Trident Towers Pvt. Ltd., New Delhi V. ITO, New Delhi

ITA 537/DEL/2013

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 3684 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 2 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-04-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 22-03-2017
• Assessment Year: 2002-2003
• Appeal Filed On: 30-01-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: UMESH CHAND DUBEY
• Assessee Lawyers: V K TULSIAN
• Keywords: Unexplained cash credit; Income from undisclosed sources; Opportunity of being heard; Accommodation entries; Reason to believe
• Section: 142(1); 234B; 147; 131; 68; 148; 2

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH D, NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI L.P. SAHU, ACCOUNTANT MEMBER I.T.A. N O. 537 /DEL/201 3 A.Y . : 20 02 - 03 M/S TRIDENT TOWERS PVT. LTD., 1/8, WEST PATEL NAGAR, NEW DELHI 110 008 (PAN: AAACT0951C) VS. INCOME TAX OFFICER, WARD 16(4), NEW DELHI (APPELLANT) (APPELLANT) (APPELLANT) (APPELLANT) (RESPONDENT) (RESPONDENT) (RESPONDENT) (RESPONDENT) ASSESSEE BY : S H. V .K. TULSIAN, CA DEPARTMENT BY : SH. UMESH CHAND DUBEY, SR. DR ORDER ORDER ORDER ORDER PER PER PER PER H.S. SIDHU H.S. SIDHU H.S. SIDHU H.S. SIDHU : : : : J JJ JM MM M ASSESSEE HAS FILED THIS APPEAL AGAINST THE IMPUGNE D ORDER DATED 21.11.2012 PASSED BY THE LD. CIT(A)-19, NEW DELHI RELEVANT TO ASSESSMENT YEAR 2002-03 ON THE FOLLOWING GROUNDS:- 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE, THE COMMISSIONER OF INCOME TAX (APPEAL) ERRED IN NOT H OLDING THAT THE ORDER PASSED BY THE ASSESSING OFFICER UNDER SECTION 147/143(3) OF THE INCOME TAX ACT, 1961 ('THE ACT') IS BEYOND JURI SDICTION, BAD IN LAW AND VOID-AB-INITIO. 1.1 THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE COMMISSIONER OF INCOME TAX (APPEAL) ERRED IN UPHOLD ING THE ACTION OF THE ASSESSING OFFICER IN INITIATING PROCEEDINGS UNDER SECTION 147 2 OF THE ACT WITHOUT FORMING ANY 'REASON TO BELIEVE' THAT ANY INCOME OF THE ASSESSEE HAD ESCAPED ASSESSMENT AND WITHOUT SATISFYING OTHER CONDITIONS PRECEDENT FOR INITIATING PROCEEDIN GS UNDER THAT SECTION. 1.2 THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE COMMISSIONER OF INCOME TAX (APPEAL) ERRED IN UPHOLD ING THE ACTION OF THE ASSESSING OFFICER IN INITIATING PROCEEDINGS UNDER SECTION 147 OF THE ACT SOLELY ON THE BASIS OF CERTAIN INFORMATI ON PURPORTEDLY RECEIVED FROM THE INVESTIGATION WING, WITHOUT ANY I NDEPENDENT APPLICATION OF MIND, WHICH IS SINE QUA NON FOR ASSU MPTION OF VALID JURISDICTION. 2. FOR THAT THE LEARNED COMMISSIONER INCOME TAX (A PPEAL) IS NOT JUSTIFIED IN UPHOLDING THE ADDITION MADE U/S 68 OF THE INCOME TAX ACT, 1961 BY THE INCOME TAX OFFICER AMOUNTING TO RS . 10,01,000/- (RUPEES TEN LAKHS ONE THOUSAND ONLY) RECEIVED FROM THE FOLLOWING PARTIES: A. RABIK EXPORTS LTD. RS. 5,00,500/- B. DIGNITY FINVEST PVT. LTD. RS. 5,00,500/- THE ADDITION AMOUNTING TO RS. 10,01,000/- MAY, PLEA SE BE DELETED AND THE SHARE APPLICATION MONEY MAY NOT BE TREATED AS UNEXPLAINED CASH CREDIT AS PER PROVISIONS OF SECTIO N 68 OF THE INCOME TAX ACT, 1961. 3. FOR THAT THE PENALTY PROCEEDINGS INITIATED U/S 2 71(1)(C) OF THE INCOME TAX ACT MAY PLEASE BE DELETED. 3 4. FOR THAT ANY OTHER GROUNDS OF APPEAL MAY BE ALLO WED TO BE URGED AT THE TIME OF HEARING. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE RETURN OF INCOME FOR THE ASSESSMENT YEAR 2002-03 WAS FILED ON 31.10.2002 DECLARING TOTA L INCOME OF RS. 26,633. THE RETURN WAS PROCESSED U/S. 143(1) OF THE I.T. ACT, 1961 ON 4.2.2003 AT THE RETURNED INCOME. IN THIS CASE, CE RTAIN INFORMATION WAS RECEIVED FROM THE DIRECTORATE OF INCOME TAX (INVESTIGATION), GIVING DETAILS THAT THE ASSESSEE HAD RECEIVED THE FOLLOWING AMOUNTS STATING THAT THESE AMOUNTS RECEIVED BY THE ASSESSEE ARE IN THE NATURE OF ACCOM MODATION ENTRIES, WHICH THE ASSESSEE HAD TAKEN AFTER PAYING UNACCOUNTED CASH TO THE ACCOMMODATION ENTRY PROVIDERS AMOUNTING TO RS. 10,01,000/- I.E. RS. 5,0 0,500/- EACH FROM M/S RABIK EXPORTS LTD. AND M/S DIGNITY FINVEST PVT. LTD . AO OBSERVED THAT THE ASSESSEE FILED THE DETAILS ALONGWITH THE RETURN OF INCOME DOES NOT INDICATE THE TRANSACTIONS HELD WITH THE ABOVE PARTIES. AO FURT HER OBSERVED THAT THE INVESTIGATION WING HAD A DETAILED ENQUIRY IN THIS R EGARD AND CAME TO A CONCLUSION THAT THE ASSESSEE HAD RECEIVED THE ABOVE RECEIPTS UNDER THE NAME OF SHARE APPLICATION MONEY/ SHARE SUBSCRIPTION. AO OB SERVED THAT THUS, THE ASSESSEE HAD PLOUGHED BACK UNACCOUNTED MONEY OF RS. 10,01,000/- IN ITS BUSINESS THROUGH THE CHANNEL OF ACCOMMODATION ENTRY . IN VIEW OF THE ABOVE, THE AO HAD THE REASON TO BELIEVE THAT THE INCOME TO THE TUNE OF RS. 10,01,000/- HAS ESCAPED ASSESSMENT. ACCORDINGLY, AFTER RECORDI NG DUE SATISFACTION NOTICE U/S. 148 OF THE ACT READ WITH SECTION 147 OF THE AC T WAS ISSUED TO THE ASSESSEE ON 24.3.2009. IN RESPONSE TO THE ABOVE NOTICE, THE ASS ESSEE VIDE ITS LETTER DATED 15.4.2009 HAS SUBMITTED THAT TO TREAT THE RETURN FI LED ON 31.10.2002 IN RESPOSNET O THE NOTICE ISSUED U/S. 148 OF THE ACT. SUBSEQUEN TLY, NOTICE U/S. 143(2) AND 142(1) OF THE ACT WERE ISSUED AND IN RESPONSE THERE TO THE A.R. OF THE ASSESSEE ATTENDED THE PROCEEDINGS AND FILE THE DETAILS WHICH WAS EXAMINED BY THE AO. 4 THEREAFTER, THE AO OBSERVED THAT ASSESSEE HAS FAI LED TO OFFER ANY EXPLANATION ABOUT CREDITS APPEARING IN ITS BOOKS. THEREAFTER, T HE AO COMPLETED THE ASSESSMENT AT AN INCOME OF RS. 10,25,636/- BY PASS ING THE ORDER DATED 31.12.2009 U/S. 143(3)/147 OF THE I.T. ACT, 1961. 3. AGAINST THE ORDER OF THE LD. AO, ASSESSEE APPEA LED BEFORE THE LD. CIT(A), WHO VIDE IMPUGNED ORDER DATED 21.11.2012 HA S DISMISSED THE APPEAL OF THE ASSESSEE. 4. AGGRIEVED WITH THE ORDER OF THE LD. CIT(A), ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 5. AT THE TIME OF HEARING, LD. COUNSEL OF THE ASSES SEE HAS CERTIFIED THAT ASSESSEE HAS FILED ALL THE DOCUMENTARY EVIDENCES BE FORE THE AO AS WELL AS BEFORE THE LD. CIT(A) FOR SUBSTANTIATING ITS CLAIM AND IN SPITE OF THE SAME THE REVENUE AUTHORITY HAS WRONGLY MADE THE ADDITION IN DISPUTE. IN SUPPORT OF HIS CONTENTION, LD. COUNSEL OF THE ASSESSEE HAS ALSO F ILED A PAPER BOOK CONTAINING PAGES 1 TO 49 HAVING THE COPY OF AUDITED BALANCE SH EET ALONGWITH ANNEXURE OF ALLOTTED SHARES, LEDGER A/C COPY BANK STATEMENT; WR ITTEN SUBMISSION TO CIT(A) VIDE LETTER DATED 6.11.2012; FORM NO. 2 OF COMPANIE S ACT FOR ALLOTMENT OF SHARES AND FILING WITH THE ROC ON 29.5.2002; APPLICATION F OR ASKING FOR REASONS; FILING OF OBJECTIONS DATED 25.11.2009; LETTER TO AO DATED 11.12.2009; DETAILS OF INVESTORS I.E. (A) RABIK EXPORTS LIMITED: SHARE APP LICATION FORM, MINUTES OF BOARD MEETING, DETAILS OF CIN NO., MOA, CONFIRMATION, AFF IDAVIT, ITR AND FINANCIAL STATEMENT; (B) DIGNITY FINVEST PRIVATE LIMITED : SH ARE APPLICATION FORM, MINUTES OF BOARD MEETING; CIN NO., MOA, PAN NO., ITR, CONFI RMATION AND AFFIDAVIT. LD. COUNSEL OF THE ASSESSEE FURTHER STATED THAT SIN CE THE ONUS OF PROVING CASH CREDIT IN THE BOOKS IS REUBUTTABLE AND THE TRANSACT ION IS ESTABLISHED AND FILED THE COPY OF THE ITAT, DELHI BENCH DECISION IN THE CASE OF ITO VS. OPG LEASING & 5 FINANCE P. LTD. PASSED IN ITA NO. 3982/10 VIDE ORDE R DATED 25.1.2016 AND RELIED ON THE SAME. 6. ON THE CONTRARY, LD. DR RELIED UPON THE ORDERS O F THE AUTHORITIES BELOW. HE STATED THAT THE PRIMARY ONUS IS ON THE ASSESSEE TO PROVE THAT IT DID NOT TAKE AN ACCOMMODATION ENTRY, WHICH THE ASSESSEE HAS NOT DONE. THEREFORE, HE STATED THAT THE LOWER AUTHORITIES WERE RIGHT IN MAK ING THE ADDITIONS IN DISPUTE, WHICH DOES NOT NEED ANY INTERFERENCE ON OUR PART AN D ACCORDINGLY, THE ASSESSEES APPEAL MAY BE DISMISSED. 7. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE R ECORDS AVAILABLE WITH US AND THE PAPER BOOK CONTAINING PAGES 1 TO 49 HAVING THE COPY OF AUDITED BALANCE SHEET ALONGWITH ANNEXURE OF ALLOTTED SHARES , LEDGER A/C COPY BANK STATEMENT; WRITTEN SUBMISSION TO CIT(A) VIDE LETTE R DATED 6.11.2012; FORM NO. 2 OF COMPANIES ACT FOR ALLOTMENT OF SHARES AND FILING WITH THE ROC ON 29.5.2002; APPLICATION FOR ASKING FOR REASONS; FILING OF OBJE CTIONS DATED 25.11.2009; LETTER TO AO DATED 11.12.2009; DETAILS OF INVESTORS I.E. (A) RABIK EXPORTS LIMITED: SHARE APPLICATION FORM, MINUTES OF BOARD MEETING, DETAILS OF CIN NO., MOA, CONFIRMATION, AFFIDAVIT, ITR AND FINANCIAL STATEMEN T; (B) DIGNITY FINVEST PRIVATE LIMITED : SHARE APPLICATION FORM, MINUTES OF BOARD MEETING; CIN NO., MOA, PAN NO., ITR, CONFIRMATION AND AFFIDAVIT. WE FIND THAT LD. COUNSEL OF THE ASSESSEE CERTIFIED THAT ASSESSEE HAS FILED ALL THE AFORESAID DOCUMENTARY EVIDENCE BEFORE THE AO AS WELL AS BEFORE THE LD. CI T(A) WHICH WAS NOT CONSIDERED BY THE AO. 7.1 IN THIS CASE, WE NOTE THAT AO VIDE HIS ORDER DA TED 31.12.2009 HAS PASSED THE FOLLOWING ORDER:- 6 1. THE RETURN OF INCOME WAS FILED ON 31.10.2002 DECLAR ING TOTAL INCOME AT RS. 26,633/-. THE RETURN OF INCOME WAS P ROCESSED U/S. 143(1) OF THE ACT ON 4.2.2003 AT THE RETURNED INCOM E. 2. IN THIS CASE, CERTAIN INFORMATION WAS RECEIVED F ROM DIRECTORATE OF INCOME TAX (INVESTIGATION), GIVING DETAILS THAT THE ASSESSEE HAD RECEIVED THE FOLLOWING AMOUNTS STATING THAT THESE A MOUNTS RECEIVED BY THE ASSESSEE ARE IN THE NATURE OF ACCOMMODATION ENTRIES, WHICH THE ASSESSEE HAD TAKEN AFTER PAYING UNACCOUNTED CAS H TO THE ACCOMMODATION ENTRY PROVIDERS. THE DETAILS ARE AS U NDER:- SL.NO. NAME OF THE PARTY FROM WHOM AMOUNT RECEIVED DETAILS OF BANK INSTRUMENT NO. AND DATE TOTAL AMOUNT 1. M/S RABIK EXPORTS LTD. RATNAKAR CO-OP. BANK, KAROL BAGH 2260 DATED 26.11.2001 RS. 5,00,500/- 2. M/S DIGNITY FINVEST PVT. LTD. VIJAYA BANK, RANI BAGH 2945 DATED 27.11.2001 RS. 5,00,500/- THE DETAILS FILED ALONGWITH THE RETURN OF INCOME DOES NOT INDICATE THE TRANSACTIONS HELD WITH THE ABOVE PARTIES. FURTH ER, THE INVESTIGATION WING HAD A DETAILED ENQUIRY IN THIS R EGARD AND CAME TO A CONCLUSION THAT THE ASSESSEE HAD RECEIVED THE ABOVE RECEIPTS UNDER THE NAME OF SHARE APPLICATION MONEY / SHARE S UBSCRIPTION. THUS, THE ASSESSEE HAD PLOUGHED BACK UNACCOUNTED MONEY OF RS. 7 10,01,000/- IN ITS BUSINESS THROUGH THE CHANNEL OF ACCOMMODATION ENTRY. THEREFORE, IT IS FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS NECESSARY FOR IT S ASSESSMENT, FOR THE ASSESSMENT YEAR 2002-03 AND HAS NOT PAID TAX ON SU CH AMOUNT. THE UNACCOUNTED MONEYS WHICH SHOULD HAVE BEEN CHARG ED TO TAX ARE BEING PLOUGHED BACK TO BUSINESS WITHOUT PAYING DUE TAX ON IT. IN VIEW OF THE ABOVE FACTS THE THEN AO HAD THE REA SON TO BELIEVE THAT THE INCOME TO THE TUNE OF RS. 10,01,000/- HAS ESCAPED ASSESSMENT. ACCORDINGLY, AFTER RECORDING DUE SATISFACTION NOTI CE U/S. 148 OF THE ACT READ WITH SECTION 147 OF THE ACT WAS ISSUED TO THE ASSESSEE ON 24.3.2009. IN RESPONSE TO THE ABOVE NOTICE, THE ASS ESSEE VIDE ITS LETTER DATED 15.4.2009 HAS SUBMITTED THAT TO TREAT THE RETURN FILED ON 31.10.2002 IN RESPONSE TO THE NOTICE ISSUED U/S. 14 8 OF THE ACT. SUBSEQUENTLY NOTICE U/S. 143(2) AND 142(1) OF THE A CT WERE ISSUED. IN RESPONSE THERETO SH. BHAWANI SHANKAR SHARMA, CA AND AR OF THE ASSESSEE ATTENDED THE PROCEEDINGS AND FILE THE DETA ILS, THE SAME ARE EXAMINED AND PLACED ON RECORD. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, VIDE LETTER DATED 11.12.2009, IT WAS SUBMITTED THAT THE ABOVE MONEY WAS RECEIVED ON ACCOUNT OF SHARE APPLICATION FROM THE A BOVE PERSONS. THIS OFFICE HAS ISSUED SUMMONS U/S. 131 OF THE ACT ON 14.12.2009 TO M/S DIGVIJAY FINVEST PVT. LTD. AND M/S RABIK EXPOR TS LTD. FOR THEIR PERSONAL DEPOSITION AND PROOF OF IDENTITY. FOR WHIC H THE CASE WAS FIXED ON 21.12.2009. HOWEVER, ON THIS DATE, THESE P ERSONS WERE NOT ATTENDED THE PROCEEDINGS, HENCE, THE ASSESSEE W AS ASKED VIDE 8 NOTE SHEET ENTRY DATED 22.12.2009 TO PRODUCE THE AB OVE PERSONS IN ORDER TO VERIFY THE GENUINENESS OF THE TRANSACTI ON, FOR WHICH THE CASE WAS FIXED FOR HEARING ON 24.12.2009. HOWEVER, ON 24.12.2009, THE ASSESSEE HAS NEITHER ATTENDED THE P ROCEEDINGS NOR ANY REPLY HAS BEEN RECEIVED. FURTHER, IT IS PERTIN ENT TO MENTION HERE WITH THAT SH. MUKESH KUMAR R/O WZ-414, NARIANA VILL AGE, NEW DELHI, AS IN THE CAPACITY OF DIRECTOR IN THE COMPAN IES M/S DIGNITY FINVEST PVT. LTD. AND M/S RABIK EXPORTS LTD. IN HIS STATEMENT RECORDED ON 06.1.2004 BY THE ADDL. DIRECTOR OF INCO ME TAX (INV.) HAS ADMITTED THAT THE INVESTMENT MADE IN THE ASSESS EE COMPANY IS NOTHING BUT A ACCOMMODATION ENTRY. IN VIEW OF THE A BOVE, THE CREDITWORTHINESS, IDENTITY, GENUINENESS OF THE TRAN SACTION COULD NOT BE PROVED BY THE ASSESSEE. ACCORDINGLY, THE AMOUNT OF RS. 10,01,000/- IS HEREBY TREATED AS UNEXPLAINED CREDIT S AS PR THE PROVISIONS OF SECTION 68 OF THE I.T. ACT, 1961. AC CORDINGLY, AN AMOUNT OF RS. 10,01,000/- WAS MADE TO THE TOTAL INC OME OF THE ASSESSEE AND ASSESSED UNDER THE HEAD INCOME FROM OT HER SOURCES. AS THE ASSESSEE HAS FAILED TO OFFER ANY EXPLANATIO N ABOUT CREDITS APPEARING IN ITS BOOKS, HENCE, I AM SATISFIED THAT IT HAS CONCEALED THE PARTICULARS OF ITS INCOME AND FURNISHED INACCUR ATE PARTICULARS OF THE SAME. IT IS THEREFORE, LIABLE FOR PENALTY U/S. 271(1) OF THE I.T. ACT, 1961 PROCEEDINGS FOR WHICH IS BEING INITIATED SEPARATELY. WITH THESE REMARKS, THE INCOME OF THE ASSESSEE IS COMPUTED AS UNDER:- INCOME RETURNED AS PER RETURN OF INCOME : RS. 24, 636 ADD: UN-EXPLAINED CREDITS U/S. 68 (AS DISCUSSED 9 ABOVE) : RS. 10,01,000 TOTAL INCOME : RS.10,25,636/- ROUNDED OFF TO RS. 10,25,640/- ASSESSED ACCORDINGLY ON A TOTAL INCOME AT RS. 10,25 ,640/-. GIVE CREDIT TO PRE-PAID TAXES, CHARGE INTEREST U/S. 234B OF THE I.T. ACT. ISSUE DEMAND NOTICE, CHALLAN AND COPY OF ITNS 150 . 7.2 WE FURTHER NOTE THAT LD. CIT(A) WHILE DISMISSIN G THE APPEAL OF THE ASSESSEE HAS PASSED A DETAILED ORDER 21.11.2012 BY OBSERVIN G AS UNDER:- 3.4 THE APPELLANT HAS ARGUED THAT THE COMPANIES SH OWN AS SHARE APPLICATIONS ARE HAVING PAN AND PAYMENTS ARE MADE B Y CHEQUE. THE APPELLANTS ARGUMENT IS UNACCEPTABLE IN VIEW OF THE SPECIFIC INFORMATION RECEIVED FROM THE INVESTIG ATION WING REGARDING INVESTIGATIONS WHICH SHOWS THAT THE APPEL LANT HAD RECEIVED BOGUS ACCOMMODATION ENTRIES. IT IS WELL KN OWN THAT IN SUCH CASES, COMPANIES ARE REGISTERED AND DOCUMEN TATION CREATED WITH THE SOLE PURPOSE OF SHOWING ACCOMMODAT ION ENTRIES AS GENUINE TRANSACTIONS. IT IS SETTLED LAW THAT MERE FILING OF RETURNS AND ROUTING OF TRANSACTIONS THROU GH BANK IS NOT SUFFICIENT PROOF OF GENUINENESS. THE COPY OF DOCU MENTS FILED SHOWS TYPICAL CHARACTERISTICS OF COMPANIES ENGAGED IN PROVIDING BOGUS ACCOMMODATION ENTRIES. THE COMPANI ES HAVE NOMINAL INCOME FROM UNKNOWN SOURCES. THEIR RET URNS HAVE NOT BEEN SCRUTINIZED U/S. 143(3). THE MERE TH AT THE RETURNS HAVE BEEN PROCESSED U/S. 143(1) DOES NOT ME AN THAT THE INCOME SHOWN HAS BEEN EXAMINED. IN ANY CASE IT WAS 10 ONLY SUBSEQUENTLY THAT INQUIRIES BY THE INVESTIGATI ON WING LED TO UNEARTHING OF A RACKET IN BOGUS ACCOMMODATION EN TRIES. THEREFORE, THE FILING OF RETURNS BY THESE COMPANIES DOES NOT MEAN THAT THEIR CAPACITY OR GENUINENESS HAS BEEN PR OVEN. IN THIS CASE, THE APPELLANT HAS NOT FILED ANY COPY OF BANK STATEMENTS OF THESE COMPANIES THEREFORE, CAPACITY R EMAINS UNPROVEN. THE APPELLANT HAS ARGUED THAT CONFIRMATIO N FROM THESE COMPANIES HAS BEEN FILED. THE FILING OF CONFI RMATION IS NOT SUFFICIENT BECAUSE OF THE COLLUSIVE NATURE OF T HESE TRANSACTIONS. IN SUCH CASES, THE ENTRY PROVIDER PRO VIDES BOGUS ACCOMMODATION ENTRIES IN RETURN FOR A FEE. HE GIVE S THE CHEQUE AFTER RECEIVING THE AMOUNT IN CASH. IN THIS WAY, THE ASSESSEES OWN UNACCOUNTED INCOME IS INTRODUCED INT O HIS BOOKS OF ACCOUNT IN THE GARB OF SHARE APPLICATION M ONEY ETC. IN THESE CIRCUMSTANCES, THE STANDARD OF PROOF REQUI RED HAS TO BE STRICTER THAN IN SAY, THE CASE OF A LARGE PUBLIC LIMITED COMPANY WHERE SHARES ARE TRANSACTED ON THE STOCK EXCHANGE. IN VIEW OF THE SPECIFIC INFORMATION FROM THE INVESTIGATION WING, A HEAVY BURDEN LAY ON THE APPEL LANT TO PROVE THAT THE CREDITS WERE GENUINE. IN VIEW OF THE FACTS DISCUSSED ABOVE, THE APPELLANT HAS CLEARLY FAILED T O DISCHARGE HIS ONUS OF PROOF. 3.5 IN THE ASSESSMENT ORDER, THE AO HAS OBSERVED TH AT THE APPELLANT WAS GIVEN AN OPPORTUNITY TO PRODUCE THE S HARE APPLICATIONS SHOWN FOR CROSS EXAMINATION HOWEVER, T HE APPELLANT FAILED TO PRODUCE THEM. THE APPELLANT HAS NOT CLAIMED THAT ANY REQUEST WAS MADE TO ISSUE SUMMONS TO 11 THESE PERSONS. IN VIEW OF THESE FACTS, THE APPELLAN TS FAILURE TO PRODUCE THESE PERSONS FOR CROSS EXAMINATION MEANS T HAT THE DOCUMENTS RELIED UPON BY THE APPELLANT HAVE NOT BEE N CORROBORATED AND CANNOT THEREFORE, BE TAKEN AS SUFF ICIENT PROOF OF CAPACITY AND GENUINENESS. 7.2.1 WE FURTHER NOTE THAT LD. CIT(A) HAS SUPPORTE D AND UPHELD THE ADDITION MADE BY THE AO BY THE FOLLOWING JUDICIAL DECISIONS AND HELD THAT THE ADDITION MADE U/S. 68 IS JUSTIFIED. I) CIT VS. NOVA PROMOTERS & FINLEASE P LTD. (2012) 324 ITR 169 (DELHI) II) CIT VS. GOLD LEAF CAPITAL CORPN LTD. (2012) 205 TAXMAN 16 (DELHI) III) ITO VS. DIZA HOLDINGS P LTD. (2002) 255 ITR 57 3 (KER) IV) CIT VS. UNITED COMMERCIAL & INDL. CO. P LTD. (1 991) 187 ITR 596 (CAL) V) CIT VS. NEELKANTH ISPAT UDHYOG PVT. LTD. 2012-TI OL- 606-HC-DEL-IT VI) ITO VS. ONASSIS AXIES PVT. LTD. 2012-TIOL-415-I TAT- DEL VII) DHINGRA GLOBAL CREDENCE (P) LTD. VS. ITO (2010 ) 1 ITR TRIB. 529 (DELHI) 7.3 WE HAVE CAREFULLY GONE THROUGH THE ASSESSMENT O RDER AS WELL AS APPELLATE ORDER. WE FIND THAT AO IN THE ASSESSMEN T ORDER HAS NOT AT ALL DISCUSSED AND CORROBORATED THE DOCUMENTARY EVIDENCE S WHICH WERE AVAILABLE WITH HIM, AS CERTIFIED BY THE LD. COUNSEL OF THE AS SESSEE. THE SAME DOCUMENTARY 12 EVIDENCES ARE BEING FILED BEFORE THE TRIBUNAL ALSO IN THE SHAPE OF PAPER BOOK I.E. COPY OF AUDITED BALANCE SHEET ALONGWITH ANNEXURE OF ALLOTTED SHARES, LEDGER A/C COPY BANK STATEMENT; WRITTEN SUBMISSION TO CIT (A) VIDE LETTER DATED 6.11.2012; FORM NO. 2 OF COMPANIES ACT FOR ALLOTMEN T OF SHARES AND FILING WITH THE ROC ON 29.5.2002; APPLICATION FOR ASKING FOR RE ASONS; FILING OF OBJECTIONS DATED 25.11.2009; LETTER TO AO DATED 11.12.2009; D ETAILS OF INVESTORS I.E. (A) RABIK EXPORTS LIMITED: SHARE APPLICATION FORM, MINU TES OF BOARD MEETING, DETAILS OF CIN NO., MOA, CONFIRMATION, AFFIDAVIT, I TR AND FINANCIAL STATEMENT; (B) DIGNITY FINVEST PRIVATE LIMITED : SHARE APPLICA TION FORM, MINUTES OF BOARD MEETING; CIN NO., MOA, PAN NO., ITR, CONFIRMATION A ND AFFIDAVIT. WE FURTHER NOTE THAT AO EMPHASIZED ON THE REPORT OF THE INVEST IGATION WING OF THE INCOME TAX DEPARTMENT ABOUT THE ACCOMMODATION ENTRIES AND BELIEVING ON THE SAME THE AO HELD THAT THE CREDITWORTHINESS, IDENTITY, GE NUINENESS OF THE TRANSACTION COULD NOT BE PROVED BY THE ASSESSEE AND ACCORDINGLY , THE AMOUNT OF RS. 10,01,000/- WAS TREATED AS UNEXPLAINED CREDITS AS P ER THE PROVISIONS OF SECTION 68 OF THE I.T. ACT, 1961 AND ADDED THE SAME IN THE HANDS OF THE ASSESSEE, WHICH ESTABLISH THAT AO HAS NOT APPRECIATED AND CORROBORA TED THE EVIDENCES AS FILED BY THE ASSESSEE AND PASSED A NON-SPEAKING ORDER, WH ICH IS NOT SUSTAINABLE IN THE EYES OF LAW, WHICH NEEDS TO BE SET ASIDE. HOW EVER, ON THE OTHER HAND, LD. CIT(A) HAS PASSED A DETAILED ORDER AND UPHELD THE ADDITION MADE BY THE AO, BUT LD. CIT(A) HAS NOT AT ALL APPRECIATED THE FACT S AND CIRCUMSTANCES OF THE CASE AS DISCUSSED BY THE AO IN THE ASSESSMENT ORDER. WE FURTHER FIND THAT LD. CIT(A) ALSO NOT OBTAINED ANY REMAND REPORT FROM THE AO WHI CH IS VERY MUCH ESSENTIAL BEFORE ADJUDICATING UPON THE ISSUE IN DISPUTE. 7.4 IN THE BACKGROUND OF THE AFORESAID DISCUSSIONS , WE ARE OF THE CONSIDERED VIEW THAT AO HAS PASSED A NON-SPEAKING ORDER AND LD . CIT(A) HAS PASSED A DETAILED ORDER AND UPHELD THE ACTION OF THE AO, WIT HOUT DISCUSSING AND 13 APPRECIATING THE FACTS OF THE CASE AS NARRATED BY THE AO IN THE ASSESSMENT ORDER. THEREFORE, IN THE INTEREST OF JUSTICE, WE C ANCEL BOTH THE ORDERS OF THE REVENUE AUTHORITIES AND SET ASIDE THE ISSUES IN DIS PUTE RAISED IN GROUNDS OF APPEAL TO DECIDE THE SAME AFRESH, AFTER GIVING ADEQ UATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE AND PASS A DETAILED AND SPEAK ING ORDER, IN ACCORDANCE WITH LAW. AO IS ALSO DIRECTED TO VERIFY THE CORREC TNESS OF THE DOCUMENTARY EVIDENCES, AS MENTIONED IN THE PAPER BOOK AND CONS IDER THE SAME, AS PER LAW. 8 . IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 07/04/2017. S SS SD DD D/ // /- -- - S SS SD DD D/ // /- -- - [ [[ [L.P. SAHU L.P. SAHU L.P. SAHU L.P. SAHU] ]] ] [ [[ [H.S. SIDHU H.S. SIDHU H.S. SIDHU H.S. SIDHU] ]] ] ACCOUNTANT MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER JUDICIAL JUDICIAL JUDICIAL JUDICIAL MEMBER MEMBER MEMBER MEMBER DATE 07/04/2017 SRBHATNAGAR SRBHATNAGAR SRBHATNAGAR SRBHATNAGAR COPY FORWARDED TO: COPY FORWARDED TO: COPY FORWARDED TO: COPY FORWARDED TO: - -- - 1. APPELLANT - 2. RESPONDENT - 3. CIT 4. CIT (A) 5. DR, ITAT ASSISTANT REGISTRAR, ITAT, DELHI BENCHES