDANCE WITH LAW, BUT IT CANNOT BE REGARDED AS UNDISCLOSED INCOME OF THE ASSESSEE . THE HONBLE BO MBAY HIGH COURT IN THE CASE OF CIT VS. GAGANDEEP INFRASTRUCTU RE PVT.LTD. (2017) 394 ITR 680, HAD CONSIDERED AN IDENTICAL ISS UE AND HELD THAT PROVISO TO SECTION 68 INSERTED BY THE FINANCE ACT, 2012 WITH EFFECT ITA NO.2969/MUM/2017 AGARALCLOTH AGENCY PVT.LTD. 13 FROM 01/04/2013 IS APPLICABLE FROM AY 2013-14 ONWAR DS, AS PER WHICH BEFORE INSERTION OF PROVISION TO 68 OF THE AC T, THE ASSESEE NEED NOT TO PROVE SOURCE OF SOURCE OF AN INVESTMENT . ONCE, HE PROVED CREDIT WORTHINESS OF THE PARTIES, IT IS SUF FICIENT ENOUGH TO COME OUT OF PROVISION OF SECTION 68 OF THE I.T. ACT , 1961. 10. THE ASSESSEE HAS RELIED UPON THE DECISION OF IT AT, MUMBAI IN THE CASE OF ACIT VS SRIDHAM BUILDERS IN ITA NO. 55 89/MUM/2017, WHERE THE TRIBUNAL HAS CONSIDERED AN IDENTICAL ISSU E OF ADDITIONS MADE U/S 68, IN RESPECT OF SHARE CAPITAL RECEIVED F ROM COMPANIES CONTROLLED AND OPERATED BY SHRI PRAVEEN KUMAR JAIN , AND AFTER CONSIDERING RELEVANT FACTS AND ALSO BY RELIED UPON VARIOUS JUDICIAL PRECEDENTS HELD THAT ONCE, ASSESSEE FILED NECESSARY EVIDENCES TO PROVE IDENTITY, GENUINENESS OF TRANSACTIONS AND ALS O FILED NECESSARY DOCUMENTS TO PROVE CAPACITY OF THE INVESTERS, THEN THE AO CANNOT MAKE ADDITIONS ONLY ON THE BASIS OF INFORMATION REC EIVED FROM THIRD PARTIES. THE RELEVANT FINDINGS OF THE TRIBUNAL ARE AS UNDER:- 2.17. STATEMENT OF SHRI ATUL RUPAPARA, SALESMAN WAS ALSO RECORDED. THE STATEMENT OF SHRI AJAY MAHESHWARI, PARTNER OF THE F IRM WAS ALSO RECORDED, WHEREIN, HE TENDERED THAT THEY RECEIVED ACCOMMODATI ON ENTRIES IN THE FORM OF UNSECURED LOANS IN LIEU OF CASH FROM SHRI P RAVIN KUMAR JAIN. THE STATEMENT OF SHRI AJAY MAHESHWARI HAS BEEN REPRODUC ED IN THE ASSESSMENT ORDER WHICH WAS HEAVILY RELIED UPON BY T HE ASSESSING OFFICER FOR MAKING THE ADDITION. IT IS NOTED THAT ON 11/11/ 2014, SHRI AJAY MAHESHWARI FILED AN AFFIDAVIT RETRACTING THE STATEM ENT RECORDED DURING SURVEY AFTER 23 DAYS, WHEREIN, HE SWORN (IN THE AFF IDAVIT) THAT THE LOANS WERE GENUINE AND THERE WERE NO CORROBORATIVE EVIDEN CE WAS FOUND AT THE ITA NO.2969/MUM/2017 AGARALCLOTH AGENCY PVT.LTD. 14 BUSINESS PREMISES DURING SURVEY AND THE ENTIRE SHRE EDHAM BUILDERS ITA NO.5589/MUM/2017 46 TRANSACTIONS WERE CONDUCTED THR OUGH BANKING CHANNEL/ACCOUNT PAYEE CHEQUE. AS PER THIS RETRACTIO N, THE SURVEY PARTY PUT MENTAL PRESSURE AND THE STATEMENT WAS RECORDED UNDER HIGH BP/HYPER DIABETIC CONDITIONS. IT IS NOTED THAT THE LOAN CONFIRMATIONS AND COPY OF ITRS OF THE CONCERNED PARTIES WERE FILED AL ONG WITH THE ADDRESS OF THE BROKER SHRI JITU BHAI. SUMMONS WERE ALSO ISSUED TO SHRI AJAY MAHESHWARI. THE ADDRESSES OF THE CONCERNED PERSONS WERE ALSO FILED BY THE ASSESSEE. THE LD. ASSESSING OFFICER ISSUED SUMM ONS UNDER SECTION 131 OF THE ACT TO ALL THE LENDERS AND OTHER NECESSA RY DETAILS WERE COLLECTED FROM THE BANK. IN RESPONSE TO THE SUMMONS ALL THE LENDERS FILED THEIR REPLIES ON 03/02/2005. THE LD. ASSESSING OFFI CER OBSERVED THAT MOST OF THE LENDER COMPANIES OPENED THEIR NEW BANK ACCOUNTS IN INDUSLND BANK, OPERA HOUSE BRANCH ON THE SAME DATE/ MONTH, THEREFORE, IT WAS PRESUMED THAT THESE ARE COMPANIES FLOATED BY SHRI PRAVIN JAIN. UNDISPUTEDLY, EVEN THE LD. ASSESSING OFFICER MENTIO NED THAT THE ASSESSEE REPAID THE LOANS TAKEN FROM THESE COMPANIE S IN FINANCIAL YEAR 2014-15 OUT OF THE FUNDS INTRODUCED BY PARTNERS AS CAPITAL. THE STATEMENT OF BROKERS HAS BEEN REPRODUCED IN THE ASS ESSMENT ORDER. THE LD. COMMISSIONER OF INCOME TAX (APPEAL) HAS MENTION ED THE OBSERVATIONS MADE BY LD. ASSESSING OFFICER IN THE A SSESSMENT ORDER WITH RESPECT TO VARIOUS PARTIES/BROKERS. THE LD. ASSESSI NG OFFICER TREATED RS.4.70 CRORES, INTRODUCED BY THE ASSESSEE IN ITS B OOKS AS UNSECURED LOANS/UNEXPLAINED CREDIT AND ADDED UNDER SECTION 68 OF THE ACT AND SOME UNEXPLAINED EXPENDITURE UNDER SECTION 69C OF T HE ACT AND ALSO DISALLOWED INTEREST OF RS.5,73,193/-, PAID ON UNSEC URED LOAN AND DISALLOWED THE SAME UNDER SECTION 37 OF THE ACT. IT IS NOTED THAT AT THE CONCLUSION OF THE SURVEY, THE ASSESSEE VIDE LETTER DATED 28/10/2014 REQUESTED FOR COPY OF STATEMENT. AS PER THE ASSESSE E, THE ASSESSING OFFICER DID NOT PROVIDE THE COPY. AS PER THE ASSESS EE, THE CROSS EXAMINATION OF SHRI PRAVIN JAIN WAS ALSO NOT PROVID ED. THE ASSESSEE FILED LOAN CONFIRMATION, ACKNOWLEDGMENTS OF ITRS, R ELEVANT BANK STATEMENT OF LENDERS, PROOF OF RE-PAYMENT OF SUCH L OANS AND ON THE SUMMONS ISSUED TO ALL THE CREDITORS AND THE BROKERS ALL OF THEM FURNISHED REQUISITE DETAILS. IT IS NOTED THAT THE FINANCIAL S TATEMENTS AND OTHER LOAN CREDITORS WERE NEVER DISCLOSED BY THE LD. ASSESSING OFFICER AND BY IMPLICATION ACCEPTED THAT THE ASSESSEE IN FACT RECE IVED LOANS. THIS HAS BEEN OBSERVED EVEN BY THE FIRST APPELLATE AUTHORITY AT PAGE-10(PARA- 4.13 OF THE IMPUGNED ORDER). IT IS FURTHER NOTED TH AT ON 21/10/2014, THE ASSESSEE REQUESTED THE ASSESSING OFFICER TO PROVIDE THE COPY OF STATEMENT RECORDED DURING SURVEY, EVIDENCE OF FILIN G RETRACTION ON 11/11/2014, EVIDENCE OF FILING OF LOAN CONFIRMATION S, ACKNOWLEDGMENT OF ITRS AND BANK STATEMENT OF PARTIES VIDE LETTER DATE D 28/12/2014, COPY OF ITS SUBMISSION ON UNSECURED LOANS DATED 16/02/2015, RETRACTION AFFIDAVIT OF SHRI PRAVIN KUMAR JAIN, DATED 15/05/2014, REPAYM ENT DETAILS OF UNSECURED LOANS AND ITS SUBMISSIONS DATED 16/02/201 5, WHEREIN, PRESENT ADDRESS, DETAILS OF DIRECTORS AND SHAREHOLDING PATT ERNS OF LENDERS COMPANIES WERE FILED BY THE ASSESSEE BEFORE THE LD. ASSESSING OFFICER. IT IS NOTED THAT BEFORE THE FIRST APPELLATE AUTHORITY, THE ASSESSEE CHALLENGED THE VALIDITY OF ASSESSMENT BY RAISING AN ADDITIONAL GROUND AS ITA NO.2969/MUM/2017 AGARALCLOTH AGENCY PVT.LTD. 15 THE ASSESSEE WAS NOT ALLOWED OPPORTUNITY TO CROSS E XAMINE SHRI PRAVIN KUMAR JAIN AND OTHER MATERIAL USED AGAINST THE ASS ESSEE, WHICH WAS NOT CONFRONTED TO IT. THE LD. COMMISSIONER OF INCOM E TAX (APPEAL) VIDE LETTER DATED 05/07/2016 ASKED THE LD. ASSESSING OFF ICER TO HANDOVER THE STATEMENTS PERTAINING TO SHRI PRAVIN KUMAR JAIN OR ITS STAFF MEMBERS OR DUMMY DIRECTORS TO ALLOW THE ASSESSEE AN OPPORTUNIT Y TO CROSS EXAMINE SHRI PRAVIN KUMAR JAIN. THE LD. ASSESSING OFFICER W AS ALSO ASKED TO PROVIDE THE EVIDENCES FOUND DURING THE COURSE OF SU RVEY ACTION OR ANY EVIDENCE THAT PAYMENT WAS MADE FOR OBTAINING UNSECU RED LOANS AND ALSO EFFORTS SO MADE TO EXAMINE THE LOAN CREDITORS. THE ASSESSING OFFICER WAS ASKED TO CONDUCT NECESSARY ENQUIRIES WITH RESPECT T O GENUINENESS OF THE UNSECURED LOANS. THE LD. ASSESSING OFFICER VIDE LET TER DATED 07/01/2017, SUBMITTED THE REMAND REPORT AS HAS BEEN REPRODUCED AT PAGE-10 ONWARDS OF THE IMPUGNED ORDER. IT HAS BEEN MENTIONE D IN PARA 6.3 OF THE IMPUGNED ORDER THAT SHRI PRAVIN JAIN PRODUCED THE L EDGER ACCOUNTS OF SHREEDHAM BUILDERS IN THE BOOKS OF HIS COMPANIES AL ONGWITH BANK STATEMENT REFLECTING ALL THE TRANSACTIONS AND ALSO AUDITED BALANCE SHEET OF LAST FOUR YEAR ALONG WITH THE COPY OF THE RETRACTIO N OF STATEMENT FILED BEFORE CBDT. NOTHING OBJECTIONABLE WAS FOUND IN THE DOCUMENTS OR STATEMENTS. ALL THE LOAN CREDITORS WERE SUMMONED AN D THE STATEMENTS OF THE DIRECTORS WERE RECORDED, WHEREIN, THEY HAVE ACC EPTED OF GIVING LOAN TO THE ASSESSEE. THE LEDGER COPIES OF THOSE COMPANI ES REFLECTING LOANS GIVEN TO THE ASSESSEE WERE ALSO PRODUCED. THE LD. A SSESSING OFFICER ALSO PROVIDED THE COPY OF STATEMENT RECORDED FROM S HRI PRAVIN KUMAR JAIN UNDER SECTION 131 OF THE ACT ON 21/11/2006. IN PARA 6.6 OF THE IMPUGNED ORDER, THERE IS AN OBSERVATION THAT THE NA TURE AND SOURCE OF BUSINESS/AMOUNT WAS EXPLAINED AND THE DETAILS OF LO AN WERE ALSO CONFIRMED. ALL CORROBORATIVE DETAILS WERE DULY FILE D. FROM THE RECORD, WE ALSO NOTE THAT THE ASSESSEE ALSO FILED ACKNOWLEDGME NT OF FILING OF IT RETURNS TOGETHER WITH COMPUTATION OF TOTAL INCOME ( PAGES 1 & 2 OF THE PAPER BOOK), AUDITED ANNUAL ACCOUNTS ALONG WITH TAX AUDIT REPORT FOR THE YEAR ENDING 31/03/2012 (PAGES 3 TO 31 OF THE PAPER BOOK), RETRACTION OF STATEMENT BY SHRI AJAY MAHESHWARI, PARTNER, DATED 1 0/11/2014 FOR THE STATEMENT ON OATH RECORDED ON 17/ & 18TH OCTOBER, 2 014 (PAGES 32 TO 37 OF THE PAPER BOOK), REMAND REPORT OF THE ASSESSING OFFICER DATED 17/12/2016 FILED BEFORE THE LD. COMMISSIONER OF INC OME TAX (APPEAL) (PAGES 38 TO 56 OF THE PAPER BOOK), REMAND REPORT O F THE ASSESSING OFFICER 04/01/2017 BEFORE THE CIT(A) (PAGES 57 OF T HE PAPER BOOK), ACKNOWLEDGMENT EVIDENCING FOR FILING OF RETURN FOR ASSESSMENT YEAR 2012-13, AUDITED ANNUAL ACCOUNT FOR THE YEAR ENDING 31/03/2012, LEDGER CONFIRMATION, LEDGER ACCOUNT OF THE ASSESSEE IN THE BOOKS OF THE LENDER AND BANK STATEMENT OF THE LENDER (IN THE CASE OF AT HRAV BUSINESS PVT. LTD. (PAGE 58 TO 72 OF THE PAPER BOOK). IDENTICALLY SIMILAR DOCUMENTS AS A PROOF OF EVIDENCE WERE FILED FROM CASPER ENTERPRISE S LTD. (PAGES 71 TO 83 OF THE PAPER BOOK), DUKE BUSINESS PVT. LTD. (J.P. K . TRADING I. PVT. LTD.) (PAGES 84 TO 96 OF THE PAPER BOOK), OLIVE OVERSEAS PVT. LTD. (PAGES 97 TO 110 OF THE PAPER BOOK), VIRAJ MERCANTILE PVT. LTD. (PAGES 111 TO 119 OF THE PAPER BOOK) AND NAKSHATRA BUSINESS PVT. LTD. (PAGES 120 TO 131 OF THE PAPER BOOK). ALL THESE DOCUMENTS NEITHER DISPROVED BY THE LD. ASSESSING OFFICER NOR ANY EVIDENCE WAS BROUGHT ON RECORD TO F ALSIFY THE CLAIM OF THE ITA NO.2969/MUM/2017 AGARALCLOTH AGENCY PVT.LTD. 16 ASSESSEE OR THE AUTHENTICITY OF THESE DOCUMENTS. T HUS, IT CAN BE SAID THAT THE ASSESSEE DISCHARGED ITS ONUS AS PROVIDED U NDER SECTION 68 OF THE ACT. THE INTEREST WAS PAID THROUGH BANKING CHAN NEL BY THE ASSESSEE ON SUCH LOANS. IT IS ALSO NOTED THAT SO FAR AS THE DISALLOWANCE OF INTEREST PORTION IS CONCERNED, THE SAME WAS DELETED BY THE L D. FAA AND HAS NOT BEEN CHALLENGED BEFORE THIS TRIBUNAL BY THE REVENUE FURTHER FORTIFIES THE CASE OF THE ASSESSEE. THE LOANS WERE REPAID ALONG W ITH INTEREST BEFORE THE DATE OF SURVEY I.E. 17/10/2014 AND NO CASH WAS FOUND DURING SURVEY FURTHER FORTIFIES THE CLAIM OF THE ASSESSEE. ALL TH E CONCERNED PARTIES APPEARED BEFORE THE LD. ASSESSING OFFICER DURING RE MAND PROCEEDINGS, THE LD. ASSESSING OFFICER RECORDED THEIR STATEMENT AND NOTHING ADVERSE WAS POINTED OUT EVEN SHRI PRAVIN JAIN HIMSELF APPEA RED BEFORE THE LD. ASSESSING OFFICER AND EVEN DURING REMAND PROCEEDING S ENQUIRIES WERE CARRIED OUT AND NO ADVERSE REMARK WAS MADE BY THE L D. ASSESSING OFFICER. THE ASSESSEE AS WELL AS THE OTHER PARTIES FURNISHED ALL POSSIBLE DOCUMENTS EVIDENCING THAT THE LOANS ARE NOT BOGUS. NO CASH WAS FOUND DEPOSITED IN THE ACCOUNTS OF ALLEGED SIX PARTIES, T HUS, KEEPING IN VIEW, THE TOTALITY OF FACTS, ATTENDANT CIRCUMSTANCES, HUMAN PROBABILITIES, AND IN THE PRESENCE OF PLAUSIBLE EXPLANATION BY THE ASSESSEE, RELEVANT MATERIAL, AND REQUIREMENT OF FULFILLMENT OF INGREDIENTS, ENSHRINE D IN SECTION 68 OF THE ACT, WE FIND THAT ONUS CAST UPON THE ASSESSEE HAS B EEN DULY DISCHARGED, THEREFORE, THE ADDITION MADE U/S 68 OF THE ACT, WHI CH IS PURELY BASED UPON PRESUMPTION OR THE STATEMENT RECORDED AND LATE R ON RETRACTED BY THE CONCERNED PARTIES, THEREFORE, WE FIND INFIRMITY IN THE CONCLUSION OF THE LD. COMMISSIONER OF INCOME TAX (APPEAL), RESULTANTLY, T HE APPEAL OF THE REVENUE IS DISMISSED. 11. COMING TO THE CASE LAWS RELIED UPON BY THE LD. DR. THE LD. DR HAS RELIED UPON THE DECISION OF HONBLE GUJARAT HIGH COURT IN THE CASE OF PAWAN KUMAR M.SANGHVI VS ITO (SUPRA). WE FIND THAT THE HONBLE GUJARAT HIGH COURT, WHILE AFFIRMING, TH E FINDINGS OF THE ITAT, CAME TO THE CONCLUSION THAT WHEN, THE AO WAS SPECIFICALLY ASKED THE ASSESSEE TO PRODUCE THE PARTIES FOR VERIF ICATION, THE ASSESSEE HAS FAILED TO PRODUCE SAID PARTIES FOR VER IFICATION. THEREFORE, IMPUGNED AMOUNT WAS RIGHTLY BROUGHT TO T AX U/S 68 OF THE ACT. WE FURTHER NOTED THAT THE LD. DR HAS RELIED U PON THE DECISION ITA NO.2969/MUM/2017 AGARALCLOTH AGENCY PVT.LTD. 17 OF HONBLE DELHI HIGH COURT IN THE CASE OF DCIT VS BIKARAM SINGH (SUPRA), WHERE THE HIGH COURT HAS HELD THAT WHEN, T HE ASSESSEE HAS FAILED TO PROVE THAT THOSE CREDITORS HAD FINANCIAL STRENGTH TO LEND SUCH HUGE SUMS OF MONEY TO ASSESSEE, THAT TO WITHO UT ANY SECURITY WITHOUT INTEREST AND WITHOUT A LOAN AGREEMENT, I MPUGNED ADDITIONS DESERVES TO BE CONFIRMED. WE FIND THAT IN BOTH THE CASE FACTS ARE DIFFERENT AND UNDER THOSE FACTS THE HONBLE HIGH CO URT CAME TO THE CONCLUSION THAT THE ASSESSE HAS FAILED TO PROVE GE NUINENESS OF TRANSACTIONS AND CREDITWORTHINESS OF THE PARTIES. I N THIS CASE, ON PERUSAL OF FACTS AVAILABLE ON RECORD, WE FIND THAT LD. CIT(A) HAD RECORDED CATEGORICAL FINDINGS IN LIGHT OF VARIOUS E VIDENCES FILED BY THE ASSESSEE TO COME TO CONCLUSION THAT THE ASSESSEE HA S DISCHARGED ITS ONUS, BUT THE LD.AO HAS NOT REACHED TO A LOGIC AL CONCLUSION BY CARRY OUT, FURTHER VERIFICATION IN LIGHT EVIDENCES FILED BY THE ASSESSEE. THEREFORE, WE ARE OF THE CONSIDERED VIEW THAT, THE CASE LAWS RELIED UPON BY THE LD. DR ARE NOT APPLICABLE TO THE FACTS OF PRESENT CASE. 12. IN THIS VIEW OF THE MATTER AND CONSIDERING THE CASE LAWS DISCUSSED HEREINABOVE, WE ARE OF THE CONSIDERED VIE W THAT THE LD. CIT(A) HAS RIGHTLY DELETED ADDITIONS MADE BY THE A O TOWARDS SHARE CAPITAL RECEIVED FROM THREE COMPANIES, ON THE BASIS OF VARIOUS EVIDENCES FILED BY THE ASSESSEE, INCLUDING CONFIRMA TION LETTER FROM ITA NO.2969/MUM/2017 AGARALCLOTH AGENCY PVT.LTD. 18 THE SHAREHOLDERS. WE DO NOT FIND ANY ERROR OR INFO RMATIVE IN THE FINDINGS OF LD. CIT(A) AND HENCE, WE ARE INCLINED T O UPHOLD ORDER OF THE LD.CIT(A) AND DISMISSED APPEAL FILED BY THE REV ENUE. 13. IN THE RESULT, APPEAL FILED BY THE REVENUE IS D ISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 23 /08/ 2019 SD/- (RAM LAL NEGI) SD/- (G. MANJUNATHA) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED 23/08/2019 THIRUMALESH SR.PS COPY OF THE ORDER FORWARDED TO : BY ORDER, (ASSTT. REGISTRAR) ITAT, MUMBAI 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A), MUMBAI. 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY//