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TMI Blog2019 (9) TMI 863X X X X Extracts X X X X X X X X Extracts X X X X ..... he ground no. 2 raised by the revenue. - ITA No. 4354/Del/2015 - - - Dated:- 18-9-2019 - Sh. H.S. Sidhu, Judicial Member And Shri O.P. Kant, Accountant Member For the Assessee : Sh. Amit Goel, CA For the Department : Smt. Sulekha Verma, CIT(DR) ORDER PER H.S. SIDHU, JM This appeal is filed by the Revenue against the Order dated 29.5.2015 passed by the Ld. CIT(A)-I, New Delhi relating to assessment year 2012-13 on the following grounds:- 1. On the facts and in the circumstances of the case, the Ld. CIT(A) has erred in deleting the addition of ₹ 18,48,00,000/- made by disallowing unsecured loan and added back by the AO u/s. 68 when the assessee had failed to discharge its onus or proving the genuineness of the transaction in the following manner:- a) M/s Shirin Exports Pvt. Ltd., who has provided bogus loan for a sum of ₹ 8.78 crore, has not provided copy of Bank Statement inspite of both the creditors i.e. M/s Shirin Exports Pvt. Ltd. And M/s Vigorous Trade Link Pvt. Ltd. Has not been proved, as both the companies failed to comply w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n able to tender interest free unsecured loans of ₹ 9,70,00,000/- to the assessee company unless funds had been received from M/s Promart Retail Pvt. Ltd. The assessee company, M/s Apple Green Power Ltd., held 93.49% shares of M/s Promart Retail India Pvt. Ltd. as on 31.3.2012. Therefore, AO noted that it becomes apparent that funds of the assessee company was routed back via M/s Vigorous Trade Link Pvt. Ltd. in the form of unsecured loan. AO further observed that vide letter dated 05.01.2015 which was issued by the DDIT(Inv.), Unit-I, Noida, wherein it was informed that search and seizure operations was conducted on M/s Apple Group of companies on 11.11.2014 by his Unit. In the Preliminary Search Report dated 27.11.2014 of the Director of Income Tax (Inv.), Kanpur it was stated that during the search and seizure operations, incriminating documents were found and seized from the residence and corporate offices of the M/s Apple Group of companies. These documents show that the group has introduced bogus unsecured loans from domestic as well as companies based on Hong Kong. Therefore, AO by relying upon the decision of the Hon ble Delhi High Court in the case of CIT vs. Nipun B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o erred in deleting the addition of ₹ 13,86,000/- made by disallowing commission paid for obtaining the above grounds unsecured loan and added back by the AO u/s. 68 of the Act when the assessee had failed to discharge its onus of proving the genuineness of the transaction. She further submitted that it appears from the records that Ld. CIT(A) has admitted the additional evidences and no opportunity was given to the AO for examination. In support of her contention, Ld. CIT(DR) filed a Paper Book containing pages 1 to 106 in which she has attached the copy of written submission on the merits of the case including various case laws to support the case of the Department; copy of order sheet entry; reply of Shirin Export in response of notice u/s. 133(6); acknowledgement of return of income of Shirin Export of AY 2012-13; Audit report of Shirin Export of AY 2012-13; Reply of Vigrous Trade Link Pvt. Ltd. In response to notice u/s. 133(6); bank account furnished by Vigorous Trade Link Pvt. Ltd. Of AY 2012-13; Audit Report of Vigorous Trade Link Pvt. Ltd. Of AY 2012-13; letter of AO to Vigorous Trade Link Pvt. Ltd. 19.3.2015; Letter of AO to Shirin Export dated 19.3.2015; Letter of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntention, he filed a copy of Synopsis wherein he has relied upon various case laws and also relied upon the case laws mentioned in the impugned order. 5. We have heard both the parties and perused the records especially the impugned order, Written Submission of both the parties and the case laws cited by them. In this case, we find that during the year under consideration the assessee has received loans from the following parties:- (i) Shirim Exports Private Ltd. RS.8,78,00,000/- (ii) Vigorous Trade Link Pvt. Ltd. ₹ 9,70,00,000/- 5.1 We note that the assessee has furnished the following documents/details before the Assessing Officer in respect of these loans: - Complete name and address of loan creditors. - Confirmation of accounts by the loan creditors. - Copy of bank statements of loan creditors reflecting the loans given to assessee company. - Income Tax particulars of loan creditors alongwith copy of their ITR. - Copy of Audited Statement of accounts of loan creditors. 5.2 In our view, the assessee has, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessing Officer has independently verified the transactions by issuing notices to the loan creditors. In fact, the matter does not end here. The Assessing Officer went one step further and made independent confirmation from the creditor of the creditor i.e. source of source . As is evident from the bank statements of the loan creditors as also noted by the Assessing Officer himself in the assessment order, that the creditors company received the amount from a company namely Promart Retail India Pvt. Ltd. The Assessing Officer issued notice to Promart Retail India Pvt. Ltd. and made independent inquiries from it. In response to such notice Promart Retail India Pvt. Ltd. filed their reply to the Assessing Officer and duly confirmed the fact of their having given amounts to the two creditors of assessee company. Thus, the Assessing Officer has made independent verification not only from the source (i.e. the loan creditor of the appellant) but also from the source of source (i.e. creditor of the loan creditor). The Assessing Officer has made remarks that the loan creditors received the amounts from Promart Retail India Pvt. Ltd. in which the assessee company holds 93.49% shares. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... '38. The ratio of a decision is to be understood and appreciated in the background of the facts of that case. So understood, it will be seen that where the complete particulars of the share applicants such as their names and addresses, income tax file numbers, their creditworthiness, share application forms and share holders' register, share transfer register etc. are furnished to the Assessing Officer and the Assessing Officer has not conducted any enquiry into the same or has no material in his possession to show that those particulars are false and cannot be acted upon, then no addition can be made in the hands of the company under sec. 68 and the remedy open to the revenue is to go after the share applicants in accordance with law. We are afraid that we cannot apply the ratio to a case, such as the present one, where the Assessing Officer is in possession of material that discredits and impeaches the particulars furnished by the assessee and also establishes the link between self-confessed accommodation entry providers , whose business it is to help assessees bring into their books of account their unaccounted monies through the medium of share ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... As per the investigation carried out by the investigation wing, the shareholders were found to be entry providers. In view of the availability of incriminating material, link between the assessee and entry providers was found. 5.4 However, in the assessee s case the Assessing Officer has not brought on record any such feature. It is a case of receipt of loans and not of issue of shares. Further, it is not a case where any loan creditor is found to be entry operator. The A.O. has not brought on record any incriminating or adverse material/information in his possession in relation to the loan creditors. The identity of the loan creditors has not even been doubted by the Assessing Officer. The notices issued by the Assessing Officer u/s 133(6) of the Income Tax Act, 1961, have been duly served on the loan creditors and they have confirmed about their having given loans to the assessee company. Therefore, the case laws relied upon as referred above are not applicable. We note that the Assessing Officer has referred to the judgments of Hon'ble Apex Court in the case of CIT v Durga Prasad More (1971) 62 ITR 640 and Sumati Dayal v CIT (1995) 80 Taxman 89. How ..... X X X X Extracts X X X X X X X X Extracts X X X X
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