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TMI Blog2019 (5) TMI 1548X X X X Extracts X X X X X X X X Extracts X X X X ..... ons, Durgapur), is fictitious. Thus, the entire investigation of the Department reveals that the entire transaction was sham. The matter of fictitious account operated in the Axis bank is subjudicial and not coming under the jurisdiction of the Income Tax Department. The claim of the assessee that the alleged payment of donation is genuine, is not acceptable, because, the assessee has not furnished any detail/evidence to prove that the donation offered by the assessee is genuine transaction since the donation was deposited in Axis Bank, where, society is not maintaining any account and the society also not confirmed having received the said donation. In case, if the assessee deposited the loan amount cheque in her bank account and thereafter, send the donation from her bank account, on receipt of the same by the donee, the amount would have been debited from assessee s account and would be evident that the donee has received the donation. Actually, this was not done in this case. The assessee claims to have deposited the loan cheque into Axis Bank as a donation to the assessee, where, the donee has not maintaining any account, the incomplete transaction cannot be held as genu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5,000/- claimed under section 35(1)(ii) of the Act. On appeal, the ld. CIT(A) confirmed the assessment. On further appeal, vide order in I.T.A. No. 2316/Mds/2015 dated 18.08.2016, the Tribunal directed the Assessing Officer to re-examine the issue and the observations are reproduced as under: The assessing officer also needs to examine when the funds were credited in the so-called fictitious account, how this money credited into such fictitious account was transferred to real account maintained by the society for Welfare of Handicapped Persons. These facts are not examined by the assessing officer. The chain of transactions, which happened to credit the large amount of funds with fictitious account opened by Axis Bank, Kolkata, the role played by the officials of Axis Bank and the receipt of society need to be examined. Therefore, this Tribunal is of the considered opinion that the matter needs to be re-examined. In view of the above directions, after obtaining and considering the verification report of investigation wing, considering the submissions of the assessee, the Assessing Officer completed the assessment under section 143(3) r.w.s. 254 of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enuine trust M/s. Society for Welfare of the Handicapped Persons. To verify the modus operandi or procedures adopted to transfer the fund. (Please furnish the details of the trust's actual account.) iv. Whether any other such fund transfers have occurred between the Axis Bank account mentioned above, to the real account of the said trust and verify the relation between the entities. v. Whether, the said trust M/s. BHAROSHA (Society for Welfare of the Handicapped Persons) is actually notified for having exemption u/s 35(1)(ii)? 5. The verification report of the ADIT (Inv.), Durgapur (O/o Pr. DIT (Inv.) Kolkata) is reproduced as under: 1. There is an organisation SOCIETY FOR WELFARE OF THE HANDICAPPED PERSONS at its registered office at 27, Tagore Avenue, Durgapur, having its PAN - AAETS6278C with date of incorporation as 09.06.1981. The society is claimed to be recognised by the Ministry of Science and Technology and is engaged in Research and Development of medicine for various diseases like Leprosy etc. On physical enquiry, it was found that the society is established long ago and actually involved in care and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Handicapped Persons (Real Trust) and the said trust was not having any account in Axis Bank anywhere in India. Hence, the donation claimed to have made by assessee in the said Axis Bank A/c located at prince Anwar Shah Branch was found to be bogus. 7. Upon the verification report of the Department, the assessee was summoned to appear and substantiate her claim. The assessee filed her reply and raised the following objections: 1. What is the status of the police complaint filed? Has further action been taken against axis bank? 2. If the account in Axis Bank has been opened without confirming to KYC norms, how is it that funds have been transferred from the Axis Bank account to the State Bank of India account of the society? I was under the impression that if KYC norms have not been complied with, the account is frozen. 3. The Axis bank account details provided, show the PAN of the account holder to be the same as that of the Society. In such circumstances, who has been operating the Axis bank account? Who opened the axis bank account in the name of the society? 4. Does your verification show that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ter regarding the alleged payment of amounts into the said account is being investigated by various agencies including RBI West Bengal State Police Department. Investigations have further revealed that the original trust at Durgapur has taken up the matter with the High Court, regarding mis-use of its Name PAN, by miscreants. Thus, these facts point to the fact that the said Axis Bank account claimed to belong to BHAROSHA (i.e. Society for Welfare of Handicapped Persons, Durgapur), is fictitious. Thus, the entire investigation of the Department reveals that the entire transaction was sham. The matter of fictitious account operated in the Axis bank is subjudicial and not coming under the jurisdiction of the Income Tax Department. Thus, the claim of the assessee that the alleged payment of donation is genuine, is not acceptable, because, the assessee has not furnished any detail/evidence to prove that the donation offered by the assessee is genuine transaction since the donation was deposited in Axis Bank, where, society is not maintaining any account and the society also not confirmed having received the said donation. In case, if the assessee deposited the loan a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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