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TMI Blog2020 (7) TMI 300X X X X Extracts X X X X X X X X Extracts X X X X ..... 0/- received by M/s Jindal Dal Mills Pvt. Ltd. in the hands of the assessee company. The addition has to be rightly made in the hands of M/s Jindal Dal Mills Pvt. Ltd. instead of the assessee company. It was also not proved that the assessee company whose name figured in the diary entries and shares of an equivalent amounts have been allotted to the common Directors, Sh. Anil Kumar Jindal. Addition has been made without specifying as to the nature of the amounts and also without examining the credits in the books of the assessee, we hereby allow the appeal of the assessee on grounds of Section 148 and Section 68 - Decided in favour of assessee. - ITA No. 1039/Del/2018 - - - Dated:- 6-5-2020 - Ms. Suchitra Kamble, Judicial Member And Dr. B. R. R. Kumar, Accountant Member For the Assessee : None For the Revenue : Sh. Pradeep Singh Gautam, Sr. DR ORDER PER DR. B.R.R. KUMAR, ACCOUNTANT MEMBER: The present appeal has been filed by the assessee against the order of ld. CIT (A)-I, New Delhi dated 07.12 .2017. 2. Following grounds have been raised by the assessee: 1. That having regards to the facts and circumstances of the case, Ld. CIT( A) has gro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Ld. AO u/s. 143(3 )/ 147 and that too without providing the opportunity of cross- examination of the parties who were examined by the learned AO on the back of it; therefore, the additions made as such as per Grounds of Appeals No. 3 may be liable to be deleted. 8. That having regards to the facts and circumstances of the case, Ld. CIT-(A) has grossly erred in law and on facts, in confirming the action of the Ld. AO despite the fact that he invoked his re- assessment jurisdiction by invoking section 147 simply on the basis of information and without having any Reasons to believe or application of mind that the income has escaped assessment, therefore, the orders passed on the basis of sue notice may be liable to be quashed. 9. That having regards to the facts and circumstances of the case, Ld. CIT( A) has grossly erred in law and on facts, in confirming the action of the Ld. AO despite the fact that he invoked section 147 without first having disposed off the case under section 143 (1)/ 143(3) etc. as the same fact could not find a mention in the assessment orders. Therefore, reason to believe based on purely guesswork only. Therefore, the orders passed on the bas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hese dummy entities are not carrying out any actual business activities, other than the activity of providing accommodation entries in the garb of some ostensible business transactions. (ii) The entries in the bank accounts through which the amounts are routed, do not have any underlying or actual business transaction. 7. The seized documents were examined and they contained comprehensive details comprising, inter alia the Beneficiary's Name, amount of entry taken, Name of Account Holder of Entry giving Account, Bank details of the accounts from which entries are given, the dates of the entries etc. The specific analysis of following documents seized in respect of the assessee company indicated transactions which are as under: (I) Pago 43 of Annexure A-25 are seized during the search operation gives comprehensive details of cheque No., Bank, Entry Providing Companies, name to one of the beneficiary i.e. M/s Adarsh Food Products Pvt. Ltd., jurisdiction of which lies with this ward. 8. As per information received, the entry of assesses found in the seized documents of Jain brothers corroborates with the Banking channel and during the year the following entries have be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s for formation of belief recorded by the AO: 10. The information was carefully perused and analyzed in light of the facts of the case as detailed above and the following facts emerged from the same: (i) Particulars of all investing companies are found recorded in the diary maintained in the regular course at the premises under control of Sh. S.K. Jain. (ii) The pass books/ cheque books of all the investing companies who have made investments in the assessee company have been found at the premises of Sh. S. K. Jain and Sh. Virendra Jain when these persons are not directors/shareholders of these companies. (iii) Perusal of various seized documents, as discussed at para 3.2 clearly shows that the name of the assessee company i.e. M/s Adarsh Food Products Pvt. Ltd., appears on this document has taken accommodation entry from S.K. Jain group companies. (iv) The assessee has declared in its return of income that it has increased its share capital total amounting to ₹ 2,00,00, 000 /- which confirms the information received from Investigation Wing. It can be fairly concluded from the above facts that the assessee company has given its own fund to Sh. S. K. Jain to in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elhi Pro Pvt.Ltd. M/ s Jindal Dal Mills Pvt.Ltd. 4,00,000 21.03.2009 M/s Virgin Capital Services Pvt.Ltd. M/ s Adarsh Food Products Pvt.Ltd. 4,00,000 21.03.2009 M/s Virgin Capital Services Pvt.Ltd. M/ s Jindal Dal Mills Pvt.Ltd. 3,00,000 13. The AO from page no. 22 to page no. 35 (para 9 to 14 ) quoted various case laws. At page no. 36 (para 15), the AO concluded the proceedings making an addition of ₹ 14,00,000 /-, the relevant portion of the assessment order is as under: 15.1 It is a settled position of law that a conspiracy is hatched and executed in darkness. To overcome these issues, law states that it is for the alleged to come out clean. The assessee company made no serious efforts to come clean on the allegation so raised. In the civil law, a mere preponderance of probability is enough to fix the responsibility. Section 68 is enacted in these terms only. It is clearly indicated from the wordings of the section that where the assessee offers no explanation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to receipt of ₹ 7,00,000/- from two entities namely, Manimala and Virgin Capital whereas the AO made addition of ₹ 14,00,000/- u/ s 68 of the Act. As per the information mentioned at para 7. 4 an amount of ₹ 7,00,000 /- has been received by another entity namely, M/s Jindal Dal Mills Pvt. Ltd. Sh. Anil Kumar Jindal is the common Director in the assessee company as well as Jindal Dal Mills Pvt. Ltd. No reasons given by the AO as to why the addition of ₹ 14,00,000 /- has been made in the case of the assessee. The AO has not mentioned whether this ₹ 14,00, 000/- is on account of share capital or loans or expenses. No details of these entries have been given. The AO has failed to examine whether the amount of ₹ 14,00, 000/- credited in the books of the assessee or not, if so under what head. The AO has made addition of ₹ 7, 00,000/- received by M/s Jindal Dal Mills Pvt. Ltd. in the hands of the assessee company. The addition has to be rightly made in the hands of M/s Jindal Dal Mills Pvt. Ltd. instead of the assessee company. It was also not proved that the assessee company whose name figured in the diary entries and shares of an equivalent amo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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