In favour of assessee.Since the AO failed to conduct inquiry even on the second remand report called for by the ld.CIT(A), his conclusion are without any supporting evidence and delete the impugned addition.
Sec. 68 of Income Tax Act, 1961—Cash Credit - The bank statement submitted by the assessee is for a limited period showing transaction received by it. The document was submitted by the assessee in order to demonstrate that it has received money through account payee cheques. PAN details were submitted in order to demonstrate that this assessee is assessable to tax, and it proves its identity. That concern, responded to the notice received under section 133(6) of the Act. The AO, thereafter did not conduct any inquiry. The investigation wing of the department is able to unearth details of various accommodation entry providers mainly Kolkatta based companies, but the AO nowhere observed that these concerns were ever engaged in providing accommodation entries, and this fact came to notice of the Department through its investigation wing. Thus, if he has any doubt, he should have called for further information from the share applicants. He should have asked the assessee to produce directors of share applicant companies. The AO could have issued summons under section 131 of the Act. But instead of conducting any inquiry, he just draw certain inference for disbelieving the documents produced by the assessee or received by him in response to his notice under section 133(6) of the Act. Quantum of income mentioned in the return of income cannot be criteria to judge credit-worthiness of share applicants. Therefore, since the AO failed to conduct inquiry even on the second remand report called for by the CIT(A), his conclusion are without any supporting evidence. In view of the above discussion, ITAT deleted the impugned addition. - D.J. STOCK BROKING PVT. LTD. V/s ITO - [2020] 23 ITCD Online 066 (ITAT-AHMEDABAD)
In favour of assessee.Since the AO failed to conduct inquiry even on the second remand report called for by the ld.CIT(A), his conclusion are without any supporting evidence and delete the impugned addition.
Sec. 68 of Income Tax Act, 1961—Cash Credit - The bank statement submitted by the assessee is for a limited period showing transaction received by it. The document was submitted by the assessee in order to demonstrate that it has received money through account payee cheques. PAN details were submitted in order to demonstrate that this assessee is assessable to tax, and it proves its identity. That concern, responded to the notice received under section 133(6) of the Act. The AO, thereafter did not conduct any inquiry. The investigation wing of the department is able to unearth details of various accommodation entry providers mainly Kolkatta based companies, but the AO nowhere observed that these concerns were ever engaged in providing accommodation entries, and this fact came to notice of the Department through its investigation wing. Thus, if he has any doubt, he should have called for further information from the share applicants. He should have asked the assessee to produce directors of share applicant companies. The AO could have issued summons under section 131 of the Act. But instead of conducting any inquiry, he just draw certain inference for disbelieving the documents produced by the assessee or received by him in response to his notice under section 133(6) of the Act. Quantum of income mentioned in the return of income cannot be criteria to judge credit-worthiness of share applicants. Therefore, since the AO failed to conduct inquiry even on the second remand report called for by the CIT(A), his conclusion are without any supporting evidence. In view of the above discussion, ITAT deleted the impugned addition. - D.J. STOCK BROKING PVT. LTD. V/s ITO - [2020] 23 ITCD Online 066 (ITAT-AHMEDABAD)