MR. GIRDHARI LAL PURI,NEW DELHI vs. ITO, NEW DELHI

This appeal by the assessee is preferred against the order of the Commissioner of Income Tax [Appeals] – 15, New Delhi dated 28.07.2016 pertaining to assessment year 2007-08.

The solitary grievance of the assessee is that the ld. CIT(A) erred in confirming the addition of Rs. 21,29,15,314/- made on protective basis by the Assessing Officer.

Briefly stated, the facts of the case are that the Assessing Officer received information from the ACIT, Central Circle – 10, New Delhi that the assessee is proprietor of three firms, namely, M/s My Fair International, M/s Supremo Trading Company and M/s Vee Vee Enterprises which have provided accommodation entries of Rs. 21,29,15,314/- . The Assessing Officer came to know that all these firms were controlled by one Shri Vaibhav Jain and these firms were being operated in the name of the assessee.

As per letter No. F. No. ACIT/Circle-10/2012-13/1241 dated 20.03.2014, the ACIT informed that income in the hands of these three firms amounting to Rs. 21,29,15,314/- has been considered in the hands of Shri Vaibhav Jain on substantive basis. However, to protect the interest of the revenue, addition of Rs. 21,29,15,314/- was again made in the hands of the assessee on protective basis.

The assessee agitated the matter before the ld. CIT(A) but without any success.

Before us, the ld. counsel for the assessee brought to our notice the decision of the co-ordinate bench in the case of Vaibhav Jain to 3775/DEL/2014 for Assessment Years 20006-07 to 2011-12 order dated 12.04.2018. It is the say of the ld. counsel for the assessee that in the hands of Vaibhav Jain, the additions have been upheld. It is the say of the ld. counsel for the assessee that since substantive additions are now confirmed in the hands of Vaibhav Jain, protective addition in the hands of the assessee should be deleted.

The ld. DR fairly conceded to this.

We have given thoughtful consideration to the orders of the authorities below. As mentioned elsewhere, substantive additions have been made in the hands of Saibhav Jain. We have carefully perused the order of the co-ordinate bench in the case of Vaibhav Jain to 3775/DEL/2014 [supra]. We find force in the contention of the ld. counsel for the assessee. The entire additions have been confirmed in the hands of Vaibhav Jain. Therefore, there is no need to doubly add the same amount on protective basis in the assessee’s hands. The Assessing Officer is, accordingly, directed to delete the protective addition from the hands of the assessee. Ground raised by the assessee is allowed.

In the result, the appeal of the assessee in is allowed.