9911796707
TMI Blog2015 (8) TMI 224X X X X Extracts X X X X X X X X Extracts X X X X ..... notice dated 18.3.2011 had returned before 31.3.2011, why the AO not applied mind in the matter to find out the correct address, by looking at data base of his assesses. The argument that it was the appellant, who had at some point of time given this address, is of no relevance, as the AO was in possession of the new address, which was duly informed by the appellant, and from which later returns were filed and which was also available in the PAN data base. Thus the reassessment proceedings in pursuance of the notice u/s 148, which was not served upon the appellant (within the prescribed time) as bad in law. Further, on perusal of the copy of the notice the same shows that the notice u/s 148 is silent about the assessment year for which the proceedings were to be reopened. Thus the notice u/s 148 as invalid.- Decided in favour of assessee. Addition u/s 68 - CIT(A) deleted the addition - Held that:- The appellant had furnished all relevant information to substantiate the identity, genuineness and creditworthiness of the share applicants by filing conformation, their PAN/ITR Details, copy of bank statements, ROC documents for allotment of shares. Appellant had duly discharged ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the onus is on the assessee to Date of Hearing 08.07.2015 Date of Pronouncement 31 .07.2015 establish the identity, creditworthiness and genuineness of the transaction, ignoring the fact that the assessee could not be able to furnish even one basic document i.e original copy of confirmation of creditors. 5. The appellant craves to add, alter, amend, modify add or forego any ground of appeal at any time before or during the hearing of this appeal. 2. The relevant facts of the case as emanating from the assessment order dated 30th December 2011 u/s 143(3)/147 of the Income Tax Act 1961 are that the assessee declared an income of ₹ 14,140/- by way of its return on 1/11/2004. The said return was processed u/s 143(1). The assessee s case was reopened u/s 147/148 based on the information received from the office of the Directorate of Income Tax (Investigation), Delhi, New Delhi about the companies who were involved in taking /dealing accommodation entries for unaccounted money. As per the report sent by the Investigation Wing the assessee company was one of the companies which had taken accommodation entry for its unaccounted money in the year under consideration. 2. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5,00,000 24/9/2003 M/s Acoot India Pvt. Ltd. (A/c No. 3365, Jailaxmi Coop, Bank, Fatehpuri, Delhi) 267960 2.3 The said notice along with enclosure as per the assessment order returned undelivered with the remark no such firm . However, letter dated 1/12/2011 was received from the assessee on 5/12/2011 again raising these objections. Accordingly, notice u/s 142(1) dated 7/12/2011 was again forwarded to the assessee along with enclosures. In responses thereto, the assessee attended the proceedings on 14/12/2011 and objected to the reopening on the grounds that the notice u/s 148 was not issued/served upon the assessee within the statutory period of limitation. The assessee further on subsequent dates filed supporting evidences in regard to the issue on merit. 2.4 The objection of the assessee was dismissed by the assessing officer holding as under:- Regarding the service of notice u/s 148, it is clarified that the said notice was issued at the address mentioned in its relevant ITR i.e A. Y 2004-05. The assessee cannot deny the address though it was its old address. The notice never received back ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from Investigation Wing regarding accommodation entry providers. 2. On the facts and in the circumstances of the case, the Ld. CIT(A) erred in quashing the re-assessment order as bad in law on the basis that the AO has issued the notice u/s 148 at old address, but ignored the fact that the notice was served validly. 3. On the facts and in the circumstances of the case, the Ld. CIT(A) erred in quashing the re-assessment order as bad in law despite the fact that the AO has passed the speaking assessment order. 5. The facts of the case are found summed up by the CIT(A) in Para 4 of his order and are reproduced hereunder:- 4. Brief facts of the case are as under: The appellant company is a Non Banking Finance Company (NBFC) engaged in the business consists of giving of loans and advances, trading in shares etc. The appellant filed the Return of income on 1st November 2004 declaring n income of ₹ 14,140/-. The return was processed u/s 143(1). Later, notice u/s 148 was issued/sent by AO, which the appellant claimed was not served on the Appellant as it was addressed at a wrong address. Thereafter, a notice u/s 142(1) dated 8/8/2011 was issued at 1004A, Chiranjiv To ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issue of the correct notice in the prescribed format (ii) Timely and valid service of such notice (iii) Maintaining proper record of both issue and service 2. Issue of Notice (only relevant portion reproduced here for brevity) 2.1 The checklist given below may be used while issuing any notice: (i) Is it the proper notice to be issued? (ii) Is it in the prescribed format? (iii) Are inapplicable words or clauses struck off? (iv) Is it addressed to the correct person? (v) Is the address correct ? (vi)Are the name and status of the appellant correctly mentioned? (vii) Is the assessment year correctly mentioned ? (viii)Is the person addressed given a reasonable time to respond? (ix)Are the date, time and venue of hearing given? (x)Is the notice signed and seal affixed? 3. Service of notice 3.1 As per the provisions of section 282 a notice may be served either by post or as if it were a court summons under the Civil Procedure Code. 4. Service by post 4.1 The procedure for service by post is given in section 27 of the General Clauses Act. Requirements for valid service by post are (i) Proper addressing (ii) Prepaying ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t only subsequently when notice u/s 142 (1) dated 8/8/2011 was issued to the assessee at the correct address that the assessee appeared. It was submitted that a duty is cast upon assessing officer to check the jurisdiction and the information; check the particulars of name, address etc. and ensure that latest particulars of the Appellant ie. Latest name, latest/correct address, correct assessment year is incorporated before issuing a notice u/s 148. Thus, referring to the requirements of Section 148, which need to be met before making the reassessment it was submitted the AO as per the following decisions is required to serve upon the appellant the notice in the prescribed form and manner which evidently was not the reassessment was claimed to be bad in law: - CIT VS. Eshan Holding Pvt. Ltd. (ITA No. 1171/2008) R. K. Upadhyaya Vs. Shanabhai P. Patel 1987 AIR 1378 S(SC) CIT VS. Rajesh Kumar Sharma ITA 1547/2006 (Delhi) (13 Aug 2007) ACIT and Anr Vs. Hotel Blue Moon [2010] 321 I.T.R. 362 (SC) CIT Vs. Rajeev Sharma [2010]40 DTR (ALL) 129 Alpine Electronics Asia Pvt. Ltd Vs. Director General of I. Tax Anr. Motilal Bimalchand Jain (HUF) Vs. CIT (285 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of ₹ 32,00,000/-of share application received shares of ₹ 17,00,000/- have been allotted to four applicants and ₹ 15,00,000/- were returned to three applicants in the very next assessment year 2005- 06 by account payee cheques. The fact though already on record was completely ignored by the AO for making such illegal addition. 3. Even the income returned by the company after A.Y 2003-04 have been quoted for alleging that shareholders cannot be inclined to make investment in a Company have meager profits. Any Share holder/Applicant is not a fortune teller and cannot predict the Income/Loss of the Company for the subsequent period. 9. In the abovementioned facts and evidences addressing the share holders filed before the AO it was submitted that it proved beyond doubt that all the transactions entered through banking channel; the share holders were assessed to tax the identity and creditworthiness and genuineness stood established. In view thereof relying upon various decisions it was pleaded that even on merit, the addition has been wrongly made. 10. Considering these facts the CIT(A) quashed the proceedings vide paras 6 to 6.4 and thereafter proceedings ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e in any manner. 14. We have heard the rival submissions and perused the material available on record. On a consideration thereof we are of the view that before we deliberate on the issues further it would be appropriate to first address the relevant finding under challenge. The same is reproduced hereunder for ready reference: - 6. I have carefully considered the facts of the case in the light of the submission made by the appellant in the light of the applicable law. Accordingly, my decision on various grounds of appeal is as under: 6.2 Vide Grounds no. 1 to 9 of the appeal, the appellant has challenged the reassessment proceedings on legal grounds. I find that for the purpose of initiating the proceedings for reassessment the notice u/s 148 was to be issued on or before 31.3.2011. On careful consideration of the facts in the light of submission of the appellant, it is evident that the ld. AO had sent the notice u/s 148 dated 18.3.2011 at the previous address of the appellant, which was changed 6 years ago by the appellant. Necessary information was specifically given to the AO in this regard and even the address was changed in the PAN data base. It is very likely th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in which a few pages are devoted to academic discussion about what constitutes an accommodation entry, etc. and by making certain general remarks such as how can someone invest in a company whose returned income is low, etc. his statutory duty as the AO was over and, therefore, he just placed the evidences furnished by the appellant in file and ignored the same. 6.6 In view of the same, I hold that the Appellant had duly discharged the onus and it was the responsibility of the AO to have made necessary verification in respect of the evidences furnished by the Appellant. Since the ld. AO made no efforts at any stage, be at the stage of recording of the reason for reopening of the case or at the assessment stage, I hold that the Appellant had duly substantiated the necessary requirements for holding cash credit as explained. Factually also, there were no specific adverse observations nor any contradiction observed by the AO in respect of such evidences and hence the action of the AO in holding the same as unexplained cash credit was without any basis, cogent grounds and was therefore unjustified. 6.7 The fact that the ld. AO did not make any efforts in making enquiries by issue ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
