Loading judgment…
Facts
A search and seizure operation against the assessee led to reassessment proceedings where the Assessing Officer made additions of Rs. 4 crores (AY 2010-11) and Rs. 2.90 crores (AY 2011-12). These additions were for alleged unsecured loans and share capital from bogus/shell companies, as notices under section 133(6) could not be served and the assessee's explanations were deemed unsatisfactory. The CIT(A) subsequently deleted these additions, finding no incriminating material.
Held
The Tribunal dismissed the Revenue's appeals, affirming the CIT(A)'s decision to delete the additions. It held that the CIT(A) was correct in concluding there was no incriminating material to support the additions and had properly applied settled legal principles. The Tribunal found no substance in the grounds raised by the Revenue.
Key Issues
Whether the additions made by the AO for unsecured loans/share capital from alleged bogus/shell companies under sections 153C/143(3) were justified in the absence of incriminating material.
Sections Cited
153C, 143(3), 133(6)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCHES : A : NEW DELHI
Before: SHRI G.S. PANNU, HON’BLE & SHRI ANUBHAV SHARMA
ORDER PER ANUBHAV SHARMA, JM: These are appeals preferred by the Revenue against the orders of the Commissioner of Income Tax (Appeals) (hereinafter referred to as Ld. First Appellate Authority or ‘the ld. FAA’ for short) in appeals filed before him against the orders of the ld. Assessing Officer (hereinafter referred to as the Ld.
ITAs No.9101 & 9102/Del/2019 AO, for short). Further details of the orders of the lower authorities are as under:- who Appeal No. & Date AO who Section of the passed the of order of the passed the IT Act under order CIT(A) assessment which the AO order & Date passed the of order order 9101/Del/2019 CIT(A)-30, 274/18-19/4175 ACIT, Central 153C/143(3) New Delhi Date 24.09.2019 Cir.30, New Delhi, date: 27.12.2018 - - - 9102/Del/2019 Do - 275/18-19/4176 date Do - Do - 24.09.2019
Heard and perused the record. The effective ground is the challenge to the deletion of Rs.4 crores in AY 2010-11 and Rs.96,33,075/- in AY 2011-12 by ld.CIT(A) which the AO had made on account of alleged unsecured loans from bogus/shell companies. As a matter of fact, a search and seizure operation was carried out in Shalimar group of cases on 18.06.2015 and, on the basis of some alleged incriminating evidences, reassessment was opened u/s 153C of the Act. The AO examined the receipt of Rs.4 crores by issuing 40000 shares to ten different private limited companies in AY 2010-11. Further, in AY 2011-12, the AO examined the loan of Rs.2.90 crores from M/s Topgrain Distributors Pvt. Ltd. The AO was not satisfied with the explanation and evidences of the assessee. Further, notices u/s 133(6) could not be served on these companies. Therefore, he made the addition. The CIT(A) was satisfied that none of the documents indicate anything incriminating relating to share capital raised by the assessee and even in the satisfaction note, there was no specific reference to any 2
ITAs No.9101 & 9102/Del/2019 incriminating material. The ld. DR could not canvass before us anything on the basis of any material or facts to show that the opinion formed by the CIT(A) was incorrect or erroneous on any factual aspect or appreciation of the evidences. The CIT(A) has followed the settled proposition of law on the basis of several judicial decisions including CIT vs. Kabul Chawla, 380 ITR 573 (Del) which has been further accepted by the Hon’ble Supreme Court in PCIT vs. Abhisar Buildwell Pvt. Ltd. (2023) 149 taxmann.com 399 and DCIT vs. UK Paints (Overseas) Ltd. (2023) 454 ITR 441. The grounds raised have no substance.