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TMI Blog2016 (4) TMI 575X X X X Extracts X X X X X X X X Extracts X X X X ..... given about the such deposits to the assessee’s depositors. No such Inquiries have been done. Therefore in view of the above we confirm the order of learned Commissioner of Income-tax (Appeals) on this ground and in result the appeal of the revenue is dismissed. - Decided in favour of assessee - ITA No.3432/Del/2009 - - - Dated:- 22-2-2016 - SHRI H.S.SIDHU, JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER For The Revenue : Sh.Trasnthen, Sr. DR For The Assessee : Sh. U.S. Aggarwal, Adv PER PRASHANT MAHARISHI, A. M. 1. This appeal is preferred by the revenue against the order of learned Commissioner of Income-tax (Appeals)-XV, New Delhi dated 04.06.2009 for the Assessment Year 2006-07 raising following grounds of appeal:- 1. On the facts and circumstance of the case the CIT(A) has erred in deleting the addition of ₹ 66.25 lacs on account of unexplained share capital, share application money and share premium received by the assessee during the year. 2. On the facts and circumstances of the case the CIT(A) erred in deleting the addition of ₹ 66.25 lacs made u/s 68 of the IT Act ignoring the fact that assessee had failed to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld learned Commissioner of Income-tax (Appeals) dealt with this issue at Para 2.1 to 2.3 as under:- 2.14 I have considered the submissions of the appellant, the finding of the AO and the facts on record. Now, the supporting before the AO (confirmations, Permanent Account No. details, cheque bank details for remittances, copy of Income Tax returns for all shareholders, address proof in the shape of ration card/ voter I card for all shareholders. fresh affidavits for 20 shareholders, copy of bank statements/ pass books, appellant's own bank statement, return of allotment of share capital (Form No.5) filed with Registrar of Companies ) in respect of the share applicant shareholder indicate the following against each one of them : S.No. Name and address PAN Amount 1. Subash Chand Jain, 486/158, K, Opp Railway Reservation Counter, Datiganj ABKPJ72020L 250000/- 2. Rita Jain, 40, Tibbia College, Karol Bagh, N. Delhi ACWPJ6677N 250000 3. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ACWPJB225G 250000 20. Kaushalya Devi B-4/34, Secor-7, Rohini, N. Delhi AESPD7638D 275000 21. Vijender Gupta, 6, Pusa Road, Karol Bagh, New Delhi AEAPG0272N 250000 22. Anita Chopra 3-4/34. Sector-7, Rohini, N. Delhi ABWPC4702G 250000 23. Dilip Sharma 239, GheeMandi, Paharganj, N. Delhi APCPS5959M 225000 24. Rajesh Kumar Chopra B-4/34, Sector-7, Rohini, N. Delhi ABWPC4687N 225000 25. Rajinder Singh B-4/34, Sector-7, Rohini, N. Delhi APAPS5961H 275000 26. Rakesh Jain 2/5763, Block No.-S, Dev Nagar, Karoi Bagh, N. Delhi ACWPJ6675Q 275000 2,2 As can be seen, each of the share applicant is an income tax assessee , has an identifiable address, and the money transmitted to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... there was error in giving bank details of all the above share applicants and fresh set of confirmations .was filed. Records show AO that name of the bank branch was typed wrongly in cases of Kaushalya Devi, Vijender Gupta, Anita Chopra, Rajesh Kumar Chopra, and Rajinder Singh , and corrected confirmation by giving the right name of the bank branch was being filed. In 4 of the 5 share applicants as can be seen; the AO's requisition and the appellant's amended information did not have any co relation , in as much as the appellant all on his own tendered the information without being goaded into doing so by the AO. Secondly, the AO has not pointed out to the manner, whereby the corrected version of confirmation did not reflect the correct particulars of the originator of money, the of transmission of money, the actual destination of the money transmitted. Viewed totally against facts on record no adverse inference could have been drawn against the appellant solely on the premise that it tendered corrected information on remitting banks in course of assessment proceedings. (b) The AO's views that the share applicants are men of insubstantial means and could not ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llant without releasing the copy her statement or affording an opportunity to cross examine the witness. It is trite law that cross-examination is germane to due process of taking evidence and no adverse inference can be drawn against a party unless the party is put on notice of the case made out against him. The assessee must be supplied with the contents of ail such evidences, both oral and documentary, so that he can prepare to meet the case against hint. This necessarily also postulates t.hut he should cross examine the witness. CIT v. Eastern Commercial Enterprises [1994] 210 TO 103 (Cal) in M. Pirai Choodi v. ITO [2008] 302 ITR 40 the Modras, High Court quashed the assessment proceedings holding that in spite of documentary evidences furnished to substantiate the agricultural income, the AO had overlooked it and refused to admit the agricultural income merely based on statement alleged to have been obtained from the village administrator behind the back of the assesses. Similar is the ratio in Tirupati Builders v. ITO [2003] 126 Taxman 54 (Rajkot) (Mag.). Alluding to the decisions supra, I hold that the AO could not have taken an adverse view on the entire set of share ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of share applicants, I hold that the AO could not have invoked the provisions of section 68 in respect of the share application money obtained by the appellant. (e) The AO on enquiry at the bank accounts of the share applicants has found linkage between some of the share applicants and some third parties, namely, Banke Bihari Securities, and Shivshakti Enterprises, According to the AO, cash has been introduced in bank accounts of these 2 concerns where from cheques have been drawn in favour of the share applicants, and in turn the share applicants have drawn DD favoring the appellant. Now, the fact remains that there is no evidence to link the appellant, with either Banke Bihari Securities or Shivshakti Enterprises and there is nothing on record or established that the appellant was instrumental in depositing cash in the bank accounts of those 2 concerns or that the appellant was the owner of the cash so introduced. As far as the appellant is concerned, it is twice removed from the 2 third parties L As held in Nemi Chand Kothari Vs CIT 264 ITR 254 (Gauhati), CIT Vs Diamond products Ltd (2009) 21 DTR (Del ) 9 and Orient Trading Co Ltd Vs CIT 49 ITR 723 (Bom ), the appellant is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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