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TMI Blog2019 (10) TMI 857X X X X Extracts X X X X X X X X Extracts X X X X ..... the Assessee : Shri Raj Kumar, CA For the Revenue : Shri S.L. Anuragi, Sr.DR ORDER This appeal by the assessee is directed against the order dated 19th December, 2018 of the CIT(A)-1, New Delhi, relating to Assessment Year 2010-11. 2. Facts of the case, in brief, are that the assessee is a company and had filed its return of income on 12th October, 2010 declaring the total income at ₹ 9,912/-. The Assessing Officer received information based on the search and seizure operation conducted u/s 132 of the IT Act, 1961 in the case of Shri Surendra Kumar Jain group of cases on 14th September, 2010 that Shri Surendra Kumar Jain, through a large number of dummy companies floated by him provided accommodation entries to various beneficiaries. In the list of beneficiaries so obtained, the name of the assessee also appears. He noticed the modus operandi of the Jain brothers was that they have received cash from the various beneficiaries which were deposited in the bank accounts of various entities as cash received against sales and were immediately transferred to various dummy companies of Jain brothers. The money is then routed through a maze of transactions through a web of dummy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are without jurisdiction, on borrowed satisfaction, without application of mind, unwarranted, mechanical and unsustainable in law and on merits. I 2. That the Ld. A.O., since failed in adjudicating all objections against reopening proceedings, properly, as per law and in totality and as per the directions of Hon'ble Supreme Court in the case of G.K.N. Drive Shafts, hence consequential proceedings and impugned asstt. is illegal and without jurisdiction. 3. That under the facts and circumstances, the approval under section l51 is fatally defective, mechanical and without application of mind which makes the whole proceedings without jurisdiction, illegal and unwarranted. 4. That under the facts and circumstances, the Ld. A.O, erred in law and on merits in making addition of Rs,20,00,000 under section 68 of the I.T. Act. 4.1 That under the facts and circumstances, addition of ₹ 20,00,000 under section 68 for the share capital / share premium received from Utsav securities (P) ltd. by holding the same as received from alleged entry operator is illegal and unsustainable in law as well as on merits. 4.2 That the findings of A.O. are unsustainable for addition of ₹ 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a 2 of the objection letter dated 16th August, 2017, it was requested that to file complete objections, the materials relied upon by the Investigation Wing for sending the report to the Assessing Officer and such other material including the statement of persons recorded at the back of the assessee should be supplied. However, the Assessing Officer had not provided any of these documents on the ground that the relevant material is internal documents of the Department and cannot be shared. He accordingly submitted that the Assessing Officer by not providing the above documents has not disposed of the objections fully as per the law laid down by the Hon'ble Supreme Court in the case of GKN Driveshaft. Referring to the following decisions, he submitted that incomplete disposal of objections makes the assessment invalid. i) Sabh Infrastructure Ltd. vs. ACIT, 398 ITR 198; ii) Pr. CIT vs. Tupperware India (P) Ltd., 127 DTR 161 (Del); iii) Scan Holding (P) Ltd. vs. ACIT, 402 ITR 290 (Del); & iv) Goa State Copr. Bank Ltd. vs. ACIT 7 Ors., (2017) 295 CTR (Bom) 369. 7. The ld. counsel for the assessee submitted that the approval u/s 151 is in a mechanical manner and without appl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... king the Assessing Officer to provide the documents relied by the Department for making the addition and asking to give opportunity to cross examine, the same were never provided. Relying on various decisions, he submitted that since the addition is based purely on presumptions and surmises and the relevant materials were not provided to the assessee, therefore, the addition so made is not sustainable. So far as the addition of ₹ 36,000/- being the commission for getting the accommodation entry is concerned, he submitted that it is an estimated addition and there is no basis or material or information based on which such addition could have been made. He accordingly submitted that the addition made by the Assessing Officer and upheld by the CIT(A) should be deleted. 9. The ld. DR, on the other hand, submitted that the Assessing Officer, in the instant case, has duly applied his mind and has made a thorough analysis of the documents and after analyzing the documents has recorded his satisfaction and reopened the assessment. The ld. Addl. CIT had perused the note and had recorded his satisfaction that income pertaining to assessment year 2010-11 has escaped assessment and, hen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... approval has also simply mentioned: "I am satisfied that it is a fit case for issue of notice u/s 148 of the IT Act." From the above, it is clear that none of the supervisory authorities have applied their mind. I find, the Hon'ble Delhi High Court in the case of CIT vs. N.C. Cables Ltd., 391 ITR 11(Del), has observed as under:- " Reassessment-Issuance of Notice-Sanction for issue of Notice-Assessee had in its return for A Y 2001-02 claimed that sum of ₹ 1 Crore was received towards share application amounts and a further sum of Thirty Five Lakhs was credited to it as an advance towards loan-Original assessment was completed u/s 143(3)- However, pursuant to reassessment notice, which was dropped due to technical reasons, and later notice was issued and assessments were taken up afresh-After considering submissions of assessee and documents produced in reassessment proceedings, AO added back a sum of ₹ 1,35,00,000-CIT(A) held against assessee on legality of reassessment notice but allowed assessee's appeal on merits holding that AO did not conduct appropriate enquiry to conclude that share inclusion and advances received were from bogus entities-Tribunal a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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