POLO COMPUTERS & SOFTWARES PRIVATE LIMITED,DELHI V. ACIT CENTRAL CIRCLE-13, DELHI

ITA 1359/DEL/2023

AI Insights

The case involves Polo Computers & Softwares Pvt. Ltd., which filed appeals against the orders of the Learned Commissioner of Income Tax (Appeals) for the assessment years 2013-14, 2014-15, and 2015-16. The appeals were related to additions made by the Assessing Officer following a search and seizure operation under section 132 of the Income Tax Act, 1961. The Tribunal heard the appeals together due to the similarity in facts and issues across the three assessment years. The main contentions of the appellant included inconsistencies in the revenue's approach, double taxation, and lack of jurisdiction and proper enquiry in the additions made. However, the Tribunal found the CIT(A)'s decisions to be well-founded and dismissed the appeals.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 41840 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-12-2024
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: F
• Assessment Year: 2014-2015
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: ANU KRISHNA AGARWAL
• Keywords: Principle of natural justice; Search and seizure; Accommodation entries
• Section: 143(3); 142(1); 132; 13; 153C

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘F’ NEW DELHI BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER AND SHRI VIMAL KUMAR, JUDICIAL MEMBER ITA Nos. 1358, 1359 & 1360/Del/2023 (Assessment Years : 2013-14, 2014-15 & 2015-16) Polo Computers & Softwares Pvt. Ltd. S. No.21, G.F. Opp - Balbhaban, Delhi – 110 002 PAN : AAECP 4758 K Vs. ACIT Central Circle – 13 Delhi – 110 055 (Appellant) (Respondent) Assessee by -None- Respondent by Ms. Anu Krishna Agarwal, CIT-D.R. Date of Hearing 17.12.2024 Date of Pronouncement 31.12.2024 O R D E R PER VIMAL KUMAR, JM: 1. These three appeals filed by assessee are against order dated 13.12.2022 (for A.Ys. 2013-14 & 2014-15) and dated 29.11.2022 (for A.Y. 2015-16) of Learned Commissioner of Income Tax (Appeals)-28, New Delhi [hereinafter referred to as ‘Ld. CIT(A)’] arising out of assessment order dated 28.12.2018 of the Assistant Commissioner of Income Tax, Central Circle-13, New Delhi -2- ITA Nos.1358, 1359 & 1360/Del/2023 Polo Computers and Softwares Pvt. Ltd. vs. ACIT A.Ys. 2013-14, 2014-15 & 2015-16 (hereinafter referred as ‘Ld. AO’) under section 153C r.w.s 143(3) of the Income Tax Act, 1961 [hereinafter referred to as “the Act”]. 2. All the three captioned appeals involve similar facts and issues. For facility of convenience, all three appeals were heard together and are being disposed of by a common order. 3. We shall first take up the A.Y. 2013-14 for adjudication purposes. ITA No. 1358/Del/2023 for A.Y. 2013-14 : 4. Brief facts leading to this case are that a search and seizure operation under section 132 of the Act was conducted on 23.07.2015 and subsequent dates in different business and residential premises of “Shri Deepak Agarwal, Shri Mukesh Kumar and others” group of cases, based at Delhi, allegedly entry operators providing accommodation entries to beneficiaries. As per Assessing Officer, during the course of search and seizure operation many incriminating papers/documents, related to the assessee company were found and seized. After recording satisfaction, notice under section 153C of the Act was issued to the assessee. Notice under section 142(1) of the Act was issued. It is noteworthy that in response to notice under section 153C of the Act, the assessee filed its return of income at a loss of Rs.4,790/-. The Authorized Representative of the assessee attended the assessment proceedings. On completion of assessment proceedings, additions of -3- ITA Nos.1358, 1359 & 1360/Del/2023 Polo Computers and Softwares Pvt. Ltd. vs. ACIT A.Ys. 2013-14, 2014-15 & 2015-16 Rs.50,02,578/-, Rs.12,50,645/-, Rs.5,71,370/- and Rs.8,99,671/- (total assessed income Rs.77,19,504/-) were made by the learned Assessing Officer vide order dated 28.12.2018. 5. Being aggrieved assessee/appellant preferred appeal before the learned CIT(A) which was partly allowed by the order dated 13.12.2022. 6. Being aggrieved, appellant/assessee preferred present appeal with the following grounds : “1. The Ld. CIT(A) has erred in not appreciating the fact that approach adopted by revenue is inconsistent and, contradictory. 2. The Ld. CIT(A) has erred in not appreciating the fact that addition tantamounts to double taxation and is therefore not permissible. 3. The Ld. CIT(A) has erred in not appreciating the fact that disallowance of expenditure amounting to Rs. 5,71,370/- is factually and legally misconceived. 4. The Ld. CIT(A) has erred in not appreciating the fact that the protective addition of Rs. 8,99,671/- in the hands of Sh. Mukesh Kumar is without jurisdiction as no cross examination of such amount or any document was done with Sh. Mukesh Kumar and the relevant document was not recovered from the possession of Sh. Mukesh Kumar. 5. The Ld. CIT(A) has erred in not appreciating the fact that the lack of enquiry by the learned assessing officer. 6. The Ld. CIT(A) has erred in not appreciating the fact that no addition can be made on the basis of surmises, suspicion and conjectures. -4- ITA Nos.1358, 1359 & 1360/Del/2023 Polo Computers and Softwares Pvt. Ltd. vs. ACIT A.Ys. 2013-14, 2014-15 & 2015-16 7. The Ld. CIT(A) has erred in not appreciating the fact that the any document found from third party premises in absence of any corroborative evidence cannot be relied upon to draw any adverse inference against the appellant. 8. The Ld. CIT(A) has erred in not appreciating the fact that in absence of section 65B of evidence act, the documents in electronic form recovered from third party premises cannot be made a foundation of invoking section 153C of the act. 9. The Ld. CIT(A) has erred in not appreciating the fact that computation made is otherwise too arbitrary and wholly untenable. 10. The Ld. CIT(A) has erred in not appreciating the fact that addition cannot be made merely on the basis of statement of third party recorded behind the back of assessee without providing an opportunity to cross examine such witness, is contrary to the principles of natural justice and any inference drawn on basis of such statements be held unsustainable under law. 11. The Ld. CIT(A) has erred in not appreciating the fact that the Ld. Assessing officer has made an addition of Rs. 8,99,671/- without getting it disowned by the person from whose possession the document based upon which such addition has been made was found and seized. Thus, the addition is against the true spirit of law. Hence, Void. 12. The Ld. CIT(A) has erred in not appreciating the fact that the Ld. Assessing officer has made an addition of Rs. 8,99,671/- without appreciating the statement recorded u/s 132 of the act in toto. Thus, the addition is against the true spirit of law. Hence, void. 13. The Ld. CIT(A) has erred in not appreciating the fact that percentage of commission adopted either @ 2.5% or increase on assets in liabilities and 1.5% as items/bank revenue deposits/withdrawals is without any basis and thus untenable. -5- ITA Nos.1358, 1359 & 1360/Del/2023 Polo Computers and Softwares Pvt. Ltd. vs. ACIT A.Ys. 2013-14, 2014-15 & 2015-16 14. The Ld. CIT(A) has erred in not appreciating the fact that the computation made is otherwise too arbitrary and wholly untenable 15. The Ld. CIT(A) has erred in not appreciating the fact that furthermore addition made on substantive basis in the hands of Mukesh Kumar @20% and protective basis in the hands of appellant company @ 80% is also based on no material and grossly untenable. 16. The Ld. CIT(A) has erred in not appreciating the fact that the assessment order dated 28th December 2018 is not a speaking order, therefore, needs to be annulled. 17. The Ld. CIT(A) has erred in not appreciating the fact that the addition made on substantive basis in the hands of Mukesh Kumar is also based on no material and grossly untenable. 18. The appellant crave leave to add, alter or amend any of the grounds before or at the time of hearing.” 7. At the time of hearing, none appeared on behalf of appellant/assessee today and earlier on several occasions i.e. dated 28.11.2023, 14.02.2024, 08.05.2024, 15.07.2024, 08.10.2024, 12.12.2024, 16.12.2024 and 17.12.2024. 8. Learned Departmental Representative for the Department of Revenue relied on the impugned order. 9. From examination of record in light of aforesaid rival contentions, it is crystal clear that appellant/assessee has challenged the order of learned CIT(A) by upholding the additions. -6- ITA Nos.1358, 1359 & 1360/Del/2023 Polo Computers and Softwares Pvt. Ltd. vs. ACIT A.Ys. 2013-14, 2014-15 & 2015-16 After going through the order of learned CIT(A) in absence of any supporting material filed by the appellant/assessee we see no reason to interfere with the findings of learned CIT(A). Therefore, the grounds of appeal in ITA No.1358/Del/2023 are dismissed. 10. In the result, assessee’s appeal in ITA No.1358/Del/2023 is dismissed. ITA Nos.1359 & 1360/Del/2023: 11. As the facts and circumstances of the above mentioned appeals are admittedly mutatis mutandis similar to those discussed and disposed of in ITA No.1358/Del/2023 hereinabove, we hold accordingly and dismiss the appeals of the assessee. 12. In the combined result, all the three appeals filed by the assessee are dismissed. Order pronounced on this day 31st December, 2024 Sd/- Sd/- (PRADIP KUMAR KEDIA) (VIMAL KUMAR) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 31.12.2024 Pr i ti Y adav, S r. PS * -7- ITA Nos.1358, 1359 & 1360/Del/2023 Polo Computers and Softwares Pvt. Ltd. vs. ACIT A.Ys. 2013-14, 2014-15 & 2015-16 Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI "