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TMI Blog2015 (12) TMI 1330X X X X Extracts X X X X X X X X Extracts X X X X ..... rch it was found that assessee had been maintaining its books of accounts at another premises situated at 20, Bhatia Niwas, 233/235, Samuel Street, Masjid Bunder, Mumbai - 400 009. Therefore, the said premise was covered for survey action u/s. 133A of the I.T. Act. During the survey action, it was revealed that seven other companies have also been operating from the said premise Bhatia Niwas. It revealed that the assessee and all the above stated seven companies were engaged in investment activities and have made investments in equity shares of various companies including one M/s. Shree Global Trade fin. Ltd. The investments were made out of the share capital of the company, which consisted of the share application money received from various other concerns. It was also revealed that there was one common director in some of the above stated seven companies e.g. Shri Ajay Kumar has been the director of., M/s Auster Properties Pvt. Ltd. and M/s Reva Properties Pvt. Ltd. Similarly Shri Om Hari Halan has been a director in M/s Archive Realty Developers Pvt. Ltd. and M/s. Vedisa Properties Pvt. Ltd.; Similarly Sh. Narayan Hari Halan was director in M/s. Martand Properties Pvt. Ltd., M/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng term capital gain, short term capital gain, losses, speculative losses and share application money etc. It was also observed that two companies of Mr. Mukesh Chokshi, i.e. M/s. Talent Infoway and M/s. Mihir Agencies have also made investment in AY 2009-10 for the purchase of shares in the M/s. Jogia Group of companies. The AO observed that Shri Ajay Kumar, Director of the company had offered the amount received as share capital from above said companies as unexplained credits in AY. 2008-09 & AY 2009-10. Since the undisclosed income declared in the statement was not offered for taxation in the return filed, therefore, the AO gave a show cause notice to the assessee to submit complete details of share application money received and utilized. The AO also asked the assessee to submit the complete evidences to prove the identity, credit worthiness and genuineness of the transaction of the share holding companies. In response to the show cause notice, the Ld. AR of the assessee submitted its reply along with relevant details, confirmations and evidences etc.; The AO however was not satisfied with the reply of the assessee and noted certain discrepancies in the evidences submitted by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the details relating to these companies. All the companies were having PAN and independently and regularly assessed to tax. Complete details of cheque number., date of cheque, bank a/c. share allotment letters giving detail of share certificate number, copy of bank account of the assessee was submitted before the AO. He further noted that the statement of Mr. Choksi was not recorded in the context of this case but was recorded in some other case. Mr. Choksi had given a general statement that he was giving accommodation entries to the companies against cash received from them. Nowhere in the statement, had he stated that cash was received from the assessee company and cheque was issued against the cash as share application money. There was no mention in the said statement that transaction with the assessee company was not genuine. No incriminating document was found and seized during search operation to prove that cash was given against cheques received from these companies. Even independent enquiry made in respect of the bank accounts of these companies, the AO could not find any instance of cash deposit against issuing of cheques. The Ld. CIT(A) thereafter examined the applicabili ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s as were made before the lower authorities. Inviting our attention to the case record relating to AY 2008-09, the Ld. AR has pointed out that none of the companies who had invested in the assessee company in the AY 2008-09 belonged to Sh. Mukesh Chokshi. He has further invited our attention to the various documents filed in the paper book to contend that the assessee had submitted all the required details such as balance sheet, return filed giving the full particulars about the company, the confirmations from the investing companies regarding the investments made in the share capital of the assessee company, certificate from the auditors to the effect that the said company was assessed to tax and that the investment was duly reflected in their regular books of accounts. The details of allotment of shares, the complete details giving cheque number, name of the bank, date, amount, address, PAN Number, ROC Number etc. in respect of each of the 8 companies from whom the assessee had received the share application money in the AY 2008-09 was filed. The details of the notice issued by the assessee company for holding the meetings of the shareholders and the proof of dispatch of the noti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... share application received in case of the assessee from certain companies had been obtained by paying cash. In reply to question No. 15, it has been stated by the said Sh. Ajay Kumar that the statement given by Mr. Jose Mathews was not true. He was not aware about the business activity of the assessee company. The Ld. AR has further stated that Mr. Jose Mathews had nothing to do with the business activity of the assessee company. Mr. Jose Mathews also had retracted the statement which was recorded during the course of survey u/s. 133A and the necessary proof and evidence for the same was also produced before the AO. The AO had also thereafter not issued any notice to Mr. Jose Mathews. The Ld. AR therefore has submitted that no reliance can be placed in the statement of Mr. Jose Mathews. 9. We have considered the above submissions of the Ld. AR of the assessee. We have also gone through the statement of Sh. Ajay Kumar Halan, recorded under section 131 of the Act. The relevant part of his statement for the purpose of proper analysis is reproduced as under:- We find force in the above submissions of the Ld. AR. of the assessee. Mr. Jose Mathews was the employee of Shree Global Trad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment proceedings, the assessee vide different letters including letter dated November 30, 2011 had explained to the Assessing Officer all the above facts and that the disclosure was made solely on the basis of information provided to him by the investigation wing and purely on the mistaken belief that the transaction of share investments by nine companies could not be explained. However subsequently he gathered the information, the papers, the documents, the confirmations, bank statements, balance sheets and other records of all the nine companies. Based on the information and documents he found that all the nine companies were genuine and they had invested in the share capital of the assessee company. No confessional statement was given by any of the nine shareholding company before the Investigation Wing. 11. We find force in this contention also of the Ld. AR. A perusal of the statement of Sh. Ajay Kumar, recorded under section 131 of the Act, as reproduced above, reveals that the acceptance or offer of the unexplained income was not based on his own knowledge or admission of facts but on the basis of facts and statements presented by the revenue before him. He has never ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o.203/Del/2003 reported in 100 TTJ 929 12. We have gone through the above case laws relied upon by the Ld. AR. We find that in the above mentioned Judicial decisions, the various courts of law have been almost unanimous in holding that though the admission is an important piece of evidence but it can not be said that it is conclusive; it is open to the person who made the admission to show that it is incorrect and that merely on the basis of statement recorded during the search under mistaken belief and which has been retracted subsequently and without there being any corroborative evidence or incriminating material found, no addition can be made. As regards the statement of Mr. Mukesh Choksi relied upon by the revenue, the Ld. AR has submitted that he had never stated that assessee had given any cash to him or any accommodation entry was provided by him to the assessee. No name of the assessee figured in his statement recorded in any other case. During the course of survey/search on assessee also, not a single evidence was found to suggest that cash was given to Mr. Mukesh Choksi and accommodation entries were taken. The ld. AR has relied upon the decisions of the Hon'ble Bo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esh R. Marolia vs. Additional CIT" (2006) 6 SOT 247 (Mum) 9. "CIT vs. Shri Mukesh R. Marolia" in ITA No.456 of 2007 decided on 07.09.2011 (Bom HC) 10. SLP No.20146/2012 styled as "CIT vs. Shri Mukesh R. Marolia vide order dated 27.01.14 (SC) 11. "CIT vs. M/s. Kesar A. Gada in ITA No.300 of 2013 decided on 21.01.15(Bom. HC) 12. "CIT vs. Kasturben H. Gada" in ITA No.299 of 2013 decided on 21.01.15.(Bom HC) 13. CIT vs. M/s Sharda Credit Pvt. Ltd. ITA NO. 3090 of 2009 decided on 12.9.2011(Bom. HC) 14. We have perused the case laws relied upon by the Ld. Representatives of the parties. In our view, each case has to be decided on its own facts. Merely because, in the case of one company Gold Star Finvest Pvt. Ltd. run by Mukesh Chokshi, the income has been determined on percentage/commission basis treating the said company as accommodation entry provider, that itself cannot hold a justification to completely ignore the facts and evidences brought on the file by the assessee. The case of the assessee has to be adjudged on the basis of its own set of facts and evidences. Moreover the facts and circumstances of the case of the assessee are squarely covered by the various decisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, had relied upon the statement of Mr. Mukesh Chokshi that he had given various accommodation entries to various parties. The Hon'ble Bombay High Court observed that where the assessee had brought the relevant evidences regarding the genuineness of transaction and that in his statement Mr. Mukesh Chokshi had not mentioned the name of the respondent/assessee as one to whom accommodation entries were given, the Hon'ble Bombay High Court upheld the findings of the Ld. CIT(A) which were further confirmed by the Tribunal holding that the transactions were genuine and the additions under section 68 of the Act were not warranted. Similar findings have been given by the Hon'ble Bombay High Court in the case of "CIT vs. Kasturben H. Gada" in ITA No.299 of 2013 decided on 21.01.15. In CIT vs. M/s Sharda Credit Pvt. Ltd. (supra), the Hon'ble High Court has dismissed the appeal of the revenue on identical facts. The Hon'ble Bombay High Court while upholding the order of the Tribunal in the above stated appeals has also relied upon the decision of the Hon'ble Bombay High Court in the case of "Shri Mukesh R. Marolia" (supra). Even in the case of "Smt Rajni S Chowdhry" ..... X X X X Extracts X X X X X X X X Extracts X X X X
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