M/s Shivam Softech Ltd., New Delhi V. ITO, New Delhi

ITA 4864/DEL/2013

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 6388 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 6 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-03-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 10-02-2016
• Assessment Year: 2002-2003
• Appeal Filed On: 13-08-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANIMA BARNWAL
• Assessee Lawyers: D OSTWAL
• Keywords: Unexplained cash credit; Principle of natural justice; Difference of opinion; Accommodation entries; Reason to believe; Change of opinion
• Section: 143(3); 133(6); 147; 148; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: G: NEW DELHI BEFORE SHRI C.M.GARG, JUDICIAL MEMBER AND SHRI O.P. KANT, ACCOUNTANT MEMBER ITA NO. 3332/DEL/2011 ITA NO. 4864/DEL/2013 ASSESSMENT YEAR: 2002-03 SHIVAM SOFTECH LTD. 39/2068, NAIWALA, 315, DAKHA CHEMBER, KAROL BAGH NEW DELHI (PAN:AAECS4589F VS. INCOME TAX OFFICER, WARD-8(2) NEW DELHI (APPELLANT) (RESPONDENT) ASSESSEE BY SHRI D.OSTWAL, C.A REVENUE BY SMT. ANIMA BARNWAL, SR. DR DATE OF HEARING 10.02.2016 DATE OF PRONOUNCEMENT 09 .03.2016 ORDER PER O.P. KANT, A.M.: THESE TWO APPEALS OF THE ASSESSEE ARE DIRECTED AGAI NST THE TWO SEPARATE ORDERS OF THE LD. CIT(A)-XI, NEW DELHI, DATED 25/01 /2011 AND 14/06/2013 . THE FIRST APPEAL IS AGAINST SUSTAINENCE OF FINDINGS MADE IN THE ASSESSMENT ORDER U/S 143(3) / 147 THE ACT AND THE SECOND APPEAL IS A GAINST SUSTAINENCE OF THE PENALTY LEVIED U/S 271(1)(C) OF THE ACT. BOTH THE A PPEALS PERTAIN TO THE SAME ASSESSMENT YEAR, AND THUS HEARD TOGETHER AND ARE DI SPOSED OFF BY THIS CONSOLIDATED ORDER FOR SAKE OF CONVENIENCE AND BREV ITY. 2 ITA NO. 3332/DEL/2011 ITA NO. 4864/DEL/2013 SHIVAM SOFTECH LTD. ITA NO. 3332/DEL/2011 2. THE GROUNDS OF APPEAL RAISED IN ITA NO. 3332/DEL /2011 ARE AS FOLLOWS : 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, THE CIT(A)-XI, NEW DELHI HAS ERRED BOTH ON FACTS AND IN LAW, IN UP HOLDING THE ILLEGAL ACTION OF RE-ASSESSMENT AND ASSUMPTION OF J URISDICTION ILLEGALLY BY THE RESPONDENT AND NOT AS PER THE PROV ISIONS OF SECTION 147 TO 151 OF THE INCOME TAX ACT APART FROM BEING B ARRED BY LIMITATION AND THE IMPUGNED ASSESSMENT ORDER IS LIA BLE TO QUASHED AS UNSUSTAINABLE, BOTH ON FACTS AND IN LAW. 2. THE RESPONDENT HAS NOT REPLIED TO THE OBJECTION SPECIFICALLY RAISED BY THE ASSESSEE DURING THE COURSE OF PROCEEDING THE REFORE IMPUGNED ORDER PASSED OUGHT TO HAVE BEEN SET ASIDE BY LD. CI T(A) AND FAILURE TO DO SO HAS VITIATED THE IMPUGNED ORDER. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, THE ORDER OF RE- ASSESSMENT HAVING BEEN PASSED IN VIOLATION OF NATUR AL JUSTICE BY THE RESPONDENT OUGHT TO HAVE BEEN SET ASIDE BY THE CIT( A) AND FAILURE TO DO SO HAS VITIATED THE IMPUGNED ORDER. 4. LD. CIT(A) ERRED IN UPHOLDING THE ILLEGAL ADDITI ONS OF RS. 2,00,000/- U/S 68 BY TREATING UNEXPLAINED INCOME BY THE RESPONDENT AS JUSTIFIED IGNORING THE FACT THAT THE AMOUNT WAS RECEIVED ON ACCOUNT OF SHARE APPLICATION MONEY AND ALSO IGNORIN G THE RECORDS, DOCUMENTS AND EXPLANATION ALREADY FILED BEFORE THE ITO WHICH WERE NOT PROPERLY VERIFIED AND ACCEPTED BY HIM. HENCE, T HE ORDER MAY BE VACATED AND DEMAND MAY BE DELETED. 5. LD. CIT(A) ERRED IN UPHOLDING THE ILLEGAL ADDI TIONS OF RS. 1,00,000/- U/S 68 BY TREATING UNEXPLAINED INCOME BY THE RESPONDENT AS JUSTIFIED IGNORING THE FACT THAT THE AMOUNT WAS RECEIVED ON ACCOUNT OF SALE OF SHARES AND ALSO IGNORING THE REC ORDS, DOCUMENTS AND EXPLANATION ALREADY FILED BEFORE THE ITO WHICH WERE NOT PROPERLY VERIFIED AND ACCEPTED BY HIM. HENCE, THE O RDER MAY BE VACATED AND DEMAND MAY BE DELETED. 6. LD. CIT(A) HAS ALSO ERRED IN UPHOLDING THE ILL EGAL ADDITIONS AND DISALLOWANCES AND CONSEQUENT DEMANDS OF INCOME TAX, INTEREST AND PENALTIES ILLEGALLY RAISED BY THE RESPONDENT AND HE NCE THE IMPUGNED ORDER SUSTAINING THE ADDITIONS AND DEMAND WOULD REQ UIRE TO BE SET ASIDE AND QUASHED TO THAT EXTENT. 7. THE APPELLANT CRAVES LEAVE TO RAISE FURTHER/ ADDITIONAL GROUNDS AND DOCUMENTS AND FILE PAPER BOOK BEFORE THE HEARIN G OF THE APPEAL AND PRAYS FOR THE APPEAL TO BE ALLOWED AFTER HEARIN G BOTH SIDE. 3 ITA NO. 3332/DEL/2011 ITA NO. 4864/DEL/2013 SHIVAM SOFTECH LTD. 3. THE FACTS IN BRIEF ARE THAT THE ASSESSEE FILE D ITS ORIGINAL RETURN OF INCOME ON 31.10.2002 DECLARING AN INCOME OF RS. 2,170/- AND T HE CASE WAS PROCESSED U/S 143(1) OF THE ACT. SUBSEQUENTLY, ON RECEIPT OF INFO RMATION FROM THE DIRECTOR OF INCOME TAX (INVESTIGATION), NEW DELHI THAT THE ASSE SSEE WAS A BENEFICIARY OF ACCOMMODATION ENTRIES / BOGUS TRANSACTION FROM TWO PARTIES NAMELY M/S ARPIT SALES CORPORATION & M/S. HARISH KUMAR & SONS (HUF) , THE ASSESSING OFFICER (AO) RE-OPENED THE CASE OF THE ASSESSEE BY WAY OF ISSUING A NOTICE U/S 148 OF THE ACT ON 20.03.2009. THE ASSESSEE WAS PROVIDED A COPY OF INFORMATION RECEIVED FROM THE DIRECTOR OF INCOME TAX (INVESTIGA TION) AND THEN THE ASSESSEE WAS ASKED TO PROVE THE GENUINENESS OF THE AMOUNT RE CEIVED FROM THE SAID TWO PARTIES. AS NOTICED BY THE LD. CIT(A), THE ASSESSEE WAS GRANTED SEVERAL OPPORTUNITIES BY THE AO BUT NO DOCUMENTS IN SUPPORT OF IDENTITY OF THE PARTIES, GENUINENESS OF THE TRANSACTIONS OR CREDITWORTHINESS OF THOSE PARTIES WERE FILED BEFORE THE AO. THE ASSESSING OFFICER COLLECTED COPI ES OF BANK STATEMENT OF THOSE TWO PARTIES FROM THE BANKS AND FOUND THAT CAS H WAS DEPOSITED IN THEIR BANK ACCOUNTS JUST BEFORE ISSUE OF CHEQUES TO THE ASSESS EE AND IN ABSENCE OF ANY EXPLANATION FROM THE ASSESSEE IN THIS RESPECT , HE HELD THAT THE ASSESSEE OBTAINED CHEQUES IN LIEU OF THE CASH AMOUNT PAID TO THOSE PA RTIES AND, ACCORDINGLY HE MADE AN ADDITION OF RS. 2,00,000/- FOR UNEXPLAINED CASH CREDIT RECEIVED IN THE NAME OF M/S HARISH KUMAR & SONS (HUF) AND AN ADDIT ION OF RS. 1,00,000/- FOR UNEXPLAINED CASH CREDIT RECEIVED IN THE NAME OF M/ S. ARPIT SALES CORPORATION. 4 ITA NO. 3332/DEL/2011 ITA NO. 4864/DEL/2013 SHIVAM SOFTECH LTD. 4. AGGRIEVED WITH THE ACTION OF THE ASSESSING OFFICER, THE ASSESSEE FILED APPEAL BEFORE THE LD. CIT(A), RAISING THE ISSUE OF JURISDICTION FOR ISSUING NOTICE U/S 148 OF THE ACT AS WELL AS MERIT OF THE ADDITION OF RS. 3,00,000/-. THE LD. CIT(A) AFTER DEALING WITH THE SUBMISSION OF THE ASS ESSEE UPHELD THE VALIDITY OF THE ACTION U/S 148 OF THE ACT AS WELL AS THE ADDITI ON ON MERIT. AGGRIEVED, THE ASSESSEE IS BEFORE THE TRIBUNAL. 5. IN GROUND NO. 1, THE ASSESSEE HAS RAISED IS SUE OF JURISDICTION U/S 147 TO 151 OF THE ACT AND IN GROUNDS NO. 2 AND 3, THE ASSESSEE HAS RAISED ISSUE OF NOT DEALING HIS OBJECTIONS AND VIOLATION OF NATURAL JUS TICE BY THE CIT(A). 6. BEFORE US THE LD. AR OF THE ASSESSEE SUBMITT ED THAT THE ASSESSING OFFICER RECORDED THE REASONS IN MECHANICAL MANNER WITHOUT A PPLICATION OF MIND AND THUS REOPENING OF THE ASSESSMENT WAS BAD IN LAW AND BEYO ND JURISDICTION. FURTHER HE RELIED ON THE DECISION OF THE TRIBUNAL DELHI BENCH DATED 14.08.2014 IN THE CASE OF ITO VS. COMERO LEASING & FINANCIAL PVT. LTD. IN ITA NO. 4281/DEL/2010. ON THE OTHER HAND, THE LD SENIOR DEPARTMENTAL REPR ESENTATIVE (SR DR) RELYING ON THE ORDER OF THE LD. CIT(A), SUBMITTED THAT REAS ONS HAVE BEEN RECORDED IN ACCORDANCE WITH THE PROVISIONS OF THE ACT AND SUFFI CIENCY OF THE REASONS CANNOT BE QUESTIONED BY THE ASSESSEE . IN SUPPORT OF THE P ROPOSITION, HE RELIED ON THE JUDGMENT OF THE HONBLE SUPREME HIGH COURT IN THE C ASE OF RAYMOND WOOLLEN MILLS 236 ITR 34. 5 ITA NO. 3332/DEL/2011 ITA NO. 4864/DEL/2013 SHIVAM SOFTECH LTD. 7. 1 WE HAVE HEARD THE RIVAL SUBMISSION AND PERUS ED THE MATERIAL ON RECORD. THE LD. CIT(A) HAS DEALT VARIOUS LEGAL ISSUES RAISE D IN RESPECT OF THE JURISDICTION AS UNDER : 3.0 JUSTIFICATION FOR RE-OPENING ASSESSMENT :- THE FIRST ISSUE TO BE CONSIDERED IS WHETHER THE AO COULD LAWFULLY ASSUME JURISDICTION TO RE- OPEN THE ASSESSMENT U/S 147 OF THE ACT. SINCE THE I NITIAL ASSESSMENT WAS MADE U/S 143(1) OF THE ACT, THE PROVISO TO SECT ION 147 OF THE ACT FOR SUCH RE-OPENING WOULD NOT COME INTO PLAY FOR TH E PERIOD UNDER CONSIDERATION. 3.1 IT IS NOT NECESSARY TO REFER TO THE SUBMISSIO N MADE BY THE LD. AR AGAIN ON THIS ISSUE. SINCE THE LAW IS WELL SETTLED. IT CANNOT BE DISPUTED THAT THE ASSESSMENT IN SUCH CASE [IN CASE OF 143(3) CANNOT BE RE- OPENED ON A MERE CHANGE OF OPINION ON THE SAME SET OF FACTS AND THAT THERE SHOULD BE FAILURE ON THE PART OF THE APPELLAN T IN DISCLOSING FULLY AND TRULY MATERIAL FACTS NECESSARY FOR THE ASSESSME NT. IT IS FURTHER WELL-SETTLED THAT FOR THE PURPOSES FOR DECIDING WHE THER THE JURISDICTION HAS BEEN PROPERLY ASSUMED OR NOT, WHAT IS NECESSARY IS THAT THERE SHOULD BE SOME MATERIAL FOR PRIMA-FACIE FORMATION O F THE BELIEF THAT THERE HAS BEEN ESCAPEMENT OF INCOME ON ACCOUNT OF O MISSION OR FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FUL LY OR TRULY ALL THE MATERIAL FACTS NECESSARY FOR THE ASSESSMENT. THE BE LIEF, WHICH WAS FORMED BY THE AO ASSUMING THE JURISDICTION, MUST BE HELD BONA FIDE AND WOULD BE A PRIMA-FACIE ONE. SUCH BELIEF IS PRIM A-FACIE ON THE MATERIAL AVAILABLE AND IN THE ULTIMATE RE-ASSESSMEN T THE ASSESSEE MAY ESTABLISH THAT THERE HAS BEEN NO ESCAPEMENT OF ANY INCOME. HOWEVER, ALL THESE CONDITIONS WOULD NOT COME INTO PLAY AS TH E PRESENT CASE IS RELATED TO 143(1) AND NOT 143(3). 3.2. IN THE LIGHT OF THE ABOVE WELL-SETTLED PRIN CIPLES, THE ABOVE ISSUE NEEDS TO BE EXAMINED. THE REASONS AS RECORDED FOR R E-OPENING THE ASSESSMENT WAS DULY COMMUNICATED TO THE APPELLANT, AT LEAST THERE WAS NO REVERSE CLAIM BY THE APPELLANT. THE REASONS WERE PROVIDED TO THE APPELLANT AND THEREAFTER REPEATED ADJOURNMENTS WERE ALLOWED TO THE APPELLANT. THIS SHOWS THAT THE RECORDED REASON WAS DULY COMMUNICATED TO THE APPELLANT. NEITHER IT WAS CONTE STED NOR IT WAS ADDUCED AS GROUND THAT RECORDED REASON WAS NOT SUPP LIED TO THE APPELLANT, RATHER IT WAS THE APPELLANT WHO REPEATED LY FAILED TO PRODUCE THE DIRECTOR OF THE INVESTING COMPANIES BEF ORE THE AO AND TO 6 ITA NO. 3332/DEL/2011 ITA NO. 4864/DEL/2013 SHIVAM SOFTECH LTD. ESTABLISH THE IDENTITY, CREDITWORTHINESS AND GENUIN ENESS OF THE TRANSACTION. 3.3 THE QUESTION THEREFORE, IS WHETHER THERE WERE MATERIAL BEFORE THE AO TO ENTERTAIN THE BELIEF THAT THE APPEOLLATN HAS NTO DISCLOSED RS. 3,00,000/- FROM HKSH & ASC. THE APPELLANT FILED ITS RETURN OF INCOME FOR THE RELEVANT ASSESSMENT YEAR ON 31.10.2002. IN THE SAID RETURN IT DID NTO SHOW SUCH AMOUNT OF RS. 3,00,000/- FROM HKS H & ASC. THE POINT WAS NEVER BEING A PART OF THE ORDER AS IT WAS MADE U/S 143(1) AND HENCE THE INCOME HAS ESCAPED THE ATTENTION OF T HE AO. 3.4 THE AO HAD MATERIAL FOR FORMING THE BELIEF T HAT THE APPELLANT HAS NTO DISCLOSED RS. 3,00,000/- FROM HKSH & ASC. T HE FACT THAT THE AO COULD PRIMA-FACIE FORM SUCH A BELIEF WOULD ALSO BE EVIDENT FROM THE MATERIAL AVAILABLE ON RECORD. FURTHER IT HAS AL READY BEEN STATED THAT THE ORDER U/S 143(1) OF THE ACT WAS CONSPICUOU SLY SILENT REGARDING THE SAID ISSUE AS THERE IS NO SUCH SCOPE IN 143(1). FROM THE ABOVE FACTS, IT CANNOT BE SAID THAT THE AO HAD NO MATERIAL FOR ENTERTAINING THE PRIMA-FACIE BELIEF THAT THE AP PELLANT COMPANY HAS DISCLOSED TRUE AND FULL INCOME FOR THE RELEVANT PER IOD. ACCORDINGLY, THE AO HAS REASON TO BELIEVE THAT THERE WAS OMISSIO N OR FAILURE ON PART OF THE APPELLANT IN DISCLOSING FULLY AND TRULY THE CORRECT FACTS WHILE CONTENDING THAT THE COMPANY HAS NOT DISCLOSED INCOME OF RS. 3,00,000/- FROM HKSH & ASC. THE CONCLUSION FROM THE AFORESAID FACT IN THE RECORDED REASON THAT THE AMOUNT WAS NOT DISC LOSED AND CONSEQUENTLY INCOME HAS ESCAPED ASSESSMENT AND SUCH DECISION OF THE AO CANNOT BE FAULTED. ACCORDINGLY, THE CONTENTION T HAT THERE WAS NO MATERIAL FOR FORMATION OF THE BELIEF AS POSTULATED U/S 147 TO RE-OPEN THE ASSESSMENT CANNOT BE SUSTAINED. THE INITIATION OF PROCEEDING OF RELEVANT ASSESSMENT IS ACCORDINGLY UPHELD. 3.5 IN THE ASSESSMENTS FOR THE RELEVANT YEAR, THE APPELLANT HAS NEVER DISCLOSED THE AMOUNT AND OFFERED THE SAME FOR TAXAT ION. THE RECORDED REASON HOWEVER IS THAT THE APPELLANT HAS INTRODUCED UNACCOUNTED MONEY IN ITS BOOKS AND HENCE THE SAME SHOULD COME U NDER THE AMBIT OF INCOME UNDER UNEXPLAINED CASH CREDIT. 3.6 THE ALLEGATION OF THE APPELLANT (AS REVEALED FROM GROUNDS OF APPEAL) THAT THERE WAS NO POSITIVE INFORMATION IN T HE POSSESSION OF THE AO IS NOT CORRECT. IT IS A FACT THAT THE AO HAS REC EIVED INFORMATION FROM DIT (INVESTIGATION), NEW DELHI AND AFTER RECEI PT OF THE INFORMATION IT WAS HIS SATISFACTION THAT THE INCOME HAS ESCAPED ASSTT. AND HENCE THE SUBMISSION OF THE APPELLANT ON THIS G ROUND IS NOT SUSTAINABLE. FURTHER THERE IS NO BAR IN THE ACT OR ANY OF THE CASES SO FAR REPORTED THA THE AO CANNOT RECEIVE INFORMATION FROM DIT (INV.). THE ONLY THING IS TO BE SEEN THAT IT SHOULD BE HIS SATISFACTION AND THAT OF NOBODY ELSE. THE SATISFACTION WAS ALSO DULY RECO RDED BY THE AO. 7 ITA NO. 3332/DEL/2011 ITA NO. 4864/DEL/2013 SHIVAM SOFTECH LTD. 7.2 THE FACT THAT NO ASSESSMENT U/S 143(3) OF THE A CT WAS COMPLETED IN THE CASE OF THE ASSESSEE BEFORE ISSUE OF NOTICE U/S 148 OF THE ACT IS NOT DISPUTED BY THE PARTIES. IN OUR VIEW, WHEN NO ASSESSMENT U/S 14 3(3) OF THE ACT WAS COMPLETED, THERE WAS NO INFORMATION AVAILABLE ON TH E FILE OF THE ASSESSING OFFICER FOR VERIFICATION WHETHER ANY CREDIT WAS INT RODUCED BY THOSE TWO CREDITORS EITHER BY WAY OF INVESTMENT OR LOAN OR IN ANY OTHER FORMS. THE AO WHILE RECORDING REASONS VERIFIED THAT THE INFORMATION BEL ONGED TO THE ASSESSEE AND IT BELONGED TO THE RELEVANT ASSESSMENT YEAR UNDER CONS IDERATION AND THE INFORMATION WAS RECEIVED FROM A RELIABLE SOURCE I.E . THE DIRECTOR OF INCOME TAX (INVESTIGATION) AND THEREAFTER HE RECORDED SATISFAC TION THAT HE HAD REASON TO BELIEVE THAT THERE WAS A ESCAPEMENT OF INCOME IN TH E CASE , THEREFORE, IN THE CIRCUMSTANCES IT CANNOT BE SAID THAT AO HAS NOT APP LIED HIS MIND. IN THE CASE OF ITO VS. COMERO LEASING & FINANCING PVT. LTD. (SUPRA ) CITED BY THE LD. AR, THE ASSESSMENT WAS COMPLETED AND THE RECORDS WERE AVAIL ABLE WITH THE AO BEFORE ISSUE OF NOTICE U/S 148 OF THE ACT, WHEREAS IN THE CASE OF ASSESSEE, THE RETURN WAS PROCESSED U/S 143(1) OF THE ACT ONLY AND NO SCRUTIN Y ASSESSMENT WAS COMPLETED BEFORE ISSUE OF NOTICE U/S 148 OF THE ACT, THUS, TH E RATIO OF THE SAID DECISION IS NOT APPLICABLE OF THE FACT OF THE CASE OF THE ASSES SEE. WE ALSO AGREE WITH THE CONTENTION OF LD SR DR THAT SUFFICIENCY OR CORRECTN ESS OF THE MATERIAL CANNOT BE CONSIDERED AT THE STAGE OF ISSUING NOTICE UNDER SEC TION 148 OF THE ACT AS HELD BY 8 ITA NO. 3332/DEL/2011 ITA NO. 4864/DEL/2013 SHIVAM SOFTECH LTD. THE HONBLE SUPREME COURT IN THE CASE OF THE RAYMON D WOOLEN MILLS LTD VS ITO ( SUPRA). 8. IN VIEW OF ABOVE, WE ARE OF THE OPINION THAT L D. CIT(A) HAS PASSED A WELL REASONED ORDER ON THE ISSUE IN DISPUTE AND THERE I S NO INFIRMITY IN HIS FINDINGS. THUS, WE UPHOLD THE FINDING OF THE LD. CIT(A) IN IM PUGNED ORDER THAT NOTICE ISSUED BY THE AO UNDER SECTION 148 OF THE ACT WAS I N ACCORDANCE TO LAW , AND ACCORDINGLY, WE DISMISS GROUNDS NO. 1,2 & 3 OF THE APPEAL. 9. IN GROUNDS NO. 4 TO 5, THE ASSESSEE HAS RAISE D THE ISSUE OF ADDITION OF RS. 3,00,000/- AS UNEXPLAINED CASH CREDIT U/S 68 OF THE ACT BY THE AO AND UPHELD BY THE LD. CIT(A). 10. BEFORE US THE LD. AR SUBMITTED THAT ALL THE D OCUMENTS IN RESPECT OF IDENTITY OF CREDITORS, GENUINENESS OF THE TRANSACTION AND CR EDITWORTHINESS OF THE CREDITORS WERE DULY FILED BY THE CREDITORS THEMSELVES IN RESP ONSE TO THE NOTICE ISSUED U/S 133(6) OF THE ACT ISSUED TO THEM AND THE LD. AO DID NOT EXAMINE THOSE EVIDENCES. HE ALSO SUBMITTED THAT THE ASSESSING OFF ICER HAS ACCEPTED THE GENUINENESS OF THE CREDITS FROM THE SAME PARTIES IN ASSESSMENT YEARS SUBSEQUENT TO THE ASSESSMENT YEAR IN CONSIDERATION. WHEREAS ON THE OTHER HAND, THE LD. SR DR RELYING ON THE ORDERS OF THE LOWER AUTHORITIES, SUBMITTED THAT THE ASSESSEE NOT ONLY FAILED TO PRODUCE THE REQUIRED EVIDENCES BEFOR E THE LD. AO BUT ALSO COULD NOT PRODUCE BEFORE THE LD. CIT AS WELL AS AND THUS, THE ADDITION SUSTAINED BY THE CIT(A) SHOULD BE UPHELD. 9 ITA NO. 3332/DEL/2011 ITA NO. 4864/DEL/2013 SHIVAM SOFTECH LTD. 11. WE HAVE HEARD THE RIVAL SUBMISSION AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE CIT(A) IN PARA 5.16 OF HIS ORDER HAS OBSERVED AS UNDER :- .. THE DETAILS OF THE CREDITOR IS NOT KNOWN AT THE PRESENT POINT OF TIME. THE APPELLANT CANNOT BE ABSOLVED OF ITS LIABILITY BY SIMPLY GIVING THE NAME (WITHOUT GIVING ADDRESS, PAN AND OTHER ACCOUNTING DETAILS) OF THE CREDITOR/SHARE APPLICANT. THE AO IS VERY MUCH WITHIN HIS JURISDICTION TO INVOKE SEC. 68 IN S UCH CASES. IT IS ALSO NOT KNOWN WHETHER THERE IS ANY TIME LEFT FOR INITIATION OF PR OCEEDING IN CASE OF SUCH CREDITOR/SHARE APPLICANT. IN ANY CASE THE INITIATIO N IF ANY, OF PROCEEDING IN CASE OF SUCH CREDITOR/SHARE APPLICANT IS NOTHING TO DO W ITH THE INVOKING OF PROVISION U/S 68 IN CASE OF THE APPELLANT. ALL THE PREREQUISI TES FOR INVOKING THE PROVISION IS CLEARLY AVAILABLE IN THE INSTANT CASE AND TO THAT E XTENT THE ACTION OF THE AO IS QUITE JUSTIFIED. IN SUCH TYPE OF CASES, EVERY CASE HAS TO BE DECIDED ON THE FACTS OF THE PARTICULAR CASE ONLY. REFERENCE TO CATENA OF DE CISIONS FAVOURING APPELLANT OR REVENUE WOULD BE OF TITLE USE IF THE FACTS DO NOT F IT TO THE CASE UNDER REFERENCE. BECAUSE OF THE PECULIAR FACTS OF THE CASE, AS BROUG HT ON RECORD BY THE LD. AO AND AS DISCUSSED ABOVE BY ME IN FOREGOING PARAGRAPH S, THE INVOKING OF SEC. 68 IS HELD TO BE CORRECT. 12. FROM ABOVE, IT IS APPARENT THAT THE REVENUE I S CONTENDING THAT NO DOCUMENTS SATISFYING THE REQUIREMENTS OF THE SECTIO N 68 HAVE BEEN FILED EITHER 10 ITA NO. 3332/DEL/2011 ITA NO. 4864/DEL/2013 SHIVAM SOFTECH LTD. BEFORE THE AO OR THE CIT(A), WHEREAS ON THE OTHER H AND , THE ASSESSEE IS RELYING ON PAGE 43 TO 50 OF THE PAPER BOOK FILED , WHICH AR E COPIES OF THE NOTICE U/S 133(6) OF THE ACT ISSUED BY THE AO TO THOSE PARTIE S AND REPLIES RECEIVED FROM THEM CONTAINING CONFIRMATION, BANK STATEMENT AND IN COME TAX RETURN ETC. 13. IN VIEW OF THE ABOVE CONTRADICTORY ASSERTIONS ON THE ISSUE, WE FIND IT APPROPRIATE, IN THE INTEREST OF NATURAL JUSTICE, TO RESTORE THE MATTER TO THE FILE OF THE AO FOR EXAMINATION OF THE ISSUE OF ADDITION UND ER SECTION 68 OF THE ACT AFRESH. NEEDLESS TO MENTION HERE THAT ASSESSEE SHAL L BE PROVIDED SUFFICIENT OPPORTUNITY OF HEARING. ACCORDINGLY, THE GROUNDS NO . 4 TO 5 OF THE APPEAL ARE ALLOWED FOR STATISTICAL PURPOSES. 14. GROUND NO. 6 AND 7 ARE GENERAL IN NATURE AND N OT REQUIRED TO ADJUDICATE UPON AND THUS DISMISSED. 15. IN THE RESULT, APPEAL OF THE ASSESSEE IS PAR TLY ALLOWED FOR STATISTICAL PURPOSES. ITA NO. 4864/DEL/2013 16. THE EFFECTIVE GROUND OF THE APPEAL RAISED IN T HE APPEAL IS IN RESPECT OF UPHOLDING OF THE PENALTY LEVIED BY THE ASSESSING OF FICER UNDER SECTION 271(1) (C) OF THE ACT. SINCE, WE HAVE ALREADY RESTORED THE ISS UE OF ADDITION MADE FOR UNEXPLAINED CASH CREDIT OF RS. 3,00,000/- FOR WHICH THE AO LEVIED THE PENALTY UNDER SECTION 271(1) (C) OF THE ACT, IN ITA NO. 333 2/DEL/2011 ,THE EFFECTIVE 11 ITA NO. 3332/DEL/2011 ITA NO. 4864/DEL/2013 SHIVAM SOFTECH LTD. GROUND OF PENALTY RAISED IN THIS APPEAL DOES NOT SU RVIVE. ACCORDINGLY, THE GROUNDS RAISED IN THE APPEAL ARE ALLOWED. IN THE RESULT APPEAL OF THE ASSESSEE IS ALLOWED. THE DECISION IS PRONOUNCED IN THE OPEN COURT ON 9 TH MARCH, 2016. SD/- SD/- (C.M.GARG) (O.P. KANT) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 9 TH MARCH, 2016. BINITA COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASST. REGISTRAR, ITAT, NEW DELHI 12 ITA NO. 3332/DEL/2011 ITA NO. 4864/DEL/2013 SHIVAM SOFTECH LTD. SL. NO. PARTICULARS DATE 1. DATE OF DICTATION (HAND WRITTEN ) 01.03.2016 2. DATE ON WHICH THE DRAFT IS PLACED BEFORE THE DICTATING MEMBER 02.03.2016 3. DRAFT PLACED BEFORE THE OTHER MEMBER 4. APPROVED DRAFT COMES TO THE SR. PS/PS 5. KEPT FOR PRONOUNCEMENT ON 6. FINAL ORDER RECEIVED AFTER PRONOUNCEMENT 7. FILE SENT TO THE BENCH CLERK 8. DATE ON WHICH FILES GOES TO THE HEAD CLERK 9. DATE ON WHICH FILE GOES TO THE ASSISTANT REGISTRAR 10. DATE OF DISPATCH OF ORDER