ITO, New Delhi V. M/s. Kanodia Pharmaceuticals Pvt. Ltd., New Delhi

ITA 4858/DEL/2015

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 4966 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 5 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-01-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Assessment Year: 2003-2004
• Appeal Filed On: 24-07-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SURENDER PAL
• Keywords: Gift; Accommodation entries; Reassessment proceedings
• Section: 143(1); 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL [ DELHI BENCH F, NEW DELHI ] BEFORE SMT. BEENA A. PILLAI, JUDICIAL MEMBER A N D DR. B.R.R. KUMAR, ACCOUNTANT MEMBER ITA NO. 4858/DEL/2015 ASSESSMENT YEAR: 2003-04 ITO WARD-14(2), ROOM NO. 308, C.R. BUILDING, I.P. ESTATE NEW DELHI VS. KANODIA PHARMACEUTICALS PVT. LTD. F- 108, GALI NO. 8, NEAR SHIV MANDIR, PANDAV NAGAR, NEW DELHI PAN: AABCK5119L (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI KAPIL GOEL, ADVOCATE DEPARTMENT BY : SHRI. SURENDER PAL, SR. DR DATE OF HEARING : 31-12-2018 DATE OF PRONOUNCEMENT : 22-01-2019 O R D E R PER DR. B.R.R. KUMAR, AM : THE APPEAL OF THE REVENUE PRIMARILY DEALS WITH QUA SHING OF THE ORDER BY THE LD. CIT (A) BY HOLDING THAT THE NOTICE ISSUED U /S 148 AS ILLEGAL AND DELETION OF THE ADDITION MADE U/S 68. 2. BRIEF FACTS OF THE CASE ARE THAT THE CASE HAS BE EN REOPENED BY THE AO BASED ON THE INFORMATION ISSUED FROM THE INVESTIGAT ION WING THAT THE ASSESSEE HAS RECEIVED AMOUNTS FROM THE ENTRY OPERATOR. THE R EASONS RECORDED ARE AS UNDER: INVESTIGATIONS WERE CONDUCTED BY THE INVESTIGATION WING OF THE DEPARTMENT ON CERTAIN PERSONS ENGAGED IN PROVIDING ACCOMMODATION ENTRIES TO BENEFICIARIES OF 2 THEIR SERVICES, IN RETURN OF COMMISSION. IT HAS BEE N REVEALED THAT MANY PERSONS WERE USING SERVICES OF ACCOMMODATION ENTRY OPERATOR S TO CHANNELISE THEIR OWN UNACCOUNTED MONEY IN THEIR REGULAR BOOKS OF ACCOUNT S BY ROUTING THE SAME THROUGH THE ACCOUNTS OF ACCOMMODATION ENTRY PROVIDE RS. ... 2. THE MODUS OPERANDI OF THESE ENTRY PROVIDERS AND BENEFICIARIES OF THEIR SERVICES, WAS DETECTED TO BE AS UNDER: 2.1 ENTRIES WERE BEING BROADLY TAKEN FOR TWO PURPOSES: 1. TO PLOUGH BACK UNACCOUNTED BLACK MONEY FOR THE PURP OSE OF BUSINESS OR FOR PERSONAL NEEDS SUCH AS PURCHASE OF ASSETS ETC., IN THE FORM OF GIFTS, SHARE APPLICATION MONEY, LOANS ETC. 2. TO INFLATE EXPENSES IN THE TRADING AND PROFIT AND L OSS ACCOUNT SO AS TO REDUCE THE REAL PROFITS AND THEREBY PAY LESS TAX ES. 2.2 THE ASSESSEES WHO HAD UNACCOUNTED MONEY (CALLED AS ENTRY TAKERS OR BENEFICIARIES) AND WANTED TO INTRODUCE THE SAME IN THE BOOKS OF ACCOUNTS WITHOUT PAYING TAX, APPROACHED ANOTHER PERSON (CALL ED AS ENTRY OPERATOR) AND HANDED OVER THE CASH (PLUS COMMISSION) AND HAD TAKE N CHEQUES/DDS/POS. THE CASH WAS BEING DEPOSITED BY THE ENTRY OPERATOR IN A BANK ACCOUNT EITHER IN HIS OWN NAME OR IN THE NAME OF RELATIVE/FRIENDS OR OTHE R PERSON HIRED BY HIM, FOR THE PURPOSE OF OPENING BANK ACCOUNT. IN MOST OF THESE B ANK ACCOUNTS THE INTRODUCER WAS THE MAIN ENTRY OPERATOR AND THE CASH DEPOSIT SLIPS AND OTHER INSTRUMENTS WERE FILLED BY HIM. THE OTHER PERSONS ( IN WHOSE NAME THE A/C IS OPENED) ONLY USED TO SIGN THE BLANK CHEQUE BOOK AND HAND OVER THE SAME TO THE MAIN ENTRY OPERATOR. THE ENTRY OPERATOR THEN US ED TO ISSUE CHEQUES/DDS/POS IN THE NAME OF THE BENEFICIARY FROM THE SAME ACCOUN T (IN WHICH THE CASH IS DEPOSITED) OR ANOTHER ACCOUNT IN WHICH FUNDS WERE T RANSFERRED THROUGH CLEARING IN TWO OR MORE STAGES. THE BENEFICIARY IN TURN DEPO SITED THESE INSTRUMENTS IN HIS BANK ACCOUNTS AND THE MONEY CAME TO HIS REGULAR BOO KS OF ACCOUNT IN THE FORM OF GIFT, SHARE APPLICATION MONEY, LOAN ETC THROUGH BANKING CHANNELS. 2.3 THE OPERATORS GAVE THE ACCOUNT HOLDERS AMOUNTS RANG ING FROM RS 1000 TO 2000 PER MONTH. THESE ACCOUNT HOLDERS WERE MASONS, PLUMBERS, ELECTRICIANS, PEONS, DRIVERS ETC, WHOSE EARNINGS ARE NOT SUFFICIE NT FOR A LIVING. THEV EARNED NORMALLY RS 3 TO 5 THOUSAND PER MONTH IN THEIR NORM AL WORK AND BY WORKING FOR THE ENTRY OPERATORS EARNED EXTRA INCOME OF RS 2 TO 4 TH OUSAND PER MONTH. THEIR SIGNATURES WERE TAKEN ON BLANK GIFT DEEDS, CHEQUE B OOKS, SHARE APPLICATION MONEY ETC. IN FACT THESE PERSONS SIGNED ALL TYPES O F PAPERS THEY WERE ASKED TO SIGN. THEY WERE MADE DIRECTORS OF COMPANIES, PARTNE RS OF FIRMS AND PROPRIETOR OF DIFFERENT CONCERNS SOLELY FOR OPERATION OF THESE AC COUNTS. ACTUALLY, MANY OF THEM WERE NOT EVEN AWARE OF THE TAX IMPLICATIONS ETC. TH EIR ONLY CONCERN WAS WITH THE FEW THOUSAND RUPEES GIVEN TO THEM BY THE ENTRY OPER ATORS. 3. SUMMING UP, THE REPORT AS A RESULT OF THESE EXTENSI VE ENQUIRIES CARRIED OUT BY THE D.I.T. (INV.), NEW DELHI HAS EST ABLISHED THE NON-GENUINENESS OF TRANSACTIONS, WHETHER SHOWN BY BENEFICIARIES AS INF LOW OF SHARE CAPITAL OR RECEIPT 3 OF GIFTS OR CONSIDERATION FOR SALE-PURCHASE. THE CR EDITWORTHINESS OF THE PERSONS/PERSONS CONTROLLING THE CONCERNS WHO HAVE G IVEN THESE CREDIT ENTRIES/SHARE CAPITAL/GIFTS/SALE CONSIDERATION HAS ALSO NOT BEEN ESTABLISHED AS THEY HAVE BEEN SEEN TO BE MAN OF NO MEANS. 4. THE SAID REPORT OF INVESTIGATION WING OF THE DEPART MENT:, ON THE INVESTIGATIONS CONDUCTED IN THE CASE OF VARIOUS ACC OMMODATION ENTRY PROVICERS ALONG WITH THE LIST OF THE BENEFICIARIES OF THEIR S ERVICES, WAS FORWARDED TO THIS OFFICE THROUGH ADDL.CIT, RANGE-$/VIDE LETTER F.NO. ADDL. C IT/RANGE-5/2005-06/759, DATED 13.3.2006. 5. IN THE INSTANT CASE OF THE ASSESSEE, M/S.KANODIA PH ARMACEUTICALS (P) LTD. INFORMATION HAS BEEN RECEIVED THAT THE ASSESSEE HAS TAKEN ACCOMMODATION ENTRIES AS NOTED BELOW:- BANK OF THE ASSESSEE BRANCH OF THE BANK AMOUNT INSTRUME NT NO. DATE CREDIT ENTRY COMING FROM THE ACCOUNT OF SYNDICATE BANK PUNJABI BAGH 400000 51778 15-JAN-03 ETHNIC CREATIONA P. LTD. 500000 245888 18-JAN-03 PARAS FINCAP P. LTD. 500000 245884 18-JAN-03 PARAS FINCAP P. LTD. 500000 245885 18-JAN-03 PARAS FINCAP P. LTD. 500000 245886 18-JAN-03 PARAS FINCAP P. LTD. 500000 246656 29-JAN-03 K.V.F. SECURITIES P. LT D. 500000 246655 29-JAN-03 K.V.F. SECURITIES P. LT D. 200000 245534 06-FEB-03 GANPATI SERVICES LTD 200000 245609 06-FEB-03 GANAPATI CRYSTAL LTD 200000 246113 06-FEB-03 GANAPATI TELECOMS LTD 300000 245633 06-FEB-03 GANAPATI AMUSEMENTS PARKS LTD 650000 304801 06-FEB-03 SANT BHOG FOODS P. LTD. 500000 246607 06-FEB-03 NEERAJ CORROSION PRODUCTS 500000 246098 13-FEB-03 SAUDAMINII TRADING & INVESTMENT 500000 246097 13-FEB-03 SAUDAMINII TRADING A INVESTMENT SYNDICATE BANK PUNJABI BAGH 66148 8505 07-JAN-03 MKM FINSEC (P) LTD. SYNDICATE BANK PUNJABI BAGH 425000 15-JAN-03 KHEC (INDIA) P. LTD. SYNDICATE PUNJABI 450000 15-JAN-03 KHEC (INDIA) P. LTD. 4 BANK BAGH SYNDICATE BANK PUNJABI BAGH 500000 15-JAN-03 KHEC (INDIA) P. LTD. SYNDICATE BANK PUNJABI BAGH 350000 246440 15-JAN-03 ROOPIN CAPITAL PVT LTD SYNDICATE BANK PUNJABI BAGH 350000 246431 15-JAN-03 ROOPIN CAPITAL PVT LTD SYNDICATE BANK PUNJABI BAGH 400000 17-JAN-03 ROOPIN CAPITAL PVT LTD SYNDICATE BANK PUNJABI BAGH 400000 17-JAN-03 ROOPIN CAPITAL PVT LTD SYNDICATE BANK PUNJABI BAGH 800000 17-JAN-03 ROOPIN CAPITAL PVT LTD SYNDICATE BANK PUNJABI BAGH 200000 05-FEB-03 GANAPATI CRYSTAL LTD SYNDICATE BANK PUNJABI BAGH 300000 05-FEB-03 GANPATI COTSPIN LIMITED SYNDICATE BANK PUNJABI BAGH 500000 05-FEB-03 GANPATI COTSPIN LIMITED SYNDICATE BANK PUNJABI BAGH 500000 05-FEB-03 GANAPATI CRYSTAL LTD SYNDICATE BANK PUNJABI BAGH 500000 246733 05-FEB-03 BHARAT NYLONS LTD. SYNDICATE BANK PUNJABI BAGH 500000 246731 05-FEB-03 BHARAT NYLONS LTD. SYNDICATE BANK PUNJABI BAGH 500000 246732 05-FEB-03 BHARAT NYLONS LTD. SYNDICATE BANK PUNJABI BAGH 300000 15-FEB-03 GANPATI COTSPIN LIMITED SYNDICATE BANK PUNJABI BAGH 500000 15-FEB-03 GANAPATI GENERAL FOODS LTD. SYNDICATE BANK PUNJABI BAGH 500000 15-FEB-03 K.V.F. SECURITIES P. LTD. SYNDICATE BANK PUNJABI BAGH 505000 15-FEB-03 GANAPATI GENERAL FOODS LTD. SYNDICATE BANK PUNJABI BAGH 300000 247452 15-FEB-03 KANODIA PHARMACEUTICALS PVT LTD SYNDICATE BANK PUNJABI BAGH 500000 246738 15-FEB-03 BHARAT NYLONS LTD. SYNDICATE BANK PUNJABI BAGH 500000 246737 15-FEB-03 BHARAT NYLONS LTD. SYNDICATE BANK PUNJABI BAGH 800000 246739 15-FEB-03 BHARAT NYLONS LTD. SYNDICATE BANK PUNJABI BAGH 100000 245694 26-FEB-03 GANPATI COTSPIN LIMITED SYNDICATE PUNJABI 500000 24-MAR-03 K.V.F. SECUR ITIES P. LTD. 5 BANK BAGH SYNDICATE BANK PUNJABI BAGH 500000 24-MAR-03 K.V.F. SECURITIES P. LTD. SYNDICATE BANK PUNJABI BAGH 500000 24-MAR-03 K.V.F. SECURITIES P. LTD. SYNDICATE BANK PUNJABI BAGH 500000 24-MAR-03 K.V.F. SECURITIES P. LTD. TOTAL 19196148 6. AS PER THE FINDINGS OF THE INVESTIGATION REPORT, THE CREDITWORTHINESS OF THE LENDERS HAS NOT BEEN ESTABLISHED AND THESE TRANSACT IONS SEEM TO BE NON GENUINE. I THEREFORE HAVE REASONS TO BELIEVE THAT T HIS AMOUNT OF RS. 1,91,96,148/- REPRESENTS INCOME OF THE ASSESSEE CHARGEABLE TO TAX WHICH HAS ESCAPED ASSESSMENT FOR A.Y. 2003-04. 3. THE LD. CIT(A) HELD THAT THE NOTICE AS ISSUED U/ S 148 IS VOID AB-INITIO BASED ON THE JUDGEMENTS ITA VS. DWARKA DAS SHAH 95 ITR 52 7, QUALITY DYEING WORKS VS. ITO 15 CTR 286, UNITED ELECTRICAL CO. PVT. LTD. VS. CIT 258 ITR 317 (DEL). 4. BEFORE US THE LD. DR ARGUED THAT THE REASONS FOR REOPENING AT THE REOPENING LEVEL NEED NOT BE COMPREHENSIVE, FULL OR IN DETAIL BUT THE REASONS FOR REOPENING SHOULD BE GERMANE TO THE ISSUE ON WHICH T HE RE-ASSESSMENT IS BASED. HE RELIED ON THE JUDGEMENT OF HONBLE HIGH COURT OF DELHI IN THE WRIT PETITION NO. 8482/2018 DATED 10.09.2008 IN THE CASE OF S. GANDHI AND ORS. HE ARGUED THAT THE CASE OF THE ASSESSEE IS AKIN TO THE CASE MENTIO NED (SUPRA), THAT BOTH CASES WERE PROCESSED U/S 143(1) AND THE PROCESSING OF THE RETURN CANNOT BE TAKEN AS AN ASSESSMENT COMPLETED UNDER 143(3). HE ARGUED THA T MINOR MISTAKES IN THE REOPENING SHOULD BE IGNORED KEEPING IN VIEW THE MOR AL ISSUE OF THE OPERATION OF ACCOMMODATION ENTRIES AND FLOW OF INFORMATION FROM THE INVESTIGATION WING TO THE AO REGARDING THE ENTIRE MODUS OPERANDI. THE LD. DR HAS ALSO ARGUED BASED ON THE JUDGEMENTS IN THE CASE OF ITO VS. RAJESH JHA VERI STOCK BROKERS PVT LTD. 291 ITR 500 (SC). HE ALSO RELIED ON THE COMPILATION OF 48 CASES FILED BEFORE US CONSISTING OF VARIOUS JUDGMENTS. 6 5. ON THE OTHER HAND LD. AR ARGUED THAT THE AO HAS NOT BROUGHT ANYTHING NEW ON RECORD EXCEPT REWRITING THE INFORMATION FORW ARDED TO HIM BY THE INVESTIGATION WING. THERE IS NO APPLICATION OF MIND BY THE ASSESSING OFFICER TO ARRIVE AT AN INDEPENDENT OPINION BY AO REGARDING TH E ISSUE IN HAND. HENCE, THE ORDER IS LIABLE TO BE QUASHED AS ILLEGAL. HE FURTHE R ARGUED THAT THE AMOUNTS SAID TO HAVE RECEIVED BY THE ASSESSEE THROUGH THE ENTRY OPERATOR WAS ALSO IN CORRECT. HEARD THE ARGUMENTS OF BOTH THE PARTIES. 6. WE HAVE GONE THROUGH THE FACTS OF THE CASE ON RE CORD AND THEY EMANATE AS UNDER: 7. THE AO HAS REOPENED ASSESSMENT ON THE GROUNDS TH AT THE ASSESSEE RECEIVED RS. 1,91,96,148 IN THE FORM OF SHARE CAPIT AL FROM DIFFERENT SHAREHOLDERS THROUGH SYNDICATE BANK, PUNJABI BAGH BRANCH WHEREAS THE ENTIRE SHARE CAPITAL OF THE ASSESSEE AS PER THE AUDITED BALANCE SHEET AS ON 31.03.2002 WAS RS. 24,42,817 AND RS. 1,29,39,540 AS ON 31.03.2003. THU S, THE ALLEGATION THAT THE ASSESSEE HAS RECEIVED 1.91 CRORES TOWARDS SHARE CAP ITAL WAS PRIMARILY A WRONG OBSERVATION WHILE ISSUING THE NOTICE U/S 148. FURTH ER, WE OBSERVE THAT THE AMOUNTS HAVE BEEN RECEIVED FROM SYNDICATE BANK, PUN JAB NATIONAL BANK, INDIAN OVERSEAS BANK FROM DIFFERENT ENTITIES AMOUNT ING TO RS. 1,21,83,000 ONLY WHEREAS THE AO HAS REOPENED THE CASE ON THE PREMISE THAT THE ASSESSEE HAS RECEIVED RS. 1,91,96,148 WHICH SHOWS THAT THE AO HA S NOT EVEN GONE THROUGH THE BALANCE SHEET OR THE RETURN OF INCOME BEFORE IS SUE OF THE NOTICE. FURTHER, WE ALSO FIND THAT THE AMOUNTS WHICH THE ASSESSEE PAID WERE ALSO CONSIDERED TO BE RECEIPTS. THE PAYMENTS MADE BY THE ASSESSEE CANNOT BE TREATED AS ACCOMMODATION ENTRIES. THE AO HAS MISLED HIMSELF WH ILE TREATING THE PAYMENTS MADE BY THE ASSESSEE AS THE RECEIPTS WHICH SHOWS AB SOLUTE NON-APPLICATION OF 7 MIND BY THE AO WHILE ISSUING THE NOTICE U/S 148. TH E AO HAS ADDED THE RECEIPTS AND PAYMENTS WITHOUT VERIFYING THE FACTS ON RECORD THUS INCREASING THE AMOUNT FROM RS. 1.21 CRORES TO 1.91 CRORES. OUT OF THE 44 TRANSACTIONS SHOWN IN THE REASONS, 18 TRANSACTIONS ARE PAYMENTS MADE BY THE A SSESSEE COMPANY AND NOT THE RECEIPTS. 14 TRANSACTIONS ARE RECEIVED IN THE B ANK ACCOUNT MAINTAINED WITH PUNJAB NATIONAL BANK WHILE IT IS SHOWN AS RECEIPT I N SYNDICATE BANK. OUT OF THE TOTAL RECEIPTS OF 1,91,96,148 A SUM OF RS. 66,148 I S THE OPENING BALANCE OF 01.04.2002. THUS, IT CAN BE GAUZED THAT THE AO HAS ISSUED THE NOTICE IN A CASUAL MANNER WITHOUT APPLICATION OF MIND. UNDER THE CIRCU MSTANCES THE RELIANCE OF THE LD. DR IN THE CASE OF SOHAIL FINANCIAL LTD. ITA NO. 4867/DEL/2011 IS OF NO HELP TO THE REVENUE. WE ALSO OBSERVE THAT THERE IS NO OT HER MATERIAL AVAILABLE ON RECORD EXCEPT THE INFORMATION RECEIVED FROM THE INV ESTIGATION WING. THE AO ON THE BASIS OF THE INFORMATION AND MATERIAL RECEIVED FROM INVESTIGATION WING HAS RECORDED REASONS FOR REOPENING OF THE ASSESSEMENT W HICH WAS ULTIMATELY FOUND TO BE INCORRECT AND NON-EXISTENT. IT IS WELL SETTLE D LAW THAT WHEN NO NEW MATERIAL OTHER THAN EXAMINED BY THE AO ORIGINALLY FOUND ON R ECORD FOR THE PURPOSE OF INITIATING THE RE-ASSESSMENT PROCEEDINGS, THE PROCE EDINGS UNDER SECTION 148 OF THE I.T. ACT WOULD BE INVALID AND BAD IN LAW. WE RE LY UPON DECISION OF DELHI HIGH COURT IN THE CASE OF ATUL KUMAR SWAMY 362 ITR 693, CONSULTING ENGINEERS SERVICES INDIA PVT. LTD., 378 ITR 318, NESTLE INDIA LTD., 384 ITR 334 AND PRIYADESH GUPTA 385 ITR 452. THE HONBLE DELHI HIGH COURT IN THE CASE OF SNG DEVELOPERS LTD., 404 ITR 312 HELD THAT WHEN AO INITIATED THE R E-ASSESSMENT PROCEEDINGS WITHOUT APPLICATION OF MIND, SUCH PROCEEDINGS WOULD BE INVALID. 7.1 IT WAS HELD IN THE FOLLOWING CASES THAT IF THE AO DID NOT APPLY HIS MIND AND RECORDED THE REASONS PURELY ON BORROWED SATISFACTIO N WITHOUT MAKING ANY ENQUIRIES ON HIS OWN AND THEREFORE THE REASONS AS R ECORDED ARE BAD IN LAW AS 8 HELD BY 1TAT DELHI BENCH VIDE ITS ORDER DATED 14/08 /2014- (ITA NO. 4281/DEL/2010) IN THE CASE OF ITO VS. COMERO LEASIN G & FINANCIAL PVT. LTD. WHICH WAS RENDERED AFTER RELYING ON JURISDICTIONAL HIGH C OURT JUDGMENT IN THE CASE OF CIT VS. SUREN INTERNATIONAL PVT. LTD. REPORTED IN 3 57 ITR 24, RELEVANT PORTION OF SUCH ITAT JUDGEMENT IS REPRODUCED BELOW: FROM THE ABOVE, WE FIND THAT AT PARAGRAPH NOS.L, 2 & 3, THE ASSESSING OFFICER HAS DISCUSSED THE FACTS IN GENERAL I.E., THE INVEST IGATION CARRIED ON BY THE DIRECTOR OF INCOME TAX (INVESTIGATION) AND THE FINDING OF SU CH INVESTIGATION, THE MODUS OPERANDI, HOW THE ENTRY OPERATOR WORKED. THE FACTS RELATING TO ASSESSEE'S CASE BEGIN IN ITA-4281 & 4949/D/2010 FROM PARAGRAPH 4. I F WE PERUSE THE CHART GIVEN BY THE ASSESSING OFFICER IN THE REASONS RECORDED BY WHICH HE FORMED AN OPINION THAT THERE WAS ESCAPEMENT OF INCOME OFRS.53 LAKHS, WE FIND THAT SEVERAL ITEMS HAVE BEEN CONSIDERED TWICE. ITEM NO.2 & 3, 4 & 5, 6 & 7, 8 & 9 AND 10 & 11 ARE SAME. THUS, OUT OF THE TOTAL TWELVE ITEMS, FIVE ITE MS HAVE BEEN CONSIDERED TWICE BY THE ASSESSING OFFICER WHICH IS AN APPARENT CASE O F NON-APPLICATION OF MIND. WE FIND THAT THE IDENTICAL CASE WAS CONSIDERED BY H ON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF SUREN INTERNATIONAL P.LTD. (SU PRA), WHEREIN, AT PAGE 32 OF THE REPORT, THEIR LORDSHIPS HELD AS UNDER:- '13. WE HAVE HEARD COUNSEL FOR THE PARTIES AT LENGT H. 14. THE LEARNED COUNSEL FOR THE APPELLANT CONTENDED THAT EVEN THOUGH THERE IS NO SPECIFIC ALLEGATION THAT THE ASSESSEE HAD FAILED TO DISCLOSE ALL THE MATERIAL FACTS BUT THE SAME CAN BE GLEANED FROM THE REASONS ITSELF. WE ARE UNABLE TO ACCEPT THIS CONTENTION. IN THE FIRST INSTANCE, WE D O NOT FIND THE REASONS AS RECORDED BY THE ASSESSING OFFICER TO BE REASONS IN L AW AT ALL A BARE PERUSAL OF THE TABLE OF ALLEGED ACCOMMODATION ENTRIES INCLUDED IN THE REASONS AS RECORDED, DISCLOSES THAT THE SAME ENTRIES HAVE BEEN REPEATED SIX TIMES. THIS IS CLEARLY INDICATIVE OF THE CALLOUS MANNER IN WHICH THE REASO NS FOR INITIATING REASSESSMENT PROCEEDINGS ARE, RECORDED AND WE ARE UNABLE TO COUN TENANCE THAT ANY BELIEF BASED ON SUCH STATEMENTS CAN EVER BE ARRIVED AT. TH E REASONS HAVE BEEN RECORDED WITHOUT ANY APPLICATION OF MIND AND THUS N O BELIEF THAT INCOME HAS ESCAPED ASSESSMENT CAN BE STATED TO HAVE BEEN FORME D BASED ON SUCH REASONS AS RECORDED.' 8. THE FACTS IN THE ASSESSEE'S CASE ARE IDENTICAL. IN THIS CASE ALSO, THE ASSESSING OFFICER, EXCEPT PREPARING THE TABLE OF AL LEGED ACCOMMODATION ENTRIES FROM THE DETAILS CLAIMED TO HAVE BEEN RECEI VED FROM THE INVESTIGATION WING, HAS NOT AT ALL APPLIED HIS MIND. FROM A BARE PERUSAL OF THE TABLE OF THE ALLEGED ACCOMMODATION ENTRIES, IT IS EVIDENT THAT T HE SHARE CAPITAL SHOWN TO BE RECEIVED IS MUCH MORE THAN THE SHARE CAPITAL, RESER VES AND SURPLUS REFLECTED AS 9 PER THE BALANCE SHEET. FURTHER THE PAYMENTS WERE TR EATED AS RECEIPTS. NO PRIMARY INDEPENDENT ENQUIRY HAS BEEN CONDUCTED BY T HE ASSESSING OFFICER WHICH GOES TO PROVE THAT THIS IS A CASE OF NON-APPL ICATION OF MIND BY THE ASSESSING OFFICER. HENCE KEEPING IN VIEW THE ENTIRETY OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROPOUNDED LEGAL PROPOSITIONS, WE HERE BY CONFIRM THE ORDER OF THE LD. CIT(A). ANY DECISION ON THE MERITS OF THE C ASE WOULD BE ONLY BE ACADEMIC IN NATURE AND HENCE NOT BEING ADJUDICATED. 9. AS A RESULT APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED ON THE OPEN COURT ON 22/01/2019. SD/- SD/- (BEENA A. PILLAI) (DR. B.R.R. KUMAR) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 22/01/2019 BIDHAN COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI 10 DRAFT DICTATED ON DRAFT PLACED BEFORE AUTHOR DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER DRAFT DISCUSSED/APPROVED BY SECOND MEMBER APPROVED DRAFT COMES TO THE SR.PS/PS KEPT FOR PRONOUNCEMENT ON DATE OF UPLOADING ORDER ON THE WEBSITE FILE SENT TO THE BENCH CLERK DATE ON WHICH FILE GOES TO THE AR DATE ON WHICH FILE GOES TO THE HEAD CLERK DATE OF DISPATCH OF ORDER