North Delhi Bullion Traders Pvt. Ltd., Delhi V. DCIT, New Delhi

ITA 6033/DEL/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 97560 (ITAT-DELHI)
• Duration Of Justice: 11 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-10-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 14-09-2015
• Assessment Year: 2010-2011
• Appeal Filed On: 07-11-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: RAVI JAIN
• Assessee Lawyers: SANJAY MEHRA
• Keywords: Search and seizure; Opportunity of being heard; Accommodation entries; Capital expenditure
• Section: 142(1); 153A; 68; 132; 15; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH E , NEW DELHI) BEFORE SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER AND SHRI KULDIP SINGH, JUDICIAL MEMBER I.T.A. NOS.6036 & 6037 /DEL/2014 ASSESSMENT YEARS : 20011-2012 & 2012-2013 MAHALAXMI BULLIONS PVT. LTD., VS. DCIT, CC-22, 1167/1172, SHOP NO.218, NEW DELHI 11ND FLOOR, KUCHA MAHAJANI, CHANDNI CHOWK, DELHI GIR / PAN:AAGSC,4162J I.T.A.NOS/6033, 6034 & 6035/DEL/2014 (ASSESSMENT YEARS 2010-2011, 2011-2012 & 2012-2013) NORTH DELHI BULLION TRADES PVT .LTD., VS. DCIT, C C-22, 1164, BASAEMENT SHOP NO.7, NEW DELHI KUCHA MAHAJANI, CHANDNI CHOWK, DELHI GIR / PAN: AADCN0380L (APPELLANTS) (RESPONDENTS) APPELLANT BY : SHRI SANJAY MEHRA, CA RESPONDENT BY : SHRI RAVI JAIN, CIT DR DATE OF HEARING : 23.09.2015 DATE OF PRONOUNCEMENT : 12.10.2015 ORDER PER BENCH: SINCE IN ALL THE AFORESAID FIVE APPEALS, IDENTICA L GROUNDS HAVE BEEN RAISED AND EVEN THE ISSUES INVOLVED ARE IDENTI CAL, SO, WITH THE ITA NO.6036/DEL/2014 2 CONCURRENCE OF THE PARTIES TO THE APPEALS, ALL THE APPEALS ARE TAKEN UP TOGETHER FOR DECISION TO AVOID REPETITION OF DISCUS SION. 1.1 THE APPELLANTS BY FILING THE PRESENT APPEALS U/ S 250 OF THE INCOME TAX ACT, 1961 (FOR SHORT THE ACT), SOUGHT TO SET ASID E THE IMPUGNED ORDER DATED 29.09.2014 PASSED BY LD. CIT(A)-III, NEW DELHI FOR THE ASSESSMENT YEARS 2010-2011, 2011-2012, 2012-2013 ON THE GROUNDS INTE R ALIA THAT: 1. THAT THE LEARNED COMMISSIONER OF INCOME TAX (AP PEALS) - III, NEW DELHI ERRED, IN CONFIRMING THE ASSESSMENT CONCL UDED BY LD. AO AT RS. 9,58,51,880/- INSTEAD OF THE RETURNED INCOME OF RS. 7,03,520/- MADE IN ABSENCE OF ANY RELATED ADVERSE DOCUMENTS OR MATERIALS, FOUND IN COURSE OF THE SEARCH OPERATION. 2. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EALS) - III, NEW DELHI ERRED ON FACTS AS WELL AS IN LAW, IN CONF IRMING AN ADDITION OF RS.5,30,00,000/- ON ACCOUNT OF UNEXPLAINED CREDI TS, IN RESPECT OF SHARE APPLICATION MONIES INCLUDING PREMIUM, AS RECE IVED BY THE APPELLANT. 3. THAT THE LEARNED COMMISSIONER OF INCOME FAX (APP EALS) - III, NEW DELHI ERRED, IN UPHOLDING THE INFERENCES MADE B Y LD. AO THAT A SUM OF RS. 5,30,00,000/- AS ABOVE- SAID ARE ACCOMMO DATION ENTRIES, WITHOUT CONFRONTING ANY SUCH RELATED DETAILS & DOCU MENTS TO THE ASSESSEE. 4. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EALS) - III, NEW DELHI ERRED, IN ABSENCE OF ANY OPPORTUNITY OF C ROSS EXAMINATION GIVEN TO APPELLANT IN RELATION TO ANY OF THE PARTY/ IES WHO IT IS ALLEGED HAVE GRANTED ACCOMMODATION ENTRIES. 5. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EALS) - III, NEW DELHI ERRED ON FACTS AS WELL AS IN LAW, IN CONF IRMING A DISALLOWANCE OF RS. 3,07,16,874/- ON ACCOUNT OF LAB OR CHARGES & ADMINISTRATIVE EXPENSES, AS INCURRED BY THE APPELLA NT. 6. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EALS) III, NEW DELHI ERRED ON FACTS AS WELL AS IN LAW, IN CONF IRMING AN ADDITION ITA NO.6036/DEL/2014 3 OF RS. 1,14,31,490/- ON ACCOUNT OF UNEXPLAINED CRED ITS, IN RESPECT OF LOANS RAISED BY THE APPELLANT. 7. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EALS) - III, NEW DELHI ERRED ON FACTS AS WELL AS IN LAW, IN UPHO LDING THE ASSESSMENT BY LD. AO, CONCLUDED IN CONTRADICTION OF THE APPLICABLE PROVISIONS OF LAW. 8. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EALS) - III, NEW DELHI ERRED ON FACTS AS WELL AS IN LAW, IN NOT DECIDING THE APPEAL ON MERITS & IN A NON-SPEAKING MANNER, WITHOUT DEALI NG WITH ALL ASPECTS OF THE VARIOUS ADDITIONS MADE. 9. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EALS) - III, NEW DELHI ERRED ON FACTS AS WELL AS IN LAW, AS THE ORDER PASSED BY LD. CIT(A) IS PERVASIVE TO THE SPECIFIC PROVISIONS OF L AW & THE INTERPRETATIONS BY HIGHER COURTS AND IS AS SUCH, A NULLITY. 10. THAT THE LEARNED COMMISSIONER OF INCOME TAX (AP PEALS) - ILL, NEW DELHI ERRED ON FACTS AS WELL AS IN LAW, IN NOT GRANTING PROPER OPPORTUNITIES TO THE APPELLANT, AS PER LAW AND ALSO IN NOT APPRECIATING THAT THE ASSESSMENT WAS CONCLUDED, IN ABSENCE OF PR OPER OPPORTUNITY OF BEING HEARD, GRANTED TO THE APPELLANT. 2. BRIEFLY STATED THE FACTS OF THIS CASE ARE THAT A SEARCH AND SEIZURE OPERATION U/S 132 OF THE ACT WAS INITIATED IN CASE OF THE ASSESSEE AS PART OF BULLION GROUP ON 20.07.2011. THEN, NOTICE U/S 15 3A WAS ISSUED ON 22.10.2012 REQUIRING THE ASSESSEE TO FILE RETURN OF INCOME U/S 153A WITHIN 15 DAYS AND IN RESPONSE THERETO, THE ASSESSEE FILED ITS RETURN OF INCOME ON 17.12.2012. THEREAFTER, A QUESTIONNAIRE WAS ISSUED TO THE ASSESSEE ON 18.07.2013 AND NOTICE WAS ISSUED U/S 142(1) ON 19.1 1.2013 AND IN RESPONSE THERETO, THE ASSESSEE SUBMITTED VIDE LETTER DATED 1 8.12.2013 TO TREAT ITS RETURN FILED U/S 139 AS RESPONSE/REPLY TO THE NOTICE U/S 1 53A OF THE ACT. THEN, NOTICE U/S 143(2) WAS ISSUED ON 18.12.2013. ITA NO.6036/DEL/2014 4 3. SHRI ATUL KHANDELWAL, CA/AR OF THE ASSESSEE ATTE NDED THE PROCEEDINGS ON 16.01.2014, FILED SOME DETAILS AND T HE CASE WAS ADJOURNED TO 17.01.2014 ON WHICH DATE, NOBODY ATTENDED THE PROCE EDINGS. THEN, LD. A.R. OF THE ASSESSEE ATTENDED THE PROCEEDINGS ON 13.03.2 014 AND HE WAS REQUIRED TO FILE NECESSARY DOCUMENTS IN SUPPORT OF ITS CLAIM AND WAS SPECIFICALLY TOLD THAT IT BEING A TIME BARRED MATTER, NO FURTHER ADJO URNMENT WOULD BE GRANTED AND THE CASE WOULD BE DECIDED ON THE BASIS OF MATER IAL AVAILABLE ON RECORD THEN THE CASE WAS ADJOURNED TO 14.03.2014 AT 11.00 AM ON WHICH DATE, LD. A.R. OF THE ASSESSEE ATTENDED AND FILED POWER OF AT TORNEY ONLY AND THE CASE WAS DISCUSSED WITH HIM. SINCE THE LD. A.R. HAS NOT FILED THE REQUIRED DETAILS, THE ASSESSMENT WAS MADE ON THE BASIS OF MA TERIAL AVAILABLE ON RECORD. WHILE THE CASE OF ONE ENTRY OPERATOR SHRI HIMANSHU VERMA WAS BEING ASSESSED WITH CENTRAL CIRCLE-16, NEW DELHI, W HO WAS TOLD TO ASCERTAIN IF THE SAID ENTRY OPERATOR SHRI HIMANSHU VERMA PROV IDED ANY ENTRY TO THE ASSESSEE. 4. THE DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL C IRCLE 16, NEW DELHI PROVIDED COMPLETE DETAILS ALONG WITH LIST ENC LOSED REGARDING ACCOMMODATION ENTRY TAKEN BY THE ASSESSEE, WHICH SH OWS THAT THE ASSESSEE HAS RECEIVED ACCOMMODATION ENTRY FROM SHRI HIMANSHU VERMA (ENTRY OPERATOR), BUT THE ASSESSEE HAS NOT FILED ANY DETAI L. CONSEQUENTLY, AS PER THE BALANCE SHEET FURNISHED, SHARE CAPITAL IS SHOWN AT RS.52,50,000/- AND THE FRESH SHARE APPLICATION MONEY OF RS.5,00,000/-. TH E ASSESSEE HAS ALSO RECEIVED SECURITY PREMIUM AT RS.4,72,50,000/-. THE ASSESSEE HAS NOT FILED DETAILS OF SHARE CAPITAL, SHARE APPLICATION MONEY A ND SECURITY PREMIUM. THE IDENTITY OF THE PERSON WHO PAID THE MONEY, CREDITWO RTHINESS AND GENUINENESS OF TRANSACTION IS NOT PROVED. THEREFORE, ADDITION OF RS.57,50,000/- ON ITA NO.6036/DEL/2014 5 ACCOUNT OF SHARE CAPITAL, SHARE APPLICATION MONEY A ND ADDITION OF RS.4,72,50,000/- ON ACCOUNT OF SECURITY PREMIUM IS ADDED IN THE INCOME OF THE ASSESSEE FROM UNDISCLOSED SOURCES U/S 68 OF T HE ACT. THE ASSESSEE HAS NOT FILED ANY CONFIRMATION OF CREDITORS AND AS SUCH THE CREDIT AT RS.1,14,31,490/- REMAINED UNVERIFIABLE AND AS SUCH THE SAME IS ADDED TO THE INCOME OF THE ASSESSEE. 5. ON THE FAILURE OF ASSESSEE TO PRODUCE BOOKS OF A CCOUNT FOR VERIFICATION AND NECESSARY INFORMATION FOR VERIFICATION 5% OF PU RCHASE AND 10% OF EXPENSES CLAIMED IN THE P & L ACCOUNT ARE DISALLOWE D AND ADDED IN THE INCOME OF THE ASSESSEE. THE PURCHASES IS SHOWN AT R S.60,86,19,398/-, 5% OF WHICH COMES TO RS.3,04,30,970/-. THE ADMINISTRATIV E AND OTHER EXPENSES CLAIMED IN THE P & L ACCOUNT AT RS.28,59,039/- @ 10 % OF THIS AMOUNT WHICH COMES TO RS.2,85,904/- AND AS SUCH, THE TOTAL ADDIT ION OF RS.3,07,16,874/- IS MADE TO THE INCOME OF THE ASSESSEE. CONSEQUENTLY, INCOME OF THE ASSESSEE IS ASSESSED AT RS.9,58,51,880/-. 6. THE APPEAL PREFERRED BY THE ASSESSEE CHALLENGING THE ORDER OF ASSESSMENT, HAS BEEN DISMISSED BY LD. CIT(A) VIDE I MPUGNED ORDER DATED 29.09.2014. NOW, THE ASSESSEE HAS COME UP BEFORE T HE TRIBUNAL BY FILING THE PRESENT APPEAL. 7. LD. A.R. CHALLENGING THE IMPUGNED ORDER CONTENDE D INTER ALIA THAT THE ASSESSEE HAS NOT BEEN PROVIDED WITH THE OPPORTUNITY TO PRODUCE THE BOOKS OF ACCOUNT AND THE CREDITORS BEFORE THE A.O.; THAT A.O . HAS DISALLOWED THE EXPENSES WITHOUT CONFRONTING THE ASSESSEE WITH THE MATERIAL COLLECTED AT HIS BACK AND AS SUCH, AD-HOC DISALLOWANCE OF EXPENSES I S NOT PERMISSIBLE; THAT THE ASSESSEE HAS SUFFICIENT MATERIAL TO DISCHARGE H IS ONUS U/S 68 OF THE ACT ITA NO.6036/DEL/2014 6 AND FILED APPLICATION FOR ADMISSION OF ADDITIONAL E VIDENCE UNDER RULE 29 OF ITAT RULES 1963 AND PRAYED TO SET ASIDE THE IMPUGNE D ORDER. 8. ON THE OTHER HAND LD. D.R. REPELLED THE CONTENTI ONS RAISED BY LD. A.R. AND CONTENDED INTER ALIA THAT WHEN THE A.O. HA S SPECIFICALLY CALLED UPON THE ASSESSEE TO FILE DOCUMENTS, THE ASSESSEE I S ESTOPPED BY HIS OWN CONDUCT FROM CONTENDING THAT HE IS NOT PROVIDED WIT H AN OPPORTUNITY OF BEING HEARD AND AS SUCH, THE APPLICATION MOVED BY T HE ASSESSEE UNDER RULE 29 OF ITAT RULES 1963 IS NOT MAINTAINABLE AS NO SUC H APPLICATION WAS FILED BY ASSESSEE BEFORE THE A.O. OR LD. CIT(A); THAT RUL E 29 OF ITAT RULES, IS TO BE CONSTRUED STRICTLY AND WHEN THE ASSESSEE HAS DUL Y APPEARED THROUGH HIS CA/AR, HE CANNOT CLAIM THAT PROPER OPPORTUNITY HAS NOT BEEN PROVIDED TO HIM AND PRAYED FOR DISMISSAL OF THE PRESENT APPEAL OF THE ASSESSEE. NO GROUND IS MADE OUT TO REOPEN THE CASE WHICH WAS FRU STRATED PROPERLY ON FILING OF APPEAL BEFORE THE TRIBUNAL 9. WE HAVE HEARD THE LD. AUTHORIZED REPRESENTATIVES OF THE PARTIES AND GONE THROUGH THE DOCUMENTS RELIED UPON IN THE LIGHT OF THE FACTS AND CIRCUMSTANCES OF THE CASE. 10. UNDISPUTED FACTS OF THIS CASE ARE INTER ALIA TH AT SEARCH AND SEIZURE OPERATION U/S 132 OF THE ACT WAS INITIATED AGAINST THE ASSESSEE AS PART OF BULLION GROUP ON 20.07.2011 AND SEARCH WARRANT U/S 132(1) OF THE ACT WAS ISSUED AND EXECUTED IN THE NAME OF ASSESSEE; THAT N OTICE U/S 153A OF THE ACT WAS ISSUED ON 22.10.2012 REQUIRING THE ASSESSEE TO FILE RETURN OF INCOME U/S 153A WITHIN 15 DAYS, WHICH HE HAS FILED ON 17.12.20 12; THAT A QUESTIONNAIRE WAS ISSUED TO THE ASSESSEE ON 18.07.2013 AND NOTICE U/S 142(1) WAS ISSUED ON 19.11.2013 AND IN RESPONSE THERETO THE ASSESSEE FILED REPLY DATED 18.12.2013 THAT THE RETURN FILED BY IT U/S 139 BE T REATED AS RESPONSE TO THE ITA NO.6036/DEL/2014 7 NOTICE U/S 153A OF THE ACT; THAT THE NOTICE U/S 143 (2) WAS ISSUED ON 18.12.2013 AND IN RESPONSE THERETO, SHRI ATUL KHAND ELWAL, CA/AR OF THE ASSESSEE ATTENDED THE PROCEEDINGS ON 16.01.2014 AND FILED SOME DETAILS AND THEN CASE WAS ADJOURNED TO 17.01.2014 BUT NOBODY AT TENDED THE PROCEEDINGS ON 17.01.2014; THAT WHEN SHRI ATUL KHANDELWAL CA/AR OF THE ASSESSEE ATTENDED THE PROCEEDINGS ON 13.03.2014, HE WAS SPE CIFICALLY ASKED TO FILE THE FOLLOWING DOCUMENTS: A) DETAIL OF SHARE CAPITAL WITH SOURCE OF SHARE CA PITAL, IDENTITY OF PERSON AND GENUINENESS OF TRANSACTION. B) SHARE APPLICATION WITH SOURCE OF SHARE APPLICATI ON, IDENTITY OF PERSON AND GENUINENESS OF TRANSACTION. C) CONFIRMATION COPY OF LOANS AND ADVANCE D) CONFIRMATION OF SUNDRY CREDITORS AND SUNDRY DEBT ORS. E) HE IS REQUIRED TO SHOW CAUSE AS TO WHY THE MEMBE RSHIP FEE OF RS.11,07,310/- + RS. 1,000/- SHOULD NOT BE ADDED IN THE INCOME AS THE SAME IS CAPITAL EXPENDITURE IN NATURE. THAT ASSESSEE WAS MADE AWARE THAT IT BEING A TIME B ARRED MATTER, NO FURTHER ADJOURNMENT SHALL BE GRANTED AND THE CASE WILL BE D ECIDED ON THE BASIS OF MATERIAL AVAILABLE ON RECORD AND THAT THE CASE WAS ADJOURNED TO 14.03.2014 AT 11.00 AM, ON WHICH DATE, SHRI ATUL KHANDELWAL, C A/AR OF THE ASSESSEE ATTENDED TO FILE POWER OF ATTORNEY ONLY AND THE CAS E WAS DISCUSSED WITH HIM BY THE LD. D.R. BUT SHRI ATUL KHANDELWAL HAS NOT PR EFERRED TO FILE REQUISITE DETAILS AND CONSEQUENTLY, THE ASSESSMENT WAS MADE. 12. THE A.O. HAS SPECIFICALLY SOUGHT INFORMATION FO RM A.O. OF CENTRAL CIRCLE-16, NEW DELHI IF SHRI HIMANSHU VERMA, ENTRY OPERATOR BEING ASSESSED WITH CC-16, NEW DELHI, HAS PROVIDED ANY EN TRY TO THE ASSESSEE AND ITA NO.6036/DEL/2014 8 CONSEQUENTLY, THE A.O. OF CC-16, NEW DELHI VIDE HIS LETTER DATED 18.03.2014 HAS PROVIDED INFORMATION SOUGHT FOR, WHI CH IS REPRODUCED AS UNDER FOR READY REFERENCE: F. NO. DCIT /CC-16/2013-14/ DATED: 18/03/2014 TO THE DEPUTY COMMISSIONER OF INCOME TAX CENTRAL CIRCLE-22 NEW DELHI. SIR, SUB:- ASSESSMENT IN THE CASE OF M/S MAHALAXMI BULLI ONS PVT. LTD AND M/S NORTH DELHI BULLION TRADERS PVT. LTD. A. Y. 201 0-11 TO 2012-13- REGARDING. PLEASE REFER THE ABOVE. REF- F.NO. OCITICC-2212013-141912 DATED 14.03.2014. IN THIS REGARD, IT IS INFORMED THAT A SEARCH WAS CO NDUCTED ON SH. HIMANSHU VERMA ON 29.03.2012 BY UNIT-VI, NEW DELHI. SH. HIMANSHU VERMA IS AN ACCOMMODATION ENTRY PROVIDER A ND HE HAS ADMITTED DURING THE COURSE OF SEARCH THAT ALL THE F OLLOWING PARTIES LISTED BY YOU - NAMELY M/S SOFFPRO TECHNOLOGIES PVT . LTD., M/S CORNELIUS MARKETING PVT. LTD., M/S TRANSMISSION MER CHANDISE PVT. LTD. AND M/S CITYLIFE PROMOTERS PVT. LTD. ARE HIS C ONDUIT COMPANIES AND ARE USED FOR PROVIDING ACCOMMODATION ENTRIES. M/S NORTH DELHI BULLION TRADERS PVT. LTD. HAS RECEI VED ACCOMMODATION ENTRY FROM THE ABOVE COMPANIES AMOUNT ING TO RS.2. 10 CRORES IN A. Y. 2011-12. OTHER COMPANIES OF SH. HIMANSHU VERMA GROUP NAMELY M/S RISING PORTFOLIO INDIA PVT. LTD RS .50,00,000/- M/S MITHIACHAL INDUSTRIAL & FINANCE PVT. LTD. RS.1,00,0 0,000/-, OMEXPO INDUSTRIES PVT. LTD. RS.50,00,000/- HAVE ALSO GIVEN ENTRIES OF RS. 2 CRORES TO YOUR ASSESSEE IN A. Y. 2012-13. FURTHER, THE ASSESSMENT IN THE CASE OF SH. HIMANSHU VERMA & HIS COMPANIES IS A LSO UNDER PROGRESS WITH THE UNDERSIGNED & GETTING BARRED BY L IMITATION 31.03.2014. FURTHER, M/S MAHALAXMI BULLIONS PVT. LTD. HAS RECEI VED ACCOMMODATION ENTRIES OF RS. 6.3 CRORES AS PER LIST ATTACHED FROM SH. HIMANSHU VERMA GROUP. YOURS FAITHFULLY, (N. D. GUPTA) DEPUTY COMMISSIONER OF INCOME TAX ITA NO.6036/DEL/2014 9 CENTRAL CIRCLE-16, NEW DELHI' LIST OMEXPO ENT. PVT. LTD. 2011-12 JAGUAR SOFTECH PVT. LTD. 2010-11 SAFFRON LOGISTICS PVT. LTD. 2010-11 USK EXIM PVT. LTD. 2010-11 WHITE COLLAR MANAGEMENT PVT. LTD. 2010-11 RISING PORTFOLIO INDIA PVT. LTD. 2011-12 CORNELIUS MARKETING AND RESEARCH PVT. LTD. 2010-11 RHYTHM EXIM PVT. LTD. 2010-11 SOFFPRO TECHNOLOGIES PVT .LTD. 2010-11 TRANSMISSION MERCANDISE PVT. LTD. 2010-11 JOIN FASHION PVT. LTD. 2010-11 CITYLIFE PROMOTERS PVT. LTD. 2010-11 MAHALAXMI BULLIONS PVT. LTD. 10000000 MAHALAXMI BULLIONS PVT. LTD. 2500000 MAHALAXMI BULLIONS PVT. LTD. 5000000 MAHALAXMI BULLIONS PVT. LTD. 2500000 MAHALAXMI BULLIONS PVT. LTD. 10000000 MAHALAXMI BULLIONS PVT. LTD. 10000000 MAHALAXMI BULLIONS PVT. LTD. 5000000 MAHALAXMI BULLIONS PVT. LTD. 5000000 MAHALAXMI BULLIONS PVT. LTD. 5000000 MAHALAXMI BULLIONS PVT. LTD. 5000000 MAHALAXMI BULLIONS PVT. LTD. 2500000 MAHALAXMI BULLIONS PVT. LTD. 500000 MAHALAXMI BULLIONS PVT. LTD. 63000000 13. ON THE BASIS OF AFORESAID MATERIAL SUPPLIED BY THE A.O. OF CC-16, NEW DELHI IN CASE OF HIMANSHU VERMA, ENTRY OPERATOR , WHICH HAS NOT BEEN CONTROVERTED BY THE ASSESSEE IN ANY MANNER WHATSOEV ER, THE A.O. HAS MADE THE ADDITION WHICH HAS BEEN AFFIRMED VIDE IMPUGNED ORDER. 14. IN THE BACKDROP OF AFORESAID UNDISPUTED FACT AN D THE FACTS AND CIRCUMSTANCES OF THIS CASE ON RECORD, THE FIRST QUE STION ARISES FOR DETERMINATION IN THIS CASE IS AS TO WHETHER THE ASSESSEE HAS BEEN PROVIDED ITA NO.6036/DEL/2014 10 WITH AN OPPORTUNITY TO DISCHARGE INITIAL ONUS U/S 6 8 OF THE ACT . WE ARE OF THE CONSIDERED OPINION THAT THE ASSESSEE HAS FAI LED TO DISCHARGE THE INITIAL ONUS TO EXPLAIN THE ACCOMMODATION ENTRY BY PROVING THE CREDITWORTHINESS OF PARTIES AND GENUINENESS OF THE TRANSACTION DESPITE BEING PROVIDED WITH AMPLE OPPORTUNITY FOR THE FOLLOWING REASONS: 14.1 THAT IN RESPONSE TO THE NOTICE ISSUED U/S 143( 2), THE ASSESSEE HAS BEEN DULY REPRESENTED BEFORE THE A.O. THROUGH SHRI ATUL KHANDELWAL, CA/AR ON 16.01.2014 AND HE HAS FILED SOME DETAILS AND THE CA SE WAS ADJOURNED TO 17.01.2014; 14.2 THAT ON 17.01.2014, SHRI ATUL KHANDELWAL, CA/A R OF THE ASSESSEE DID NOT ATTEND THE PROCEEDINGS WHICH WAS ADJOURNED TO 1 3.03.2014, ON WHICH DATE LD. A.R. OF THE ASSESSEE APPEARED AND HE WAS S PECIFICALLY CALLED UPON TO FILE REQUISITE DOCUMENTS AS DETAILED IN PARA 10 ABOVE; 14.3 THAT THE ASSESSEE THROUGH HIS AR HAS NOT PREFE RRED TO FILE THE REQUISITE DOCUMENTS ON 14.03.2014 DESPITE THE FACT THAT HE WA S TOLD NOT TO GRANT ANY FURTHER TIME AS IT BEING TIME BOUND MATTER. LD. A. R. OF THE ASSESSEE ATTENDED THE PROCEEDINGS AND MERELY FILED HIS POWER OF ATTOR NEY ON 14.03.2014. CONSEQUENTLY, A.O. PASSED THE ASSESSMENT ORDER ON T HE BASIS OF MATERIAL AVAILABLE ON RECORD; 14.4 THAT THE ASSESSEE PREFERRED AN APPEAL CHALLENG ING THE ORDER OF A.O. BEFORE LD. CIT(A), WHICH REMAINED PENDING FOR A PER IOD OF ABOUT 5 MONTHS BUT HE HAS NOT PREFERRED TO FILE ANY ADDITIONAL DOC UMENTS TO DISCHARGE ITS ONUS U/S 68 OF THE ACT AND THEN FILED THE PRESENT A PPEAL BEFORE THE TRIBUNAL ON 23.07.2015; 14.5 THAT ALL OF A SUDDEN, THE ASSESSEE FILED APPLI CATION FOR ADMISSION OF ADDITIONAL DOCUMENTS UNDER RULE 29 OF ITAT RULES 19 63 ON THE SOLE GROUND ITA NO.6036/DEL/2014 11 THAT SHRI ATUL KHANDELWAL, CA/AR OF THE ASSESSEE MI SGUIDED THE ASSESSEE AND HAS ALSO NOT FILED REQUISITE DOCUMENTS AND DID NOT RESPOND TO THE NOTICE OF THE A.O. IN SPITE OF SUBMITTING THE SAME TO HIM; 14.6 THAT THERE IS NOT AN IOTA OF MATERIAL ON RECOR D TO EVEN PRIMA FACIE MAKE OUT IF ASSESSEE HAS BEEN MISGUIDED BY SHRI ATUL KHA NDELWAL CA/AR OF THE ASSESSEE OR THAT HE WAS PROVIDED WITH THE REQUISITE DOCUMENTS TO BE FILED WITH THE A.O. OR LD. CIT(A); 14.7 THAT FOR ARGUMENTS SAKE, IF IT IS ASSUMED THAT THE ASSESSEE HAS BEEN MISGUIDED BY SHRI ATUL KHANDELWAL, HIS CA/AR BEFORE A.O., HE (ASSESSEE) WOULD HAVE RECTIFIED HIS MISTAKE DURING THE PENDENC Y OF HIS APPEAL BEFORE LD. CIT(A) BUT THE ASSESSEE HAS CONTINUED TO GET PR OFESSIONAL ADVICE FROM HIS CA/AR DURING PENDENCY OF APPEAL BEFORE CIT(A). SO, IT IS AN AFTERTHOUGHT ON THE PART OF ASSESSEE TO FILE APPLIC ATION FOR ADMISSION OF ADDITIONAL DOCUMENTS/EVIDENCE BY PREPARING SOME BOG US DOCUMENTS; 14.8 THAT EVEN NO SUCH GROUND HAS BEEN RAISED BY TH E ASSESSEE BEFORE LD. CIT(A) THAT HE HAS BEEN MISGUIDED BY HIS AR AND AS SUCH, COULD NOT DISCHARGE HIS ONUS U/S 68 OF THE ACT; 14.9 THAT LD. CIT(A) IN PARA 4 OF THE IMPUGNED ORDE R HAS DISCUSSED THE CHRONOLOGY OF PROCEEDINGS CONDUCTED BY THE A.O. DU RING THE ASSESSMENT PROCEEDINGS, WHICH GOES TO PROVE THAT AMPLE OPPORTU NITIES SPREAD INTO ABOUT TWO MONTHS WERE PROVIDED TO THE ASSESSEE BUT HE HAS NOT COME UP WITH ANY DEFENCE TO CONTROVERT THE MATERIAL ON THE BASIS OF WHICH ASSESSMENT HAS BEEN MADE VIDE ORDER DATED 29.03.2014; 14.10 THAT THE APPLICATION MOVED BY THE APPELLANT UNDER RULE 29 OF ITAT RULES 1963 FOR ADMISSION OF ADDITIONAL DOCUMEN TS, IS NOT MAINTAINABLE ON THE GROUND THAT IT IS PROVED BEYOND REASONABLE D OUBT THAT HE HAS BEEN ITA NO.6036/DEL/2014 12 PROVIDED WITH PROPER OPPORTUNITY OF BEING HEARD DUR ING PROCEEDINGS BEFORE A.O. AS WELL AS DURING PENDENCY OF HIS APPEAL BEFOR E LD. CIT(A); 14.11 THAT THE APPELLANT/ASSESSEE HAS NOT EVEN PRE FERRED TO DISCLOSE AS TO WHAT SORT OF MISGUIDANCE WAS GIVEN TO HIM BY HIS CA/ARA SHRI ATUL KHANDELWAL NOR ANY COMPLAINT AGAINST HIS CA/AR HAS BEEN FILED BY THE ASSESSEE AT ANY POINT OF TIME; 14.12 THAT THE JUDGEMENT CITED RSS SHAMUGAM PILLAI & SONS VS CIT (MAD.) 95 ITR 109 RELIED UPON BY THE LD. A.R. OF THE ASSESSEE IS NOT APPLICABLE TO THE FACTS AND CIRCUMSTANCES OF THIS C ASE AS THE APPLICATION UNDER CONSIDERATION ITSELF HAS BEEN FILED BY CONCEA LING THE MATERIAL FACTS AS WELL AS ON THE BASIS OF DISTORTED FACTS; 14.13 THAT THE JUDGMENT CITED AS SMT. PRABHAWATI S. SHAH VS CIT 231 ITR 01(SUPRA) IS NOT APPLICABLE TO THE FACTS AND CIRCUMSTANCES O F THIS CASE BECAUSE IN THE INSTANT CASE, UNDISPUTEDLY NO S UCH APPLICATION WAS FILED BY THE ASSESSEE BEFORE THE A.O. OR LD. CIT(A). 14.14 THAT THE JUDGMENT CITED AS RSS SHAMUGAM PILLAI & SONS VS CIT (MAD.) 95 ITR 109 (SUPRA) IS ALSO NOT APPLICABLE TO THE FACTS AND CIRCUMSTANCES OF THIS CASE FOR TWO REASONS- ONE: TH AT THE APPLICATION IS MOVED BY THE APPELLANT ON THE BASIS OF MISLEADING F ACT THAT HE HAS BEEN MISGUIDED BY SHRI ATUL KHANDELWAL, CA/AR, WHO HAS C ONTINUOUSLY REPRESENTED THE ASSESSEE ON EACH AND EVERY HEARING BEFORE THE A.O. AS WELL AS LD. CIT(A) AND AGAINST WHOM NO COMPLAINT HAS EVE R BEEN FILED BY THE ASSESSEE; TWO: THAT THERE IS NOT AN IOTA OF EVIDENC E ON RECORD AS TO WHAT WERE THE CIRCUMSTANCES WHICH HAVE RESTRAINED THE APPELLA NT/ASSESSEE FROM FILING SUCH APPLICATION BEFORE THE A.O. AS WELL AS LD. CIT (A). ITA NO.6036/DEL/2014 13 14.15 THAT THE CONTENTION OF LD. COUNSEL FOR THE ASSESSE E THAT ASSESSEE SHOULD BE GIVEN FAIR OPPORTUNITY TO PRODUCE ALL DOC UMENTS BEFORE THE A.O. AS HE HAD NO FAULT IN PROVIDING THE DETAILS CALLED FOR , IS NOT TENABLE IN VIEW OF LAW LAID DOWN BY HONBLE ITAT, DELHI BENCHES I BE NCH (THIRD MEMBER), IN THE CASE CITED AS 112 ITD 205, ZUARI LEASING & FINANCE CORPN. LTD VS ITO , THE OPERATIVE PART OF THE ORDER IS REPRODUCED AS UNDER: THE PRIMARY POWER, RATHER OBLIGATION OF THE TRIBUN AL IS TO DISPOSE OF THE APPEAL ON MERITS. THE INCIDENTAL PO WER TO REMAND, IS ONLY AN EXCEPTION AND SHOULD BE SPARINGL Y USED WHEN IT IS NOT POSSIBLE TO DISPOSE OF THE APPEAL FO R WANT OF RELEVANT EVIDENCE, LACK OF FINDING OR INVESTIGATION WARRANTED BY THE CIRCUMSTANCES OF THE CASE. REMAND IN A CASUAL MANNER AND FOR THE SAKE OF REMAND ONLY OR AS A SHORT CUT, IS T OTALLY PROHIBITED. IT HAS TO BE BORNE IN MIND THAT LITIGA NTS HAVE TO WAIT FOR LONG TO HAVE FRUIT OF LEGAL ACTION AND EXP ECT THE TRIBUNAL TO DECIDE ON MERITS. IT IS, THEREFORE, AL L THE MORE NECESSARY THAT MATER SHOULD BE DECIDED ON MERITS WI THOUT FOLLOWING ONE OF THE PARTIES BEFORE THE TRIBUNAL TO HAVE ANOTHER INNING, PARTICULARLY WHEN SUCH PARTY HAD FULL OPPOR TUNITY TO ESTABLISH ITS CASE. UNNECESSARY REMANDS, WHEN RELE VANT EVIDENCE IS ON RECORD, BELIES LITIGANTS LEGITIMATE EXPECTATIONS AND IS TO BE DEPRECATED. HAVING REGARD TO THE AFOR ESAID PRINCIPLE, IT WAS NECESSARY TO LOOK INTO RECORD TO SEE WHETHER THERE WAS SUFFICIENT MATERIAL ON RECORD TO DISPOSE OF THE ISSUE ON MERIT AND, HENCE, THERE WAS NO NEED TO REMAND TH E ISSUE TO PROVIDE A FRESH INNINGS TO THE REVENUE. 14.16 THAT THE HONBLE TRIBUNAL WHILE DECIDING THE AFORES AID CASE, RELIED UPON THE JUDGEMENT CITED AS M. G. SHAHANI & CO. (DELHI) LTD. VS COLLECTOR OF CENTRAL EXCISE 1994 (73) ELT 3 (S.C.) WHEREIN IT IS OBSERVED AS UNDER: THE COMPLAINT OF THE APPELLANT BEFORE US, FOR WHIC H WE FIND SUFFICIENT JUSTIFICATION, IS THAT THE TRIBUNAL SHOU LD HAVE ITSELF GONE THROUGH THE EVIDENCE AND RENDERED A FINDING BE CAUSE ALL ITA NO.6036/DEL/2014 14 THE RELEVANT MATERIALS WERE BEFORE THE TRIBUNAL. TO OUR MIND, IT APPEARS THAT THE TRIBUNAL HAS ADOPTED AN EASY COURS E IN REMANDING THE MATTER. THE REMAND WAS SUPERFLUOUS WH EN THE PARTIES HAVE ARGUED THE MATTER AT LENGTH. TO CHARAC TERIZE THE ORDER OF THE COLLECTOR AS LACONIC IS NOT CORRECT SI NCE HE HAS WRITTEN A DETAILED ORDER INCLUDING REFERENCE TO REL EVANT CASE LAW. THE TRIBUNAL HAS ADOPTED AN EASY COURSE OF REMANDIN G THE MATTER TO COLLECTOR, WHEN IT COULD HAVE DECIDED THE SAME. THE REMAND WAS SUPERFLUOUS WHEN THE PARTIES HAVE ARGUED THE MATTER AT LENGTH AND RELEVANT MATERIAL FOR DECISION WAS AVAILABLE ON RECORD. THE CEGAT SHOULD HAVE ITSELF A NALYSED THE EVIDENCE AND GIVEN A FACTUAL CONCLUSION.' 14.17 THAT HON'BLE HIGH COURT OF KARNATAKA IN THE CASE CI TED AS KARNATAKA WAKF BOARD VS STATE OF KARNATAKA AIR 1996 KAR. 55 ALSO HELD THAT: WHERE THE PARTY HAD AN OPPORTUNITY OF ADDUCING EVI DENCE IN THE CASE BUT WITH OPEN EYES FAILED TO ADDUCE THAT E VIDENCE, THE CASE SHOULD NOT BE REMANDED TO GIVE A SECOND CHANCE TO THE PARTY TO ADDUCE THAT EVIDENCE. THE POLICY OF THE LA W IS THAT ONCE THAT MATTER HAS BEEN FAIRLY TRIED BETWEEN THE PARTI ES, IT SHOULD NOT, EXCEPT IN SPECIAL CIRCUMSTANCES, BE REOPENED A ND RETIRED. IN A RECENT DECISION THEIR LORDSHIPS OF THE SUPREME COURT LAID DOWN THAT POWER TO ORDER RETRIAL AFTER REMAND, WHER E THERE HAD ALREADY BEEN A TRIAL ON EVIDENCE BEFORE THE COURT O F FIRST INSTANCE, CANNOT BE EXERCISED MERELY BECAUSE THE AP PELLATE COURT IS OF THE VIEW THAT THE PARTIES WHO COULD LEA D BETTER EVIDENCE IN THE COURT OF FIRST INSTANCE HAVE FAILED TO DO SO.' 14.18 THAT THE HONBLE TRIBUNAL IN THE CASE ZUARI LEASING & FINANCE LTD. (SUPRA) HAS ALSO RELIED UPON THE JUDGEMENTS CI TED AS ASSTT. CIT V. ANIMA INVESTMENT LTD [2000] 73 ITD 125 (DELHI), AS STT. CIT V. ARUNODAI APARTMENTS (P.) LTD [2002] 123 TAXMAN 48 ( GAU.) (MAG.), SMT. NEENA SYALV. ASSTT. CIT[1999] 70 ITD 62 (CHD.) , RAJESH BABUBHAI DAMANIA V. CIT[2001] 251 ITR 5411 (GUJ.) AND CIT V. ITA NO.6036/DEL/2014 15 HARIKISHAN JETHALAL PATEL [1987] 168 ITR 4722 (GUJ. ) WHEREIN IT IS HELD THAT POWERS OF THE TRIBUNAL IN THE MATTER OF SETTIN G ASIDE AN ASSESSMENT ARE LARGE AND WIDE, BUT THESE POWERS CANNOT BE EXERCISE TO ALLOW THE A.O. AN OPPORTUNITY TO PATCH UP THE WEAK PARTS OF THIS CASE AND TO FILL UP THE OMISSION BY GIVING ANOTHER INNINGS. 14.19 THAT FOLLOWING THE RATIO OF JUDGEMENT IN ZUARI LEASING & FINANCE LTD. (SUPRA), WHEREIN THE TRIBUNAL HAS THRASHED THE CONTROVERSY T HREADBARE BY RELYING UPON THE LAW LAID DOWN BY HON'BLE SUPREM E COURT AS WELL AS HON'BLE HIGH COURTS THAT REMAND OF THE CASE AT 2 ND APPELLATE STAGE FOR THE PURPOSE OF DE NOVO TRIAL IS AN EXCEPTION AND IT CAN NEVER BE MADE TO FILL UP THE LACUNA OR TO DECIDE THE CONTROVERSY FOR WHICH S UFFICIENT OPPORTUNITIES HAVE ALREADY BEEN AFFORDED TO THE ASSESSEE. 14.20 THAT IN THE INSTANT CASE, SINCE THE ASSESSEE HAS BE EN PROVIDED WITH FAIR AND COMPLETE OPPORTUNITY BY THE A.O. TO P RODUCE SPECIFIC DOCUMENTS TO ARRIVE AT A LOGICAL CONCLUSION, THE AS SESSEE WAS GIVEN DUE OPPORTUNITY OF BEING HEARD BY LD. CIT(A) BUT HE HAS NOT PREFERRED TO SUPPLY THE REQUISITE DOCUMENTS, NOR FILED ANY APPLICATION TO PRODUCE ADDITIONAL DOCUMENTS RATHER COME UP BEFORE THE TRIBUNAL WITH A FLIMSY GROUND THAT HE HAS BEEN MISGUIDED BY HIS CA/AR AND AS SUCH, HE COU LD NOT PRODUCE THE REQUISITE DOCUMENTS, NO FURTHER OPPORTUNITY BY WAY OF REMAND CAN BE GIVEN TO THE APPELLANT. 15. FURTHERMORE, ON THE BASIS OF INFORMATION SUPPLI ED BY THE A.O. OF CC- 16, NEW DELHI, IN CASE OF SHRI HIMANSHU VERMA, AN E NTRY PROVIDER, WHO HAS ADMITTED DURING SEARCH PROCEEDINGS THAT HE (SHRI HI MANSHU VERMA) HAS PROVIDED ACCOMMODATION ENTRY OF MORE THAN RS.12.60 CRORES TO THE APPELLANT AS WELL AS THEIR GROUP COMPANIES AND CONSEQUENTLY M ADE ADDITION OF ITA NO.6036/DEL/2014 16 RS.57,50,000/- ON ACCOUNT OF SHARE CAPITAL, SHARE A PPLICATION MONEY AND ADDITION OF RS.4,72,50,000/- ON ACCOUNT OF SECURITY PREMIUM. SIMILARLY ASSESSEE HAS FAILED TO FILE ANY CONFIRMATION OF CRE DITORS TO EXPLAIN THE CREDIT OF RS.1,14,31,490/- AND THE SAME REMAINED UNVERIFIA BLE AND THE A.O. HAS MADE ADDITION OF RS.1,14,31,490/- IN THE INCOME OF THE ASSESSEE FOR NON FILING OF REQUISITE INFORMATION AND BOOKS OF ACCOUN T FOR VERIFICATION, 5% OF PURCHASES AND 10% ON EXPENSE CLAIMED IN THE P & L A CCOUNT HAVE BEEN DISALLOWED WHICH COME TO RS.3,07,16,874/- (RS.3,04, 30,970/- BEING 5% OF PURCHASE AT RS.60,86,19,398/- + RS.2,85,904/- I.E. ADMINISTRATIVE AND OTHER EXPENSES CLAIMED IN THE P & L ACCOUNT @ 10% AT RS.2 8,59,039/-) AND CONSEQUENTLY MADE THE DISALLOWANCE OF RS.3,07,16,87 4/- AND ASSESSED THE TOTAL INCOME TO THE TUNE OF RS.9,58,51,883/-. EVEN OTHERWISE IT WOULD NOT BE PROFESSIONALLY FEASIBLE FOR A.O. TO SCAN THE SO CAL LED RECORD NOW SET UP BY THE ASSESSEE AFTER A GAP OF MORE THAN FOUR YEARS. 16. LD. CIT(A) AFTER PROVIDING PROPER OPPORTUNITY O F BEING HEARD TO THE APPELLANT/ASSESSEE AFFIRMED THE ADDITION BY PASSING REASONED ORDER. HENCE, FINDING NO ILLEGALITY OR PERVERSITY, WE ARE NOT INC LINED TO INTERFERE INTO THE IMPUGNED ORDER. 17. CONSEQUENTLY APPEALS UNDER CONSIDERATION ARE HE REBY DISMISSED. 18. ORDER PRONOUNCED IN THE OPEN COURT ON 12 TH OCT., 2015. SD./- SD./- ( INTURI RAMA RAO) (KULDIP S INGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATE: 12.10. 2015 SP ITA NO.6036/DEL/2014 17 COPY FORWARDED TO:- 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT (A)-, NEW DELHI. 5. THE DR, ITAT, LOKNAYAK BHAWAN, KHAN MARKET, NEW DEL HI. TRUE COPY. BY ORDER (ITAT, NEW DELHI). S.NO. DETAILS DATE INITIALS DESIGNATION 1 DRAFT DICTATED ON 24/9 SR. PS/PS 2 DRAFT PLACED BEFORE AUTHOR 28,29,29/9,11,12,1212, 12 SR. PS/PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER AM/AM 5 APPROVED DRAFT COMES TO THE SR. PS/PS 12/10/2015 SR. PS/PS 6 KEPT FOR PRONOUNCEMENT 12/10 SR. PS/PS 7 FILE SENT TO BENCH CLERK 13/10 SR. PS/PS 8 DATE ON WHICH THE FILE GOES TO HEAD CLERK 9 DATE ON WHICH FILE GOES TO A.R. 10 DATE OF DISPATCH OF ORDER