DCIT CENTRAL CIRCLE-26, NEW DELHI vs. VKS PROPERTIES PVT. LTD., NEW DELHI

ORDER PER BENCH :

The Revenue has filed the aforesaid 03 Appeals against the respective impugned orders passed by the Ld. CIT(A)-29, New Delhi relating to assessment years 2012-13 to 2014-15 and Assessee has filed the aforesaid 05 Cross Objections relating to assessment years 2012-13 to 2014-15 and 2016-17 and 2015-16 respectively. Since the issues involved in all the 03 Revenue appeals are common and identical, except the difference in figure of addition made on protective basis, hence, all the 03 appeals of Revenue alongwith Assessee’s 05 Cross Objections were heard together and are being disposed of by this common order for the sake of convenience, by only dealing with Revenue’s Appeal No. 8410/Del/2019 (AY 2012-13) and the decision thereof will apply mutatis mutandis to other Revenue’s to 8412/Del/2019 (AYrs. 2013-14 & 2014-15).

2. That the appellant craves leave to add, amend, after or forgo any ground(s) of appeal either before or at the time of hearing of the appeal.

6. On the contrary, Ld. Counsel for the assessee relied upon the order of the Ld. CIT(A) and stated that Ld. CIT(A) has passed a well reasoned order on the basis of the facts and circumstances of the case and in accordance with provisions of law, therefore, the appeal filed by the Revenue may be dismissed. In support of his contention, he filed the copy of Tribunal’s order dated 28.4.2023 passed in (AY 2010-11) & Ors. in the case of Sh. Anand Kumar Jain vs. ACIT & Ors. wherein, on similar analogy and facts and circumstances, the Tribunal held that since the substantive addition has already been completed in the case of Sh. Naresh Kumar Jain, and hence, no protective addition can be confirmed at this juncture in the case of the assessee i.e. Anand Kumar Jain in Revenue’s ITA No. 2890/Del/2019 (AY 2012- 4 13) and accordingly dismissed the appeal of the Revenue. Therefore, he requested to dismiss the Revenue’s appeal by following the aforesaid precedent by upholding the order of the Ld. CIT(A), New Delhi. Ld. DR could not controvert this proposition of the Ld. Counsel for the Assessee.

“….It is noticed that the appellant company has received funds from various concerns and transferred the same to the above mentioned companies/concerns immediately thereafter, and accordingly, appellant company is not beneficiary company. The above arrangement of funds is nothing but part of modus operandi of the accommodation entry provider to introduce the unaccounted funds of the beneficiaries in their respective bank accounts. Further, the AO also in the assessment order has observed that the appellant company was a conduit company operated by Sh. Naresh Jain and Anand Jain to provide accommodation entries to various beneficiaries. Accordingly, the addition in such cases can at best be that of commission earned on such accommodation entries. The commission income earned on providing accommodation entries through the appellant company have already been assessed by the AO in the 5 hands of Sh. Anand Jain and Naresh Jain which has been confirmed by me in their respective appeals. Therefore, I am of the view that no further addition can be made in the hands of the appellant company under the facts as discussed above. Under the circumstances, the protective addition made by the AO of Rs. 12,63,58,536/- is directed to be deleted…..” 7.1 From the above, it is noted that the commission income earned on providing accommodation entries through the assessee company have already been assessed by the AO in the hands of Sh. Anand Jain and Naresh Jain which has been confirmed by the Ld. CIT(A) in their respective appeals. Therefore, Ld. CIT(A) has rightly held that no further addition can be made in the hands of the assessee company and therefore, directed to delete the protective addition of Rs. 12,63,58,536/- made by the AO. We further find that the issue in the instant appeal is squarely covered by the Delhi Tribunal’s order dated 28.4.2023 passed in (AY 2010-11) & Ors. in the case of Sh. Anand Kumar Jain vs. ACIT & Ors. wherein, on similar aspect and identical facts and circumstances, the Tribunal held that since the substantive addition has already been completed in the case of Sh. Naresh Kumar Jain, hence, no protective addition can be confirmed at this juncture in the case of the assessee i.e. Anand Kumar Jain in Revenue’s ITA No. 2890/Del/2019 (AY 2012-13) and accordingly dismissed the appeal of the Revenue. 6 7.2 In view of facts and circumstances of the present case and respectfully following the precedent, as aforesaid, we are of the considered view that Ld. CIT(A) has rightly decided the issue in favour of the Assessee and deleted the addition in dispute, after elaborately discussing the issue in detail, which did not require any interference on our part. Hence, we uphold the findings of the Ld. CIT(A) on the issue in dispute and accordingly reject the ground raised by the Revenue by dismissing the appeal of the Revenue.

Order pronounced on 18/08/2023.