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TMI Blog2019 (4) TMI 498X X X X Extracts X X X X X X X X Extracts X X X X ..... referred to as 'the assessee') by filing the present appeal, sought to set aside the impugned order dated 17.10.2013 passed by Ld. CIT (Appeals)-XI, New Delhi qua the Assessment Year 2003-04 on the concise grounds inter alia that:- "On the facts and in the circumstances of the case, the CIT (A), New Delhi has erred both facts and in law, in upholding the illegal Order of The respondent on the following grounds and hence liable to be quashed because: 1. Reasons recorded are vague and scanty, without application of his own mind by AO and without necessary approval of the Joint CIT and hence reassessment proceeding are not in terms of section 147 to 151 of the Income Tax Act. 2. Re-assessment proceedings are without issue/service of not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nces of the case and in law, the order of the Ld. CIT (A) is wrong and against the provisions of law which is liable to be set aside. 2. On the facts and circumstances of the case, the Ld. CIT (A) has erred in deleting the addition of Rs. 1,28,53,466/- as the assessee company has failed to explain the identity, genuineness and source of credits appearing in his bank account. 3. On the facts and circumstances of the case, the Ld. CIT (A) has erred in holding that the assessee company was a stepping stone in routing back undisclosed money of the beneficiaries." 4. Briefly stated the facts necessary for adjudication of the controversy at hand are : Assessing Officer framed the assessment under section 143(3)/147 of the Income-tax Act, 196 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... their beneficiaries have been received in the form of CD from the Office of the Directorate of Income-tax, Jhandewalan, that the assessee has received Rs. 4,50,000/- as accommodation entries from M/S. SHIVAM SOFTECH LTD. & ARPIT SALES CORP. The detail is as under :- BENEFICIARY'S NAME VALUE OF ENTRY TAKEN INSTRUMENT NO. BY WHICH ENTRY TAKEN DATE ON WHICH ENTRY TAKEN NAME OF ACCOUNT HOLDER OF ENTRY GIVING ACCOUNT BANK AND BRANCH FROM WHICH ENTRY GIVEN A/C NO. ENTRY GIVEING ACCOUNT HOPEWIN ADMARK & CONSULTANCY SERVICES (P) LTD. HOPEWIN ADMARK & CONSULTANCY SERVICES (P) LTD. 250000 200000 941601 115504 08/02/2002 27/03/2003 SHIVAM SOFTECH LTD. ARPIT SALES CORP. FEDERAL KAROL BAGH &nbs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly, AO reopened the assessment on the ground that an income of Rs. 4,50,000/- (Rs.2,50,000/- and Rs. 2,00,000/-) taken by the assessee as entry from M/s. Shivam Softech Ltd. and M/s. Arpit Sales Corp. respectively has escaped assessment. It is also not in dispute that the amount of Rs. 2,00,000/- alleged to have been taken by the assessee from M/s. Arpit Sales Corp. merely as an entry pertains to earlier year i.e. for AY 2002-03 being of 27.03.2003. 9. It is also not in dispute that the entry amount of Rs. 2,50,000/- and Rs. 2,00,000/- alleged to have escaped assessment by the AO, has been duly accepted by the AO during assessment proceedings, having been duly explained by the assessee and no addition thereon has been made. 10. Now the qu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... count, he would be required to issue a fresh notice under section 148. The Assessing Officer was satisfied with the justifications given by the assessee regarding the items of club fees, gifts and presents and provision for leave encashment, but during the assessment proceedings, he found the deduction under sections 80HH and 80-I as claimed by the assessee to be not admissible. He consequently proceeded to make deductions under sections 80HH and 80-I and accordingly reduced the claim on these accounts. The very basis of initiation of proceedings for which reasons to believe were recorded was income escaping assessment in respect of items of club fees, gifts and presents, etc., but while these items were not disturbed, the Assessing Officer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Rs. 1,28,53,466/- made addition of Rs. 1,28,535/- on substantive basis being 1% of the commission of Rs. 1,28,53,466/- credited in the profit and loss account. At the same time, AO made addition of Rs. 1,28,53,466/- on protective basis in the hands of assessee. 14. Undisputedly, protective addition of Rs. 1,28,53,466/- has been deleted by the ld. CIT(A) wide impugned order which has been challenged by the Revenue by way of filing cross appeal. But again for the sake of repetition, we are of the considered view that since items of these additions were not subject matter of the reasons recorded / reopening, the addition per se cannot survive, as has been held by Hon'ble Delhi high court in Ranbaxy Laboratories Ltd. (supra). Consequently, G ..... X X X X Extracts X X X X X X X X Extracts X X X X
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