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TMI Blog2021 (7) TMI 732X X X X Extracts X X X X X X X X Extracts X X X X ..... rther the Hon ble Bombay High Court in Ivan Singh Vs ACIT [ 2020 (2) TMI 850 - BOMBAY HIGH COURT] also held that when the credit in the account of the assessee was found in the books of account, so credit can be charged to the income of the assessee in that previous year and the said credit cannot be brought to tax in subsequent assessment year. Considering the aforesaid factual and legal discussions and respectfully following the order of Hon'ble High Court and coordinate bench of Tribunal, no addition can be made during the A.Y. 2009-10. The case laws relied by Ld. DR for the revenue is not helpful to the department as all the case laws relates the validity of reopening on the basis of information from investigation wing of the department. On the contrary, we held that the share application money and premium was not received in the current financial year, which is the subject matter under appeal. Therefore, the assessee succeed. Considering the fact that no addition on account of share application and share premium is sustainable in the year under consideration. Therefore, the addition on account of alleged commission payment is also not sustainable. - Decided in favou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inal Investigation), Ahmedabad vide letter dated 27.03.2014 that assessee has received unreasonable premium as per the details provided by the Registrar of Company (ROC). That information was not available at the time of processing the return of income, therefore, income to the tune of ₹ 94,50,000/- escaped the assessment. The assessee filed objection vide his objection dated 02.07.2014. The objection of the assessee was disposed off vide speaking order on 01.09.2014. The Assessing Officer after discussing objection of the assessee proceeded for reassessment. The Assessing Officer noted that on the verification of material available on record, the assessee has received share capital of ₹ 10,50,000/- and Share premium of ₹ 94,50,000/- aggregating to ₹ 1.05,00,000/- from 11 following investor: Sr. No. Name of Investor Amount deposited in assessee s account (in Rs.) 1. Balaji Indifin Ltd. 15,00,000/- 2. Flyhigh Exports Pvt. Ltd. 10,00,000/- 3. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the summary of report of investigation wing Kolkata. In the show cause notice, the Assessing Officer stated that investigation wing of Kolkata recorded the statement of one of the Director Flyhigh Export Pvt Ltd, namely Shri RajkumarTharad, who allegedly stated that his main source of income is commissions from business of providing entry through jamaKhaarchi/ paper companies . The investigation wing of Kolkata recorded the statement of one of the Director of Vignhar Marketing Pvt Limited, namely Shri Jivendra Mishra, who has also stated that his main source of income is commissions from business of providing entry through jamaKhaarchi/ paper companies . 5. The assessee demanded copy of statement of both the person vide application dated 20.03.2015 and again on 23.03.2015. The assessee also demanded for cross-examination of that person. In response to show cause notice dated 23.03.2015 the assessee filed details of capital received from the investor company,their profit and loss account, their copy of audited balance sheet and along with the acknowledgement of return of income and contended that the assessee discharged its onus by furnishing identity of investor, creditwor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n with related to investor company. The assessee also relied upon various case laws. Ld. CIT(A) after considering the factual and legal submission of the assessee upheld the validity of re-opening as well as addition on merit. Further aggrieved, the assessee has filed present appeal before us. 7. We have heard the submission of Ld. Authorized Representative (AR) of the assessee and Ld. Departmental Representative (DR) and have gone through the orders of authorities below. Ground No.1 relates to validity of re-opening. The Ld. AR of the assessee submits that there was no tangible material to form the belief that the income of the assessee as escaped adjustment under section 68 of the Act, unless, there specific information that assessee have received accommodation in the form of share application or share premium. The Assessing Officer has not raised doubt regarding receipt of share application and premium and of accommodation entry by the assessee in the reason recorded. The Assessing Officer recorded the reasons on 31.03.2014 and issued notice under section 148 of the Act on the same date. In the reasons recorded, the Assessing Officer recorded that the intimation is received ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssing officer, the assessee has specifically contended before the Assessing Officer that share application and share premium money was received in earlier financial year. The similar submission was made before the Ld. CIT(A). Both the lower authorities disregarded the submission of assessee. The Ld. AR for the assessee further submits that all the investor companies are registered of Non-Banking Financial Company (NBFC) with the reserve bank of India (RBI) and are regularly filing their return of income. The assessee substantiated its contention and to discharge its onus furnish copy of share application, bank statement, copy of PAN and registration certificate of investor company with RBI certificate of information with registrar of company and memorandum of association and article of association. After furnishing all those evidences, the Assessing Officer again issued another show cause notice dated 13.03.2015 as recorded in para-6 (page 7 to 18) of the assessment order, wherein the Assessing Officer referred the statement of Shri RajkumarTharad and Shri Jivendra Mishra. The assessee requested for supply of copy of those statements vide application dated 20.03.2015 and 23.03.2015 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s evidence on record that assessee had made any commission payment. The addition is purely on assumption and presumption basis. The Ld. AR of the assessee prayed that the assessee is entitled to succeed on legal issue as well as on merit. 13. On the other hand, Ld. Sr.DR of the Revenue supported the order of lower authorities. Ld. DR for the revenue submits that initially of the return of income was processed under section 143(1) and intimation was given to the assessee. The intimation under section 143(1) of the Act is not an assessment order. The case was re-opened on the basis of information received from Director of Income Tax (Intelligent Criminal), which in turn received information from ROC. The assessee was provided full opportunity during the reassessment. The assessee filed objection against the re-opening. The objection of assessee was duly disposed of a speaking order. The assessee received share application money and share premium from the companies which are paper companies. The Assessing Officer got the inquiry conducted through ADIT Kolkata and find that most of the companies are not existed on the address given by the assessee. The Investigation Wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to FY 2007-08 (FY 2008-09) 1. Balaji Indifin Ltd. 5,00,000/- 17.08.2007 5,00,000/- 20.12.2007 5,00,000/- 20.12.2007 2. Flyhigh Exports Pvt. Ltd. 5,00,000/- 21.01.2008 5,00,000/- 21.01.2008 3. G.R. Industries and Finance Ltd. 10,00,000/- 13.12.2007 4. MehndipuraTradelink 5,00,000/- 03.08.2007 5,00,000/- 27.08.2007 5. Prachi Chemicals and Ind. Ltd. 5,00,000/- 06.09.2007 6. Vinghnhar Marketing Pvt. Ltd. 5,00,000/- 03. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x in subsequent assessment year. Considering the aforesaid factual and legal discussions and respectfully following the order of Hon'ble High Court and coordinate bench of Tribunal, no addition can be made during the A.Y. 2009-10. 17. The case laws relied by Ld. DR for the revenue is not helpful to the department as all the case laws relates the validity of reopening on the basis of information from investigation wing of the department. On the contrary, we held that the share application money and premium was not received in the current financial year, which is the subject matter under appeal. Therefore, the assessee succeed in Ground No.2. 18. Considering the fact that no addition on account of share application and share premium is sustainable in the year under consideration. Therefore, the addition on account of alleged commission payment of ₹ 1.05 lakh is also not sustainable. Even otherwise the addition is not based on any evidence on record. Hence, ground no. 3 of the appeal is also allowed. 19. Further considering the fact that we have deleted the addition by holding that no share application or share premium money is received during the current fina ..... X X X X Extracts X X X X X X X X Extracts X X X X
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