M/S. RAJ KUMAR ANAND & SONS HUF,NEW DELHI vs. ITO, NEW DELHI

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ITA 644/DEL/2014Status: DisposedITAT Delhi30 October 2015AY 2003-043 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found that the authorities' conclusions were based on general information about entry operators, but lacked specific factual discussion relating to the assessee. Therefore, the case was restored to the CIT(A) for a fresh decision.

What were the facts?

The assessee declared LTCG on sale of shares, but the AO re-opened the assessment based on information from DIT(E) regarding accommodation entries. The AO added the amount received from S.J. Capital Ltd. as bogus, and the CIT(A) dismissed the assessee's appeal.

What were the issues?

Whether the addition made by the AO on account of alleged bogus share transaction was justified without proper factual analysis pertaining to the assessee.

Which sections of the Income-tax Act were involved?

Section 143(1),Section 143(3),Section 147,Section 131

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH: ‘SMC’ NEW DELHI

Before: SMT DIVA SINGH

Hearing: 10.09.2015Pronounced: 30.10.2015

Date of Hearing 10.09.2015 Date of Pronouncement 30.10.2015 ORDER

The present appeal has been filed by the assessee assailing the correctness of the order dated 03.12.2013 of CIT(A)-XXI, New Delhi pertaining to 2003-04 assessment year on the following ground:-

1. “On the facts and circumstances of the case the Learned A.O was not justified in making genuine entries as accommodation/bogus entries and thus the claim of LTCG of 6,37,772 on sale of shares is valid.”

2. No one was present on behalf of the assessee at the time of hearing. Accordingly it is considered appropriate to proceed with the present appeal ex- parte qua the assessee on the basis of the material available on record after hearing the Ld. Sr.DR.

3. The record shows that the assessee declared an income of Rs.1,46,622/- which was processed u/s 143(1). Pursuant to the information received from the Directorate of Income Tax (Investigation) [hereinafter referred to as “DIT(E)]” the assessment was re-opened by an order u/s 143(3)/147 wherein addition of Rs.6,37,772/- was made. The record shows that the DIT(E) consequent to the survey in the case of M/s Gurcharan Jewellers (proprietor Sh. Ashok Kumar Chauhan) was found to have admitted that he had taken cheques under the I.T.A .No.-644/Del/2014 garb of gifts after giving cheques to the entry operators. In the facts of the present case, the assessee was found to have the following credit in its bank accounts:- Bank of the Branch of Instrument Amount Date Credit entry assessee the Bank No. coming from the account of BOR New Rohtak 637772/- 16/05/2002 S.J.Capital Ltd. Road 3.1. Also taking note of the fact that one Sh. Mahesh Garg of Bhiwani, Haryana who was controlling the bank accounts in various names was using various persons to operate various accounts the addition was made. The assessee as per record claimed that it had received an amount from S.J. Capital Ltd. the said claim was not accepted as the assessee failed to produce the said broker.

4. The assessee came in appeal before the CIT(A) who dismissed the appeal.

5. Aggrieved by which the assessee is in appeal. The Ld. Sr. DR relied upon the impugned order.

6.

Having heard the submissions and considered the arguments of the Ld. Sr.DR, I am of the view that in the facts of the present case the conclusions drawn by the authorities have been arrived at on the basis of the general information in regard to accommodation entry operators and various decisions. However, discussion on facts relatable to the assessee are found to be missing. What is coming out from the assessment order is that there was a survey on M/s Gurcharan Jewellers it is also seen that statement under oath u/s 131of the ITAT Act recorded of Sh. Mahesh Garg of Bhiwani Haryana. What was said in the statement qua the assessee is not coming out in the orders. Accordingly the impugned order is set aside and the issue is restored to the file to the CIT(A) with the direction to address the full, proper and relevant facts. Accordingly for want of discussion on facts, the issue is restored back to the CIT(A) with the direction to pass a speaking order in accordance with law after giving the assessee a reasonable opportunity of being heard.

5.

In the result, the appeal of the assessee is allowed for statistical purposes. The order is pronounced in the open court on 30th of October, 2015. Sd/- (DIVA SINGH) JUDICIAL MEMBER Dated:30/10/2015 *Amit Kumar* Page 2 of 3

I.T.A .No.-644/Del/2014

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