ACIT, New Delhi V. M/s. Ravnet Solutions Pvt. Ltd., New Delhi

ITA 6591/DEL/2013

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 2826 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 3 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-03-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 13-07-2017
• Assessment Year: 2007-2008
• Appeal Filed On: 11-12-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DEL ASSESSMENT YEARS
• Assessee Lawyers: VIJAY VERMA CITD R SHRI
• Keywords: Unexplained cash credit; Bogus Share capital; Income from undisclosed sources; Search and seizure; Share purchase agreement; Principle of natural justice; Period of limitation; Additional evidence; Question of law; Deemed dividend; Accommodation entries; Assessment record; Block assessment; Right to appeal; Onus to prove
• Section: 143(3); 153A; 133(6); 131; 68; 148; 132; 139

Judgement Text

//FIT FOR PUBLICATION// SD/- SD/- A.M. J.M. IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES D : DELHI BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI O.P. KANT, ACCOUNTANT MEMBER ITA.NO.6589, 6590, 6591 & 6592/DEL./2013 ASSESSMENT YEARS 2005-06, 2006-07, 2007-08 & 2008-2 009 THE ACIT, CENTRAL CIRCLE-IX, ROOM NO.357, ARA CENTRE, JHANDEWALAN EXTENSION, NEW DELHI 110 055. VS. M/S. RAVNET SOLUTIONS PVT. LTD., C/O. M/S. RRA TAX INDIA, D-28, SOUTH EXTN-1, NEW DELHI 110 049. (APPELLANT) (RESPONDENT) FOR REVENUE : SHRI VIJAY VERMA, CIT-D.R. FOR ASSESSEE : SHRI ASHWANI TANEJA & SHRI SHANTHU JAIN, ADVOCATES DATE OF HEARING : 15.02.2018 DATE OF PRONOUNCEMENT : 16.03.2018 ORDER PER BHAVNESH SAINI, J.M. ALL THE APPEALS BY REVENUE ARE DIRECTED AGAINST DIFFERENT ORDERS OF THE LD. CIT(A)-XXXII, NEW DELHI , DATED 17 TH SEPTEMBER, 2013, FOR THE A.YS. 2005-2006, 2006-2007 , 2007- 2008 AND 2008-2009, CHALLENGING THE DELETION OF ADD ITIONS OF RS.1,52,08,500, RS.96 LAKHS, RS.58,10,000 AND RS.2, 46,91,500 2 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. ON ACCOUNT OF BOGUS SHARE CAPITAL AND SHARE PREMIUM MADE BY A.O. BY TREATING THEM AS UNEXPLAINED CASH CREDITS, UNDER SECTION 68 OF THE I.T. ACT, 1961, RESPECTIVELY IN A LL THE ASSESSMENT YEARS UNDER APPEAL. 2. WE HAVE HEARD THE LEARNED REPRESENTATIVES OF BO TH THE PARTIES AND PERUSED THE MATERIAL ON RECORD. LEA RNED REPRESENTATIVES OF BOTH THE PARTIES SUBMITTED THAT FACTS AND ISSUES ARE SAME IN ALL THE APPEALS. THEREFORE, FOR THE PURPOSE OF DISPOSAL OF ALL THE DEPARTMENTAL APPEALS, THE FACTS ARE TAKEN FROM A.Y. 2005-2006 IN ITA.NO.6589/DEL./2013. ITA.NO.6589/DEL./2013 A.Y. 2005-2006 : 3. BRIEFLY, THE FACTS OF THE CASE ARE THAT SEARCH AND SEIZURE OPERATION UNDER SECTION 132 OF THE I.T. ACT , WAS CONDUCTED BY DIRECTORATE OF INTELLIGENCE ON 26 TH MARCH, 2010 IN ASEEM GUPTA GROUP OF CASES AT VARIOUS PREMISES OF A SEEM KUMAR GUPTA, C.A, WHO WAS, ALLEGEDLY, PROVIDED ACCOMMODATION ENTRIES TO SEVERAL BENEFICIARIES. SEA RCH AND SURVEY COVERED THE PREMISES OF SEVERAL BENEFICIARIE S INCLUDING 3 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. THAT OF THE ASSESSEE. THE A.O. ISSUED NOTICE UNDER SECTION 153A OF THE I.T. ACT. IN RESPONSE THERETO, ASSESSEE FILE D RETURN FOR THE ASSESSMENT YEAR UNDER APPEAL, DECLARING INCOME OF R S.3,929/- THE ASSESSEE HAD EARLIER FILED RETURN UNDER SECTION 139 OF THE I.T. ACT DECLARING INCOME OF RS.3,929/- WHICH WAS P ROCESSED UNDER SECTION 143(1) OF THE I.T. ACT. THE A.O. NOTE D THAT ASSESSEE HAS SHOWN RECEIPT OF SUM OF RS.10,13,900/- AS SHARE CAPITAL AND RS.1,41,94,600/- AS SHARE PREMIUM. THE ASSESSEE WAS ASKED TO FILE EVIDENCES TO ESTABLISH THE IDENTI TY AND CAPACITY OF THE PERSONS WHO HAD GIVEN HIM SHARE CAPITAL AND SHARE PREMIUM. THE ASSESSEE WAS ASKED TO FURNISH COPY OF THE ITR, BANK STATEMENT WITH THEIR NAMES AND ADDRESSES FROM WHOM SHARE APPLICATION MONEY WAS RECEIVED ALONG WITH THE REASONS AND BASIS FOR ISSUE OF SHARES AT HIGH PREMIUM. THE A.O. NOTED THAT ASSESSEE HAS FAILED TO FURNISH ANY EVIDENCE TO ESTABLISH IDENTITY AND CAPACITY OF THE PERSONS, WHO HAVE GIVE N SHARE CAPITAL AND SHARE PREMIUM TO THE ASSESSEE. THE A.O, THEREFORE, MADE ADDITION OF RS.1,52,08,500/- CONSIDERING IT TO BE THE UNEXPLAINED INCOME OF ASSESSEE UNDER SECTION 68 OF THE I.T. ACT, 4 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. 1961. THE A.O. COMPLETED THE ASSESSMENT UNDER SECTI ON 143(3) R.W.S. 153A OF THE I.T. ACT, 1961 DATED 23 RD DECEMBER, 2011. SIMILAR ADDITIONS WERE MADE IN REMAINING ASSESSMENT YEARS. 4. THE ASSESSEE CHALLENGED THE FINDINGS OF THE A.O . AND ABOVE ADDITION BEFORE LD. CIT(A). THE ASSESSEE RAIS ED SEVERAL GROUNDS OF APPEAL BEFORE THE LD. CIT(A) STATING THE REIN THAT ASSESSMENT ORDER IS PASSED IN VIOLATION OF PRINCIPL ES OF NATURAL JUSTICE AND THAT IMPUGNED ASSESSMENT ORDER IS FRAME D WITHOUT JURISDICTION AS PER LAW, TOTALLY ILLEGAL AND VOID ABINITIO . NO CROSS- EXAMINATION HAVE BEEN ALLOWED TO THE ASSESSEE. IT W AS SUBMITTED THAT ADDITION HAVE BEEN MADE WITHOUT RECO VERY OF INCRIMINATING MATERIAL FOUND DURING THE COURSE OF S EARCH. THEREFORE, ASSESSMENT IS BAD IN LAW. THE ASSESSEE A LSO FILED APPLICATION UNDER RULE 46A OF I.T. RULES FOR ADMISS ION OF ADDITIONAL EVIDENCES. THE ASSESSEE FILED ADDITIONAL EVIDENCE IN THE PAPER BOOK AND IT WAS SUBMITTED THAT A.O. ISSUE D SHOW CAUSE NOTICE DATED 09 TH DECEMBER, 2011 AND FIXED THE CASE FOR 16 TH DECEMBER, 2011. THE NOTICE WAS RECEIVED BY THE ASS ESSEE 5 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. IN THE EVENING OF 14 TH DECEMBER, 2011. THE ASSESSEE BROUGHT THIS FACT ABOUT LATE SERVICE OF THE NOTICE TO THE A .O. VIDE LETTER DATED 15 TH DECEMBER, 2011 AND REQUESTED TO GRANT TIME UP-TO 23 RD DECEMBER, 2011 TO FILE REQUIRED DETAILS. HOWEVER, THE A.O. WITHOUT CONSIDERING THE REQUEST OF THE ASSESSEE, PA SSED THE IMPUGNED ASSESSMENT ORDER ON 23 RD DECEMBER, 2011. THUS, IT WAS A CASE, WHERE ADEQUATE OPPORTUNITY OF HEARING W AS NOT ALLOWED TO THE ASSESSEE. THE ASSESSEE, THEREFORE, R EQUESTED THAT ADDITIONAL EVIDENCES MAY BE ADMITTED WHICH ARE CONF IRMATION OF ACCOUNTS OF ALL THE THREE INVESTORS I.E., (1) M/S. KMC PORTFOLIO PVT. LTD., (2) CHOTTI LEASING & FINANCING LEASING P VT. LTD., AND (3) MODERATE CREDIT CORPORATION LTD., WITH COPY OF THE BOARD RESOLUTION, COPY OF FORM NO.2, COPY OF COMPANY MAST ER DATA OF ALL THE INVESTORS, COPY OF PAN, ITR, CERTIFICATE OF INCORPORATION, BANK STATEMENTS, SHARE APPLICATION F ORM WITH RESOLUTION OF ALL THE INVESTORS. THE ASSESSEE RELIE D UPON SEVERAL DECISIONS IN SUPPORT OF THE CONTENTION THAT ADDITIO NAL EVIDENCE MAY BE ADMITTED. 6 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. 4.1. THE LD. CIT(A) SENT THESE ADDITIONAL EVIDENCE S TO THE A.O. FOR HIS EXAMINATION AND TO OFFER HIS COMMENTS. THE A.O. FILED HIS REMAND REPORT WHICH IS REPRODUCED IN THE IMPUGNED APPELLATE ORDER, IN WHICH HE HAS BRIEFLY EXPLAINED THAT ASSESSEE ATTENDED BEFORE HIM IN THE REMAND PROCEEDINGS WITH ALL THE SUPPORTING DOCUMENTS ON WHICH ASSESSEE RELIED UPON. THE ASSESSEE PRODUCED THE BOOKS OF ACCOUNT AND SUPPORTI NG EVIDENCES. IT WAS EXPLAINED THAT EARLIER NOTICES WE RE ALSO ISSUED, WHICH WERE NOT COMPLIED WITH BY THE ASSESSEE. THE A SSESSEE WAS PROVIDED COPY OF SEIZED MATERIAL SEIZED FROM THE O/ O. SHRI ASEEM KUMAR GUPTA. THE ASSESSEES LETTER DATED 15 TH DECEMBER, 2011, SEEKING ADJOURNMENT IS AVAILABLE ON RECORD. THE A.O, THEREFORE, OBJECTED TO THE FILING OF THE A DDITIONAL EVIDENCES. REPLY OF ASSESSEE SENT THROUGH SPEED POS T ON 23.12.2011 HAS BEEN RECEIVED IN OFFICE ON 26.12.201 1. 4.2. WITH REGARD TO THE MERITS, THE A.O. CONFIRMED THAT ASSESSEE PRODUCED THE ABOVE DOCUMENTARY EVIDENCES T O PROVE IDENTITY OF THE INVESTORS, THEIR CREDITWORTHINESS A ND 7 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. GENUINENESS OF THE TRANSACTION IN THE MATTER. BUT S TATUS OF THESE COMPANIES ARE DOUBTFUL. THE A.O. IN THE REMAN D REPORT STATED THAT ASSESSMENTS IN THE CASES OF CHOTTI LEAS ING & FINANCING LEASING PVT. LTD., AND MODERATE CREDIT CO RPORATION LTD., WERE COMPLETED IN HIS CIRCLE UNDER SECTION 15 3A/153C OF THE I.T. ACT AND M/S. KMC PORTFOLIO PVT. LTD., IS A PPARENTLY NOT RELATED TO SHRI ASEEM KUMAR GUPTA. THE DOCUMENTS AR E SIMILAR IN THE CASES OF ALL THE INVESTORS. SINCE, SHRI ASEE M KUMAR GUPTA STATED IN HIS STATEMENT THAT HE HAS PROVIDED ACCOMMODATION ENTRIES, THEREFORE, THERE WERE NO REA SON FOR HIM TO DIFFER WITH THE ORDER OF THE A.O. 4.3. THE ASSESSEE FILED REJOINDER IN WHICH ALL THE FACTS STATED EARLIER WERE REITERATED AND IT WAS SUBMITTED THAT ASSESSEE PROVED THE IDENTITY AND CREDITWORTHINESS OF THE INV ESTORS. NO DEFECTS HAVE BEEN POINTED OUT IN THE DOCUMENTS FILE D BY THE ASSESSEE. NOTHING WAS FOUND DURING THE COURSE OF SE ARCH AGAINST THE ASSESSEE. THE A.O. IN THE REMAND REPORT ADMITTED THAT THIS CIRCLE ASSESSED TWO OF THE INVESTORS AND THAT THERE IS 8 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. NO RELATION BETWEEN THE INVESTOR AND SHRI ASEEM KUM AR GUPTA. THE ASSESSEE RELIED UPON SEVERAL DECISIONS OF HONB LE JURISDICTIONAL DELHI HIGH COURT AND OTHERS IN SUPPO RT OF THE CONTENTION THAT IT HAS PROVED THE CONDITIONS OF SEC TION 68 OF THE I.T. ACT, 1961. 4.4. THE LD. CIT(A) CONSIDERING THE MATERIAL ON RE CORD IN THE LIGHT OF REMAND REPORT OF THE A.O. ADMITTED THE ADDITIONAL EVIDENCES AS PER RULE 46A OF THE I.T. ACT BECAUSE S AME WERE RELEVANT AND VITAL AND GOES TO THE ROUTE OF THE MAT TER. IT MAY BE NOTED HERE THAT THE REVENUE DEPARTMENT DID NOT CHAL LENGE THESE FINDINGS OF THE LD. CIT(A) IN THE DEPARTMENTA L APPEALS ADMITTING THE ABOVE ADDITIONAL EVIDENCES. 4.5. THE ASSESSEE FURTHER SUBMITTED BEFORE LD. CIT (A) THAT THE ADDITIONS HAVE BEEN MADE IN THE ASSESSMENT ORDE R WHICH WERE NOT BASED UPON ANY MATERIAL OR EVIDENCE FOUND AS A RESULT OF SEARCH BUT WERE MADE ON THE BASIS OF THE RETURN OF INCOME ALREADY FILED ENCLOSED WITH THE AUDIT REPORT, SHOWI NG SHARE CAPITAL AND SHARE PREMIUM. THEREFORE, NO ASSESSMENT COULD BE 9 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. FRAMED UNDER SECTION 153A OF THE I.T. ACT. THE ASSE SSEE RELIED UPON SEVERAL DECISIONS IN SUPPORT OF HIS CONTENTION . THE LD. CIT(A) HOWEVER, NOTED THAT SEARCH WAS CONDUCTED IN THE CASE OF THE ASSESSEE AND ITS DIRECTORS. THEREFORE, SECTION 153A IS APPLICABLE TO FRAME THE ASSESSMENT AGAINST THE SEAR CHED PERSON UNDER SECTION 153A OF THE I.T. ACT. THE LD. CIT(A) FOLLOWING THE DECISION OF THE DELHI HIGH COURT IN THE CASE OF ANI L KUMAR BHATIA, REJECTED THE CONTENTION OF ASSESSEE. THE LD . CIT(A) ALSO NOTED THAT AFTER SEARCH AND SEIZURE OPERATION, IT I S MANDATORY TO INITIATE PROCEEDINGS UNDER SECTION 153A OF THE I .T. ACT. THIS GROUND OF APPEAL OF ASSESSEE WAS DISMISSED BY THE L D. CIT(A). 5. AS REGARDS ADDITION OF RS.1,52,86,500 MADE UNDE R SECTION 68 OF THE I.T. ACT, THE ASSESSEE FILED DETA ILED WRITTEN SUBMISSIONS, SUPPORTED BY EVIDENCE AND CASE LAW TO EXPLAIN THAT ADDITION ON MERIT IS WHOLLY UNJUSTIFIED. THE W RITTEN SUBMISSIONS OF THE ASSESSEE WERE REPRODUCED IN THE APPELLATE ORDER, WHICH READS AS UNDER : 10 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. 15. IN THE COURSE OF APPEAL PROCEEDINGS THE A.R OF THE APPELLANT FILED THE FOLLOWING WRITTEN SUBMIS SIONS: 'LD. CIT(A). AO HAS MADE AN ADDITION OF RS.10,13,900/- AS UNEXPLAINED SHARE CAPITAL AND FURTHER A SUM OF RS.1,41,94,600/- ON ACCOUNT OF UNEXPLAINED PREMIUM U/S 68. FIRST, IT IS SUBMITTED AS WAS SUBMITTED EARLIER ALS O THAT IMPUGNED ADDITION HAS BEEN MADE DEHORS THE SEIZED MATERIAL WHICH IS EVIDENT FROM THE PLAIN READING OF THE ASSESSMENT ORDER AND WHICH READS THAT THE ADDITION IS BEING MADE ON THE BASIS OF SUMS APPEARING IN THE BOOKS OF ACCOUNTS. THEREFORE, IN VIEW OF THE SPECIA L BENCH DECISION IN THE CASE OF ALL CARGO GLOBAL LOGI STICS LTD. VS. DCIT IN ITA NO'S 5018 TO 5022 & 5059/M/10 DATED 06-07-2012, IMPUGNED ADDITION COULD NOT BE MADE IN THE PRESENT PROCEEDING U/S 153A. EVEN ON MERIT, IT IS SUBMITTED THAT ASSESSEE HAS FI LED EXHAUSTIVE EVIDENCES OF THE IMPUGNED SHARE CAPITAL AND SHARE PREMIUM WHICH ARE HELD IN THE PAPER BOOK (PB 39- 80). YOUR GOOD SELF WOULD KINDLY SEE FROM THE PERUSAL OF THESE DETAILS THAT THE DETAILS FURNISHED SHOW NOT ONLY THE NAMES OF THE SHAREHOLDERS BUT ALSO THE IR ADDRESSES, OCCUPATIONS AND PAN NUMBERS (PB39). 11 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. THE APPELLANT FURNISHED APART FROM THE ABOVE DETAIL S, THE COPIES OF SHARE APPLICATION FORMS, INCORPORATIO N CERTIFICATE, COPY OF PAN CARD, COPIES OF BANK STATE MENTS AND COPY OF COMPANY MASTER DETAILS DOWNLOADED FROM THE ROC WEBSITE, COPY OF FORM NO. 2 ALONG WITH THE COPY OF RESOLUTION PASSED BY THE APPELLANT COMPANY. COPIES OF THESE EVIDENCES ARE ENCLOSED IN THE PAPER BOOK AND ARE DETAILED AS UNDER :- S. NO. NAME OF THE SHAREHOLDERS APPLICATION FOR SHARE CERTIFICATE OF INCORPORATION PAN/ ITR BANK STATEMENT COMPANY MASTER DETAILS RESOLUTION CONFIRMATION OF ACCOUNTS 1. KMC PORTFOLIO PVT. LTD., (EARLIER PRAKRITI SOFTEK PVT. P. LTD.) 64 63 55 57-63 52 65 44 2. CHOTTI LEASING & FINANCE PVT. LTD., 74 -- 66.67 70-73 53 75 43 3. SUMA FINANCE & INVESTMENT LTD., (NOW MODERATE CREDIT CORPORATION LTD.) 79 76 77 80 54 78 42 PB 45-48 IS THE COPY OF BOARD RESOLUTION. PB 49-51 IS THE COPY OF FORM NO. 2 IN THE LIGHT OF THESE EVIDENCES, IMPUGNED ADDITION COULD NOT BE MADE IN VIEW OF THE FOLLOWING JURIDICA L DECISIONS: 12 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. 1. CIT VS. GOELSONS GOLDEN ESTATE PVT. LTD.(DHC) IN ITA NO. 212/2012 2. CIT VS. DWARKADHISH INVESTMENT PVT. LTD. (2011) 330 ITR 298. INCOMECASH CREDITSHARE APPLICATION MONEY THOUGH IN S. 68 PROCEEDINGS, THE INITIAL BURDEN OF PROOF LIES ON THE ASSESSEE YET ONCE HE PROVES THE IDENTITY OF THE CREDITORS/SHARE APPLICANTS BY EITHE R FURNISHING THEIR PAN OR INCOME-TAX ASSESSMENT NUMBER AND SHOWS THE GENUINENESS OF TRANSACTION BY SHOWING MONEY IN HIS BOOKS EITHER BY ACCOUNT PAYEE CHEQUE OR BY DRAFT OR BY ANY OTHER MODE, THEN THE ONUS OF PROOF WOULD SHIFT TO THE REVENUEJUST BECAUSE THE CREDITORS/SHARE APPLICANTS COULD NOT BE FOUND AT THE ADDRESS GIVEN, IT WOULD NOT GIVE THE REVENUE THE RIGHT TO INVOKE S. 68 REVENUE HAS ALL THE POWER AND WHEREWITHAL TO TRACE ANY PERSON MOREOVER, IT IS SETTLED LAW THAT THE ASSESSEE NEED NOT TO PROVE THE 'SOURCE OF SOURCE ' IN THE INSTANT CASE, THE TRIBUNAL HAS CONFIRMED THE ORDER OF THE CIT(A) DELETING THE IMPUGNED ADDITION HOLDING THAT THE ASSESSEE HAS BEEN ABLE TO PROVE THE IDENTITY OF THE SHARE APPLICANTS AND THE SHARE APPLICATION MONEY HAS BEEN RECEIVED BY WAY OF ACCOUNT PAYEE CHEQUESNO QUESTION OF LAW ARISES. 13 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. 3. CIT VS. WINSTRAL PETROCHEMICALS (P) LTD.: (2011) 330 ITR 603 INCOMECASE CREDITSHARE APPLICATION MONEY ASSESSEE COMPANY WAS FOUND TO HAVE RECEIVED THE MONEY THROUGH BANKING CHANNELSASSESSEE COMPANY ALSO FURNISHED WRITTEN CONFIRMATIONS FROM THE APPLI CANT COMPANIES, COPIES OF CERTIFICATES OF INCORPORATION, PAN CARDS, PAN DETAILS AND COMPANY DETAILS ETC. OF THE APPLICANTSFINDING OF TRIBUNAL THAT IDENTITY OF THE SUBSCRIBERS STOOD DULY ESTABLISHED FROM THE DOCUMENTS PRODUCED BY THE ASSESSEE, CANNOT BE SAID TO BE PERVERSETHERE IS NO LEGAL BAR TO MORE THAN ONE COMPANY BEING REGISTERED AT THE SAME ADDRESS MERELY BECAUSE THE APPLICANTS DID NOT RESPOND TO TH E NOTICES SENT TO THEM, AO WAS NOT JUSTIFIED IN ADDIN G THE AMOUNT OF SHARE APPLICATION MONEY TO THE INCOME OF THE ASSESSEE. 4. KAMDHENU STEEL & ALLOYS LTD. (DHC) : 248 CTR 33. 5. CIT VS. OASIS HOSPITALITIES PVT. LTD., (DHC): 333 ITR 119. INCOME CASH CREDITSHARE APPLICATION MONEY THOUGH THE SHARE APPLICANTS WERE NOT PRODUCED IN SP ITE OF SPECIFIC DIRECTION OF THE AO, ASSESSEE COMPANY H AS 14 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. FILED COPIES OF PAN, ACKNOWLEDGEMENT OF RETURNS OF THE SHARE APPLICANTS AND THEIR BANK ACCOUNT STATEMENTS OF THE RELEVANT PERIOD WHEN THE CHEQUES WERE CLEARED THUS, PRIMARY ONUS WAS DISCHARGED BY THE ASSESSEE ASSESSEE WAS NOT CONFRONTED WITH THE INVESTIGATION CARRIED OUT BY THE INVESTIGATION WING OR GIVEN ANY OPPORTUNITY TO CROSS-EXAMINE THE PERSONS WHOSE STATEMENTS WERE RECORDED BY THE INVESTIGATION WING TO DRAW ADVERSE CONCLUSION AGAINST THE ASSESSEEAS REGARDS DISCREPANCIES IN THE BANK STATEMENTS, THESE STATEMENTS WERE PROVIDED BY THE SHAREHOLDERS AND WE RE PRINTED ON THE BANK STATIONERY ASSESSEE WAS NEVER CONFRONTED WITH THESE DISCREPANCIES BY THE AOIN AN Y CASE, IT DOES NOT FOLLOW FROM THESE DISCREPANCIES T HAT THE AMOUNT OF SHARE CAPITAL WAS UNDISCLOSED INCOME OF T HE ASSESSEEEVEN THE CORRECT BANK STATEMENTS AS CLAIME D BY THE AO SHOW THAT THE ASSESSEE HAS RECEIVED CHEQU ES FROM THE SHAREHOLDERS THOUGH SOURCE OF CASH DEPOSITS IN THE BANK ACCOUNTS OF SOME SHAREHOLDERS IS QUESTIONABLE, AO HAS NOT FURTHER PROBED THE MATTER THEREFORE, REMEDY LIES IN REOPENING THE CASE OF THE SE INVESTORS AND ADDITION CANNOT BE MADE IN THE HANDS OF THE ASSESSEE. 15 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. IT IS, THEREFORE, PRAYED THAT THE IMPUGNED ADDITION MAY PLEASE BE DELETED. ADVERSE OBSERVATIONS OF LD. A.O. ARE MET AS UNDER : - 1. LD. A.O. HAS MENTIONED THAT ASSESSEE HAS NOT FURNISHED THE EVIDENCES TO PROVE THE IDENTITY AND CAPACITY OF THE SHAREHOLDERS AND GENUINENESS OF THE TRANSACTIONS. IN REPLY, IT IS RESPECTFULLY SUBMITTED THAT THE DET AILS AND EVIDENCES WERE FILED BY THE APPELLANT ALONG WITH IT S LETTER DATED 23.12.2011(PB 39-41) WHICH, IT APPEARS, HAS NOT BEEN CONSIDERED BY THE ID. A.0 EVEN THOUGH THE ASSESSMENT ORDER HAS BEEN PASSED ON 23.12.2011 ONLY THOUGH IT WAS SERVED ON 29.12.2011. IT MAY PLEASE BE APPRECIATED THAT ASSESSEE ALONG WI TH OTHER GROUPS OF COMPANIES AND THEIR DIRECTORS WERE BEING REPRESENTED BY THE SAME AR, NAMELY MR. RAM AVTAR AGARWAL AND BECAUSE OF SIMULTANEOUS PROCEEDIN G BEING UNDERTAKEN AND AR BEING ONE, THERE WAS SOME DELAY IN FURNISHING THE INFORMATION. BUT THE LAST L ETTER WAS SERVED ON THE ASSESSEE IN THE EVENING OF A DAY PRIOR TO THE DATE OF HEARING AND ON THAT ADJOURNMENT WAS SOUGHT IN WRITING AND THEREAFTER THE ABOVE LETTER D ATED 23.12.2011 WAS FILED BEFORE LD. AO. 16 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. 1. LD.AO HAS MENTIONED THAT ASSESSEE HAD NOT FURNISHED THE JUSTIFICATION FOR PREMIUM. IN REPLY, IT IS SUBMITTED THAT SHARES WERE OFFERED AT PREMIUM IN VIEW OF THE FACT THAT THE APPELLANT COMP ANY WAS HAVING VERY GOOD ORDERS IN HAND AND WAS HAVING VERY BRIGHT FUTURE AND I.E. WHY THE BOARD PASSED A RESOLUTION A COPY OF WHICH WAS FILED TO LD. A.0. TA KING INTO ACCOUNT THESE FACTORS (PB 45). IN ANY CASE, THE ISSUANCE OF SHARES AT A PRICE IS THE PREROGATIVE OF THE ISSU ING COMPANY IN THE INVITATION OF OFFER. ANY SHAREHOLDER WHO IS WILLING TO BUY SHARES AT THAT PRICE MAKES OFFER WHICH IN TURN IS ACCEPTED BY THE COMPANY. THERE ARE NO STATU TORY RESTRICTIONS AND IT IS SOMETHING WHICH FALLS WITHIN THE DOMAIN OF CONTRACTUAL TERMS. THEREFORE, WHEN HAVING REGARD TO THE BRIGHT FUTURE BASED UPON IT PERCEPTIO N OF THE EVENTS, THE APPELLANT COMPANY INVITED OFFERS AT A PREMIUM, IT IS FOR THE PROSPECTIVE SHAREHOLDER) TO JUDGE AND DECIDE AS TO WHETHER THE SHARE PREMIUM WAS JUSTIFIED FROM THEIR PERSPECTIVE AND WHEN THESE SHAREHOLDER SO DECIDE, THAT IS THE END OF THE MATTE R AND THE BUSINESS PRUDENCE OF THE INVESTOR IS NOT OPEN F OR QUESTIONING. THEREFORE, THIS OBJECTION OF AO THAT A SSESSEE DID NOT PROVIDE ANY RATIONALE FOR ISSUE OF SHARES A T HIGH PREMIUM IS MISPLACED. 17 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. 1. LD. AO HAS MENTIONED THAT ASSESSEE HAS TAKEN ACCOMMODATION ENTRIES FROM THE ENTITIES OWNED OR FU LLY CONTROLLED BY SHRI ASSEEM KUMAR GUPTA IN OTHER ASSESSMENT YEARS. IN REPLY, IT IS SUBMITTED THAT FIRST THERE IS NO BA SIS OR MATERIAL WITH LD. A.0 TO MAKE THIS ALLEGATION AND I N ANY CASE ACCORDING TO LD. A.0 HIMSELF, THERE IS NO ADVE RSE EVIDENCE FOR THIS YEAR. THEREFORE, ALL THE OBJECTIO NS OF LD. A.0 IN MAKING THE IMPUGNED ADDITION ARE BAD IN LAW. 5.1. THE LD. CIT(A) CONSIDERING THE EVIDENCES ON R ECORD, REMAND REPORT OF THE A.O. AND SUBMISSIONS OF THE AS SESSEE, DELETED THE ADDITION ON MERIT. THE FINDINGS OF THE LD. CIT(A) IN PARAS 16 TO 16.10 OF THE IMPUGNED ORDER ARE REPRODU CED AS UNDER : 16. I HAVE GONE THROUGH THE FACTS OF THE CASE, WRITTEN SUBMISSIONS OF THE APPELLANT, REMAND REPORT OF THE ASSESSING OFFICER AND THE REJOINDER OF THE APPELLAN T. I HAVE ALSO PURSUED THE CASE LAWS RELIED UPON BY THE APPELLANT. HERE, FOR THE SAKE OF CONVENIENCE, IT WO ULD BE APPROPRIATE TO EXTRACT THE RELEVANT PORTION OF THE ASSESSING OFFICER COMMENTS ON THIS ISSUE. 18 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. DURING THE YEAR UNDER CONSIDERATION ASSESSEE COMPAN Y RECEIVED SHARE CAPITAL OF RS.10,13,900/- AND SHARE PREMIUM O F RS.L,41,94,600/- FROM FOLLOWING THREE COMPANIES, BY ISSUING 1,01,390 NUMBER OF SHARES OF RS. 10/-EACH AT A PREMIUM OF RS .140/- PER SHARE: D) KMC PORTFOLIO PVT. LTD., RS.88,80,000/- E) CHOTTI LEASING & FINANCE PVT. LTD., RS.55,78,50 0/- F) SUMA FINANCE & INVESTMENT LTD., RS. 7,50,000/ - (NOW KNOWN AS MODERATE CREDIT CORPORATION LTD). THE AO MADE THE ADDITION AS THE ASSESSEE FAILED TO FILED ANY EVIDENCE TO ESTABLISH THE IDENTITY AND CAPACITY OF PERSONS WHO HAD GIVEN THE SHARE CAPITAL AND SHARE PREMIUM, AND FAIL ED TO ESTABLISH THE GENUINENESS OF THE TRANSACTIONS. WITH REPLY DATED 23.12.2011, ASSESSEE FURNISHED FOL LOWING EVIDENCES: 7) COPY OF CONFIRMATION OF SHARE HOLDER WITH THEIR PA N AND PLACE OF ASSESSMENT. 8) COPY OF BANK STATEMENT 9) COPY OF FORM NO. 2 FILED WITH ROC 10) COPY OF RESOLUTION REGARDING ALLOTMENT OF SHARES. 11) DETAILS OF SHARES HOLDERS, GIVING THE LATEST ADDRES S AND OTHER PARTICULARS DOWNLOADED FROM THE SITE OF ROC. 19 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. 12) COPY OF ITR OF THE SUBSCRIBERS TO SHARE CAPITAL FOR ASSTT. YEAR 11-12 IN RESPECT OF M/S. KMC PORTFOLIO PVT. LTD. AN D M/S. CHOTTI LEASING & FINANCE (P) LTD., AND FOR AY2007-0 8 IN THE CASE OF M/S. MODERATE CREDIT CORPORATION LIMITED. THE ASSESSEE HAS FURNISHED ABOVE MENTIONED DOCUMENT S TO PROVE THE IDENTITY, CAPACITY, GENUINENESS OF THE TRANSACTIONS , AND CREDITWORTHINESS OF PARTIES. HOWEVER, THE STATUS OF THESE COMPANIES IS STILL DOUBTFUL IN VIEW OF THE NATURE OF DOCUMENT S SUBMITTED DURING THE REMAND PROCEEDINGS, AND DOCUMENTS FOUND DURING THE COURSE OF SEARCH AND SEIZURE OPERATION OF SHRI ASEEM KUMAR GU PTA, WHO HAS ALSO CATEGORICALLY ADMITTED THAT THESE COMPANIES WE RE RUN BY HIM TO PROVIDE ACCOMMODATION ENTRIES. THE ASSESSMENTS IN T HE CASES OF M/S. CHOTTI LEASING & FINANCE (P) LTD., & M/S. MODERATE CREDIT CORPORATION LTD., WERE COMPLETED IN THIS CIRCLE U/S . 153A/153C, AND M/S. KMC PORTFOLIO PVT. LTD., IS THOUGH APPARENTLY NOT RELATED TO SHRI ASEEM KUMAR GUPTA, HOWEVER NATURE OF THE TRANS ACTIONS IN THE BANK ACCOUNT AND PAPERS SUBMITTED ARE APPARENTLY SI MILAR. ACCORDINGLY THERE SEEMS TO BE NO REASON TO DIFFER W ITH THE ORDER OF THE AO. 16.1. FROM THE COMMENTS OF THE ASSESSING OFFICER IN HIS REMAND REPORT, IT IS SEEN THAT THE ASSESSING OF FICER HAS EXAMINED THE ADDITIONAL EVIDENCES AND APPEARED TO BE SATISFIED WITH THE EVIDENCE FILED BY THE APPELLA NT. THE ASSESSING OFFICER HOWEVER, HAS OBSERVED THAT THE ST ATUS 20 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. OF THE COMPANIES WHO HAD SUBSCRIBED TO THE SHARE CA PITAL AND SHARE PREMIUM IS DOUBTFUL IN VIEW OF THE NATURE OF DOCUMENTS SUBMITTED DURING THE REMAND PROCEEDINGS A ND DOCUMENTS FOUND DURING THE COURSE OF SEARCH AND SEI ZURE OPERATION IN THE CASE OF SH. ASSEM KUMAR GUPTA, WHO HAD CATEGORICALLY ADMITTED THAT THESE COMPANIES WERE RU N BY HIM TO PROVIDE ACCOMMODATION ENTRIES. THIS OBSERVAT ION IS TOTALLY BASED ON SURMISES AND CONJECTURE. THE ASSES SING OFFICER HAS NOT BROUGHT ON RECORD ANY MATERIAL TO SUBSTANTIATE THIS OBSERVATION. NOT ONLY IN THE ASSE SSMENT PROCEEDINGS, BUT ALSO IN THE REMAND PROCEEDINGS THE ASSESSING OFFICER DID NOT MAKE ANY EFFORT TO CONDUC T ENQUIRIES TO FIND OUT THE STATUS OF THESE COMPANIES . THE ASSESSING OFFICER SHOULD HAVE ISSUED NOTICES U/S 13 3(6) TO THESE COMPANIES AND ALSO SUMMONED THE DIRECTORS OF THESE COMPANIES U/S 131 AND RECORDED THEIR STATEMEN TS. THIS WAS NOT DONE BY THE ASSESSING OFFICERS. THE ASSESSING OFFICER HAS MERELY RELIED ON THE REPORT O F THE INVESTIGATION WING FOR HIS OBSERVATION THAT THESE COMPANIES WERE RUN BY SH. ASSEM KUMAR GUPTA TO PROVIDE ACCOMMODATION ENTRIES. MOREOVER, THERE IS A CONTRADICTION BY THE ASSESSING OFFICER HIMSELF SO F AR AS HIS OBSERVATION IS CONCERNED ON THIS ISSUE. IN THE VERY NEXT SENTENCE AFTER HIS OBSERVATION, THE ASSESSING OFFIC ER HAS STATED THAT ASSESSMENTS IN THE CASES OF M/S CHOTTI LEASING 21 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. & FINANCE (P) LIMITED & M/S MODERATE CREDIT CORPORA TION LTD, WERE COMPLETED IN THIS CIRCLE U/S 153A/153C, A ND M/S KMC PORTFOLIO PVT LTD, IS THOUGH APPARENTLY NOT REL ATED TO SHRI ASEEM KUMAR GUPTA, HOWEVER NATURE OF THE TRANS ACTIONS IN THE BANK ACCOUNT AND PAPERS SUBMITTED ARE APPARE NTLY SIMILAR. THEREFORE, ON THE BASIS OF SUCH CONTRADICTORY OBSERVATIONS IT IS NOT UNDERSTOOD AS TO HOW THE AO COULD JUSTIFY HIS FINDINGS IN THE ASSESSMENT ORDER. 16.2. ON PERUSAL OF THE ASSESSMENT RECORD, I FIND THAT THE APPELLANT HAD ALSO FILED THESE ADDITIONAL EVIDENCES ON 26.12.2011 BEFORE THE ASSESSING OFFICE R VIDE ITS LETTER DATED 23.12.2011. HOWEVER, SINCE TH E ASSESSMENT ORDER WAS PASSED ON 23.12.2011, THE ASSESSING OFFICER DID NOT CONSIDER THESE EVIDENCES FILED BEFORE HIM ON 28.12.2011. 16.3. THE APPELLANT HAS FILED THE FOLLOWING DOCUMENTS AS ADDITIONAL EVIDENCES WHICH THE ASSESSI NG OFFICER HAS NOT EXAMINED DURING THE COURSE OF ASSES SMENT PROCEEDINGS : (I) COPIES OF CONFIRMATIONS OF ACCOUNTS OF M/S KMC PORTFOLIO (P) LTD, M/S CHOTTI LEASING & FINANCE (P) LTD AND M/S MODERATE CREDIT (P) LTD. 22 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. (II) COPY OF BOARD RESOLUTION. (III) COPY OF FORM NO.2 FILED WITH ROC. (IV) COPY OF COMPANY MASTER DATA OF M/S KMC PORTFOLIO (P) LTD, M/S CHOTTI LEASING & FINANCE (P) LTD AND M /S MODERATE CREDIT (P) LTD. (V) COPIES OF PANS, ITRS, CERTIFICATES OF INCORPORATI ON, BANK STATEMENTS, SHARE APPLICATION FORMS, RESOLUTIO N OF - (A) M/S KMC PORTFOLIO (P) LTD (B) M/S CHOTTI LEASING & FINANCE (P) LTD (C) M/S. MODERATE CREDIT (P) LTD. 16.4. ON THE BASIS OF ABOVE MATERIAL PLACED ON REC ORD, IT IS SEEN THAT THE APPELLANT HAS DISCHARGED ITS ON US COST UPON IT U/S 68 IN PROVING THE IDENTITY OF THE SUBSCRIBER COMPANIES; GENUINENESS OF THE TRANSACTION, NAMELY WHETHER IT HAS BEEN TRANSMITTED THROUGH BANKING OR OTHER INDISPUTABLE CHANNELS; AND CREDITWORTHINESS OF THESE SUBSCRIBERS. 16.5. THUS, THE THREE INGREDIENTS WHICH THE APPELL ANT COMPANY HAS TO FULFILL IN ACCORDANCE WITH THE PROVI SIONS OF SECTION 68 OF THE I.T. ACT, 1961 HAVE BEEN FULFILLE D IN THIS CASE. THE APPELLANT HAS A) ESTABLISHED THE IDENTITY OF THE 23 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. SUBSCRIBERS; B) PROVE THE GENUINENESS OF THE TRANSA CTIONS I.E WHETHER IT WAS TRANSMITTED THROUGH BANKING OR OTHER INDISPUTABLE CHANNELS; AND C) ESTABLISHED THE CREDITWORTHINESS OR THE FINANCIAL STRENGTH OF THE SUBSCRIBERS. I ALSO FIND THAT THE APPELLANT FURNISH ED COMPLETE DETAILS I.E., NAMES OF THE SHARE HOLDERS, THEIR ADDRESSES, OCCUPATION AND THEIR PANS. ON THE BASIS OF THE DOCUMENTARY EVIDENCES FILED BY THE APPELLANT, IN MY OPINION, THE APPELLANT HAS DISCHARGED ITS ONUS IN P ROVING THE TRANSACTIONS PERTAINING TO SHARE CAPITAL AND SH ARE PREMIUM. 16.6. ON PERUSAL OF THE DOCUMENTARY EVIDENCES FURNISHED BY THE APPELLANT, I FIND THAT ALL THE SUB SCRIBERS ARE CORPORATE ENTITIES WHO HAVE APPLIED FOR SHARES IN THE APPELLANT COMPANY AND THE SHARES WERE DULY ALLOTTED TO THEM THROUGH A RESOLUTION PASSED IN THE MEETING OF BOARD OF DIRECTORS OF THE COMPANY HELD ON 31ST DAY OF MAR CH 2005. THE RESOLUTION PASSED IN THE MEETING OF BOARD OF DIRECTORS OF THE COMPANY IS EXTRACTED BELOW: RESOLVED THAT, EQUITY SHARE OF RS.10/- EACH AT A P REMIUM OF RS.140/- PER SHARE BE ALLOTTED TO THE FOLLOWING : 24 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. S.NO. PARTICULAR PAN NO NO. OF SHARES RATE 1. M/S. KMC PORTFOLIO PVT. LTD., RZH-266, RAJ NAGAR, PART-II, PALAM, NEW DELHI 110 045. AACCP- 5345-A 59200 10/- AT PREMIUM 2. M/S. CHOTTI LEASING & FINANCE PVT. LTD., D-11, NANDA DEVI TOWER, CENTRAL MARKET, II FLOOR, PRASHANT VIHAR, DELHI 110 034. AABCC- 8851-H 37190 10/- AT PREMIUM 3. SUMA FINANCE & INVESTMENT PVT. LTD., (PRESENTLY KNOWN AS MODERATE CREDIT CORPORATION LTD.) 7-B, 1 ST FLOOR, DACRES LANE, KOLKATA. AAAACS- 0309-P 5000 10/- AT PREMIUM FURTHER RESOLVED THAT SH. R.P. SINGH A DIRECTOR OF THE COMPANY BE & HEREBY AUTHORIZE TO ISSUE THE SHARE CERTIFICATES UNDER THE COMMON SEAL OF THE COMPANY T O THE SHARE HOLDER NAME AS ABOVE, WHO HAVE BEEN ALLOTTED THE SHARE OF THE COMPANY. CERTIFIED TRUE COPY FOR RAVNET SOLUTIONS PVT. LTD., (DIRECTOR/AUTH SIGNATORY) 16.7. IN INSTANT CASE, I FIND THAT THE ASSESSING OFFICER HAS NOT BROUGHT ON RECORD ANY MATERIAL OR C OGENT EVIDENCE TO SUBSTANTIATE HIS OBSERVATIONS AND FINDI NGS GIVEN IN THE ASSESSMENT ORDER. THEREFORE, SUCH OBSERVATIONS AND FINDINGS ARE NOT ONLY VAGUE BUT AR E BASED ON MERE SURMISES AND CONJECTURE. THE ASSESSIN G OFFICER HAS NOT BROUGHT ON RECORD ANY ADVERSE MATER IAL AGAINST THE SUBMISSIONS MADE BY THE APPELLANT AND DOCUMENTARY EVIDENCE PLACED ON RECORD. BEFORE TREAT ING 25 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. THAT THE CREDIT ENTRIES REPRESENTING SHARE CAPITAL AND SHARE PREMIUM AS UN-EXPLAINED AND ADDING THEM U/S 6 8 OF THE I.T. ACT, 1961 IN THE HANDS OF THE APPELLANT , THE ASSESSING OFFICER WAS DUTY BOUND TO THOROUGHLY INVESTIGATE THE IDENTITY, CREDIT WORTHINESS AND GENUINENESS OF THE SUBSCRIBERS, WHICH HE FAILED TO DO SO. 16.8. REGARDING THE ASSESSING OFFICER'S OBSERVATIO N THAT THE APPELLANT HAS NOT FURNISHED ANY REASONS OR BASIS FOR ISSUANCE OF SHARES AT SUCH A HIGH PREMIUM, I FI ND THAT THE APPELLANT HAS GIVEN AN EXPLANATION ON THIS ISSU E IN ITS WRITTEN SUBMISSIONS. AS MENTIONED ABOVE, THESE WRIT TEN SUBMISSIONS WERE SENT TO THE ASSESSING OFFICER FOR THE EXAMINATION AND COMMENTS. HOWEVER, THE ASSESSING OFFICER IN HIS REMAND REPORT DID NOT COMMENT ON THE SE SUBMISSIONS OF THE APPELLANT. IT HAS BEEN EXPLAINED BY THE APPELLANT IN THE WRITTEN SUBMISSIONS THAT THE SHARE S WERE OFFERED AT PREMIUM IN VIEW OF THE FACT THAT THE APP ELLANT COMPANY WAS HAVING VERY GOOD ORDERS IN HAND AND WAS HAVING VERY BRIGHT FUTURE AND THAT IS WHY THE BOARD OF DIRECTORS PASSED A RESOLUTION TO ISSUE THE SHARE OF THE COMPANY AT PREMIUM. THE ISSUANCE OF SHARES AT PREMI UM IS THE PREROGATIVE OF THE ISSUING COMPANY IN AN INV ITATION OFFER. THERE IS NO STATUTORY RESTRICTION AND IT IS SOMETHING WHICH FALLS WITHIN THE DOMAIN OF CONTRACTUAL TERMS. IT IS 26 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. FOR THE PROSPECTIVE SHAREHOLDERS TO JUDGE AND DECID E AS TO WHETHER THE SHARE PREMIUM WAS JUSTIFIED FROM THEIR PERSPECTIVE AND WHEN THESE SHAREHOLDERS SO DECIDE, THERE THE MATTER ENDS AND THE BUSINESS PRUDENCE OF THE INVESTORS IS NOT OPEN FOR QUESTIONING. THEREFORE, I DO NOT FIND THIS AS A GOOD GROUND FOR THE ASSESSING OFFICE TO DISBELIEVE THAT THE SHARES OF THE APPELLANT COMPANY OF THE FACE VALUE OF RS.10/- WERE SOLD AT PREMIUM, WITHOUT BRINGING ADVERSE MATERIAL ON RECORD AGAINST THE APPELLANT. 16.9. IN THE INSTANT CASE, AS STATED ABOVE, THE APPELLANT HAD GIVEN NAMES AND ADDRESSES OF THE SUBSCRIBERS. THESE SUBSCRIBERS WERE INCOME TAX ASSESSES. THEIR TANS WERE IN THE FILE OF THE ASSESS ING OFFICER. IN SPITE OF ALL THESE DETAILS/ INFORMATION , THE ASSESSING OFFICER DID NOT PURSUE THE MATTER FURTHER TO VERIFY THE SAME. THERE WAS NO EFFORT MADE TO PURSUE THE SHARE SUBSCRIBERS OR TO CHECK THE VERACITY OF THE E VIDENCE FILED REGARDING THEIR TAX PROFILE. WHAT THE APPELLA NT COULD DO TO DISCHARGE ITS ONUS, IT HAD BEEN DONE AND IF T HE AO HAD ANY DOUBT, IT WAS HIS DUTY TO PROBE THE MATTER FURTHER TILL HE EXHAUSTED ALL MEANS TO DETECT ANY FALSITY O F THE APPELLANT. WHEN THE AO IS SATISFIED WITH THE EVIDEN CE FILED BY THE APPELLANT AND IF THE AO DID NOT BOTHER TO MA KE 27 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. FURTHER ENQUIRIES INDEPENDENTLY REGARDING THE SHARE SUBSCRIBERS, IT CANNOT BE SAID THAT THE APPELLANT F AULTED AND MAKE AN ADDITION. 16.10. THEREFORE, IN VIEW OF THE ABOVE DISCUSSION AND CONSIDERING THE FACTS OF THE CASE AS ALSO THE VARIOUS CASE LAWS RELIED UPON BY THE APPELLANT, I HOLD THAT THE ASSESSING OFFICER WAS NOT JUSTIFIED IN TRE ATING THE AMOUNT OF SHARE CAPITAL AND SHARE PREMIUM AS UN- EXPLAINED CREDITS U/S 68 OF THE I.T. ACT, 1961. ACC ORDINGLY, THE ADDITION OF RS.1,52,08,500/- (RS.47,90,000 + RS.4,30,31,800) MADE BY THE ASSESSING OFFICER IS DE LETED. THIS GROUND OF APPEAL IS ALLOWED. 5.2. THE LD. CIT(A) SIMILARLY DELETED ADDITIONS ON MERITS IN REMAINING ASSESSMENT YEARS IN APPEALS. 6. THE ASSESSEE, IN ALL THE DEPARTMENTAL APPEALS, MOVED PETITION UNDER RULE 27 OF THE APPELLATE TRIBU NAL RULES, SEEKING PERMISSION OF THE TRIBUNAL TO SUPPORT THE O RDER OF THE LD. CIT(A) ON THE GROUND THAT IN ANY CASE AND IN VIEW OF THE MATTER AND HAVING REGARD TO THE FACTS AND CIRCUMSTA NCES OF THE CASE, THE LD. CIT(A) OUGHT TO HAVE DELETED THE ADDI TION OF 28 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. RS.1,52,08,500 ON ACCOUNT OF SHARE CAPITAL INTER AL IA, ON THE GROUND THAT NO INCRIMINATING MATERIAL HAS BEEN FOUN D AS A RESULT OF SEARCH FOR MAKING THE IMPUGNED ADDITIONS AND THE REFORE, THE LD. CIT(A) OUGHT TO HAVE DELETED THE SAME ON THIS G ROUND ITSELF. 6.1. THE LEARNED COUNSEL FOR THE ASSESSEE SU BMITTED THAT THE ASSESSEE FILED ORIGINAL RETURN OF INCOME UNDER SECTION 139 OF THE I.T. ACT, ON 05 TH AUGUST, 2005, DECLARING INCOME OF RS.3929/- WHICH HAVE BEEN PROCESSED UNDER SECTION 1 43(1) OF THE I.T. ACT, 1961. COPY OF THE ACKNOWLEDGMENT OF F ILING OF THE RETURN IS FILED ON RECORD. HE HAS SUBMITTED THAT LD . CIT(A) HAS DELETED THE ADDITION ON MERIT AND ASSESSEE SEEKS TO SUPPORT THE ORDER OF THE LD. CIT(A) IN DELETING THE ADDITION ON THE GROUND THAT NO INCRIMINATING MATERIAL HAS BEEN FOUND AS A RESULT OF SEARCH BECAUSE ADDITION IS MADE IN ASSESSMENT UNDER SECTION 153A OF THE ACT, ON THE BASIS OF THE DETAILS SUBMIT TED IN ORIGINAL RETURN OF INCOME ALREADY FILED AND STOOD COMPLETED ON THE DATE OF THE SEARCH. NO ASSESSMENT WAS PENDING ON THE DAT E OF THE SEARCH. HE HAS SUBMITTED THAT IN CASE WHERE SOME IN TER- 29 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. CONNECTED GROUNDS ARE SUBJECT MATTER OF APPEAL, THE OTHER GROUND NOT SUBJECT MATTER OF THE APPEAL, CAN BE CON SIDERED AT THE INSTANCE OF THE RESPONDENT. HE HAS RELIED UPON THE FOLLOWING DECISIONS IN SUPPORT OF HIS CONTENTION. 6.2. DECISION OF JURISDICTIONAL DELHI HIGH COURT I N THE CASE OF CIT VS. EDWARD KEVENTER (SUCCESSORS) P. LTD ., (1980) 123 ITR 200 IN WHICH, IN PARA-9, IT WAS HELD AS UNDER : 9. IF A PARTY APPEALS, HE IS THE PARTY WHO COME S BEFORE THE TRIBUNAL TO REDRESS A GRIEVANCE ALLEGED BY HIM. IF THE OTHER SIDE HAS A GRIEVANCE, HE HAS A RIGHT TO F ILE A CROSS- APPEAL (AND UNDER THE CPC AND THE IT ACT OF 1961, A MEMORANDUM OF OBJECTIONS). BUT, IF NO SUCH THING IS DONE, HE IS DEEMED TO BE SATISFIED WITH THE DECISION. HE IS, THEREFORE, ENTITLED TO SUPPORT THE JUDGMENT OF THE FIRST OFFICER ON ANY GROUND BUT HE IS NOT ENTITLED TO RAISE A GRO UND WHICH WILL WORK ADVERSELY TO THE APPELLANT. IN FACT SUCH A GROUND MAY BE A TOTALLY NEW GROUND, IT IF IS PURELY ONE OF LAW, AND DOES NOT NECESSITATE THE RECORDING OF ANY EVIDENCE, EVEN 30 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. THOUGH THE NATURE OF THE OBJECTION MAY BE SUCH THAT IT IS NOT ONLY A DEFENCE TO THE APPEAL ITSELF BUT GOES FURTHE R AND MAY AFFECT THE VALIDITY OF THE ENTIRE PROCEEDINGS. BUT THE ENTERTAINMENT OF SUCH A GROUND WOULD BE SUBJECT TO THE RESTRICTION THAT EVEN IF IT IS ACCEPTED, IT SHOULD BE GIVEN EFFECT TO ONLY FOR THE PURPOSE OF SUSTAINING THE ORDER IN APPEAL AND DISMISSING THE APPEAL AND CANNOT BE MADE USE OF, TO DISTURB OR TO SET ASIDE, THE ORDER IN FAVOUR OF THE APPELLA NT [B.R. BAMASI VS. CIT (1972) 83 ITR 223 (BOM) ; TC8R. 911] RELIED ON. 6.3. DECISION OF HONBLE GUJARAT HIGH COURT IN THE CASE OF DAHOD SAHAKARI KHARID VECHAN SANGH LTD., VS. CIT (2 006) 282 ITR 321 (GUJ.) IN WHICH FOLLOWING QUESTION OF LAW W AS REFERRED:- 2. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE TRIBUNAL WAS RIGHT IN LAW IN HOLDING THAT IT WA S NECESSARY FOR ASSESSEE TO FILE CROSS OBJECTION IN S PITE OF FULLY SUCCEEDING IN APPEAL AND THEREFORE, IT CANNOT CHALLENGE THE FINDING BY THE CIT(A) OF ASSESSEE BEI NG GUILTY 31 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. OF CONCEALMENT OF INCOME AND/OR FURNISHING INACCURAT E PARTICULARS? 6.4. THE FINDINGS OF THE HONBLE GUJARAT HIGH COUR T ON THIS QUESTION IN PARAS 17 TO 21 OF THE JUDGMENT READS AS UNDER : 17. TAKING UP THE SECOND ISSUE FIRST. THE TRIBUNA L HAS COMMITTED AN ERROR IN LAW IN HOLDING THAT THE ASSES SEE HAVING NOT FILED CROSS OBJECTION AGAINST FINDINGS ADVERSE TO THE ASSESSEE IN THE ORDER OF COMMISSIONE R (APPEALS), THE SAID FINDINGS HAD BECOME FINAL AND REMAINED UNCHALLENGED. THE TRIBUNAL APPARENTLY LOST SIGHT OF THE FACT THAT THE ASSESSEE HAD SUCCEEDED BEFORE THE COMMISSIONER (APPEALS). THE APPEAL HAD BEEN ALLOWED AND THE PENALTY LEVIED BY THE ASSESSIN G OFFICER DELETED IN ENTIRETY. IN FACT, THERE WAS NO OCCASION FOR THE ASSESSEE TO FEEL AGGRIEVED AND HEN CE, IT WAS NOT NECESSARY FOR THE ASSESSEE TO PREFER AN APPEAL. THE POSITION IN LAW IS WELL-SETTLED THAT A CROSS OBJECTION, FOR ALL INTENTS AND PURPOSES, WOULD AMOU NT TO AN APPEAL AND THE CROSS OBJECTOR WOULD HAVE THE SAME RIGHTS WHICH AN APPELLANT HAS BEFORE THE TRIBUNAL. 18. SECTION 253 OF THE ACT PROVIDES FOR APPEAL TO THE TRIBUNAL. UNDER SUB-SECTION (1), AN ASSESSEE IS 32 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. GRANTED RIGHT TO FILE AN APPEAL; UNDER SUB-SECTION (2), THE COMMISSIONER IS GRANTED A RIGHT TO FILE APPEAL BY ISSUING NECESSARY DIRECTION TO THE ASSESSING OFFICE R; SUB-SECTION (3) PRESCRIBES THE PERIOD OF LIMITATION WITHIN WHICH AN APPEAL COULD BE PREFERRED. SECTION 253(4) OF THE ACT LAYS DOWN THAT EITHER THE ASSESSI NG OFFICER OR THE ASSESSEE, ON RECEIPT OF NOTICE THAT AN APPEAL AGAINST THE ORDER OF COMMISSIONER (APPEALS) HAS BEEN PREFERRED UNDER SUB-SECTION (1) OR SUB- SECTION (2) BY THE OTHER PARTY, MAY, NOTWITHSTANDIN G THAT NO APPEAL HAD BEEN FILED AGAINST SUCH AN ORDER OR ANY PART THEREOF, WITHIN 30 DAYS OF THE NOTICE, FIL E A MEMORANDUM OF CROSS OBJECTIONS VERIFIED IN THE PRESCRIBED MANNER AND SUCH MEMORANDUM SHALL BE DISPOSED OF BY THE TRIBUNAL AS IF IT WERE AN APPEAL PRESENTED WITHIN THE PERIOD OF LIMITATION PRESCRIBE D UNDER SUB-SECTION (3). THEREFORE, ON A PLAIN READIN G OF THE PROVISION, IT TRANSPIRES THAT A PARTY HAS BEEN GRANTED AN OPTION OR A DISCRETION TO FILE CROSS OBJ ECTION. 19. IN CASE A PARTY HAVING SUCCEEDED BEFORE COMMISSIONER (APPEALS) OPTS NOT TO FILE CROSS OBJEC TION EVEN WHEN AN APPEAL HAS BEEN PREFERRED BY THE OTHER PARTY, FROM THAT IT IS NOT POSSIBLE TO INFER THAT T HE SAID PARTY HAS ACCEPTED THE ORDER OR THE PART THEREOF WH ICH 33 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. WAS AGAINST THE RESPONDENT. THE TRIBUNAL HAS, IN TH E PRESENT CASE, UNFORTUNATELY DRAWN SUCH AN INFERENCE WHICH IS NOT SUPPORTED BY THE PLAIN LANGUAGE EMPLOYED BY THE PROVISION. 20. IF THE INFERENCE DRAWN BY THE TRIBUNAL IS ACCE PTED AS A CORRECT PROPOSITION, IT WOULD RENDER RULE 27 OF T HE TRIBUNAL RULES REDUNDANT AND NUGATORY. IT IS NOT POSSIBLE TO INTERPRET THE PROVISION IN SUCH MANNER. ANY INTERPRETATION PLACED ON A PROVISION HAS TO BE IN HARMONY WITH THE OTHER PROVISIONS UNDER THE ACT OR THE CONNECTED RULES AND AN INTERPRETATION WHICH MAKES OTHER CONNECTED PROVISIONS OTIOSE HAS TO BE AVOIDED . RULE 27 OF THE TRIBUNAL RULES IS CLEAR AND UNAMBIGUOUS. THE RIGHT GRANTED TO THE RESPONDENT BY THE SAID RULE CANNOT BE TAKEN AWAY BY THE TRIBUNAL BY REFERRING TO PROVISIONS OF SECTION 253(4) OF THE ACT. THE TRIBUNAL WAS, THEREFORE, IN ERROR IN HOLDING TH AT THE FINDING RECORDED BY THE COMMISSIONER (APPEALS) REMAINED UNCHALLENGED SINCE THE ASSESSEE HAD NOT FILED CROSS OBJECTIONS. 21. ACCORDINGLY, THE SECOND QUESTION (PROPOSED QUE STION NO. 3) IS ANSWERED IN THE NEGATIVE I.E., IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE. 34 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. 6.5. DECISION OF ITAT, DELHI TRIBUNAL IN THE CASE OF ITO, WARD-11(6), NEW DELHI VS. SMT. GURINDER KAUR (2006) 102 ITD 189 (DEL.) IN WHICH, IN PARA-11 OF THE ORDER, IT WA S HELD AS UNDER: 11. EVEN DE HORS RULE 27 OF THE APPELLATE TRIBUN AL RULES, IT IS OPEN TO THE RESPONDENT IN AN APPEAL B EFORE THE TRIBUNAL TO RAISE A NEW GROUND IN DEFENCE OF THE O RDER APPEALED AGAINST. IT HAS BEEN SO HELD BY THE SUPREM E COURT IN HUKAM CHAND MILLS LTD. V. CIT [1967] 63 ITR 232. AT PAGE 237 OF THE REPORT IT WAS HELD THAT EVEN ASSUMI NG THAT RULE 27 IS NOT STRICTLY APPLICABLE, THE TRIBUNAL HA S INHERENT POWERS UNDER SECTION 254(1) TO ENTERTAIN THE ARGUME NT OF THE RESPONDENT WHICH AMOUNTED TO A NEW GROUND. IT W AS FURTHER HELD BY THE SUPREME COURT AS FOLLOWS: IT IS NECESSARY TO STATE THAT RULES 12 AND 27 ARE NOT EXHAUSTIVE AND THE POWERS OF THE APPELLATE TRIBUNAL . THE RULES ARE MERELY PROCEDURAL IN CHARACTER AND DO NOT , IN ANY 35 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. WAY, CIRCUMSCRIBE OR CONTROL THE POWER OF THE TRIBU NAL UNDER SECTION 33(4) OF THE ACT. IT IS SIGNIFICANT TO NOTE THAT IN THE CASE BEFORE T HE SUPREME COURT, THE DEPARTMENT WHICH WAS THE RESPONDENT SOUG HT TO RAISE A NEW PLEA IN DEFENCE OF THE ORDER APPEALED A GAINST. EARLIER, IN NEW INDIA LIFE ASSURANCE CO. LTD. V. CI T [1957] 31 ITR 844, THE BOMBAY HIGH COURT WHILE POINTING OU T THE DIFFERENCE BETWEEN AN APPELLANT AND RESPONDENT BEFO RE THE APPELLATE COURT, OBSERVED AT PAGE 55 THAT THE RESPO NDENT MAY SUPPORT THE DECISION OF THE TRIAL COURT, NOT O NLY ON THE GROUND CONTAINED IN THE JUDGMENT OF THE TRIAL COURT , BUT ON ANY OTHER GROUND. LATER, IN THE CASE OF B.R. BAMAS I V. CIT [1972] 83 ITR 223, THE BOMBAY HIGH COURT WHICH WAS DEALING WITH THE CASE OF RIGHT OF THE RESPONDENT TO DEFEND THE ORDER APPEALED AGAINST HELD THAT THE RESPONDENT WOULD BE ENTITLED TO RAISE A NEW GROUND IN DEFENCE OF THE ORDER APPEALED AGAINST, PROVIDED IT IS A GROUND OF LAW AN D DOES NOT NECESSITATE ANY OTHER EVIDENCE TO BE RECORDED, THE 36 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. NATURE OF WHICH WOULD NOT ONLY BE A DEFENCE TO THE APPEAL ITSELF, BUT MAY ALSO AFFECT THE VALIDITY OF THE ENT IRE ASSESSMENT PROCEEDINGS. IT WAS FURTHER HELD THAT TH E GROUND SERVED AS A WEAPON OF DEFENCE AGAINST THE AP PEAL AND, IF ACCEPTED SHOULD NOT PLACE THE APPELLANT IN A WORSE THAN HE WOULD HAVE BEEN, HAD HE NOT APPEALED. IN CI T V. GILBERT & BARKAR MFG. CO. [1978] 111 ITR 529, THE B OMBAY HIGH COURT MADE NO DISTINCTION BETWEEN THE APPELLAN T AND RESPONDENT IN AN APPEAL BEFORE THE TRIBUNAL AND HEL D THAT BOTH WERE ENTITLED TO RAISE NEW POINTS OR CONTENTIO NS SUBJECT ONLY TO THE CONDITION FIRSTLY THAT NO NEW FACTS ARE REQUIRED TO BE BROUGHT ON RECORD IS CAPABLE OF BEING DISPOSED O F ON THE FACTS ON RECORD AND SECONDLY THAT AN OPPORTUNITY IS GIVEN TO THE OTHER SIDE TO MEET THAT POINT WHICH IS ALLOWED TO BE RAISED FOR THE FIRST TIME IN THE APPEAL. THIS WAS A LSO A CASE OF THE RESPONDENT. TO THE SAME EFFECT ARE THE DECIS IONS OF THE ALLAHABAD, GAUHATI, KERALA AND GUJARAT HIGH COU RTS CITED ON BEHALF OF THE ASSESSEE. THEREFORE, WHETHER IT IS THE APPELLANT OR THE RESPONDENT BEFORE THE TRIBUNAL, NE W POINTS 37 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. OR CONTENTIONS CAN BE RAISED PROVIDED THEY DID NOT INVOLVE INVESTIGATION INTO FACTS (AS CONTRASTED WITH THE RE CORD) AND THAT AN OPPORTUNITY IS GIVEN TO THE OTHER SIDE TO M EET THE CONTENTIONS. APPLYING THESE PRINCIPLES TO THE PRESE NT CASE, WE OVERRULE THE PRELIMINARY OBJECTION OF THE LD. SR . DR AND PERMIT THE ASSESSEE TO RAISE THE NEW POINTS BEFORE US AS A RESPONDENT. 6.6. THE LEARNED COUNSEL FOR THE ASSESSEE ON MERIT S OF SUCH CONTENTION RELIED UPON THE DECISION OF JURISDI CTIONAL DELHI HIGH COURT IN THE CASE OF CIT (CENTRAL)-III VS. KAB UL CHAWLA (2016) 380 ITR 573 (DEL.) IN WHICH IT WAS HELD AS U NDER : COMPLETED ASSESSMENTS CAN BE INTERFERED WITH BY THE A.O. WHILE MAKING THE ASSESSMENT UNDER SECTION 153A ONLY ON THE BASIS OF SOME INCRIMINATING MATERIAL UNEARTHED DURING THE COURSE OF SEARCH OR REQUISITIO N OF DOCUMENTS OR UNDISCLOSED INCOME OR PROPERTY DISCOVERED IN THE COURSE OF SEARCH WHICH WERE NOT 38 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. PRODUCED OR NOT ALREADY DISCLOSED OR MADE KNOWN IN THE COURSE OF ORIGINAL ASSESSMENT 6.7. DECISION OF JURISDICTIONAL DELHI HIGH COURT I N THE CASE OF PR. CIT, CENTRAL-2, NEW DELHI VS. MEETA GUT GUTIA (2017) 82 TAXMANN.COM 287 (DEL.) IN WHICH IN PARAS 69 TO 7 2, IT WAS HELD AS UNDER : 69. WHAT WEIGHED WITH THE COURT IN THE ABOVE DECIS ION WAS THE HABITUAL CONCEALING OF INCOME AND INDULGIN G IN CLANDESTINE OPERATIONS AND THAT A PERSON INDULGING IN SUCH ACTIVITIES CAN HARDLY BE ACCEPTED TO MAINTAIN METI CULOUS BOOKS OR RECORDS FOR LONG. THESE FACTORS ARE ABSEN T IN THE PRESENT CASE. THERE WAS NO JUSTIFICATION AT ALL FOR THE AO TO PROCEED ON SURMISES AND ESTIMATES WITHOUT THERE BEI NG ANY INCRIMINATING MATERIAL QUA THE AY FOR WHICH HE SOUGHT TO MAKE ADDITIONS OF FRANCHISEE COMMISSION. 70. THE ABOVE DISTINGUISHING FACTORS IN DAYAWANTI GUPTA (SUPRA), THEREFORE, DO NOT DETRACT FROM THE SETTLED LEGAL POSITION IN KABUL CHAWLA (SUPRA) WHICH HAS BEEN FOLLOWED NOT ONLY BY THIS COURT IN ITS SUBSEQUENT DECISIONS BUT ALSO BY SEVERAL OTHER HIGH COURTS. 39 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. 71. FOR ALL OF THE AFOREMENTIONED REASONS, THE COUR T IS OF THE VIEW THAT THE ITAT WAS JUSTIFIED IN HOLDING THA T THE INVOCATION OF SECTION 153A BY THE REVENUE FOR THE A YS 2000- 01 TO 2003-04 WAS WITHOUT ANY LEGAL BASIS AS THERE WAS NO INCRIMINATING MATERIAL QUA EACH OF THOSE AYS. CONCLUSION 72. TO CONCLUDE : (I)QUESTION (I) IS ANSWERED IN THE NEGATIVE I.E., I N FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE. IT IS HELD TH AT IN THE FACTS AND CIRCUMSTANCES, THE REVENUE WAS NOT JU STIFIED IN INVOKING SECTION 153 A OF THE ACT AGAINST THE AS SESSEE IN RELATION TO AYS 2000-01 TO AYS 2003-04. 6.8. THE LEARNED COUNSEL FOR THE ASSESSEE ALSO REL IED UPON THE DECISION OF HONBLE SUPREME COURT IN THE C ASE OF CIT VS. SINHGAD TECHNICAL EDUCATION SOCIETY (2017) 397 ITR 344 (SC) IN WHICH IT WAS HELD AS UNDER : WHERE, AS PER PROVISIONS OF SECTION 153C OF THE AC T, INCRIMINATING MATERIAL WHICH WAS SEIZED HAD TO PERTAIN TO THE ASSESSMENT YEARS IN QUESTION, AND DOCUMENTS WHICH WERE SEIZED DID NOT ESTABLISH ANY 40 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. CO-RELATION, DOCUMENT-WISE, WITH FOUR ASSESSMENT YEARS THEN ORDER PASSED FOR INITIATION OF PROCEEDIN G U/S.153C SHOULD BE QUASHED. 6.9. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTE D THAT SINCE, DURING THE COURSE OF SEARCH NO INCRIMINATING MATERIAL WAS FOUND AGAINST THE ASSESSEE SO AS TO MAKE THE IM PUGNED ADDITION UNDER SECTION 68 OF THE I.T. ACT AND NO AS SESSMENT WAS PENDING ON THE DATE OF THE SEARCH, THEREFORE, NO AD DITION COULD BE MADE ON MERITS UNDER SECTION 153A OF THE I.T. AC T, 1961. LD. CIT(A) ON THIS GROUND SHOULD HAVE DELETED THE ADDIT ION. 7. THE LD. D.R. ON THE OTHER HAND, OBJECTED TO THE ADMISSION OF THE PETITION UNDER RULE 27 OF THE APPE LLATE TRIBUNAL RULES. THE LD. D.R. SUBMITTED THAT THERE W AS A SEARCH IN THE CASE OF THE ASSESSEE ON 26 TH MARCH, 2010 AND IN THE CASE OF SHRI ASEEM KUMAR GUPTA GROUP OF CASES WHO WAS RU NNING ACCOMMODATION ENTRY RACKET. NOTICE UNDER SECTION 15 3A WAS ISSUED TO THE ASSESSEE BEFORE COMPLETION OF THE ASS ESSMENT AND ADDITION WAS MADE UNDER SECTION 68 OF THE I.T. ACT FOR 41 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. ACCOMMODATION ENTRY OF SHARE APPLICATION MONEY. THE LD. CIT(A) DISMISSED THIS GROUND OF APPEAL OF THE ASSES SEE. THE ASSESSEE DID NOT FILE ANY CROSS-APPEAL OR THE CROSS OBJECTION. THE ASSESSEE IS NOT SUPPORTING THE ORDER OF THE LD. CIT(A) BUT ATTACKING THE ORDER OF THE LD. CIT(A) WHICH IS NOT PERMISSIBLE. THE LD. D.R. RELIED UPON THE ORDER OF THE ITAT, AHM EDABAD BENCH IN THE CASE OF DCIT VS. SANDEEP M. PATEL (201 2) 137 ITD 104 (AHD.) IN WHICH IT WAS HELD THAT RULE-27 SANCTIONS A DEFENDANT ONLY TO SUPPORT THE ORDER OF THE LD. CI T(A) AND NOT PERMITTED TO ATTACK THE JUDGMENT. THE ASSESSEE CA N SUPPORT THE ORDER OF THE CIT(A) ON ANY GROUND WHICH IS DECI DED AGAINST HIM. THE LD. D.R. ALSO RELIED UPON THE DECISION OF THE HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF SELF KNI TTING WORKS VS. CIT (2015) 116 DTR 319 (P&H) IN WHICH IT WAS H ELD AS UNDER: WHERE RESPONDENT IS AGGRIEVED AGAINST ANY DISALLOWANCE OR ADDITION SUSTAINED BY CIT(A) WHICH IS NOT UNDER CHALLENGE AT BEHEST OF APPELLANT, ONLY 42 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. REMEDY AVAILABLE WITH RESPONDENT IS TO EITHER FILE SEPARATE APPEAL OR AGITATE ISSUE BY WAY OF CROSS OBJECTIONS IN APPEAL FILED BY APPELLANT IMPUGNING DISALLOWANCE OR ADDITION SUSTAINED. 7.1. THE LD. D.R. ALSO RELIED UPON THE DECISION OF THE JURISDICTIONAL DELHI HIGH COURT IN THE CASE OF ACIT VS. VIPUL MOTORS (P) LTD., ORDER DATED 08.08.2013 IN ITA.NOS. 2675 & 2676/DEL./2010) IN WHICH IT WAS HELD THAT DURING THE PENDENCY OF PROCEEDING UNDER SECTION 153A OF THE ACT, THE A. O. IS NOT EMPOWERED TO ISSUE NOTICE UNDER SECTION 148 OF THE ACT. THE LD. D.R. ALSO RELIED UPON THE DECISION OF HONBLE SUPRE ME COURT IN THE CASE OF CIT VS. MUKUNDRAY K. SHAH (2007) 290 IT R 433 (SC) IN WHICH IT WAS HELD AS UNDER : DIARY SEIZED DURING SEARCH REVEALING THAT COMPANY MKSEPL IN WHICH ASSESSEE HAD SUBSTANTIAL INTEREST A ND WHICH HAD ACCUMULATED PROFITS ADVANCED MONEYS TO TW O CLOSELY RELATED PARTNERSHIP FIRMS IN WHICH ALSO ASS ESSEE WAS A PARTNER WHICH AMOUNTS WERE WITHDRAWN BY ASSES SEE 43 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. AND UTILISED FOR PURCHASE OF RBI BONDS, THE AMOUNTS WERE ADVANCED BY MKSEPL FOR THE BENEFIT OF ASSESSEE BY U SING THE TWO FIRMS AS CONDUITS AND THE SAID AMOUNT WAS R IGHTLY ASSESSED AS DEEMED DIVIDEND IN THE HANDS OF ASSESSE E IN BLOCK ASSESSMENT. 7.2. THE LD. D.R. SUBMITTED THAT THE LD. CIT(A) HE LD THAT ADDITION CAN BE MADE UNDER SECTION 153A OF THE I.T. ACT IN RESPECT OF THE SEIZED MATERIAL. 8. WE HAVE CONSIDERED THE RIVAL CONTENTIONS. IN TH E PRESENT CASE, SEARCH WAS CONDUCTED IN THE CASE OF T HE ASSESSEE AS WELL AS IN THE CASE OF SHRI ASEEM KUMAR GUPTA GR OUP CASES AT VARIOUS PREMISES WHO WAS ALLEGEDLY PROVIDING ACCOMMODATION ENTRIES. THE A.O, THEREFORE, ISSUED N OTICE UNDER SECTION 153A OF THE I.T. ACT. HOWEVER, PRIOR TO THA T, ASSESSEE HAD ALREADY FILED RETURN UNDER SECTION 139 OF THE I.T. ACT, ON 05 TH AUGUST, 2005, WHICH HAVE BEEN PROCESSED UNDER SECTI ON 143(1) OF THE I.T. ACT. THEREFORE, NO ASSESSMENT WAS PENDI NG PRIOR TO THE SEARCH. THE ASSESSMENT WAS COMPLETED UNDER SECT ION 143(1) 44 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. OF THE I.T. ACT. THE LD. CIT(A) IN THE IMPUGNED ORD ER HELD THAT ONCE SEARCH IS INITIATED, PROVISIONS OF SECTION 15 3A ARE APPLICABLE FOR FRAMING ASSESSMENT IN THE CASE OF SU CH PERSON. THE HONBLE JURISDICTIONAL DELHI HIGH COURT IN THE CASE OF CIT VS. KABUL CHAWLA (SUPRA), CONSIDERING THE CONSPECTU S OF SECTION 153A IN THE LIGHT OF LAW EXPLAINED IN VARIOUS JUDGM ENTS, DECIDED THE LEGAL POSITION AND ONE OF THEM WAS THAT ONCE A SEARCH TAKES PLACE UNDER SECTION 132, NOTICE UNDER SECTION 153A(1) WILL HAVE TO BE MANDATORILY ISSUED TO THE P ERSON SEARCHED REQUIRING HIM TO FILE RETURNS FOR SIX ASSE SSMENT YEARS IMMEDIATELY PRECEDING THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR IN WHICH THE SEARCH TAKES PLACE. TO THAT EXTENT, THERE IS NO DISPUTE AS REGARDS THE LEGAL PO SITION IS CONCERNED THAT ASSESSMENTS ARE TO BE FRAMED UNDER S ECTION 153A OF THE I.T. ACT. HOWEVER, THE HONBLE DELHI HI GH COURT AT THE END DECIDED THAT COMPLETED ASSESSMENTS CAN BE INTERFERED BY THE A.O. WHILE MAKING ASSESSMENT UNDER SECTION 1 53A ONLY ON THE BASIS OF SOME INCRIMINATING MATERIAL UNEARTH ED DURING THE COURSE OF SEARCH WHICH WAS NOT PRODUCED OR NOT ALRE ADY 45 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. DISCLOSED OR MADE KNOWN IN THE COURSE OF ORIGINAL A SSESSMENT. THE HONBLE JURISDICTIONAL DELHI HIGH COURT IN ITS LATEST DECISION IN THE CASE OF PR. CIT, CENTRAL-2, NEW DELHI VS. ME ETA GUTGUTIA (SUPRA), REITERATED THE SAME PROPOSITION THAT INVOCATION OF SECTION 153A BY REVENUE FOR A.YS. 2001-2002 TO 2003 -2004 WAS WITHOUT ANY LEGAL BASIS AS THERE WAS NO INCRIMINATI NG MATERIAL QUA EACH OF THOSE ASSESSMENT YEARS. SIMILARLY, THE HONBLE SUPREME COURT IN THE CASE OF CIT VS. SINHGAD TECHNI CAL EDUCATION SOCIETY (SUPRA) HELD THAT WHERE, AS PER PROVISIONS OF SECTION 153C OF THE ACT, INCRIMINATING MATERIAL WHI CH WAS SEIZED HAD TO BE PERTAIN TO ASSESSMENT YEAR IN QUESTION AN D DOCUMENTS WHICH WERE SEIZED DID NOT ESTABLISH ANY CO-RELATION DOCUMENT- WISE WITH FOUR ASSESSMENT YEARS, THEN ORDER PASSED FOR INITIATION OF PROCEEDING UNDER SECTION 153C SHOULD BE QUASHED. THESE LEGAL PROPOSITIONS HAVE NOT BEEN DISPUTED BY THE LD . D.R. IT IS, THEREFORE, CLEAR FROM THE ABOVE DISCUSSION IN THE L IGHT OF THESE CASE LAWS THAT THERE SHOULD BE RECOVERY OF INCRIMIN ATING MATERIAL (UNEARTHED) DURING THE COURSE OF SEARCH, T HEN ONLY, THE A.O. CAN INTERFERE WITH THE COMPLETED ASSESSMENTS. HOWEVER, IN 46 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. THE PRESENT CASE, NO INCRIMINATING MATERIAL WAS UNE ARTHED DURING THE COURSE OF SEARCH IN THE CASE OF THE ASSE SSEE TO MAKE THE ADDITION UNDER SECTION 68 OF THE I.T. ACT AGAIN ST THE ASSESSEE. THE ASSESSEE FILED ORIGINAL RETURN OF INC OME PRIOR TO THE SEARCH WHICH WAS COMPLETED. THE ASSESSEE DISCLO SED RECEIPTS OF SHARE CAPITAL AND SHARE PREMIUM IN THE ORIGINAL RETURN OF INCOME. THE A.O. ON THE BASIS OF THE ORIG INAL RETURN OF INCOME MADE THE IMPUGNED ADDITION IN THE ASSESSMENT ORDER UNDER SECTION 153A OF THE I.T. ACT. THEREFORE, NO I NCRIMINATING MATERIAL WAS FOUND DURING THE COURSE OF SEARCH TO M AKE SUCH ADDITION AGAINST THE ASSESSEE. THE LD. CIT(A), DELE TED THE ADDITION ON MERIT WHICH IS IN CHALLENGE BEFORE THE TRIBUNAL IN DEPARTMENTAL APPEALS. THE ASSESSEE IN HIS PETITION UNDER RULE- 27 OF THE APPELLATE TRIBUNAL RULES, SOUGHT PERMISSI ON OF THE TRIBUNAL TO SUPPORT THE ORDER OF THE LD. CIT(A) UND ER RULE-27, BY CONTENDING THAT THE LD. CIT(A) SHOULD HAVE DELET ED THE ADDITION IN QUESTION UNDER SECTION 68 OF THE I.T. A CT, ON THE GROUND THAT NO INCRIMINATING MATERIAL HAS BEEN FOUN D, AS A RESULT OF SEARCH. RULE-27 OF THE APPELLATE TRIBUNAL RULES 47 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. PROVIDES THE RESPONDENT, THOUGH HE MAY NOT HAVE APPEALED, MAY SUPPORT OF THE ORDER APPEALED AGAINST ON ANY OF THE GROUNDS DECIDED AGAINST HIM. IN THE PRESENT CASE, THE ASSESSEE IS A RESPONDENT AND HAVE NOT FILED ANY CROSS-APPEAL OR C ROSS OBJECTION. THE ASSESSEE WANTED TO SUPPORT THE ORDER OF THE LD. CIT(A) ON THE GROUND WHICH IS DECIDED AGAINST HIM B ECAUSE THE LD. CIT(A) DECIDED THIS ISSUE AGAINST THE ASSESSEE ON THE GROUND THAT SEARCH UNDER SECTION 132 OF THE ACT, HAVE BEEN CONDUCTED IN THE CASE OF THE ASSESSEE. EVEN IF SEARCH HAVE BE EN CONDUCTED IN THE CASE OF THE ASSESSEE UNDER SECTION 132 OF TH E I.T. ACT, THE A.O. COULD PROCEED UNDER SECTION 153A OF THE I.T. A CT. BUT, COMPLETED ASSESSMENT COULD BE INTERFERED WITH BY TH E A.O. WHILE MAKING ASSESSMENT UNDER SECTION 153A ONLY ON THE BASIS OF THE RECOVERY OF INCRIMINATING MATERIAL FOUND DUR ING THE COURSE OF SEARCH. IT IS, THEREFORE, NOT A CASE SET- UP BY THE REVENUE THAT ANY INCRIMINATING MATERIAL WAS FOUND D URING THE COURSE OF SEARCH SO AS TO MAKE THE ADDITION UNDER S ECTION 68 OF THE I.T. ACT. NO NEW FACTS ARE TO BE INVESTIGATED. THE ASSESSEE IN THE PRESENT PETITION SOUGHT TO SUPPORT ORDER OF LD. CIT(A) IN 48 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. DELETING THE ADDITION ON GROUND DECIDED AGAINST IT. ASSESSEE DID NOT WANT MORE RELIEF AS AGAINST DELETED BY LD. CIT( A). THEREFORE, ASSESSEE IS JUSTIFIED IN MOVING PETITION UNDER RULE -27 OF APPELLATE TRIBUNAL RULES TO SUPPORT THE ORDER APPEA LED AGAINST ON ANY OF THE GROUND DECIDED AGAINST HIM. THE DECIS IONS RELIED UPON BY LEARNED COUNSEL FOR THE ASSESSEE SQUARELY A PPLICABLE TO THE FACTS AND CIRCUMSTANCES OF THE CASE. THE DEC ISIONS RELIED UPON BY THE LD. D.R. WOULD NOT SUPPORT THE CASE OF THE REVENUE ON THIS PROPOSITION. WE, THEREFORE, PERMIT THE ASSE SSEE TO RAISE HIS POINT IN PETITION UNDER RULE-27 OF THE APPELLAT E TRIBUNAL RULES. THE APPLICATION OF THE ASSESSEE UNDER RULE-2 7 OF THE APPELLATE TRIBUNAL RULES IS ACCORDINGLY ALLOWED. 8.1. CONSIDERING THE ABOVE DISCUSSION, IT IS, CLEA R THAT DURING THE COURSE OF SEARCH, NO INCRIMINATING MATER IAL WAS FOUND SO AS TO MAKE ANY ADDITION UNDER SECTION 153A OF THE ACT, ON ACCOUNT OF UNEXPLAINED SHARE CAPITAL/PREMIUM WHI CH WAS ALREADY DISCLOSED IN THE ORIGINAL RETURN OF INCOME. THEREFORE, THE DECISIONS OF JURISDICTIONAL DELHI HIGH COURT IN THE CASE OF KABUL 49 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. CHAWLA (SUPRA), SQUARELY APPLICABLE TO THE FACTS AN D CIRCUMSTANCES OF THE CASE BECAUSE NO ASSESSMENT WAS PENDING ON THE DATE OF SEARCH AND ADDITION IS MADE MERELY O N THE BASIS OF BOOK ENTRIES ALREADY DISCLOSED TO THE REVENUE DE PARTMENT. THEREFORE, THE LD. CIT(A) SHOULD HAVE DELETED THE A DDITION ON THIS GROUND ITSELF. THE ORDER OF THE LD. CIT(A), TO THAT EXTENT, IS SET ASIDE AND QUASHED. THE ADDITION WOULD STAND DEL ETED BECAUSE NO INCRIMINATING MATERIAL WAS FOUND DURING THE COURSE OF SEARCH TO MAKE ANY ADDITION UNDER SECTION 68 OF THE I.T. ACT, 1961. THE PETITION UNDER RULE-27 OF THE APPELLATE T RIBUNAL RULES, IS ACCORDINGLY ALLOWED. 9. AS REGARDS THE ADDITION ON MERIT DELETED BY THE LD. CIT(A), THE LD. D.R. CONTENDED THAT IT WAS BROUGHT ON RECORD THAT ACCOMMODATION ENTRIES HAVE BEEN RECEIVED FROM SHRI ASEEM KUMAR GUPTA AND HIS STATEMENT WAS RECORDED BY THE INVESTIGATION WING. THE ASSESSEE DID NOT PRODUCE AN Y EVIDENCE AT THE ASSESSMENT STAGE. THE SATISFACTION OF THE A. O. AT THE REMAND PROCEEDINGS IS NOT REQUIRED BECAUSE THE SATI SFACTION OF 50 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. THE LD. CIT(A) IS REQUIRED. A.O. MADE ENQUIRY UNDER SECTION 250(4) OF THE I.T. ACT ON BEHALF OF THE LD. CIT(A). THE LD. CIT(A) HAS PUT THE RESPONSIBILITY OF NOT CONDUCTING ENQUIR Y ON THE A.O. THEREFORE, THE LD. CIT(A) SHOULD HAVE CONDUCTED ENQ UIRY AND RELIED ON JUDGMENT OF JURISDICTIONAL DELHI HIGH COU RT IN THE CASE OF JANSAMPARK ADVERTISING AND MARKETING PVT. LTD., IN ITA.NO.525 OF 2015 DATED 11.03.2015. 10. ON THE OTHER HAND, LEARNED COUNSEL FOR THE ASSESSEE, REITERATED THE SUBMISSIONS MADE BEFORE TH E AUTHORITIES BELOW AND SUBMITTED THAT ASSESSEE PRODU CED SUFFICIENT EVIDENCE BEFORE THE AUTHORITIES BELOW ON WHICH REMAND REPORT FROM THE A.O. WAS CALLED FOR. THE A.O . DID NOT OBJECT TO THE EVIDENCES PRODUCED BY THE ASSESSEE. T HE A.O. ACCEPTED THAT INVESTORS ARE NOT RELATED TO SHRI ASE EM KUMAR GUPTA. THE A.O. DID NOT SUMMON ANY OF THE INVESTOR AND NOTHING WAS FOUND AGAINST THE ASSESSEE DURING THE C OURSE OF SEARCH. THE LEARNED COUNSEL FOR THE ASSESSEE RELIED UPON THE 51 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. FOLLOWING DECISIONS OF THE DELHI HIGH COURT ON THE PROPOSITION THAT ADDITION HAVE BEEN RIGHTLY DELETED BY THE LD. CIT(A). 10.1. DECISION OF THE HONBLE JURISDICTIONAL DELHI HIGH COURT IN THE CASE OF CIT VS. GANGESHWARI METAL PVT. LTD., (2014) 361 ITR 10 (DEL.) (HC) IN WHICH IT WAS HELD AS UNDE R : IT WAS HELD THAT WHERE COMPLETE PARTICULARS OF SHA RE APPLICANTS ARE FURNISHED TO THE A.O. AND THE A.O. H AS NOT CONDUCTED ANY ENQUIRY INTO THE SAME OR HAS NO MATERIAL IN HIS POSSESSION TO SHOW THAT THOSE PARTICULARS ARE FALSE AND CANNOT BE ACTED UPON, THE N NO ADDITION CAN BE MADE IN THE HANDS OF THE COMPANY U/S.68. 10.2. DECISION OF THE HONBLE JURISDICTIONAL DELHI HIGH COURT IN THE CASE OF CIT VS. KAMDHENU STEEL & ALLOY S LTD., & OTHERS (2014) 361 ITR 220 (DEL.) (HC) IN WHICH IT W AS HELD AS UNDER : ONCE ADEQUATE EVIDENCE/MATERIAL IS GIVEN, WHICH WOULD PRIMA FACIE DISCHARGE THE BURDEN OF THE 52 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. ASSESSEE IN PROVING THE IDENTITY OF SHAREHOLDERS, GENUINENESS OF THE TRANSACTION AND CREDITWORTHINESS OF THE SHAREHOLDERS, THEREAFTER IN CASE SUCH EVIDEN CE IS TO BE DISCARDED OR IT IS PROVED THAT IT HAS CRE ATED EVIDENCE, THE REVENUE IS SUPPOSED TO MAKE THOROUGH PROBE BEFORE IT COULD NAIL THE ASSESSEE AND FASTEN THE ASSESSEE WITH SUCH A LIABILITY UNDER S.68; A.O. FAI LED TO CARRY HIS SUSPICION TO LOGICAL CONCLUSION BY FUR THER INVESTIGATION AND THEREFORE ADDITION UNDER S.68 WAS NOT SUSTAINABLE. 10.3. DECISION OF THE HONBLE JURISDICTIONAL DELHI HIGH COURT IN THE CASE OF CIT VS. EXPO GLOBE INDIA LTD. , (2014) 361 ITR 147 (DEL.) (HC) IN WHICH IT WAS HELD AS UNDER : THE ORDER OF THE CIT (A), WOULD REVEAL THAT EVEN THOUGH THE ASSESSING OFFICER HAD INITIALLY CONCLUD ED ON THE BASIS OF THE MATERIALS MADE AVAILABLE AT THA T STAGE THAT SERVICE OF THE ENTRY PROVIDERS HAD BEEN UTILIZED TO BRING IN CAPITAL, AFTER REMAND THE CIT (A) 53 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. ELABORATELY TOOK INTO ACCOUNT CONSIDERABLE MATERIAL FURNISHED BY THE ASSESSEE. THESE INCLUDED INCOME TA X RETURNS, BALANCE SHEETS, ROC PARTICULARS AND BANK ACCOUNT STATEMENTS. ON THE BASIS OF THESE, THE CIT( A) HELD THAT THE SHARE APPLICATION MONEY OR THE SOURCE OF THE SHARE APPLICATION MONEY HAD BEEN SATISFACTORILY EXPLAINED. THE ITAT WAS OF THE OPINION THAT NO INTERFERENCE WAS WARRANTED HAVING REGARD TO THE FAC TS OF THIS CASE. THIS COURT IS OF THE OPINION THAT THE ONLY SENTENCE IN PARAGRAPH-6 OF THE IMPUGNED ORDER THAT AMOUNTS WERE REFUNDED TO THE APPLICANTS ITSELF SHOU LD NOT BE A GROUND TO CONCLUDE THAT THE FINDINGS RECOR DED BY THE LOWER AUTHORITIES ARE NOT ON THE BASIS OF EVIDENCE. THE ENTIRE CONTROVERSY SOUGHT TO BE RAISE D IS PURELY FACTUAL. 10.4. DECISION OF THE HONBLE JURISDICTIONAL DELHI HIGH COURT IN THE CASE OF CIT VS. FIVE VISION PROMOTERS PVT. LTD., & 54 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. ORS. (2016) 380 ITR 289 (DEL.) (HC) IN WHICH IT WAS HELD AS UNDER : PROVISIONS OF S.68 CAN BE INVOKED ONLY WHERE ASSESSEE OFFERS NO EXPLANATION AT ALL OR EXPLANATIO N OFFERED IS UNSATISFACTORY, AND ADDITION THEREUNDER CAN BE MADE ONLY ON THAT CONDITION. 10.5 DECISION OF THE HONBLE JURISDICTIONAL DELHI HIGH COURT IN THE CASE OF CIT VS. FAIR FINVEST LTD., (20 13) 357 ITR 146 (DEL.) (HC) IN WHICH IT WAS HELD AS UNDER : THE A.O. CANNOT MAKE ANY ADDITION IN RESPECT OF SHARE APPLICATION MONEY WITHOUT SATISFYING HIMSELF AS TO THE VERACITY AND GENUINENESS OF THE TRANSACTION BY EXAMINING THE BANK ACCOUNTS OR THE ACCOUNTS OF THE COMPANIES WHO HAD APPLIED FOR SHARES. 10.6. DECISION OF THE HONBLE JURISDICTIONAL DELHI HIGH COURT IN THE CASE OF CIT VS. OASIS HOSPITALITIES (P ) LTD., (2011) 333 ITR 119 (DEL.) (HC) IN WHICH IT WAS HELD AS UND ER : 55 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. INCOME - CASH CREDIT - SHARE APPLICATION MONEY - THOUGH THE SHARE APPLICANTS WERE NOT PRODUCED IN SPITE OF SPECIFIC DIRECTION OF THE AO, ASSESSEE COMPANY HAS FILED COPIES OF PAN, ACKNOWLEDGEMENT OF RETURNS OF THE SHARE APPLICANTS AND THEIR BANK ACCOUNT STATEMENTS OF THE RELEVANT PERIOD WHEN THE CHEQUES WERE CLEARED - THUS, PRIMARY ONUS WAS DISCHARGED BY THE ASSESSEE - ASSESSEE WAS NOT CONFRONTED WITH THE INVESTIGATION CARRIED OUT BY THE INVESTIGATION WING OR GIVEN ANY OPPORTUNITY TO CROSS-EXAMINE THE PERSONS WHOSE STATEMENTS WERE RECORDED BY THE INVESTIGATION WING TO DRAW ADVERSE CONCLUSION AGAINST THE ASSESSEE. AS REGARDS DISCREPANCIES IN THE BANK STATEMENTS, THESE STATEMENTS WERE PROVIDED BY THE SHAREHOLDERS AND WERE PRINTED ON THE BANK STATIONERY - ASSESSEE WAS NEVER CONFRONTED WITH THESE DISCREPANCIES BY THE A.O. - 56 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. IN ANY CASE, IT DOES NOT FOLLOW FROM THESE DISCREPANCIES THAT THE AMOUNT OF SHARE CAPITAL WAS UNDISCLOSED INCOME OF THE ASSESSEE - EVEN THE CORRECT BANK STATEMENTS AS CLAIMED BY THE AO SHOW THAT THE ASSESSEE HAS RECEIVED CHEQUES FROM THE SHAREHOLDERS - THOUGH SOURCE OF CASH DEPOSITS IN THE BANK ACCOUNTS OF SOME SHAREHOLDERS IS QUESTIONABLE, AO HAS NOT FURTHER PROBED THE MATTER - THEREFORE, REMEDY LIES IN REOPENING THE CASE OF THESE INVESTORS AND ADDITION CANNOT BE MADE IN THE HANDS OF THE ASSESSEE. 11. WE HAVE CONSIDERED THE RIVAL CONTENTIONS. THE A.O. DIRECTED THE ASSESSEE TO FURNISH COPY OF THE ITR AN D RELATED BANK STATEMENTS OF NEW SHAREHOLDERS WITH THEIR NAME S AND ADDRESSES AT THE ASSESSMENT STAGE. THE A.O. HOWEVER , NOTED THAT SINCE ASSESSEE DID NOT PRODUCE THESE DOCUMENTS , HE MADE ADDITION UNDER SECTION 68 OF THE I.T. ACT. THE ASSE SSEE FILED APPLICATION UNDER RULE 46A OF I.T. RULES, BEFORE LD . CIT(A) IN 57 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. WHICH IT WAS SUBMITTED THAT A.O. ISSUED SHOW-CAUSE NOTICE DATED 09 TH DECEMBER, 2011 AND CASE WAS FIXED FOR HEARING ON 16 TH DECEMBER, 2011. THE ASSESSEE RECEIVED NOTICE IN TH E EVENING ON 14 TH DECEMBER, 2011 AND VIDE LETTER DATED 15 TH DECEMBER, 2011 REQUESTED THE A.O. TO GRANT TIME UP TO 23 RD DECEMBER, 2011 TO FILE THE REQUIRED DETAILS. THE AS SESSEE SENT REPLY WITH DOCUMENTS ON 23.12.2011 WHICH WERE RECEI VED BY A.O. ON 26.12.2011. THE A.O. HOWEVER, PASSED THE O RDER DATED 23 RD DECEMBER, 2011. THE ASSESSEE, THEREFORE, PLEADED T HAT NO SUFFICIENT OPPORTUNITY HAVE BEEN GIVEN TO HIM TO FI LE REQUIRED DETAILS. THE ADDITIONAL EVIDENCES WERE, CONFIRMATIO N OF ACCOUNTS OF ALL THE INVESTORS, THEIR BOARD RESOLUTION, COPY OF FORM NO.2, COPY OF MASTER DATA, COPY OF PAN, COPY OF ITR, COPY OF CERTIFICATE OF INCORPORATION, BANK STATEMENTS AND S HARE APPLICATION FORMS OF ALL THE INVESTORS. THE LD. CIT (A) CALLED FOR THE REMAND REPORT FROM THE A.O. AND DIRECTED THE A. O. TO EXAMINE THE ADDITIONAL EVIDENCES. THE LD. CIT(A) AD MITTED THE ADDITIONAL EVIDENCES BY HOLDING THAT NO PROPER OPPO RTUNITY HAVE BEEN GIVEN TO ASSESSEE AT THE ASSESSMENT STAGE TO PRODUCE 58 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. EVIDENCES. THE REVENUE IS NOT IN APPEAL TO CHALLENG E THESE FINDINGS OF THE LD. CIT(A) IN ADMITTING THE ADDITIO NAL EVIDENCES. IT, THEREFORE, STANDS PROVED ON RECORD THAT ASSESSE E WAS PREVENTED BY SUFFICIENT CAUSE IN NOT PRODUCING REQU IRED EVIDENCES BEFORE A.O. BECAUSE NO SUFFICIENT TIME WA S GIVEN TO THE ASSESSEE AT ASSESSMENT STAGE. THE ASSESSEE LATE R ON PRODUCED ALL THESE ADDITIONAL EVIDENCES BEFORE LD. CIT(A) WHICH HAVE BEEN EXAMINED BY THE A.O. AS PER THE DIRECTION S OF THE LD. CIT(A). THE A.O. DID NOT POINT-OUT ANY DEFECT OR ER ROR IN THE EVIDENCES PRODUCED AT THE APPELLATE STAGE. THUS, AL L THESE ADDITIONAL EVIDENCES HAVE BEEN EXAMINED BY THE A.O. WHICH CLEARLY PROVE THE IDENTITY OF THE INVESTORS, THEIR CREDITWORTHINESS AND GENUINENESS OF THE TRANSACTION IN THE MATTER. E VEN THE A.O. IN THE REMAND REPORT SUBMITTED THAT TWO OF THE INVE STORS HAVE BEEN ASSESSED IN HIS CIRCLE UNDER SECTION 153A/153C OF THE I.T. ACT AND THE INVESTORS ARE APPARENTLY NOT RELATED TO SHRI ASEEM KUMAR GUPTA. THE ADMISSION OF THE A.O. THEREFORE, C LEARLY SHOW THAT ASSESSEE IS NOT BENEFICIARY OF ANY ALLEGED ACC OMMODATION ENTRIES PROVIDED BY SHRI ASEEM KUMAR GUPTA AND HOW HIS 59 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. STATEMENT RECORDED BY INVESTIGATION WING, WAS RELEV ANT TO THE CASE OF THE ASSESSEE, HAS NOT BEEN PROVED BY THE RE VENUE. THE A.O. ON THESE ADDITIONAL EVIDENCES THOUGH MADE SOME ENQUIRIES, BUT DID NOT FIND ANYTHING AGAINST THE AS SESSEE. NO FURTHER ENQUIRY HAVE BEEN MADE BY THE A.O. ON THESE ADDITIONAL EVIDENCES. NO INCRIMINATING MATERIAL WAS FOUND DURI NG THE COURSE OF SEARCH AGAINST THE ASSESSEE SO AS TO MAKE THE ABOVE ADDITION UNDER SECTION 68 OF THE I.T. ACT. THE A.O. HAS NOT BROUGHT ON RECORD ANY MATERIAL TO SUBSTANTIATE HIS OBSERVATIONS IN THE REMAND REPORT. THE A.O. DID NOT MAKE ANY EFF ORT TO CONDUCT ANY ENQUIRY DIRECTLY FROM THESE INVESTORS. THE A.O. DID NOT ISSUE NOTICES UNDER SECTION 133(6) OR SUMMON UN DER SECTION 131 AGAINST THESE INVESTORS FOR RECORDING T HEIR STATEMENTS. THE A.O. WAS SWAYED BY THE FACT THAT ST ATEMENT OF SHRI ASEEM KUMAR GUPTA WAS RECORDED BY INVESTIGATIO N WING TO PROVIDE ACCOMMODATION ENTRIES. HOWEVER, SUCH FAC T IS CONTRADICTED BY THE A.O. HIMSELF BY NOTING IN THE R EMAND REPORT THAT HIS CIRCLE HAS ASSESSED TWO OF THE INVESTORS U NDER SECTION 153A OF THE ACT AND THAT INVESTORS ARE NOT APPARENT LY RELATED TO 60 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. SHRI ASEEM KUMAR GUPTA. THEREFORE, THERE WAS NOTHIN G ON RECORD TO SUPPORT THE FINDING OF FACT RECORDED BY T HE A.O. EVIDENCES AND MATERIAL AVAILABLE ON RECORD CLEARLY JUSTIFY THE FINDINGS OF LD. CIT(A) IN DELETING THE ADDITION. TH E ASSESSEE ALSO EXPLAINED THE REASONS FOR ISSUANCE OF SHARES AT HIG H PREMIUM ON WHICH A.O. IN THE REMAND REPORT DID NOT MAKE ANY COMMENT ON THE SUBMISSIONS OF THE ASSESSEE. THE LD. CIT(A), THEREFORE, WAS JUSTIFIED IN HOLDING THAT A.O. WAS NOT JUSTIFIE D IN TREATING SHARE CAPITAL AND SHARE PREMIUM AS UNEXPLAINED CRED ITS UNDER SECTION 68 OF THE I.T. ACT. WE MAY RELY UPON THE FO LLOWING DECISIONS. 11.1. THE HONBLE SUPREME COURT IN THE CASE OF CI T VS. LOVELY EXPORTS PVT. LTD., (2008) 216 CTR 195 IN WHI CH IT WAS HELD AS UNDER : IF THE SHARE APPLICATION MONEY IS RECEIVED BY THE ASSESSEE COMPANY FROM ALLEGED BOGUS SHAREHOLDERS, WHOSE NAME S ARE GIVEN TO THE AO, THEN THE DEPARTMENT IS FREE TO PROCEED TO REOPEN THEIR INDIVIDUAL ASSESSMENTS IN ACCORDANC E WITH 61 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. LAW, BUT IT CANNOT BE REGARDED AS UNDISCLOSED INCOM E OF ASSESSEE COMPANY. 11.2. DECISION OF THE HONBLE JURISDICTIONAL DELHI HIGH COURT IN THE CASE OF CIT VS. KAMDHENU STEEL & ALLOY S LTD., & OTHERS 361 ITR 220 IN WHICH IT WAS HELD AS UNDER : ONCE ADEQUATE EVIDENCE/MATERIAL IS GIVEN, WHICH WO ULD PRIMA FACIE DISCHARGE THE BURDEN OF THE ASSESSEE IN PROVING THE IDENTITY OF SHAREHOLDERS, GENUINENESS OF THE TR ANSACTION AND CREDITWORTHINESS OF THE SHAREHOLDERS, THEREAFTE R IN CASE SUCH EVIDENCE IS TO BE DISCARDED OR IT IS PROVED TH AT IT HAS CREATED EVIDENCE, THE REVENUE IS SUPPOSED TO MAKE THOROUGH PROBE BEFORE IT COULD NAIL THE ASSESSEE AN D FASTEN THE ASSESSEE WITH SUCH A LIABILITY UNDER S.68; AO F AILED TO CARRY HIS SUSPICION TO LOGICAL CONCLUSION BY FURTHE R INVESTIGATION AND THEREFORE ADDITION UNDER S.68 WAS NOT SUSTAINABLE. 11.3. DECISION OF THE HONBLE JURISDICTIONAL DEL HI HIGH COURT IN THE CASE OF CIT VS. LAXMAN INDUSTRIAL RESO URCES PVT. 62 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. LTD., ITA.NO.169 OF 2017 DATED 14 TH MARCH, 2017, IN WHICH IT WAS HELD AS UNDER : THE CIT(A) TOOK NOTE OF THE MATERIAL FILED BY THE ASSESSEE AND PROVIDED OPPORTUNITY TO THE AO IN REMAND PROCEEDINGS. THE AO MERELY OBJECTED TO THE MATERIAL FURNISHED BUT DID NOT UNDERTAKE ANY VERIFICATION. THE CIT(A) DELETED THE ADDITION BY R ELYING UPON THE DECISION OF THE HONBLE APEX COURT IN THE CASE OF LOVELY EXPORTS PVT.LTD. (SUPRA) AND JUDGEMENT OF DELHI HIGH COURT IN THE CASE OF CIT VS DIVINE LEASI NG & FINANCE LTD. [2008] 299 ITR 268. THE ITAT CONFIRMED THE OPINION OF THE LD.CIT(A). HONBLE HI GH COURT IN VIEW OF THE ABOVE FINDINGS NOTED THAT THE ASSESSEE HAD PROVIDED SEVERAL DOCUMENTS THAT COULD HAVE SHOWED LIGHT INTO WHETHER TRULY THE TRANSACTIO NS WERE GENUINE. THE ASSESSEE PROVIDED DETAILS OF SHA RE APPLICANTS I.E. COPY OF THE PAN, ASSESSMENT PARTICULARS, MODE OF AMOUNT INVESTED THROUGH BANKIN G 63 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. CHANNEL, COPY OF RESOLUTION AND COPIES OF THE BALAN CE SHEET. THE AO FAILED TO CONDUCT ANY SCRUTINY OF TH E DOCUMENT, THE DEPARTMENTAL APPEAL WAS ACCORDINGLY DISMISSED. 11.4. DECISION OF HONBLE SUPREME COURT IN THE CAS E OF EARTH METAL ELECTRIC PVT. LTD., VS. CIT, ORDER DATE D 30 TH JULY, 2010 IN SLP.NO.21073 OF 1999 IN WHICH IT WAS HELD A S UNDER : WE HAVE EXAMINED THE POSITION, WE FIND THAT THE SHAREHOLDERS ARE GENUINE PARTIES. THEY ARE NOT BOG US AND FICTITIOUS THEREFORE, THE IMPUGNED ORDER IS SET ASIDE. 11.5. DECISION OF HONBLE MADHYA PRADESH HIGH COUR T IN THE CASE OF CIT VS. PEOPLES GENERAL HOSPITAL LTD., (2013) 356 ITR 65 IN WHICH IT WAS HELD AS UNDER : DISMISSING THE APPEALS, THAT IF THE ASSESSEE HAD RECEIVED SUBSCRIPTIONS TO THE PUBLIC OR RIGHTS ISSU E THROUGH BANKING CHANNELS AND FURNISHED COMPLETE DETAILS OF THE SHAREHOLDERS, NO ADDITION COULD BE M ADE 64 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. UNDER SECTION 68 OF THE INCOME-TAX ACT, 1961, IN TH E ABSENCE OF ANY POSITIVE MATERIAL OR EVIDENCE TO INDICATE THAT THE SHAREHOLDERS WERE BENAMIDARS OR FICTITIOUS PERSONS OR THAT ANY PART OF THE SHARE CA PITAL REPRESENTED THE COMPANY'S OWN INCOME FROM UNDISCLOSED SOURCES. IT WAS NOBODY'S CASE THAT THE NON-RESIDENT INDIAN COMPANY WAS A BOGUS OR NON- EXISTENT COMPANY OR THAT THE AMOUNT SUBSCRIBED BY THE COMPANY BY WAY OF SHARE SUBSCRIPTION WAS IN FAC T THE MONEY OF THE ASSESSEE. THE ASSESSEE HAD ESTABLISHED THE IDENTITY OF THE INVESTOR WHO HAD PROVIDED THE SHARE SUBSCRIPTION AND THAT THE TRANSACTION WAS GENUINE. THOUGH THE ASSESSEE'S CONTENTION WAS THAT THE CREDITWORTHINESS OF THE CREDITOR WAS ALSO ESTABLISHED, IN THIS CASE, THE ESTABLISHMENT OF THE IDENTITY OF THE INVESTOR ALONE WAS TO BE SEEN. THUS, THE ADDITION WAS RIGHTLY DELETED. CIT V. LOVELY EXPORTS P. LTD. [2009] 319ITR (ST.) 5 (SC ) APPLIED. 65 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. 11.6. DECISION OF THE HONBLE JURISDICTIONAL DELHI HIGH COURT IN THE CASE OF CIT VS. (I) DWARAKADHISH INVES TMENT P. LTD., (ITA.NO. 911 OF 2010) AND (II) DWARKADHISH CAPITAL P. LTD., (ITA.NO.913 OF 2010) (2011) 330 ITR 298 (DEL.) (HC) , IN WHICH IT WAS HELD AS UNDER : IN ANY MATTER, THE ONUS OF PROOF IS NOT A STATIC O NE. THOUGH IN SECTION 68 OF THE INCOME TAX ACT, 1961, THE INIT IAL BURDEN OF PROOF LIES ON THE ASSESSES YET ONCE HE PROVES TH E IDENTITY OF THE CREDITORS/SHARE APPLICANTS BY EITHER FURNISH ING THEIR PAN NUMBER OR INCOME-TAX ASSESSMENT NUMBER AND SHOW S THE GENUINENESS OF TRANSACTION BY SHOWING MONEY IN HIS BOOKS EITHER BY ACCOUNT PAYEE CHEQUE OR BY DRAFT OR BY ANY OTHER MODE, THEN THE ONUS OF PROOF WOULD SHIFT TO T HE REVENUE. JUST BECAUSE THE CREDITORS/SHARE APPLICANT S COULD NOT BE FOUND AT THE ADDRESS GIVEN, IT WOULD NOT GIV E THE REVENUE THE RIGHT TO INVOKE SECTION 68. ONE MUST NO T LOSE SIGHT OF THE FACT THAT IT IS THE REVENUE WHICH HAS ALL THE POWER AND WHEREWITHAL TO TRACE ANY PERSON. MOREOVER , IT IS 66 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. SETTLED LAW THAT THE ASSESSEE NEED NOT TO PROVE THE 'SOURCE OF SOURCE'. THE ASSESSEE-COMPANY WAS ENGAGED IN THE BUSINESS OF FINANCING AND TRADING OF SHARES. FOR TH E ASSESSMENT YEAR 2001-02 ON SCRUTINY OF ACCOUNTS, TH E ASSESSING OFFICER FOUND AN ADDITION OF RS.71,75,000 IN THE SHARE CAPITAL OF THE ASSESSEE. THE ASSESSING OFFICE R SOUGHT AN EXPLANATION OF THE ASSESSEE ABOUT THIS ADDITION IN THE SHARE CAPITAL. THE ASSESSEE OFFERED A DETAILED EXPL ANATION. HOWEVER, ACCORDING TO THE ASSESSING OFFICER, THE AS SESSEE FAILED TO EXPLAIN THE ADDITION OF SHARE APPLICATION MONEY FROM FIVE OF ITS SUBSCRIBERS. ACCORDINGLY, THE ASS ESSING OFFICER MADE AN ADDITION OF RS.35,50,000/- WITH THE AID OF SECTION 68 OF THE ACT, 1961 ON ACCOUNT OF UNEXPLAIN ED CASH CREDITS APPEARING IN THE BOOKS OF THE ASSESSEE. HOW EVER, IN APPEAL, THE COMMISSIONER OF INCOME-TAX (APPEALS) DE LETED THE ADDITION ON THE GROUND THAT THE ASSESSEE HAD PR OVED THE EXISTENCE OF THE SHAREHOLDERS AND THE GENUINENE SS OF THE TRANSACTION. THE INCOME-TAX APPELLATE TRIBUNAL CONFIRMED THE ORDER OF THE COMMISSIONER OF INCOME-T AX 67 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. (APPEALS) AS IT WAS ALSO OF THE OPINION THAT THE AS SESSEE HAD BEEN ABLE TO PROVE THE IDENTITY OF THE SHARE AP PLICANTS AND THE SHARE APPLICATION MONEY HAD BEEN RECEIVED B Y WAY OF ACCOUNT PAYEE CHEQUES. ON APPEAL TO THE HIGH COU RT: HELD, DISMISSING THE APPEALS, THAT THE DELETION OF ADDITION WAS JUSTIFIED. 11.7. DECISION OF THE HONBLE JURISDICTIONAL DELHI HIGH COURT IN THE CASE OF CIT VS. WINSTRAL PETROCHEMICAL S P. LTD., 330 ITR 603 IN WHICH IT WAS HELD AS UNDER : DISMISSING THE APPEAL, THAT IT HAD NOT BEEN DISPUT ED THAT THE SHARE APPLICATION MONEY WAS RECEIVED BY THE ASS ESSEE- COMPANY BY WAY OF ACCOUNT PAYEE CHEQUES, THROUGH NO RMAL BANKING CHANNELS. ADMITTEDLY, COPIES OF APPLICATIO N FOR ALLOTMENT OF SHARES WERE ALSO PROVIDED TO THE ASSES SING OFFICER. SINCE THE APPLICANT COMPANIES WERE DULY INCORPORATED, WERE ISSUED PAN CARDS AND HAD BANK ACCOUNTS FROM WHICH MONEY WAS TRANSFERRED TO THE ASSESSEE BY WAY OF ACCOUNT PAYEE CHEQUES, THEY COUL D NOT 68 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. BE SAID TO BE NON-EXISTENT, EVEN IF THEY, AFTER SUB MITTING THE SHARE APPLICATIONS HAD CHANGED THEIR ADDRESSES OR H AD STOPPED FUNCTIONING. THEREFORE, THE COMMISSIONER ( APPEALS) AND THE TRIBUNAL WERE JUSTIFIED IN HOLDING THAT THE GENUINENESS OF THE TRANSACTIONS HAD BEEN DULY ESTAB LISHED BY THE ASSESSEE. 11.8. DECISION OF THE HONBLE JURISDICTIONAL DELHI HIGH COURT IN THE CASE OF CIT VS. VALUE CAPITAL SERVICES PVT. LTD., (2008) 307 ITR 334 (DEL.) (HC) IN WHICH IT WAS HELD AS UNDER : DISMISSING THE APPEAL, THAT THE ADDITIONAL BURDEN WAS ON THE DEPARTMENT TO SHOW THAT EVEN IF THE SHARE APPLI CANTS DID NOT HAVE THE MEANS TO MAKE THE INVESTMENT, THE INVESTMENT MADE BY THEM ACTUALLY EMANATED FROM THE COFFERS OF THE ASSESSEE SO AS TO ENABLE IT TO BE TR EATED AS THE UNDISCLOSED INCOME OF THE ASSESSEE. NO SUBSTANTIA L QUESTION OF LAW AROSE. 12. CONSIDERING THE FACTS OF THE CASE AND OUR FIND INGS ON THE LEGAL ISSUE, THERE IS NO NEED TO CONSIDER THIS ISSUE ON MERIT 69 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. IN DETAIL. THE LD. CIT(A) ON PROPER PERSPECTIVE AND CONSIDERING THE MATERIAL ON RECORD, CORRECTLY DELETED THE ADDIT ION ON MERIT. IN VIEW OF THE ABOVE, WE DO NOT FIND ANY ERROR IN T HE ORDER OF THE LD. CIT(A) IN DELETING THE ADDITION ON MERIT. THE D EPARTMENTAL APPEAL FOR THE A.Y. 2005-2006 STANDS DISMISSED. 13. THE FINDINGS IN A.Y. 2005-2006 ARE FOLLOWED IN THE REMAINING ASSESSMENT YEARS BECAUSE THE ISSUES ARE S AME IN THE REMAINING APPEALS AS IS ALSO SUGGESTED BY THE PARTI ES. IN VIEW OF THE ABOVE DISCUSSION, THE DEPARTMENTAL APPEALS F OR THE A.YS. 2006-2007, 2007-2008 AND 2008-2009 ARE ALSO DISMISS ED. 14. IN THE RESULT, ALL THE APPEALS OF THE DEPARTME NT ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (O.P. KANT) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER DELHI, DATED 16 TH MARCH, 2018 VBP/- 70 ITA.NOS.6589,6590,6591 & 6592/DEL./2013 M/S. RAVNET SOLUTIONS PVT. LTD., NEW DELHI. COPY TO 1. THE APPELLANT 2. THE RESPONDENT 3. CIT(A) CONCERNED 4. CIT CONCERNED 5. D.R. ITAT D BENCH, DELHI 6. GUARD FILE. // BY ORDER // ASSISTANT REGISTRAR : ITAT DELHI BENCHES : DELHI.