“entry operator”

Cash Credits & Unexplained ItemsSection 68Section 682,071 judgments

The decision most relied on for entry operator is CIT v. Jamnadevi Agarwal (328 ITR 656), cited in 230 judgments on BharatTax.

Leading authorities on entry operator

CIT v. Jamnadevi Agarwal

328 ITR 656 · 2010 · High Court

230

citing judgments

When faced with allegations of bogus long-term capital gains from penny stocks, the Assessing Officer must discharge the onus of proving that the assessee's transactions were not genuine. The assessee can rely on the principle of preponderance of probability, and the Revenue must present substantial evidence to establish that the transactions were a colourable device or that the assessee was an entry operator.

ITO, 19(3) (4) Mumbai v. Shamim M Bharwani

69 Taxmann.com 65 · 2016 · Reported

142

citing judgments

Long Term Capital Gains (LTCG) from penny stock transactions are liable to be treated as bogus and added back under Section 68 as unexplained cash credits, especially when evidence suggests the involvement of entry operators providing accommodation entries.

5. PCIT v. Paramount Communication (P.) Ltd. Delhi High Court

392 ITR 444 · 2017 · High Court

111

citing judgments

For valid initiation of reassessment proceedings, the Assessing Officer must possess tangible material and apply independent mind to form a 'reason to believe' that income has escaped assessment. Reassessment cannot be based on mere borrowed satisfaction or unverified information without proper scrutiny.

2 CIT v. Indrajit Singh Suri

33 Taxmann.com 281 · 2013 · High Court

100

citing judgments

The validity of reassessment proceedings initiated under Sections 147/148 against legal representatives of a deceased assessee requires a demonstrable 'reason to believe' that income escaped assessment, often based on third-party information such as alleged accommodation entries.

Dharappa v. Bijapur Co-operative Milk Producers Societies Union Ltd.

9 SCC 109 · 2007 · Reported

citing judgments

When a State Act has obtained presidential assent, its repugnant provisions prevail over the provisions of a Central Act in that State, even if both laws relate to subjects in the Concurrent List. This principle was applied to determine repugnancy between the Karnataka Co-operative Societies Act, 1959, and the Industrial Disputes Act, 1947.

CIT v. Sanghamitra Bharali

361 ITR 481 · 2014 · High Court

citing judgments

Capital gains arising from sham transactions, particularly those involving penny stocks designed to appear genuine, are not exempt under Section 10(38) but are taxable as unaccounted income brought into the books.

CIT v. Active Traders (P.) Ltd.

214 ITR 583 · 1995 · High Court

citing judgments

When a sum is credited on account of share capital or share premium, the assessee must establish the existence, identity, genuineness, and creditworthiness of the share applicants, going beyond mere submission of documents. The Assessing Officer has the power to investigate and lift the corporate veil to ascertain the bonafides of such transactions.

Income Tax Vs. India Discount Co. Ltd. 75 ITR 191 (SC), Commissioner of Income Tax v. Provincial Farmers (P) Ltd.

245 ITR 421 · 2000 · Supreme Court

citing judgments

The entry in the books of accounts is not determinative of the true nature of a transaction for income tax purposes; the substance of the transaction, rather than its accounting treatment, governs its taxability and deductibility.

Judgments citing entry operator

Samarth Lifestyle Retailing Pvt. Ltd., Jaipur vs. DCIT, Circle-6, Jaipur

In the result, the appeal of the assessee is allowed

ITA 621/JPR/2024[2011-12]Status: DisposedITAT Jaipur17 Oct 2024AY 2011-12

For Appellant: Shri P. C. Parwal, CAFor Respondent: Shri Sanjay Nargas, Addl. CIT

Section 143(1)Section 143(3)Section 147Section 148Section 68

entries to the willing beneficiaries in lieu of cash and earning commission on such entries. The modus operandi of this scam was that the entry operators would receive unaccounted cash from the beneficiaries companies and provide them accommodation entry in form of share premium by rotating the money in various ... dubious bank accounts managed and controlled by the entry operator. The entry providers charged commission on these entries. Based on these information Id. AO verified Return of income filed by the assessee company which shows a share premium of Rs. 3,90,60,000/- and share application money

Konark Fixtures Ltd( Successor to Kalinga Fixtures Pvt Ltd), Mumbai vs. DCIT Circle-6(1)(2), Mumbai

Appeal is allowed

ITA 2028/MUM/2024[2012-13]Status: DisposedITAT Mumbai17 Oct 2024AY 2012-13

Bench: Shri Pavan Kumar Gadale & Shri Girish Agrawal

Section 132Section 133(6)Section 143(1)Section 143(3)Section 147Section 148Section 37Section 68

IN THE INCOME TAX APPELLATE TRIBUNAL, “E” BENCH MUMBAI BEFORE SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER & SHRI GIRISH AGRAWAL, ACCOUNTANT

ITO Ward-22(1)(6), Mumbai vs. Jalpa Nitesh Shriwardhankar, Mumbai

In the result, the appeal by the Revenue is dismissed

ITA 2842/MUM/2024[2012-13]Status: DisposedITAT Mumbai16 Oct 2024AY 2012-13

Bench: Shri Prashant Maharishishri Sandeep Singh Karhailito, Ward-22(1)(6), Mumbai – 400012 Maharashtra ……………. Appellant

For Appellant: Shri Tejveer Singh, AdvFor Respondent: Shri Sushil Bhagwat Shendge, Sr.DR

Section 143(1)Section 250

case and modus operandi as detailed investigation has been carried out by the investigation wing and confirming that the scrip is utilized-by entry operators for providing accommodation entries under the garb of Long Term Capital Gain/Short Term Capital Gain Loss by manipulating/rigging up the share price

Nabiul Industrial Metal Pvt. Ltd., Paschim Medinipur vs. I.T.O., Ward - 39(2), Midnapore, Paschim Medinipur

In the result, the appeal filed by the assessee is allowed

ITA 1328/KOL/2024[2017-2018]Status: DisposedITAT Kolkata15 Oct 2024AY 2017-2018

Bench: Sri Rajesh Kumar & Pradip Kumar Choubey

Section 142(1)Section 147Section 151ASection 250Section 68

investigation in the case of M/s. Darsh Coke Trading Pvt. Ltd., it was revealed that the said company is a paper company through which entry operators provide bogus entries and layer money in exchange of commission. It was also found that the one of the beneficiaries is the assessee company

Bhavana Lalit Jain, Navi Mumbai vs. Income Tax Officer, WD-15(1)(1), Mumbai

The appeals are allowed

ITA 1016/MUM/2024[2014-15]Status: DisposedITAT Mumbai15 Oct 2024AY 2014-15

Bench: Shri Prashant Maharishi, Am & Shriraj Kumar Chauhan, Jm

Section 10Section 143Section 147Section 148Section 68

With respect to the allegation of the learned assessing officer that the above transaction is sham because of the reason that the entry operators and exit providers were issued notices under section 133 (6) remained non complied with, he submitted that the assessee has sold the entire sales through online ... information from PDIT Kolkatavide letter dated 27/4/2015 regarding accommodation entry providers for long-term capital gain which involved entry operators, share brokers and money-launderers. Accordingly, the assessment of the assessee was reopened under section 147 of the act after recording reasons and after obtaining approval of the competent authority

DCIT Circle-10(1), New Delhi vs. Anjani Kumar Goenka, New Delhi

In the result, appeal by the Revenue is dismissed in the aforesaid manner

ITA 790/DEL/2021[2011-12]Status: DisposedITAT Delhi15 Oct 2024AY 2011-12

Bench: Shri Shamim Yahya & Shri Sudhir Kumara.Yr. : 2011-12 Dcit, Cirlce-10(1), Anjani Kumar Goenka, C.R. Building, Vs. N-86, Connaught Place, I.P. Estate, New Delhi – 1 New Delhi – 2 (Pan: Aagpg6344M) (Appellant) (Respondent) Appellant By : Sh. Amit Goel, Ca Respondent By : Mr. Javed Akhtar, Cit(Dr) Date Of Hearing : 08.10.2024 Date Of Pronouncement : 15.10.2024 Order

For Appellant: Sh. Amit Goel, CAFor Respondent: Mr. Javed Akhtar, CIT(DR)

Section 132Section 132(4)Section 143(2)Section 143(3)Section 147Section 148Section 153ASection 6Section 69

found during the search and duly and annexurized and substantiated by modus operandi employed and which were further corroborated by the statement of entry operator and of the Dummy Director. The facts as discussed above clearly held at the assessee has made available excess amount which was paid from ... were found during the search and duly and annexurized and substantiated by modus operandi employed and which were further corroborated by the statement of entry operator and of the Dummy Director. The facts as discussed above clearly held at the assessee has made available excess amount which was paid from

Shri Anilkumar M. Jain, Ahmedabad vs. The ACIT, Circle-5(2), Ahmedabad

In the result, appeal of the assessee is dismissed

ITA 2239/AHD/2018[2012-13]Status: DisposedITAT Ahmedabad14 Oct 2024AY 2012-13

Bench: Ms. Suchitra Kamble & Shri Narendra Prasad Sinhaassessment Year: 2012-13

Section 10(38)Section 131Section 143(1)Section 143(2)Section 147Section 148

penny stock for accommodating bogus LTCG/LTCL entries. Further, the DIT (Inv.), Kolkata conducted investigation on a project basis which wat resulted into unearthing syndicate entry operators share broker and money launders providing bogus accommodation of LTCG/STCL. The share of Alpha Graphic India Ltd is reflected in this list and therefore ... been used for generating bogus LTCG. Further, the DIT(Inv.) Kolkata conducted investigation on a project basis which has resulted into unearthing of syndicate entry operators share broker and money launders providing bogus accommodation entry of Long Term Capital Gain/Short Term Capital Loss. As per the report many penny stocks

Dinesh Prabhudas Hingoo, Jogeshwari (W), Mumbai vs. ACIT Circle-31(1), Mumbai

In the result, the appeal filed by the Assessee stands allowed

ITA 667/MUM/2024[2011-12]Status: DisposedITAT Mumbai11 Oct 2024AY 2011-12

Bench: Shri Narender Kumar Choudhry & Shri Girish Agrawalassessment Year: 2011-12

For Appellant: Shri Ravindra Poojari, A.RFor Respondent: Shri H.M. Bhatt, Sr. D.R

Section 10(38)Section 131Section 143(1)Section 148Section 250

Assessee qua scrip of M/s. S.V. Electricals Ltd. mainly on the investigation report, financials of scrips and statement of various persons such as promoters, entry operators, exit providers/share brokers as recorded by the investigation wing, as well as the fact that there was sharp increase in the scrip

DCIT 41(4)(1), Room No, Kautilya Bhawan, G Block, Bkc, Mumbai vs. Dinesh Prabhudas Hingoo, Jogeshwari(W), Mumbai

In the result, the appeal filed by the Assessee stands allowed

ITA 1348/MUM/2024[2011-12]Status: DisposedITAT Mumbai11 Oct 2024AY 2011-12

Bench: Shri Narender Kumar Choudhry & Shri Girish Agrawalassessment Year: 2011-12

For Appellant: Shri Ravindra Poojari, A.RFor Respondent: Shri H.M. Bhatt, Sr. D.R

Section 10(38)Section 131Section 143(1)Section 148Section 250

Amit Sajjan Kumar Gupta, Mumbai vs. DCIT 8(2)(1), Mumbai

In the result, the appeal filed by the assessee is allowed

ITA 1378/MUM/2024[2015-16]Status: DisposedITAT Mumbai10 Oct 2024AY 2015-16

Bench: Shri Pavan Kumar Gadale & Shri Girish Agrawalamitsajjankumargupta, Dcit-8(2)(1), 110, Ashirwad, Roomno.624, बनाम/ Ahmedabad Street, Aayakar Bhavan, Vs. Carnac Bunder, M.K.Road, Mumbai-400009. Mumbai-400020. स्थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Abrpg2852N (अपीलार्थी /Appellant) (प्रत्यर्थी / Respondent) Assessee By : Shri Ravikant Pathak.Ar Revenue By : Shri Manoj Kumar Sinha, Sr. Dr सुनवाई की तारीख / Date Of Hearing 08/08/2023 घोषणा की तारीख /Date Of Pronouncement 10/10/2024 आदेश / Order Per Pavan Kumar Gadale - Jm: The Appeal Is Filed By The Assesse Against The Order Of The National Faceless Appeal Centre (Nfac), Delhi / Cit(A) Passed U/Sec 143(3) & U/Sec 250 Of The Act. The Assessee Has Raised The Following Grounds Of Appeal: 1. On The Facts & In The Circumstances Of The Case & In Law, The Learned Cit (A) Nfac, Erred In Confirming Order Made U/S. 143(3) Of The Income Tax Act, 1961 Which Is Bad In Law, Ultra Vires & Without Appreciating The Facts, Submission & Evidences In The Proper Perspective, Without Providing Copies Of Material Used Against The Appellant & Without Providing Opportunity Of Cross Examination, Is Liable To Be Annulled.

For Appellant: Shri Ravikant Pathak.ARFor Respondent: Shri Manoj Kumar Sinha, Sr. DR

Section 143(3)Section 68

shares under section 10(38) - Assessing Officer rejected assessee's plea and made additions under sections 68 and 69 by relying on statements from 'entry operators' On appeal, Commissioner (Appeals) accepted assessee's claim, noting that shares were purchased via Account Payee Cheques, held in a Demat Account for over ... transaction tax Tribunal upheld Commissioner (Appeal)'s decision, emphasizing assessee's right to correct mistakes and criticized Assessing Officer's reliance on statements from 'entry operators' to support additions under sections 68 and 69 as those statements were recorded in unrelated proceedings before survey on assessee, and assessee

ITO-28.3.1, Navi Mumbai vs. Seema Narendra Bapna, Nerul

In the result both the grounds of appeal are dismissed

ITA 1120/MUM/2024[2014-15]Status: DisposedITAT Mumbai10 Oct 2024AY 2014-15

Bench: Shri Prashant Maharishi, Am & Shri Raj Kumar Chauhan, Jm A.Y.2014-15 Ito,28.3.1, Seema Narendra Bapna, Mumbai Flat No.A 2701, Plot No. R3 B Emerald Bay, Sector Vs. 14 Nerul, Navi Mumbai, Thane 400706

Section 143Section 147Section 148

intimated that they had undertaken investigation of accommodation entry of long-term capital gain (LTCG) which resulted into unearthing of a huge syndicate of entry operator, share broker and money-laundering who are involved in providing bogus accommodation entries of long- term capital gain, long-term capital loss and others ... With respect to the allegation of the learned assessing officer that the above transaction is sham because of the reason that the entry operators and exit providers were issued notices under section 133 (6) remained non complied with, he submitted that the assessee has sold the entire sales through online

DCIT, Circle-20(1), New Delhi vs. Pragyawan Technologies Private Limited, Delhi

ITA 88/DEL/2020[2016-17]Status: DisposedITAT Delhi10 Oct 2024AY 2016-17

Bench: Shri Pradip Kumar Kedia & Shri Anubhav Sharmaassessment Year: 2016-17 Dcit, Vs Pragyawan Technologies Private Circle-20(1), Limited, Flat No.02, 2Nd Floor, New Delhi. Plot No.70A/31, Guru Nanakpura, Laxmi Nagar, Delhi – 110 092. Pan: Aagcp1209D

For Appellant: Shri Vijay Singla, CAFor Respondent: Shri Mandeep Pawar, Sr. DR

Section 131(1)(d)Section 133(6)Section 142(1)Section 143(3)Section 68

reality and are mere paper companies or shell companies operated and controlled by 2 Shri Vikas Kumar Aggarwal, a well-known Kolkata based entry operator. The AO also observed that: “3.4 It is important to mention here again that identity of any of the companies which have extended huge loans ... their books, without appreciating the report of the Investigation Wing, Kolkata which stated that these were shell companies reflected in the database of entry operators, further evidenced by the fact that these companies did not exist at the given addresses?” (iii) The appellant craves to amend, modify, alter

Lemongrass Dealtrade Pvt. Ltd., Kolkata vs. DCIT, Cir. -5(1), Kolkata

In the result, the appeal of the assessee is allowed

ITA 947/KOL/2024[2012-13]Status: DisposedITAT Kolkata09 Oct 2024AY 2012-13

Bench: Shri Rajesh Kumar&Shri Pradip Kumar Choubey]

Section 143(3)Section 147Section 148Section 148(2)Section 264Section 68

/Kol/Whitepetals/2018-19/9065 dated 01-03-2019 wherein he has stated that during the investigation the statement of Shri Rajesh Kumar Agarwala a well known entry operators of Kolkata recorded on Oath under section 131 of the Income-tax A.ct,1961 and in his statement he has admitted that ... entry operator, having his office at Kolkata. During the course of statement he has admitted that his source of income is from commission earned in lieu of giving service in the form of giving cheques to his clients in return for cash. He has also admitted that he along with

M/S. Star Dealcom Pvt. Ltd., Birbhum vs. I.T.O., Ward - 3(1), Suri, Birbhum

ITA 1415/KOL/2024[2011-2012]Status: DisposedITAT Kolkata09 Oct 2024AY 2011-2012

Bench: Shri Rajesh Kumar&Shri Pradip Kumar Choubey]

Section 133(6)Section 143(1)Section 147Section 148

which is a shell entity in which Shri Chandresh Kumar Jain was acting as dummy director working at the instance of one entry operator Shri Naresh Kumar Jain. The said information revealed that the assessee is a beneficiary of Rs.15.00 lacs from the said shell company and consequently the case

Sanjay Singal, Chandigarh vs. Deputy Commissioner of Income Tax, CC-1, Chandigarh

ITA 655/CHANDI/2023[2015-16]Status: DisposedITAT Chandigarh08 Oct 2024AY 2015-16

Bench: SHRI A.D.JAIN (Vice President), SHRI KRINWANT SAHAY (Accountant Member)

For Appellant: Shri Ashwani Kumar, CAFor Respondent: Smt. Kusum Bansal, CIT, DR

Section 132Section 132(4)Section 250(6)Section 68Section 69ASection 69C

used for this purpose. It was explained by him that shares of such paper companies were purchased, which were managed and controlled by such entry operators, so that benefit of exempt LTCG through such listed companies floated by them could be taken in future. He also mentioned the names ... further disclosed the modus operandi in detail, wherein, it was explained how the rates of such scrips were rigged in the stock exchange by entry operators in the desired manner, through synchronized trading. When the price of such ITA 655/CHD/2023 & ITA 610/CHD/2023 A.Y. 2015-16 5 listed scrips was artificially

M/S Sanjay Singal HUF, Chandigarh vs. DCIT, CC-1, Chandigarh

ITA 610/CHANDI/2023[2015-16]Status: DisposedITAT Chandigarh08 Oct 2024AY 2015-16

Bench: SHRI A.D.JAIN (Vice President), SHRI KRINWANT SAHAY (Accountant Member)

For Appellant: Shri Ashwani Kumar, CAFor Respondent: Smt. Kusum Bansal, CIT, DR

Section 132Section 132(4)Section 250(6)Section 68Section 69ASection 69C

Ace Cabs Limited, Delhi vs. ACIT, Circle-1(2), Delhi, C R Building

In the result, appeal filed by the assessee is allowed

ITA 443/DEL/2024[2017-18]Status: DisposedITAT Delhi04 Oct 2024AY 2017-18

Bench: Shri Saktijit Dey, Hon’Ble & Shri S.Rifaur Rahmanace Cabs Limited, Vs. Acit, Circle 1 (2), 562, Silver Oak Lane, Delhi. M.G. Road, Ghitorni, Delhi – 110 030. (Pan : Aaica4494R) (Appellant) (Respondent) Assessee By : Shri Gaurav Jain, Advocate Ms. Bharti Sharma, Advocate Revenue By : Shri Kanv Bali, Sr. Dr Date Of Hearing : 23.07.2024 Date Of Order : 04.10.2024 Order Per S.Rifaur Rahman,Am: 1. This Appeal Has Been Filed By The Assessee Against The Order Of Ld. Commissioner Of Income Tax (Appeals), New Delhi [“Ld. Cit(A)”, For Short]/ National Faceless Appeal Centre (Nfac) Dated 12.12.2023 For The Assessment Year 2017-18. 2. The Assessee Submitted An Application Under Rule 29 Of The Itat Rules For Admitting The Additional Evidences & The Contents Thereof Are Reproduced Below:-

For Appellant: Shri Gaurav Jain, AdvocateFor Respondent: Shri Kanv Bali, Sr. DR

Section 142(1)Section 143(2)

DDIT had stated that none of these companies were traceable at their given addresses and that all the sixteen (16) shareholders belonged to entry operators. At the time of hearing, the Ld. AR of the assessee painstakingly took us through the contents of the report and argued that the averments

Balhanuman Commodeal Pvt. Ltd., Kolkata vs. ITO, Ward-5(4), Kolkata

ITA 116/KOL/2024[2012-13]Status: DisposedITAT Kolkata03 Oct 2024AY 2012-13

Bench: Shri Sanjay Garg & Shri Rakesh Mishraassessment Year: 2012-13

For Appellant: NoneFor Respondent: Shri Vineet Kumar, Addl. CIT, Sr. DR

Section 131Section 143(2)Section 143(3)Section 14ASection 250Section 68

IN THE INCOME TAX APPELLATE TRIBUNAL “C” BENCH KOLKATA BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER AND SHRI RAKESH MISHRA, ACCOUNTANT

The ACIT, Central Circle-3, Vadodara vs. M/S. Aikya Chemicals Pvt. Ltd., Vadodara

In the result, both the appeals of the Revenue are hereby dismissed

ITA 160/AHD/2021[2015-16]Status: DisposedITAT Ahmedabad01 Oct 2024AY 2015-16

Bench: Ms. Suchitra Kamble, Judical Member & Shri Narendra Prasad Sinhaआयकर अपील (एसएस) सं./I.T (Ss).A. No. 81/Ahd/2021 ("नधा"रण वष" / Assessment Years : 2014-15) बनाम/ Asstt. Commissioner Of M/S. Cube Mines & Income-Tax Minerals Pvt. Ltd. Vs. Central Circle-3, Vadodara 11/C Ground Floor, Jaishri Narayan Co-Operative Hsg. Society, Subhanpura, Gorwa, Vadodara, Gujarat 390015 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aaccc5761D (Appellant) .. (Respondent) & आयकर अपील (एसएस) सं./I.T (Ss).A. No. 82/Ahd/2021 ("नधा"रण वष" / Assessment Years : 2014-15) & आयकर अपील सं./I.T.A. No. 159/Ahd/2021 ("नधा"रण वष" / Assessment Years : 2015-16) बनाम/ Asstt. Commissioner Of M/S. Iolite Cube Income-Tax Inframaterial Ltd. Vs. Central Circle-3, Vadodara 1, Chandamani Nagar, Vidhya Vihar School Lane, Subhanpura, Vadodara, "थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aacci5944A (Appellant) .. (Respondent) &

For Appellant: Shri Jigar Adhiyaru, A.RFor Respondent: Shri H. Phani Raju, CIT. DR

Section 132Section 153A

company M/s. Blackberry Ventures Pvt. Ltd. (‘BVPL’), which was floated in Kolkata in the year 2010. This company was floated by an accommodation entry operator of Kolkata, namely, Mr. Pankaj Agrawal who had admitted that BVPL was a paper company. BVPL had raised funds of about Rs.40 Crores by issuing ... advance the loan. 5. The AO, however, rejected the evidences filed by the assessee on the ground that BVPL was floated by an accommodation entry operator of Kolkata, namely, Mr. Pankaj Agrawal who had accepted in his statement that BVPL was a paper company. As mentioned earlier, the company BVPL

The ACIT, Central Circle-3, Vadodara vs. M/S. Iolite Cube Inframaterial Ltd., Vadodara

In the result, both the appeals of the Revenue are hereby dismissed

ITA 159/AHD/2021[2015-16]Status: DisposedITAT Ahmedabad01 Oct 2024AY 2015-16

For Appellant: Shri Jigar Adhiyaru, A.RFor Respondent: Shri H. Phani Raju, CIT. DR

Section 132Section 153A