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TMI Blog2017 (9) TMI 116X X X X Extracts X X X X X X X X Extracts X X X X ..... has escaped to the tune of Rs. 6 lakhs. Therefore, notice under section 148 was issued. The assessee was provided copy of the reasons. The assessee in response to the notice submitted that the return originally filed may be treated as return as having been filed in response to the notice under section 148 of the Act. 3.1. The assessee-company is engaged in manufacturing and trading of electrical goods and components. In the instant case, information has been received from Commissioner of Income Tax, Central-2, New Delhi that assessee has taken/received accommodation entries totalling to Rs. 6 lakhs from companies floated by Shri Asheem Gupta on 27th August, 2004 through Corporation Bank for a sum of Rs. 3 lakhs each from M/s. Moderate Credit Corporation Pvt. Ltd. Shri Asheem Gupta has stated on oath at the time of search that cash and other unexplained deposits in various bank accounts of several entities controlled by him and he was merely providing accommodation entries. The modus operandi of Shri Asheem Gupta was to accept cash from the beneficiaries and cash deposited in bank account of companies floated by him. The assessee submitted that it had received two cheques of Rs. 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see-company. Paper Book Page No.32 is the List of Directors in M/s. Moderate Credit Corporation Pvy. Ltd., in which Shri Shri Asheem Gupta has no connection whatsoever and he was also not connected with the subscriber company. He has also filed copy of the assessment order under section 143(3) dated 23rd December, 2008 for A.Y. 2006-2007 in the case of M/s. Moderate Credit Corporation Pvt. Ltd., to show that it was a genuine company and assessed to tax by the Revenue Department. He has, therefore, submitted that assessee-company has proved the identity of the subscriber company, their creditworthiness and genuineness of the transaction. The party has also directly confirmed the genuineness of the transaction to the A.O. He has relied upon the decision of Delhi High Court in the case of CIT-9 Erstwhile CIT-VI vs. M/s. Vrindavan Farms P. Ltd., 2015 (11) TMI 279 in which paras 3 to 5 reads as under : "3. Ms. Suruchi Aggarwal, learned Senior Standing counsel for the Appellant, relied upon the decision of this Court in CIT v. Nova Promoters & Finlease Ltd. 342 ITR 169 and urged that the Assessing Officer (AO) was not required to "point to the source from which the money was received b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax by such share applicants and did not carry out a deeper analysis or rather chose to ignore it. In these circumstances, the inferences drawn by the CIT (A) are not only factual but facially accurate. 9. Having regard to these circumstances, the Court discerns no question of law, least a substantial question, having regard to the fact that the judgment in Lovely Exports (supra) was cited and applied. 10. For these reasons, there is no merit in the appeal; the same is accordingly dismissed". 4.2. He has also relied upon the order of the ITAT, Delhi Bench in the case of Prabhatam Investment P. Ltd., vs. ACIT dated 17th April, 2017 in which the Tribunal relied upon the decision of the Delhi High Court in the case of CIT vs. Winstral Petrochemicals P. Ltd., 330 ITR 603 (Del.) in which it was held as under : "Dismissing the appeal, that it had not been disputed that the share application money was received by the assessee-company by way of account payee cheques, through normal banking channels. Admittedly, copies of application for allotment of shares were also provided to the Assessing Officer. Since the applicant companies were duly incorporated, were issued PAN cards and had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has relied upon the decision of Delhi High Court in the case of CIT vs. Navodya Castles Pvt. Ltd., (2014) 367 ITR 306 (Del.) in which assessee was unable to produce the Directors and Principal Officers of six share holder companies. The matter was therefore, remitted back to the Tribunal for fresh adjudication. This decision of Hon'ble Delhi High Court is confirmed by the Hon'ble Supreme Court reported in (2015) 56 taxman.com 18 (SC). 5.1. The Ld. D.R. submitted that even if A.O. has not called for the share applicants for examination as noted by the Ld. CIT(A) in the appellate order and A.O. did not make proper enquiry, then the matter may be remanded back to the A.O. for re-consideration of the issue. 6. I have considered the rival contentions. During the course of hearing of the appeal, vide order dated 10th July, 2017, the Ld. D.R. was directed to verify how Shri Asheem Gupta has connection with the lender company i.e., M/s. Moderate Credit Corporation Pvt. Ltd. The Ld. D.R. did file reply containing information provided by CIT (Central)-2, New Delhi to the A.O. on the basis of which assessment was reopened supported by list of beneficiaries who has given the name of assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al Officer of the share applicant company for examination before him. It is not clear from where Ld. CIT(A) has noted that assessee did not produce the Director/Principal Officer of the Company before A.O. It is well settled law that onus of proving the claim is initially on the assessee but the burden shifts on the A.O. when the assessee discharged its primary onus. In the present case, the assessee had fully discharged its primary onus by submitting the relevant and cogent evidences before A.O. to establish the genuineness of the transaction in the matter. The A.O. however, did not do so anything in the matter and has not pointed out how the claim of assessee was factually incorrect. Simply because the share applicant company did not have sufficient income would not prove the case of the A.O. because the share applicant company has huge worth to make investment in assessee-company. The decisions of Delhi High Court relied upon by Learned Counsel for the Assessee squarely apply to the facts of the case. The assessee thus, proved the identity of share applicant, its creditworthiness and genuineness of the transaction in the matter. The decisions relied upon by Ld. D.R. would not su ..... X X X X Extracts X X X X X X X X Extracts X X X X
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