M/s. Smart Projects (P) Ltd., New Delhi V. ITO, New Delhi

ITA 3045/DEL/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 53253 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 5 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-12-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 15-09-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 17-06-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NIRANJAN KAULI
• Assessee Lawyers: DR RAKESH GUPTA
• Keywords: Unexplained cash credit; Gift; Share purchase agreement; Principle of natural justice; Opportunity of cross examination; Accommodation entries
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH G DELHI) BEFORE SHRI G.E. VEERABHADRAPPA, HONBLE PRESIDENT AND SHRI A.D. JAIN, JUDICIAL MEMBER ITA NO. 3045(DEL)2010 ASSESSMENT YEAR: 2006-07 M/S. SMART PROJECTS (P)LTD. INCOME TAX OFFICER, 6, KALA NIKETAN, KEWAL PARK, AZADPUR, V. WA RD 9(1), NEW DELHI. NEW DELHI-110033. (APPELLANT) (RESPONDENT) APPELLANT BY: DR. RAKESH GUPTA, ADVOCATE RESPONDENT BY: SHRI NIRA NJAN KAULI, CIT/DR ORDER PER A.D. JAIN, J.M . THIS IS ASSESSEES APPEAL FOR THE ASSESSMENT YEAR 2 006-07 AGAINST THE ORDER DATED 30.3.2010 PASSED BY THE LEARNED COMMISS IONER OF INCOME TAX(APPEALS) XII, NEW DELHI, TAKING THE FOLLOWING G ROUNDS:- 1. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANC ES OF THE CASE, LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ACTION OF THE LD.AO IN MAKING ADDITION OF ` 15,00,000/- BEING SHARE APPLICATION MONEY RECEIVED DURING THE YEAR HOLDING THE SAME AS UNEXPLAINED CASH CREDIT U/S 68 OF THE ACT. ITA 3045(DEL)2010 2 2. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTAN CES OF THE CASE, LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ACTION OF THE LD. AO IN MAKING ADDITION OF ` 15,000/- (I.E. 1% OF 15,00,000/-) ON ACCOUNT OF ALLEGED COMMISSION PAID. 3. THAT IN ANY CASE AND IN ANY VIEW OF THE MATTER , THE ACTION OF THE LD. CIT(A) IN CONFIRMING THE ACTION OF THE LD. AO IN MA KING THE AGGREGATE ADDITION OF ` 15,15,000/- AND IN FRAMING THE IMPUGNED ASSESSMENT IS ILLEGAL, VOID AB INITIO, CONTRARY TO LAW AND FACTS, BEYOND JURISDICTION AND DESERVES TO BE QUASHED. 4. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTAN CES OF THE CASE, THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN CONFIRM ING THE ACTION OF THE LD. AO IN FRAMING THE ASSESSMENT IN VIOLATION O F PRINCIPLES OF NATURAL JUSTICE INASMUCH AS PASSING THE IMPUGNED OR DER WITHOUT CONFRONTING THE ENTIRE ADVERSE MATERIAL USED AGAINS T THE ASSESSEE AND BY RECORDING THE INCORRECT FACTS AND FINDINGS AND W ITHOUT PROVIDING ADEQUATE OPPORTUNITY OF HEARING AND WITHOUT PROVID ING THE OPPORTUNITY OF CROSS EXAMINATION OF THE PERSONS WHO SE STATEMENTS WEE USED AGAINST THE ASSESSEE. 5. THAT IN ANY CASE AND IN ANY VIEW OF THE MATTER ACTION OF THE LD. CIT(A) IN CONFIRMING THE ACTION OF THE LD. AO IN MA KING THE IMPUGNED ADDITION AND FRAMING THE IMPUGNED ASSESSMENT ORDER IS CONTRARY TO LAW AND FACTS, VOID AB INITIO, BEYOND JURISDICTION AND THE SAME IS NOT SUSTAINABLE ON VARIOUS LEGAL AND FACTUAL GROUNDS. 6. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTAN CES OF THE CASE, LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN NOT REVERSI NG THE ACTION OF LD. AO IN CHARGING INTEREST U/S 234A, 234B, 234C & 234 D. 7. THAT THE APPELLANT CRAVES TO LEAVE TO ADD, MOD IFY, AMEND OR DELETE ANY OF THE GROUNDS OF APPEAL AT THE TIME OF HEARING AND ALL THE ABOVE GROUNDS ARE WITHOUT PREJUDICE TO EACH OTHER. 2. GROUND NO.7 IS GENERAL. ITA 3045(DEL)2010 3 3. GROUND NOS. 1 TO 5 ARE AGAINST THE ACTION OF THE LEARNED CIT(A) IN CONFIRMING THE ADDITION OF ` 15,00,000/- BEING SHARE APPLICATION MONEY RECEIVED DURING THE YEAR AND THAT OF ` 15,000/-, BEING 1% OF 15,00,000/-, ON ACCOUNT OF ALLEGED COMMISSION PAID. 4. THE FACTS ARE THAT THE ASSESSEE COMPANY, ENGAGED IN THE BUSINESS OF REAL ESTATE, STATED TO HAVE RECEIVED THE FOLLOWING AS SHARE APPLICATION MONEY DURING THE YEAR: S.NO. NAME OF THE INVESTOR/LENDER SHARE APPLICATION/CAPITAL/SHARE PREMIUM TOTAL 1. REENA OIL INDUSTRY(P)LTD. 5,00,000 5,00,000 2. GAURAV HOLDINGS(P)LTD. 5,00,000 5,00,000 3. REENA PLASTIC PIPES(P)LTD. 5,00,000 5,00,000 TOTAL 15,00,000 5. THE AO OBSERVED THAT AS A RESULT OF INVESTIGATIO N CARRIED OUT BY THE INVESTIGATION WING, DELHI, IT WAS FOUND THAT THESE COMPANIES/PERSONS WERE GIVING ONLY ACCOMMODATION ENTRIES AND WERE NOT DOIN G ANY GENERAL BUSINESS OR INVESTMENT; THAT THE GROUP OF COMPANIES WAS BEIN G USED BY ONE SHRI PRADEEP JINDAL WHO HAD BEEN EXAMINED BY THE INVESTI GATION WING OF THE DEPARTMENT; THAT THE ASSESSEE WAS INTIMATED, THROUG H NOTICE THAT THE ABOVE ITA 3045(DEL)2010 4 COMPANIES WERE NOT RELIABLE/GENUINE; AND THAT THEY WERE NOT IN A POSITION TO ADVANCE THE DEPOSITS. THE COPIES OF SWORN STATEME NT OF THE ENTRY OPERATOR WAS ALSO PROVIDED TO THE ASSESSEE, INTIMATING THAT THE SAID PERSONS HAD AFFIRMED IN THEIR STATEMENTS THAT THEY WERE NOT DOI NG ANY GENUINE BUSINESS/INVESTMENT, BUT WERE ONLY GIVING ACCOMMODA TION ENTRIES AFTER TAKING CASH FROM THE PARTIES, WHICH WAS ROUTED THRO UGH THE ACCOUNTS MAINTAINED BY THEM FOR GIVING CHEQUES IN THE SHAPE OF SHARE APPLICATION, SHARE CAPITAL, LOANS, GIFTS, ETC. THE ASSESSEE W AS ALSO INFORMED THAT AS SUCH THERE WAS NO GENUINE BUSINESS TRANSACTION, THE IDEN TITY OF THE PERSONS AS INVESTOR DID NOT STAND ESTABLISHED; AND THAT THE BA NKING CHANNEL IS NOT A BONA FIDE BANKING TRANSACTION BUT A MANIPULATED DEVICE. THE ASSESSEE WAS TOLD THAT IN CASE THE ASSESSEE WAS NOT ABLE TO SUBSTANTI ATE ITS CLAIM, THE AMOUNT RECEIVED AS SHARE APPLICATION MONEY WOULD BE TREATE D AS THE UNDISCLOSED INCOME OF THE ASSESSEE, BEING UNEXPLAINED CASH CRED ITS U/S 68 OF THE I.T. ACT. THE ASSESSEE WAS REQUIRED TO PRESENT THE DIRECTORS/ PRINCIPAL OFFICERS OF THESE COMPANIES FOR CROSS EXAMINATION AND TO PROVE THEIR CREDIT WORTHINESS AND GENUINENESS OF THE TRANSACTIONS. THE ASSESSEE , HOWEVER, REMAINED UNABLE TO PRODUCE THESE PERSONS BEFORE THE AO. 6. THE AO OBSERVED FROM THE INFORMATION FURNISHED B Y THE INVESTIGATION WING OF THE DEPARTMENT, THAT THE ASSESSEE HAD TAKEN BOGUS ENTRIES IN THE ITA 3045(DEL)2010 5 FORM OF SHARE APPLICATION FROM THE PERSONS ENGAGED IN THIS TRADE; THAT IN HIS STATEMENT DATED 15.4.04 RECORDED BY THE INVESTIGATI ON WING OF THE DEPARTMENT, SHRI PRADEEP JINDAL HAD ADMITTED THAT H E WAS DIRECTOR IN VARIOUS COMPANIES INCLUDING M/S. GAURAV HOLDING (P) LTD., M/S. REENA OIL INDUSTRY (P)LTD. AND M/S. REENA PLASTIC PIPES (P)LT D.; THAT HE ADMITTED THAT THE CASH DEPOSITED IN VARIOUS BANK ACCOUNTS OPERATE D BY HIM FOR THE ENTIRE BUSINESS WAS RECEIVED FROM VARIOUS PARTIES AND IT W AS SHOWN AS SALE OF SHARES ROUTED THROUGH VARIOUS ACCOUNTS AND CHEQUES/ PAY ORDERS/DDS WERE SUBSEQUENTLY ISSUED TO THE PARTIES AS WELL AS NECE SSARY DOCUMENTS WERE SIGNED AND DELIVERED; THAT THERE WAS NO ACTUAL SALE /PURCHASE AND TRANSFER OF SHARES; THAT HE WAS EARNING COMMISSION 0.25% TO 0. 15% FROM THE ABOVE DEALINGS; THAT HE WAS GETTING HIS COMMISSION FOR HA NDLING THE CASH AND ROUTING THE SAID TRANSACTIONS; THAT VARIOUS PERSONS LIKE ARUN LATA VERMA, GIAN CHAND, MADHU BHATNAGAR, RACHNA BANSAL, RAM KIS HORE BANSAL, ETC. WERE WORKING FOR HIM AND THE TRANSACTIONS WERE ALSO ROUTED THROUGH THE INDIVIDUAL ACCOUNTS ON HIS INSTRUCTIONS AND HE USED TO GIVE THEM INCENTIVE OF 0.05% TO 1.10% FOR THE TRANSACTIONS. THE AO OBSE RVED THAT SINCE THE ASSESSEE HAD NOT PRODUCED THE CONCERNED PERSONS/PRI NCIPAL OFFICERS/DIRECTORS OF M/S. REENA OIL INDUSTRY (P)LT D, M/S. GAURAV HOLDING (P)LTD., AND M/S. REENA PLASTIC PIPES (P)LTD., IT H AD FAILED TO DISCHARGE ITS ITA 3045(DEL)2010 6 ONUS IN RESPECT OF THE AMOUNT CREDITED IN ITS ACCOU NTS IN THE GUISE OF SHARE CAPITAL; THAT THE CONFIRMATIONS FILED BY THE ASSESS EE WERE NOT SUFFICIENT OR ACCEPTABLE IN THE LIGHT OF THE SWORN STATEMENT OF S HRI PRADEEP JINDAL. THE TRANSACTIONS WERE FOUND TO BE COMPLETELY UNEXPLAINE D AND BOGUS. IT WAS HELD THAT THE ASSESSEE HAD FAILED TO PROVE THE CRED IT WORTHINESS OF THE DEPOSITORS/INVESTORS AND THE GENUINENESS OF THE TRA NSACTIONS; AND THAT THE TRANSACTIONS HAD BEEN FOUND TO BE MERELY A COLOURAB LE DEVICE TO DEFRAUD THE REVENUE BY INTRODUCING THE ASSESSEES OWN UNEXPLAIN ED MONEY IN THE GUISE OF SHARE APPLICATION MONEY. THE TOTAL AMOUNT OF ` 15,00,000/- WAS, THEREFORE, TREATED AS UNEXPLAINED CASH CREDIT IN TH E HANDS OF THE ASSESSEE U/S 68 OF THE I.T. ACT AND ADDED TO THE INCOME OF THE A SSESSEE COMPANY. FURTHER, IN VIEW OF THE STATEMENT OF SHRI PRADEEP J INDAL, AN AMOUNT OF ` 15,000/- @ 1% OF THE TOTAL ENTRIES OF ` 15,00,000/- TAKEN BY THE ASSESSEE, WAS ALSO ADDED AS EXPENDITURE INCURRED ON ACCOUNT O F COMMISSION AND EXTRA CHARGE PAID BY THE ASSESSEE ON THE SERVICES OF THE ENTRY OPERATORS. 7. BY VIRTUE OF THE IMPUGNED ORDER, THE LD. CIT(A) CONFIRMED THESE ADDITIONS. THIS BRINGS THE ASSESSEE IN FURTHER AP PEAL BEFORE US. 8. BEFORE US, CHALLENGING THE IMPUGNED ORDER, THE L EARNED COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT THE LD. CIT(A)HAS ERRED IN CONFIRMING THE ADDITIONS WRONGLY MADE; THAT THE LD. CIT(A) HAS FAI LED TO APPRECIATE THAT THE ITA 3045(DEL)2010 7 ASSESSEE WAS NOT CONFRONTED WITH THE ENTIRE ADVERSE MATERIAL USED AGAINST THE ASSESSEE; AND THAT THE ADDITIONS WERE MADE BY RECOR DING INCORRECT FACTS AND FINDINGS WITHOUT PROVIDING ADEQUATE OPPORTUNITY OF HEARING AND ALSO WITHOUT PROVIDING OPPORTUNITY OF CROSS EXAMINATION OF THE P ERSONS WHOSE STATEMENT WAS USED AGAINST THE ASSESSEE. IT HAS BEEN SUBMITT ED THAT IN RESPONSE TO THE AOS QUERY, THE ASSESSEE HAD DULY SUBMITTED ALL THE REQUISITE DETAILS AND EVIDENCE ALONG WITH THE BOOKS OF ACCOUNT AND VOUCHE RS TO CORROBORATE AND SUBSTANTIATE THE TRANSACTIONS. IT HAS BEEN POINTED OUT THAT DETAILED SUBMISSIONS (COPY AT PAGES 138 TO 169 OF THE ASSESS EES PAPER BOOK, APB FOR SHORT), WERE FILED BEFORE THE LD. CIT(A); THAT THE ASSESSEE FILED REPLY DATED 7.2.08 (APB 10) BEFORE THE AO, SUBMITTI NG VARIOUS DETAILS; THAT VIDE LETTER DATED 24.2.08 (APB 11), CONFIRMATIONS, BANK STATEMENT AND ITRS OF THE CREDITORS WERE FILED. ATTENTION HAS BEEN D RAWN TO THE COPIES OF ACKNOWLEDGEMENT OF RETURN OF INCOME FOR THE ASSESSM ENT YEAR 2006-07 (APB 13), COMPUTATION OF INCOME FOR ASSESSMENT YEAR 2006-07 (APB 14), LETTER DATED 17.3.08 (APB 15) FILED BEFORE THE AO A ND, BALANCE SHEETS OF THE COMPANIES FROM WHOM THE SHARE CAPITAL WAS RECEIVED. IT HAS BEEN SUBMITTED THAT THE ASSESSEE HAD SPECIFICALLY REQUESTED THE AO TO GRANT AN OPPORTUNITY TO CROSS EXAMINE SHRI PRADEEP JINDAL, WHOSE STATEMENT HAD BEEN RELIED ON BY ITA 3045(DEL)2010 8 THE AO TO MAKE THE ADDITIONS; THAT THE FOLLOWING E VIDENCES WERE SUBMITTED WITH REGARD TO M/S. REENA OIL INDUSTRY PVT. LTD.:- THE EVIDENCES REGARDING M/S. REENA OIL INDUSTRY PVT . LTD . 1. MOA AND CERTIFICATE OF INCORPORATION PB 16-27 2. BALANCE SHEET AND PROFIT AND LOSS ACCOUNT PB 28 -32 3. ANNUAL RETURN FILED WITH ROC PB 33-47 4. SHARE APPLICATION FORM PB 48 5. CONFIRMATION PB 49 6. ACKNOWLEDGEMENT OF ITR FOR A.Y. 2004-05 P B 50 7. BANK STATEMENT PB 52 8. ALLOTMENT ADVICE PB 53 9. SHARE CERTIFICATE PB 54 9. IT HAS BEEN POINTED OUT THAT THE SCHEDULE SHOWIN G THE DETAILS OF INVESTMENTS OF THE COMPANY IS AT APB 31; THAT THIS SCHEDULE PROVES THE GENUINENESS OF THE TRANSACTION; THAT THE ANNUAL RET URN (APB 35 TO 36) SHOWS THAT SHRI PRADEEP JINDAL WAS NOT THE DIRECTOR OF THE AFORESAID COMPANY DURING THE YEAR; THAT FURTHER, THE STATEMEN T OF SHRI PRADEEP JINDAL WAS RECORDED AT THE BACK OF THE AO AND THE ASSESSEE WAS DEPRIVED OF REBUTTING THE SAME. 10. THE LEARNED COUNSEL HAS SUBMITTED THAT APROPOS M/S. REENA PLASTIC PIPES (P)LTD., THE AMOUNT WAS RECEIVED FROM THIS PA RTY IN ASSESSMENT YEAR 2005-06 AND NOT IN ASSESSMENT YEAR 2006-07, I.E., T HE YEAR UNDER CONSIDERATION; THAT APB 36 IS THE BANK ACCOUNT WHIC H SHOWS THIS AMOUNT TO ITA 3045(DEL)2010 9 HAVE BEEN RECEIVED ON 15.3.2005, FALLING IN ASSESSM ENT YEAR 2004-05, RELEVANT TO ASSESSMENT YEAR 2005-06; THAT THIS SUBM ISSION WAS DULY TAKEN BEFORE THE LD. CIT(A), AS AVAILABLE FROM APB 150; A ND THAT THE FOLLOWING EVIDENCES WERE PRODUCED WITH REGARD TO THIS PARTY:- 1. CERTIFICATE OF INCORPORATION PB 55 2. MEMORANDUM OF ASSOCIATION PB 56-65 3. BALANCE SHEET & PROFIT AND LOSS ACCOUNT PB 66 -70 4. SHARE APPLICATION FORM SHOWING CHEQUE DT.11.3.0 5 PB 71 5. CONFIRMATION SHOWING CHEQUE DATED 11.03.05 PB 72 6. ACKNOWLEDGEMENT OF ITR FOR A.Y.2004-05 PB 73 7. BANK STATEMENT PB 74 8. ALLOTMENT ADVICE PB 75 9. SHARE CERTIFICATE PB 76 10.FORM NO. 32 PB 77 IT HAS BEEN SUBMITTED THAT APB 70 IS THE SCHEDULE S HOWING THE DETAILS OF INVESTMENTS OF THE COMPANY, REFLECTING THE INVESTME NT IN THE ASSESSEE COMPANY ALSO; THAT FORM NO. 32 (APB 77) SHOWS THAT SHRI PRADEEP JINDAL WAS INDUCTED AS THE DIRECTOR OF THE ASSESSEE ON 8.1 2.05, ESTABLISHING THAT HE WAS NOT THE DIRECTOR OF THE COMPANY EITHER AT THE T IME OF TRANSACTION, OR ON THE DATE OF THE RECORDING OF HIS STATEMENT. 10 A. WITH REGARD TO M/S. GAURAV HOLDING PVT. LT D., THE FOLLOWING EVIDENCE HAS BEEN STATED TO HAVE BEEN FILED:- ITA 3045(DEL)2010 10 THE EVIDENCES REGARDING M/S. GAURAV HOLDING PVT. LT D. 1. CERTIFICATE OF INCORPORATION PB 78 2. MEMORANDUM OF ASSOCIATION PB 79-87 3. BALANCE SHEET AND PROFIT AND LOSS ACCOUNT PB 8 8-94 4. CONFIRMATION PB 95 5. SHARE APPLICATION FORM PB 96 6. ACKNOWLEDGEMENT OF ITR FOR A.Y. 2005-06 PB 97 7. BANK STATEMENT PB 98 8. ALLOTMENT ADVICE PB 99 9. SHARE CERTIFICATE PB 100 IT HAS FURTHER BEEN SUBMITTED THAT APB 92, I.E., T HE SCHEDULE SHOWING THE DETAILS OF INVESTMENT OF THE COMPANY DULY REFLECTS THE INVESTMENT IN THE ASSESSEE COMPANY; THAT APB 102 IS THE CERTIFICATE O F INCORPORATION OF THE ASSESSEE COMPANY; THAT A COPY OF THE MEMORANDUM OF ASSOCIATION AND ARTICLES OF ASSOCIATION OF THE ASSESSEE COMPANY ARE AT APB 101 TO 116A; THAT THE TAX AUDIT REPORT, BALANCE SHEET AND PROFIT AND LOSS ACCOUNT OF THE ASSESSEE COMPANY FOR THE YEAR IS AT APB 117 TO 135; AND THAT THE BANK STATEMENT OF THE ASSESSEE COMPANY SHOWING THE TRANS ACTIONS IN QUESTION IS AT APB 136 TO 137. 11. IT HAS BEEN, ON THE BASIS OF THE ABOVE EVIDENCE , SUBMITTED THAT IT IS THUS CLEAR THAT THE ASSESSEE HAD DULY ESTABLISHED T HE IDENTITY AND CREDIT WORTHINESS OF THE CREDITORS, AS ALSO THE GENUINENES S OF THE TRANSACTIONS. IT HAS BEEN CONTENDED THAT WHEN THE ASSESSEE WAS HANDE D OVER THE STATEMENT OF ITA 3045(DEL)2010 11 SHRI PRADEEP JINDAL, VIDE LETTER DATED 17.3.08 (APB 15), THE ASSESSEE, REFUTING THE SAID STATEMENT, REQUESTED FOR CROSS EX AMINATION OF SHRI JINDAL ; THAT HOWEVER, NO SUCH OPPORTUNITY OF CROSS EXAMINAT ION WAS AFFORDED TO THE ASSESSEE AND THE ADDITIONS WERE MADE RELYING SOLELY ON THE SAID STATEMENT OF SHRI PRADEEP JINDAL; THAT BEFORE THE LD. CIT(A), VI DE WRITTEN SUBMISSIONS (APB 148 TO 150) AS WELL AS BY WAY OF ARGUMENTS, IT WAS CONTENDED THAT NO ADVERSE INFERENCE COULD BE DRAWN FROM THE STATEMENT OF SHRI PRADEEP JINDAL AGAINST THE ASSESSEE; THAT IT IS PERTINENT THAT WHE REAS THE STATEMENT OF SHRI PRADEEP JINDAL WAS RECORDED ON 15.4.04, THE SHARE C APITAL WAS RECEIVED BY THE ASSESSEE IN MARCH AND MAY, 2005 AND SO, THE STA TEMENT WAS NOT APPLICABLE TO THE TRANSACTIONS IN QUESTION; THAT TH E LD. CIT(A) OBSERVED, INTER ALIA, THAT THE ASSESSEES CONTENTION THAT THE AO HA D NOT AFFORDED OPPORTUNITY TO THE ASSESSEE TO CROSS EXAMINE SHRI PRADEEP JINDA L, COULD NOT BE ACCEPTED SINCE THE AO HAD MADE ALL INFORMATION AVAILABLE ON RECORD; AND THAT THIS DESPITE THE FACT THAT THE ASSESSEE HAD MADE SPECIF IC REQUEST FOR CROSS EXAMINATION, AS ABOVE, WHEREAS THE AO HAD NOT ACCEP TED THIS REQUEST AND HAD GONE ON TO MAKE THE ADDITIONS, EVEN THOUGH THE STATEMENT OF PRADEEP JINDAL WAS RECORDED AT THE BACK OF THE ASSESSEE. THE LEARNED COUNSEL HAS PLACED RELIANCE ON THE FOLLOWING DECISIONS:- ITA 3045(DEL)2010 12 1. CIT V. ASHWANI GUPTA, 322 ITR 396 (DHC); 2. PRAKASH CHAND NAHTA V. CIT,(HC)(MP), 218 CTR 367; 3. CIT V. SMC GLOBAL SHARE BROKERS, 288 ITR 345(DEL) ; 4. CIT V. RAJESH KUMAR, ITA NO. 545/2007 DT. 4.4.200 8; & 5. ITO V. DR. PUSHPA GUPTA, ITA NO. 4468(DEL)2004. 12. THE LEARNED COUNSEL HAS FURTHER SUBMITTED THAT AS HELD BY VARIOUS COURTS, INCLUDING THE HONBLE SUPREME COURT AND HON BLE JURISDICTIONAL DELHI HIGH COURT, ONCE THE IDENTITY OF THE SHAREHOL DERS HAD BEEN ESTABLISHED, NO ADDITION CAN BE MADE IN THE HANDS OF THE RECIPIE NT COMPANY. RELIANCE IN THIS REGARD HAS BEEN PLACED ON CIT V. LOVELY EXPOR TS PVT. LTD., 216 CTR (SC) 195. 13. THE LEARNED COUNSEL HAS THEN CONTENDED THAT THE LEARNED CIT(A) HAS GONE WRONG IN OBSERVING THAT SHRI PRADEEP JINDAL WA S THE ASSESSEES WITNESS AND SO, THERE WAS NO QUESTION OF GIVING THE ASSESSE E AN OPPORTUNITY TO CROSS EXAMINE HIM; THAT IN KISHIN CHAND CHELLARAM, 125 ITR 713(SC), IT HAS BEEN HELD THAT WHERE THE EVIDENCE IN THE FORM OF A STATEMENT OF A THIRD PARTY IS USED AGAINST THE ASSESSEE WITHOUT CONFRONTING TH E ASSESSEE AND WITHOUT ADEQUATE OPPORTUNITY OF CROSS EXAMINATION, IT DOES NOT CONSTITUTE ANY MATERIAL EVIDENCE AT ALL; THAT THEREFORE, ANY ADDIT ION BASED THEREON IS NOT IN ACCORDANCE WITH LAW; THAT IN SONA ELECTRIC CO., 1 52 ITR 507(DEL), IT HAS BEEN HELD THAT WHERE THE GROUNDS THEMSELVES FOR MAK ING THE ADDITION ARE BASED ON NO EVIDENCE, NO QUESTION OF PRESUMPTION AR ISES; THAT IN MENAKA ITA 3045(DEL)2010 13 GANDHI V. UNION OF INDIA AIR 1978 SC 597, IT HAS B EEN HELD THAT A JUDICIAL DECISION OR AN ADMINISTRATIVE DECISION RENDERED OR AN ORDER MADE IN VIOLATION OF RULE OF AUDI ALTEREM PARTEM IS NULL AND VOID AND THE ORDER MADE IN SUCH A CASE NEEDS TO BE STRUCK DOWN ON THAT SCORE ITSELF . 14. THE LEARNED COUNSEL HAS FURTHER CONTENDED THAT APB 33 TO 47 IS A COPY OF THE ANNUAL RETURN OF REENA OIL INDUSTRY (P)LTD., FILED WITH ROC; THAT THEREFROM, IT IS CLEAR THAT PRADEEP JINDAL WAS NEVE R A DIRECTOR IN THE SAID COMPANY; THAT FORM NO. 32 OF REENA PLASTIC PIPES (P )LTD.(APB 7) SHOWS THAT SHRI PRADEEP JINDAL WAS INDUCTED AS A DIRECTOR W.E.F. 8.12.05; THAT HOWEVER, THE TRANSACTION WAS ENTERED INTO ON 15.3.0 5, MAKING IT CLEAR THAT THIS TRANSACTION DID NOT COME ABOUT IN THE YEAR UND ER CONSIDERATION; THAT THIS FACT IS ALSO VERIFIABLE FROM THE SHARE APPLICATION FORM (APB 71) AND THE BANK STATEMENT OF REENA PLASTIC PIPES (P)LTD. (APB 74); THAT FROM THESE FACTS, IT IS EVIDENT THAT SHRI JINDAL WAS NEITHER A DIRECTOR OF THE COMPANY ON THE DATE OF RECORDING OF HIS STATEMENT, NOR WAS HE THE DIRECTO R OF THE COMPANY ON THE DATE OF THE TRANSACTION. 15. IT HAS BEEN FURTHER SUBMITTED BY THE LEARNED CO UNSEL THAT THE AO WRONGLY OBSERVED THAT THE ASSESSEE COMPANY WAS UNWI LLING TO PRODUCE THE PRINCIPAL OFFICERS/DIRECTORS OF M/S. REENA OIL INDU STRY (P)LTD.,M/S. GAURAV HOLDING (P)LTD. AND M/S. REENA PLASTIC PIPES (P)LTD .; THAT THE ASSESSEE HAD ITA 3045(DEL)2010 14 NEVER STATED ANY SUCH UNWILLINGNESS; THAT RATHER, T HE ASSESSEE HAD SPECIFICALLY ASKED FOR THE CROSS EXAMINATION FOR BEING ALLOWED O PPORTUNITY TO CROSS EXAMINE THE CONCERNED PERSONS OF THE COMPANIES MANY TIMES, AS EVIDENT FROM THE ASSESSEES LETTER DATED 17.3.08, AS ABOVE, ADDRESSED TO THE AO. 16. FURTHER, IT HAS BEEN AVERRED THAT THE AO WRONGL Y OBSERVED THAT THE BANKS ACCOUNTS OF THE CREDITOR COMPANIES WERE MAIN TAINED BY SHRI PRADEEP JINDAL; THAT AMPLE MATERIAL BELYING THIS OBSERVATIO N WAS PLACED BEFORE THE AO; THAT IN THE STATEMENT OF SHRI PRADEEP JINDAL, THE BANK ACCOUNT THROUGH WHICH THE CONCERNED TRANSACTION HAD TAKEN PLACE, IS NOWHERE MENTIONED; THAT THE CONCERNED TRANSACTION WAS THROUGH VIJAY BANK; T HAT SHRI PRADEEP JINDAL NEVER MADE MENTION OF THIS BANK IN HIS STATEMENT; T HAT THE GENUINENESS OF THE TRANSACTION IS ALSO AVAILABLE CLEARLY FROM THE BANK STATEMENT OF M/S. VEENA OIL INDUSTRY (P)LTD. (APB 52), THE BANK STATEMENT O F M/S. GAURAV HOLDING (P)LTD.(APB 98) AND THE BANK STATEMENT OF M/S. REE NA PLASTIC PIPES (P)LTD.(APB 74). 17. LASTLY, IT HAS BEEN CONTENDED THAT THE ADDITION OF ` 15,000/- AS COMMISSION AMOUNT IS ALSO, CONSEQUENTIAL, WITHOUT B ASIS, DESERVING TO BE DELETED ALONG WITH THE MAIN ADDITION OF ` 15,00,000/-. ITA 3045(DEL)2010 15 18. THE LD. DR, ON THE OTHER HAND, HAS STAUNCHLY SU PPORTED THE IMPUGNED ORDER. IT HAS BEEN SUBMITTED THAT IT WAS CLEAR FRO M THE INVESTIGATION CARRIED ON BY THE INVESTIGATION WING OF THE DEPARTMENT THA T THE THREE COMPANIES INVOLVED WERE GIVING ONLY ACCOMMODATION ENTRIES RAT HER THAN DOING ANY GENUINE BUSINESS OR MAKING ANY INVESTMENT; THAT THE SE COMPANIES WERE USED BY SHRI PRADEEP JINDAL; THAT IN HIS STATEMENT BEFOR E THE INVESTIGATION WING OF THE DEPARTMENT, SHRI JINDAL HAD MADE AN INCULPAT ORY STATEMENT; THAT THE SWORN STATEMENTS OF THE ENTRY OPERATORS WERE DULY S UPPLIED TO THE ASSESSEE; THAT IN THESE STATEMENTS, THE ENTRY OPERATORS HAD C ATEGORICALLY ADMITTED THAT THEY WERE NOT DOING ANY GENUINE BUSINESS OR INVESTM ENT BUT WERE ONLY GIVING ACCOMMODATION ENTRIES ON TAKING CASH FROM TH E PARTIES WHICH WAS ROUTED THROUGH THE ACCOUNTS MAINTAINED FOR GIVING C HEQUES IN THE SHAPE OF SHARE APPLICATION, SHARE CAPITAL, LOANS, GIFTS, ETC .; THAT THE ASSESSEE WAS SPECIFICALLY ASKED TO PRODUCE THE DIRECTORS/PRINCIP AL OFFICERS OF THESE COMPANIES FOR CROSS EXAMINATION AND TO PROVE THEIR CREDIT WORTHINESS AND THE GENUINENESS OF THE TRANSACTIONS; THAT HOWEVER, THE COUNSEL FOR THE ASSESSEE HAD EXPRESSED THE UNWILLINGNESS OF THE ASSESSEE CO MPANY TO PRODUCE THE PRINCIPAL OFFICERS/DIRECTORS OF THESE COMPANIES; TH AT IT WAS IN THE BACKDROP OF THESE FACTS THAT THE AO CORRECTLY MADE THE ADDIT IONS; THAT THE MATTER WAS FURTHER CLARIFIED BY THE AO BEFORE THE LD. CIT(A) O N REMAND; THAT IN THE ITA 3045(DEL)2010 16 REMAND REPORT DATED 27.7.07, THE AO HAD CATEGORICAL LY STATED THAT ENQUIRIES WERE MADE FROM VIJAY BANK, AZADPUR, NEW DELHI, IN W HICH, IT WAS FOUND THAT SHRI PRADEEP JINDAL , THE PROPRIETOR OF M/S.RA JA AGENCIES, AZADPUR, NEW DELHI, HAD DEPOSITED CASH GIVEN BY THE ASSESSEE IN THE PROPRIETORSHIP ACCOUNT AND HAD TRANSFERRED THIS CASH TO THE COMPAN Y ACCOUNTS MAINTAINED BY HIM, FROM WHERE, THE ENTRIES WERE GIVEN TO HIM B Y THE ASSESSEE COMPANY; AND THAT THE ADDRESS OF LAXMAN SINGH SATYAPAL, PRO PRIETOR OF M/S. RANI ENTERPRISES, AND PRADEEP JINDAL, PROPRIETOR OF M/S. RAJA AGENCIES, WERE ALSO THE SAME IN AZADPUR, DELHI. THE LD. DR HAS FURTHER CONTENDED THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS CORRECTLY OBSERVED THAT THE AO HAD MADE ALL THE INFORMATION ON RECORD AVAILABLE TO THE ASSESSEE; THAT THE ASSESSEES CONTENTION THAT IT WAS NOT GIVE N AN OPPORTUNITY TO CROSS EXAMINE SHRI PRADEEP JINDAL COULD NOT BE ACCEPTED; THAT ACTUALLY, IT WAS THE ASSESSEES ONUS TO ESTABLISH THE GENUINENESS OF THE TRANSACTIONS AND THE IDENTITY AND CAPACITY TO PAY OFF THE CREDITOR COMPA NIES; THAT THE ASSESSEE COMPANY HAD RECEIVED THE MONEY IN ITS BOOKS OF ACCO UNT AND THE DEPARTMENT HAD NOT COLLECTED INFORMATION FROM ANY O UTSIDE PARTY; THAT THE ASSESSEE COULD NOT WASH ITS HANDS OFF BY MERELY TA KING SPECIOUS PLEA THAT IT WAS NOT CONCERNED ABOUT THE SOURCE OF THE SOURCE, I .E., THE SOURCE OF THE CASH DEPOSIT IN THE ACCOUNT WHEREFROM THE SHARE APPLICAT ION MONEY WAS RECEIVED ITA 3045(DEL)2010 17 BY THE ASSESSEE; THAT IN THE STATEMENT OF SHRI PRAD EEP JINDAL, HE HAD STATED THAT ALL THE COMPANIES THAT HE WAS DEALING WERE DEA LING IN PROVIDING ACCOMMODATION ENTRIES ON COMMISSION BASIS; THAT I N THESE FACTS, THERE IS NO ERROR WHATSOEVER IN THE ORDER OF THE LD. CIT(A) AND IT CANNOT BE, IN ANY MANNER BE SAID THAT THE ADDITIONS HAVE BEEN WRONGLY CONFIRMED; AND THAT THEREFORE, THERE BEING NO MERIT THEREIN, THE APPEAL FILED BY THE ASSESSEE BE DISMISSED. 19. WE HAVE HEARD THE PARTIES AND HAVE PERUSED THE MATERIAL ON RECORD. THE ASSESSEE HAD RECEIVED ` 5,00,000/- EACH FROM REENA OIL INDUSTRY (P)LTD., REENA PLASTIC PIPES (P)LTD. AND GAURAV HOL DINGS (P)LTD., RESPECTIVELY, AS SHARE APPLICATION MONEY, DURING TH E YEAR. BEFORE THE AO, THE ASSESSEE FILED REPLIES DATED 7.2.08 (APB 10) AN D 24.2.08 (APB 11), GIVING THE REQUIRED DETAILS. BESIDES, CERTIFICATE OF INCORPORATION OF THE ASSESSEE COMPANY (APB 102), MEMORANDUM OF ASSOCIATI ON AND ARTICLES OF ASSOCIATION OF THE ASSESSEE COMPANY (APB 101 TO 116 A), TAX AUDIT REPORT, BALANCE SHEET AND PROFIT AND LOSS ACCOUNT O F THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION (APB 117 TO 135) AND BANK STATEMENT (APB 136 AND 137) OF THE ASSESSEE COMPANY FOR THE CONCERNED PERIOD, SHOWING THE RELATED TRANSACTIONS WITH ALL THE CREDITOR PARTIES WERE ALSO FILED. ACKNOWLEDGEMENT OF RETURN OF INCOME FOR THE YEAR UN DER CONSIDERATION IS AT ITA 3045(DEL)2010 18 APB 13, WHEREAS COMPUTATION OF INCOME FOR THE YEAR IS AT APB 14. VIDE LETTER DATED 17.3.08 (APB 15) THE ASSESSEE SUBMITTE D THE BALANCE SHEETS OF THE CREDITOR COMPANIES AND ASKED FOR CROSS EXAMINAT ION OF PRADEEP JINDAL, ON WHOSE STATEMENT, THE AO HAD SOUGHT TO RELY. 20. APROPOS M/S. REENA OIL INDUSTRY (P)LTD., THE AS SESSEE FILED BEFORE THE AO AN MOU AND CERTIFICATE OF INCORPORATION, BALANCE SHEET AND PROFIT AND LOSS ACCOUNT, ANNUAL RETURN FILED WITH THE ROC, SH ARE APPLICATION FORM, CONFIRMATION, ACKNOWLEDGEMENT OF INCOME TAX RETURN FOR ASSESSMENT YEAR 2004-05, BANK STATEMENT, ALLOTMENT ADVICES AND SHAR E CERTIFICATE WERE FILED. COPIES THEREOF HAVE BEEN PLACED BEFORE US, AS NOTED HEREINABOVE. A SCHEDULE (APB 30 AND 31) SHOWING THE DETAILS OF INV ESTMENT OF M/S. REENA OIL INDUSTRY (P)LTD. WAS ALSO FILED. THIS SCHEDUL E DEPICTS INVESTMENT OF ` 5,00,000/- IN THE ASSESSEE COMPANY. THIS SCHEDULE IS AN ANNEXURE FORMING PART OF SCHEDULE III OF THE BALANCE SHEET OF REENA OIL INDUSTRY (P) LTD., AS ON 31.3.06. 21. SO FAR AS REGARDS REENA PLASTIC PIPES (P)LTD., IT HAS BEEN SUBMITTED THAT THE AMOUNT OF ` 5,00,000/- WAS RECEIVED BY THE ASSESSEE FROM THIS CREDITOR IN F.Y. 2004-05, RELEVANT TO ASSESSMENT YE AR 2005-06 AND NOT IN THE YEAR UNDER CONSIDERATION, I.E. ASSESSMENT YEAR 2006 -07. A COPY OF BANK STATEMENT IN THIS REGARD IS AT APB 136 TO 137. IT S HOWS CREDIT OF ` 5,00,000/- ITA 3045(DEL)2010 19 ON 14.3.05, BY DEPOSITING OF CHEQUE NO. 606894, BY CLEARING. THE ASSESSEE STATES THIS TO BE THE AMOUNT PERTAINING TO REENA PL ASTIC PIPES (P)LTD. AND THIS FACT HAS NOT BEEN DISPUTED. THEREFORE, SINCE THE AMOUNT WAS RECEIVED IN ASSESSMENT YEAR 2005-06, NO ADDITION COULD BE MADE U/S 68 IN THE YEAR UNDER CONSIDERATION, I.E., ASSESSMENT YEAR 2006-07. THI S IS SO BECAUSE AS PER THE PROVISIONS OF SECTION 68 OF THE ACT, WHERE ANY SUM IS FOUND CREDITED IN THE BOOKS OF AN ASSESSEE MAINTAINED FOR ANY PREVIOUS YE AR, THE SUM SO CREDITED MAY BE CHARGED TO INCOME TAX AS THE INCOME OF THE A SSESSEE OF THAT PREVIOUS YEAR, IF THE REQUIREMENTS OF SECTION 68 AR E NOT FULFILLED. 22. FURTHER, THE IDENTITY OF REENA PLASTIC PIPES (P )LTD. STANDS ESTABLISHED ALONG WITH THE CREDIT WORTHINESS OF THIS PARTY AND THE GENUINENESS OF THE TRANSACTION, FROM THE VOLUMINOUS DOCUMENTS FILED BY THE ASSESSEE BEFORE THE AUTHORITIES BELOW, INCLUDING THE CERTIFICATE OF INC ORPORATION, THE MEMORANDUM OF ASSOCIATION, BALANCE SHEET AND PROFIT & LOSS ACCOUNT, THE SHARE APPLICATION FORM SHOWING CHEQUE DATED 11.3.05 , CONFIRMATION SHOWING CHEQUE DATED 11.3.05, ACKNOWLEDGMENT OF ITR FOR ASSESSMENT YEAR 2004-05, BANK STATEMENT, ALLOTMENT ADVICE AND SHARE CERTIFICATE AND FORM NO. 32. IN THE BALANCE SHEET AND PROFIT AND LOSS ACCOUNT FOR ASSESSMENT YEAR 2006-07 (APB 67 70), THERE IS A SCHEDULE (AP B 70) SHOWING THE DETAILS OF INVESTMENTS OF THE COMPANY, INCLUDING TH E INVESTMENT OF ` 5 LAKHS ITA 3045(DEL)2010 20 IN THE ASSESSEE COMPANY. THE NAME OF THE ASSESSEE COMPANY STANDS DULY REFLECTED. 23. APROPOS M/S. GAURAV HOLDINGS (P)LTD., AGAIN, TH E ASSESSEE FURNISHED CERTIFICATE OF INCORPORATION (APB 78), MEMORANDUM O F ASSOCIATION (APB 79 TO 87), BALANCE SHEET AND PROFIT AND LOSS ACCOU NT (APB 88 TO 94), CONFIRMATION (APB 95), SHARE APPLICATION FORM (APB 96), ACKNOWLEDGEMENT OF ITR FOR ASSESSMENT YEAR 2005-06 (APB 97), BANK STATEMENT (APB 98), ALLOTMENT ADVICE (APB 99), AND SHARE CERTIFICATE (APB 100). IN THE SCHEDULE SHOWING THE DETAILS OF INVESTMENTS OF THE SAID COMPANY (APB 92), THE INVESTMENT OF ` 5,00,000/- IN THE ASSESSEE COMPANY HAD DULY REFLECTED. THEREFORE, HERE ALSO, ALL THE THREE INGREDIENTS OF SECTION 68 OF THE I.T. ACT ARE DULY MET. THE IDENTITY AND CREDIT WORTHINESS OF THE CREDITOR STANDS ESTABLISHED AS THUS THE GENUINENESS OF THE TRANSACTION. 24. MOREOVER, WE FIND THAT IT HAS BEEN RIGHTLY CONT ENDED ON BEHALF OF THE ASSESSEE, THAT SHRI PRADEEP JINDALS STATEMENT COUL D NOT HAVE BEEN MADE THE BASIS FOR THE ADDITION IN QUESTION. THIS IS SO, B ECAUSE WHEREAS THE STATEMENT OF SHRI PRADEEP JINDAL WAS RECORDED ON 15.4.04, THE SHARE CAPITAL IN QUESTION WAS RECEIVED BY THE ASSESSEE ONLY IN MARCH, 2005 AN D MAY, 2005. THAT BEING SO, AT THE OUTSET, THE SAID STATEMENT OF SHRI PRADEEP JINDAL COULD NOT HAVE BEEN ABOUT THE TRANSACTIONS NOT HITHERTO-FORE ENTERED INTO AT THE TIME OF ITA 3045(DEL)2010 21 RECORDING OF THE SAID STATEMENT AND IT RELATED ONLY TO TRANSACTIONS PRIOR TO 15.4.04. ON THIS SCORE ITSELF, THE STATEMENT OF SH RI PRADEEP JINDAL WAS WRONGLY MADE THE BASIS OF THE ADDITIONS IN QUESTION . 25. AND NOT ONLY THIS, DESPITE THE ASSESSEE HAVING REQUESTED FOR PROVIDING AN OPPORTUNITY TO CROSS EXAMINE SHRI PRADEEP JINDAL , THIS REQUEST WAS NOT ACCEDED TO, TO THE DETRIMENT OF THE ASSESSEE, IN UT TER VIOLATION OF PRINCIPLES OF NATURAL JUSTICE, SUCH STATEMENT HAVING BEEN RECORDE D AT THE BACK OF THE ASSESSEE. 26. FURTHER-MORE, IT HAS RIGHTLY BEEN CONTENDED THA T ON THE DATE OF RECORDING OF THE STATEMENT OF SHRI PRADEEP JINDAL, HE WAS NOT THE DIRECTOR IN THE CREDITOR COMPANIES. THE ANNUAL RETURN FILED B Y M/S. REENA OIL INDUSTRY (P)LTD. WITH THE ROC IS AT APB 34 TO 47. THEREFROM, IT IS EVIDENT THAT SHRI PRADEEP JINDAL WAS NEVER A DIRECTOR IN TH E SAID COMPANY. IN FORM NO. 32 (APB 77) OF REENA PLASTIC PIPES (P)LTD., SH RI PRADEEP JINDAL HAS BEEN SHOWN TO HAVE BEEN INDUCTED AS A DIRECTOR OF T HE COMPANY W.E.F. 8.12.05, WHEREAS THE TRANSACTION WITH REENA PLASTIC PIPES (P)LTD. WAS ON 15.3.05, AS EVIDENT FROM THE SHARE APPLICATION FORM (APB 71), OF REENA PLASTIC PIPES (P)LTD. AND THE BANK STATEMENT (APB 7 4) OF THE SAID COMPANY. ITA 3045(DEL)2010 22 27. ON THIS SCORE ALSO, THE ADDITION CANNOT SUSTAIN . DESPITE THESE UNDISPUTED FACTS, SHRI JINDAL HAD DEPOSED IN HIS S TATEMENT THAT HE WAS A DIRECTOR IN THESE COMPANIES. 28. STILL FURTHER, FROM THE BANK STATEMENTS OF THE THREE CREDITOR COMPANIES, COPIES WHEREOF ARE AT APB PAGES 52, 74 AND 98, RESP ECTIVELY, IT IS AVAILABLE THAT THE TRANSACTIONS WERE ENTERED THROUGH VIJAY BA NK. IN HIS STATEMENT, SHRI PRADEEP JINDAL DID NOT MENTION THIS BANK. THE DET AILS OF THE BANK ACCOUNT THROUGH WHICH THE CONCERNED TRANSACTIONS HAD TAKEN PLACE WERE ALSO NOT MENTIONED. THEREFORE ALSO, WEIGHING THE DOCUMENTA RY EVIDENCE AGAINST THE ORAL ONE, THE TRANSACTIONS ENTERED INTO BY THE ASSE SSEE COMPANY ARE CLEARLY STATED IN THE BANK STATEMENTS TO BE THROUGH VIJAY B ANK, THEREBY ESTABLISHING THE GENUINENESS OF THESE TRANSACTIONS, WHEREAS THE ORAL STATEMENT OF SHRI PRADEEP JINDAL IS DE-VOID OF ANY DETAILS OF THE TRA NSACTIONS AND IS NOT WORTHY OF CREDENCE IN THE FACE OF THE SAID DOCUMENTARY EVI DENCE. 29. IN THE AFORESAID FACTS AND CIRCUMSTANCES, WE HO LD THAT THE ASSESSEE COMPANY HAS DULY SUBMITTED ALL REQUISITE DOCUMENTA RY EVIDENCES BEFORE THE AUTHORITIES BELOW SO AS TO DISCHARGE ITS ONUS OF E STABLISHING THE IDENTITY AND CREDIT WORTHINESS OF THE SHAREHOLDERS AND THE GENUI NENESS OF THE TRANSACTIONS. THAT BEING SO, LOOKED AT FROM ANY ANGLE, THE ADDIT ION HAS WRONGLY BEEN MADE IN THE HANDS OF THE ASSESSEE COMPANY, THOUGH T HE SAME OUGHT TO HAVE ITA 3045(DEL)2010 23 BEEN MADE, IF AT ALL, IN THE HANDS OF THE SHAREHOLD ERS, AS HELD IN LOVELY EXPORTS (SUPRA). 30. IN VIEW OF THE ABOVE, THE GRIEVANCE OF THE ASSE SSEE IS ACCEPTED AND THE ADDITION OF ` 15,00,000/- BEING SHARE APPLICATION MONEY RECEIVED DURING THE YEAR AND THAT OF ` 15,000/- ON ACCOUNT OF THE ALLEGED COMMISSION PAID, ARE HEREBY DELETED, ACCEPTING GROUND NOS. 1 TO 5. 31. GROUND NO.6 IS CONSEQUENTIAL. 32. GROUND NO. 7 IS GENERAL. 33. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 07.12.2011. SD/- SD/- (G.E. VEERABHADRAPPA) (A.D. JAIN) PRESIDENT JUDICIAL MEMBER DATED: 07.12.2011. *RM COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR TRUE COPY BY ORDER ITA 3045(DEL)2010 24 DEPUTY REGISTRAR