True Power Electronics (P) Ltd., New Delhi v. ITO, New Delhi

ITA 356/DEL/2010 | 2001-2002
Pronouncement Date: 21-01-2011 | Result: Partly Allowed

Appeal Details

RSA Number 35620114 RSA 2010
Bench Delhi
Appeal Number ITA 356/DEL/2010
Duration Of Justice 11 month(s) 27 day(s)
Appellant True Power Electronics (P) Ltd., New Delhi
Respondent ITO, New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 21-01-2011
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted H
Tribunal Order Date 21-01-2011
Date Of Final Hearing 12-01-2011
Next Hearing Date 12-01-2011
Assessment Year 2001-2002
Appeal Filed On 25-01-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: H NEW DELHI BEFORE SHRI RAJPAL YADAV JUDICIAL MEMBER AND SHRI K.G. BANSAL ACCOUNTANT MEMBER I.T.A NO. 356/DEL/10 ASSTT. YEAR 2001-02 TRUE POWER ELECTRONICS (P) LTD. 80 PRIYADARSHINI VIHAR NEW DELHI. VS. ITO WARD-16(4) NEW DELHI. (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI GURJEET SINGH CA RESPONDENT BY: SHRI AMRENDRA KUMAR SR. DR ORDER PER RAJPAL YADAV JM: THE ASSESSEE IS IN APPEAL BEFORE US AGAINST THE OR DER OF LD. CIT(A) DATED 16.10.2009 PASSED FOR ASSTT. YEAR 2001 -02. THE GROUNDS OF APPEAL TAKEN BY THE ASSESSEE ARE NOT IN CONSONAN CE WITH RULE 8 OF THE ITAT RULES. THEY ARE DESCRIPTIVE AND ARGUMENTAT IVE IN NATURE. IN BRIEF THE GRIEVANCE OF ASSESSEE IS THAT LD. CIT(A) HAS ERRED IN UPHOLDING THE REOPENING OF ASSESSMENT AS WELL AS CONFIRMATIO N OF ADDITION AMOUNTING TO RS. 2 00 500/-. ITA NO. 356/DEL/10 ASSTT. YEAR 2001-02 2 2. AS FAR AS THE ISSUE REGARDING REOPENING OF ASSES SMENT IS CONCERNED LD. COUNSEL FOR THE ASSESSEE DID NOT PRE SS IT. THEREFORE GROUND NO. 2 & 3 WHEREIN ASSESSEE HAS IMPUGNED THE REOPENING OF ASSESSMENT ARE REJECTED. 3. AS FAR AS THE ADDITION OF RS. 2 00 500/- IS CONC ERNED THE BRIEF FACTS ARE THAT ASSESSEE HAS FILED ITS RETURN OF INCOME ON 31 ST OCTOBER 2001 DECLARING INCOME AT RS. 71 040/-. THE AO HAD RECEIV ED AN INFORMATION FROM THE INVESTIGATION WING THAT ASSESSEE HAS RECEI VED AN ENTRY OF RS. 2 LACS FROM M/S TRANSPAN FINANCIAL SERVICES LIMITED. HE REOPENED THE ASSESSMENT AND ISSUED NOTICE U/S 143(2) OF THE ACT. THE AO DIRECTED THE ASSESSEE TO EXPLAIN AS TO WHY THE ADDITION OF RS. 2 LACS BE NOT MADE U/S 68 OF THE INCOME TAX ACT. IN RESPONSE TO THE QUERY OF AO IT WAS CONTENDED BY THE ASSESSEE THAT HE HAS RECEIVED SHAR E APPLICATION MONEY FROM M/S. TRANSPAN FINANCIAL SERVICES LIMITED . IN SUPPORT OF ITS CLAIM THE ASSESSEE HAS SUBMITTED COPY OF THE RESOL UTION PASSED BY M/S. TRANSPAN FINANCIAL SERVICES AUTHORIZING TO APPLY FO R SHARES RESOLUTION OF THE ASSESSEE COMPANY CONFIRMATION FROM M/S TRANSPA N FINANCIAL SERVICES LIMITED THAT IT HAD APPLIED FOR SHARES. AF FIDAVIT OF THE DIRECTOR OF M/S. TRANSPAN FINANCIAL SERVICES PERMANENT ACCOUNT NUMBER OF THE SHARE APPLICANT. TAN DETAIL OF TRANSPAN FINANCIAL SERVICES AND THE DETAILS FROM REGISTRAR OF COMPANIES DEMONSTRATING T HE EXISTENCE OF THE ITA NO. 356/DEL/10 ASSTT. YEAR 2001-02 3 COMPANY. ACCORDING TO THE LD. AO HE HAS ISSUED NOT ICE ON THE ADDRESSES GIVEN BY THE ASSESSEE BUT IT RETURNED BAC K UNSERVED. WHEN THIS FACT WAS COMMUNICATED TO THE ASSESSEE IT HAS F ILED A DETAILED REPLY ON 22 ND DECEMBER 2008 AND SUBMITTED THAT ADDRESS OF M/S. TRANSPAN FINANCIAL SERVICES LIMITED IS 2-C JC BLOCK HARI ENCLAVE HARI NAGAR DELHI AND ENQUIRED WHETHER NOTICE WAS SENT TO THIS ADDRESS OR NOT ? THE ASSESSEE ALSO PRAYED TO AO TO PROCURE THE PRESENCE OF THE PRINCIPLE OFFICER OR THE DIRECTOR OF THIS COMPANY BY EXERCIS ING THE STATUTORY POWERS. LD. AO INSTEAD OF CARRYING OUT THAT EXERCIS E HEAVILY RELIED UPON THE STATEMENT OF ONE SHRI MAHESH GARG WHO HAS DISC LOSED THAT HE IS IN THE BUSINESS OF PROVIDING ENTRY. HE IS HAVING A NUM BER OF COMPANIES FROM WHERE HE USED TO TAKE MONEY IN CASH AND THEN R OTATE IT IN A NUMBER OF ENTITIES AND THEN RETURN THE MONEY IN THE SHAPE OF SHARE APPLICATION MONEY TO THE CONCERNED WHERE CASH WAS OBTAINED. THI S STATEMENT WAS RECORDED BY THE INVESTIGATION WING. THE AO RELIED U PON THE STATEMENT AND MADE THE ADDITION OF RS. 2 LACS. HE FURTHER MAD E AN ADDITION OF RS. 500/- ON THE GROUND THAT ASSESSEE MUST INCUR THIS M UCH OF AMOUNT FOR ARRANGEMENT OF THE ACCOMMODATION ENTRY OF RS. 2 LAC S. IN THIS WAY THE TOTAL ADDITION OF RS. 2 00 500/- HAS BEEN MADE IN T HE INCOME OF ASSESSEE. ITA NO. 356/DEL/10 ASSTT. YEAR 2001-02 4 4. APPEAL TO THE LD. CIT(A) DID NOT BRING ANY RELIE F TO THE ASSESSEE. 5. BEFORE US LD. COUNSEL FOR THE ASSESSEE SUBMITTE D THAT IT HAS PROVED IDENTITY OF THE SHARE APPLICANT. IT HAS PROD UCED THE DETAILS IN THE SHAPE OF PERMANENT ACCOUNT NUMBER CONFIRMATION ETC . THE ISSUE IN DISPUTE IS COVERED IN ITS FAVOUR BY THE DECISION OF HONBLE DELHI HIGH COURT RENDERED IN THE CASE OF CIT VS. TARUNA AUTO P VT. LTD. REPORTED IN ITA 889/2010 AS WELL AS IN THE CASE OF VICTOR ELECT RODES LTD. RENDERED IN 586/DEL/2010. HE ALSO REFERRED THE DECISION OF HON BLE DELHI HIGH COURT IN THE CASE OF CIT VS. DWARIKADHISH INVESTMENT P. L TD. WHEREIN HONBLE HIGH COURT HAS EXAMINED THE ISSUE IN DETAIL AND CON SIDERED A LARGE NUMBER OF DECISION ON THIS ISSUE. LD. DR ON THE OTH ER HAND RELIED UPON THE ORDER OF LD. CIT(A). HE POINTED OUT THAT AO HAS RELIED UPON THE STATEMENT OF SHRI MAHESH GARG WHO DISCLOSED THE MOD US OPERENDI ADOPTED BY HIM AND OTHER RELATIVES IN PROVIDING ACC OMMODATION ENTRIES. 6. WE HAVE DULY CONSIDERED THE RIVAL CONTENTION AND GONE THROUGH THE RECORD CAREFULLY. THE ASSESSEE HAS PRODUCED PE RMANENT ACCOUNT NUMBER OF ITS SHARE APPLICANT CONFIRMATION FROM T HE SHARE APPLICANT AS WELL AS THE AFFIDAVIT OF THE DIRECTOR. IT ALSO PROD UCED COPY OF THE RESOLUTION AUTHORISING TO APPLY FOR INVESTMENT. THE ASSESSEE PRODUCED THE DETAILS FROM ROC OFFICE. CONTRARY TO THIS DOCUM ENTARY EVIDENCE AO ITA NO. 356/DEL/10 ASSTT. YEAR 2001-02 5 IS HARPING UPON THE STATEMENT OF SHRI MAHESH GARG W HICH WAS RECORDED BY THE INVESTIGATION WING. IN THE STATEMENT HE HAS NOT TAKEN SPECIFICALLY NAME OF ASSESSEE THE STATEMENT REFERRED IN THE ASSE SSMENT ORDER IS OF GENERAL IN NATURE AND SHRI MAHESH GARG WAS NOT SUBJ ECTED TO CROSS OBJECTION BY THE ASSESSEE. IT WAS NOT EVEN OFFERED BY THE AO. AN ADDITION OF RS. 28 40 000/- WAS MADE IN THE CASE OF FUNNY TIME FINVEST LTD. WHEREIN THE AO HAD MADE REFERENCE TO THE SIMIL AR STATEMENT OF SHRI MAHESH GARG. LD. CIT(A) HAS DELETED THIS ADDITION. THE DEPARTMENT CHALLENGED THE ORDER OF LD. CIT(A) IN ITA NO. 1278/ DEL/09. THE BENCH OF THIS VERY COMPOSITION HAS DISMISSED THE APPEAL OF T HE REVENUE. OUR ORDER DATED 10.12.2010 IN THE CASE OF M/S. FUNNY TI MES FINVEST LTD. READ AS UNDER :- 2. THE BRIEF FACTS OF THE CASE ARE THAT ASSESSEE H AS FILED ITS RETURN OF INCOME ON 30 TH NOVEMBER 2000 DECLARING AN INCOME OF RS. 2860/-. THE ASSESSEE AT THE RELEVANT TIME WAS ENGAGED IN THE BU SINESS OF INVESTMENT IN SHARES / FIXED DEPOSITS. IT USED TO DRIVE INCOME FR OM DIVIDEND AND INTEREST. THE AO HAD RECEIVED AN INFORMATION FROM THE INVESTIGATI ON WING THAT ASSESSEE HAS RECEIVED ACCOMMODATION ENTRIES IN ITS BANK ACCOUNT WITH PNB NEW ROHTAK ROAD NEW DELHI. THE DETAILS OF ENTRIES HAVE BEEN N OTICED BY THE AO ON PAGE 1 OF THE ASSTT. ORDER. ON THE STRENGTH OF THESE ENT RIES AO FORMED AN OPINION THAT INCOME OF THE ASSESSEE AS ESCAPED ASSESSMENT. THEREFORE HE RECORDED THE REASONS FOR REOPENING OF ASST. AND TOOK THE APPROVA L FROM THE ADDITIONAL COMMISSIONER OF INCOME TAX. A NOTICE U/S 148 WAS SE RVED UPON THE ASSESSEE ON 30 TH MARCH 2007. ACCORDING TO THE AO IN RESPONSE TO TH E NOTICE ISSUED ON 30 TH MARCH 2007 SHRI ADITYA SHARMA CA APPEARED ON 10 TH JULY 2007. HOWEVER THEREAFTER NO ONE APPEARED UP TO 15.11.2007 . HE OBSERVED THAT NOTICE U/S 271 (1) (B) WAS ALSO SENT ON 22 ND AUGUST 2007. ON SCRUTINY OF THE ACCOUNTS LD. AO FOUND THAT ASSESSEE HAS RECEIVED FR ESH SHARE CAPITAL OF RS. 28 40 000/- IN THIS ASSTT. YEAR. THOUGH THE INFORMA TION ABOUT THE ACCOMMODATION ENTRY WAS OF RS. 9 LAC ONLY BUT LD. AO INVESTIGATED THE TOTAL ITA NO. 356/DEL/10 ASSTT. YEAR 2001-02 6 SHARE CAPITAL RECEIVED AFRESH IN THIS ASSTT. YEAR. IN RESPONSE TO THE QUERIES OF AO ASSESSEE HAS FILED THE FOLLOWING DOCUMENTS :- 1. COPY OF APPLICATION FOR SHARES 2. COPY OF CONFIRMATION 3. COPY OF AFFIDAVITS OF CONFIRMATION WITH PAN NUMB ER 4. COPY OF RETURN OF INCOME 5. COPY OF BANK STATEMENT 6. COPY OF RATION CARD 7. COPY OF DRIVING LICENSE 8. COPY OF BOARD MINUTES IN CASE OF CORPORATE ENTRY 3. THE AO HAS MADE THE ADDITION OF RS. 28 40 000/-. THE REASONS ASSIGNED BY THE AO FOR DISBELIEVING THE CONTENTION OF THE ASSESSEE ARE THAT DEPARTMENT HAS RECORDED STATEMENT OF ONE SHRI MAHES H GARG WHO HAS GIVEN AN ACCOMMODATION ENTRY OF RS. 2 LAC TO THE ASSESSEE ON 25 TH MARCH 2000. SHRI MAHESH GARG IN HIS STATEMENT RECORDED BY THE A D1 ON 10 TH SEPTEMBER 2003 HAS DISCLOSED THAT HE HAS FORMED MANY ENTITIE S WHO GAVE ACCOMMODATION ENTRIES TO THE ASSESSEE ON RECEIPT OF COMMISSION. THUS MAINLY THE AO HAS PUT RELIANCE UPON THE STATEMENT OF SHRI MAHESH GARG. HE FURTHER OBSERVED THAT SUMMONS WERE SENT U/S 133 (6) TO THE SHARE APPLICANTS. SOME OF THEM HAVE RESPONDED TO THE SUMMONS BUT SUBMITTED IN COMPLETE INFORMATION. WE ALSO OBSERVED THAT ASSESSEE FAILED TO PRODUCE I TS DIRECTOR. AO HAS FURTHER MENTIONED THAT ASSESSEE HAS ADOPTED DILATORY STRATE GY IN COMPLETING THE ASSTT. PROCEEDING AND DID NOT SUBMIT THE DETAILS IN TIME. 4. ON APPEAL LD. CIT(A) HAS DELETED THE ADDITION ON THE GROUND THAT AO WAS NOT POSSESSING ANY CONCRETE MATERIAL. HE HAS JU ST CERTAIN INFORMATION SUPPLIED BY THE INVESTIGATION WING EXHIBITING THE F ACT THAT ONE SHRI MAHESH GARG WAS INVOLVED IN GIVING ACCOMMODATION ENTRIES. ACCORDING TO THE LD. CIT(A) AO HAS MADE REFERENCE TO THE REPLIES GIVEN B Y SHRI MAHESH GARG BUT THOSE QUESTIONS AND REPLY ARE OF GENERAL NATURE. TH E AO HAS NOT GIVEN REFERENCE TO ANY REPLY OF SHRI MAHESH GARG WHERE HE HAD TAKEN SPECIFICALLY THE NAME OF ASSESSEE AND THE AMOUNT. APART FROM THI S ASSESSEE HAS TIME AND AGAIN ASKED FOR GIVING AN OPPORTUNITY TO CROSS EXAM INE SHRI MAHESH GARG BUT THE AO DID NOT PROVIDE SUCH OPPORTUNITY RATHER HE OBSERVED THAT STATEMENT OF SHRI MAHESH GARG WAS CONFRONTED TO THE ASSESSEE. LD . CIT(A) FURTHER OBSERVED THAT AO WITHOUT DISCUSSING THE DEFECTS IN THE DETAILS SUBMITTED BY THE SHARE APPLICANT DIRECTLY TO HIM IN RESPONSE TO NOTI CE RECEIVED U/S 133 (6) OF THE ACT HAS JUST OBSERVED THAT THESE DETAILS ARE INCOM PLETE. ACCORDING TO THE LD. CIT(A) ASSESSEE HAS PROVED THE IDENTITY OF THE CRED ITORS BY GIVING THEIR PAN NO. CONFIRMATION COPY OF THE INCOME TAX RETURN ET C. AO HAS THE INFORMATION WHICH CAN ONLY GIVE RISE A SUSPICION ABOUT THE DETA ILS SUBMITTED BY THE ASSESSEE EFFECTIVELY AO COULD NOT REBUT THE DETAIL S SUBMITTED BY THE ASSESSEE. LD. CIT (A) THEREAFTER PUT RELIANCE UPON THE AUTHOR ITATIVE PRONOUNCEMENTS OF HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. VA LUE CAPITAL SERVICES REPORTED IN 307 ITR 334 DCIT VS. DIVINE LEASING AN D FINANCE LTD. REPORTED ITA NO. 356/DEL/10 ASSTT. YEAR 2001-02 7 IN 299 ITR 268 ALSO REFERRED LOVELY EXPORTS 216 CTR 195. IN THIS WAY LD. CTI(A) DELETED THE ADDITION. 5. LD. DR WHILE IMPUGNING THE ORDER OF LD. CIT(A) C ONTENDED THAT WHATEVER DETAILS REFERRED BY THE LD. CIT(A) IN PARA GRAPH B OF PAGE 6 IS CONCERNED SUCH DETAILS ARE ONLY ON PAPERS. IN FACT THE SHARE APPLICANT OF THE ASSESSEE ARE MEN OF NO MEANS. THESE ENTITIES ARE JU ST ON THE PAPERS. SHRI MAHESH GARG HAS HIGHLIGHTED THE MODUS OPERENDI IN H IS STATEMENT GIVEN TO THE ADI. AFTER THIS STATEMENT A HEAVY ONUS IS UPON THE ASSESSEE TO DEMONSTRATE THAT SHARE APPLICATION MONEY RECEIVED BY IT IS A GE NUINE SHARE APPLICATION TRANSACTION. LD. DR IN SUPPORT OF HIS CONTENTION RE LIED UPON THE ORDER OF ITAT IN THE CASE OF MICO BALL BEARING (INDIA) LTD. VS. ITO IN ITA NO. 3284/DEL/08. HE ALSO RELIED UPON THE DECISION OF IT AT IN THE CASE OF ITO VS. OMEGA BIOTEC LTD. IN ITA NO. 2860/DEL/2009 DHINGR A GLOBAL CREDENCE PVT. LTD. VS ITO IN ITA NO. 2927/DEL/2009. HE POINTED O UT THAT IN THESE TWO CASES SIMILAR DOCUMENTARY EVIDENCE WERE PRODUCED BUT TRIB UNAL HAS POINTED OUT HOW THESE ARE ON THE PAPER. IN THE CASE OF OMEGA BI OTETCH LTD. THE ISSUE HAS BEEN SET ASIDE THE FILE OF AO FOR READJUDICATION WH EREAS IN THE CASE OF MICO BALL BEARING (INDIA) LTD. THE APPEAL OF THE ASSESSE E HAS BEEN DISMISSED. IN THE CASE OF DHINGRA GLOBAL CREDENCE PVT. LTD. TRIBUNAL HAS CONFIRMED THE ADDITION AND HELD THAT THESE DOCUMENTS ARE FABRICA TED AT THE INSTANCE OF ASSESSEE. ON THE OTHER HAND LD. COUNSEL FOR THE AS SESSEE RELIED UPON THE ORDER OF LD. CIT(A). HE ALSO RELIED UPON THE RECENT DECISION OF HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. DWARKADHISH INVES TMENT RENDERED IN ITA NO. 911/2010 ON 2 ND AUGUST 2010. HE ALSO RELIED UPON THE DECISION OF HONBLE DELHI HIGH COURT IN THE CASE OF VICTOR E LECTRODES LTD. RENDERED IN 586/D/2010 WHICH WAS DELIVERED ON 22 ND MAY 2010. HE POINTED OUT THAT IN THESE TWO DECISION HONBLE HIGH COURT HAS DISCUSSE D THE EARLIER DECISION OF HONBLE DELHI HIGH COURT AS WELL AS OF HONBLE SUPR EME COURT. IN THE CASE OF VICTOR ELECTRODES HONBLE HIGH COURT HAS OBSERVED T HAT THERE WAS NO OBLIGATION ON THE ASSESSEE TO PRODUCE DIRECTOR OR S OME OTHER REPRESENTATIVE OF THE SHARE APPLICANT COMPANY. SIMILARLY IN THE CASE OF CIT VS. DWARKADHISH INVESTMENT HONBLE HIGH COURT HAS EXPOUNDED THE MEA NING OF ONUS CONTEMPLATED IN SECTION 68 AND HOW IT IS TOBE DISCH ARGED. 6. WE HAVE DULY CONSIDERED THE RIVAL CONTENTION AND GONE THROUGH THE RECORD CAREFULLY. THE ASSESSEE HAS FILED CONFIRMATI ON AND OTHER DETAILS EXTRACTED SUPRA BEFORE THE AO AS WELL AS BEFORE THE LD. CIT(A). THESE DETAILS HAVE BEEN PLACED IN THE PAPER BOOK ALSO. THE AO DID NOT ACCEPT THESE DETAILS AND MADE THE ADDITION. FROM PERUSAL OF THE ASSTT. O RDER WE FIND THAT EXCEPT HAVING A DIFFERENT PERCEPTION ON THE BASIS OF SURMI SES AND CONJECTURE THE AO FAILED TO BRING ANY CONCRETE MATERIAL ON THE RECORD TO DISBELIEVE THESE DOCUMENTS. FROM THE ASSTT. ORDER IT REVEALED THAT N OTICE U/S 148 WAS ALLEGED TO HAVE BEEN SERVED UPON THE ASSESSEE ON 30 TH MARCH 2007. THE AO THEREAFTER OBSERVED THAT ON 10 TH JULY 2007 SHRI ADITYA SHARMA CHARTERED ACCOUNTAN T APPEARED BUT AGAIN NO ONE APPEARED UPTO 15.11.2007. WE DO NOT FIND ANY DATE IN THE ASSTT. ORDER BEFORE THIS DATE AO REQU IRED THE ASSESSEE TO APPEAR ITA NO. 356/DEL/10 ASSTT. YEAR 2001-02 8 AND SUBMIT DETAIL. FROM PERUSAL OF PAGE 2 OF THE AS STT. ORDER IT REVEALS THAT EFFECTIVELY HE TOOK UP THE PROCEEDING IN THE MONTH OF NOVEMBER 2007 AND PASSED THE ASSTT. ORDER ON 24.12.2007. HE LEVELLED ALLEGATIONS AGAINST THE ASSESSEE THAT IT FAILED TO SUPPLY THE INFORMATION A ND ASSESSMENT IS GOING TO BE TIME BARRED. STATEMENT OF SHRI MAHESH GARG WHO ALLE GED TO HAVE DISCLOSED ABOUT GIVING OF ACCOMMODATION ENTRY WAS RECORDED ON 10 TH SEPTEMBER 2003 WE FAIL TO UNDERSTAND WHAT PREVENTED THE DEPTT. TO INVESTIGATE THE ISSUE AT AN EARLY STAGE. WITHOUT ANALYTICALLY EXAMINING INFORMA TION HE MADE ONLY GENERAL OBSERVATION ABOUT THE MODUS OPERANDI OF THE PERSONS WHO INVOLVED IN GIVING ACCOMMODATION ENTRY BUT TO OUR MIND AO SHOULD HAVE ESTABLISHED A LIVE NEXUS BETWEEN THE ACTIVITY OF ACCOMMODATION PROVIDE R VIS A VIS THE BENEFICIARY. BEFORE EMBARKING UPON THE ORDER OF LD. CIT(A) IT IS WORTH TO NOTE THE OBSERVATION OF HONBLE DELHI HIGH COURT MADE I N THE CASE OF VICTOR ELECTRODES AS WELL AS IN THE CASE OF CIT VS. DWARKA DHISH INVESTMENT. IN BOTH THESE CASES HONBLE HIGH COURT HAS EXPOUNDED THE AP PROACH REQUIRED TO BE ADOPTED BY AUTHORITIES IN SUCH TYPE OF CASES. THESE OBSERVATIONS READ AS UNDER :- VICTOR ELECTRODES LTD . ITA NO.586/DEL/10: 9. THERE WAS NO LEGAL OBLIGATION ON THE ASSESSEE TO PRODUCE SOME DIRECTOR OR OTHER REPRESENTATIVE OF THE APPLICANT C OMPANIES BEFORE THE ASSESSING OFFICER. THEREFORE FAILURE OF ASSESSEE T O PRODUCE THEM COULD NOT BY ITSELF HAVE JUSTIFIED THE ADDITIONS MADE BY THE AS SESSING OFFICER WHEN THE ASSESSEE HAD FURNISHED DOCUMENTS ON THE BASIS OF W HICH THE ASSESSING OFFICER IF HE SO WANTED COULD HAVE SUMMONED THEM F OR VERIFICATION. NO ATTEMPT WAS MADE BY THE ASSESSING OFFICER TO SUMMON THE DIRECTORS OF THE APPLICANT COMPANIES. THE ADDRESSES OF THESE COMPANI ES MUST BE AVAILABLE ON THE SHARE APPLICATIONS MEMORANDUM AND ARTICLES OF ASSOCIATION AND THEIR INCOME-TAX RETURNS. IF THE ASSESSING OFFICER HAD AN Y DOUBT ABOUT IDENTITY OF THE SHARE APPLICANTS HE COULD HAVE SUMMONED THE DI RECTORS OF THE APPLICANT COMPANIES. NO SUCH ATTEMPT WAS HOWEVER MADE BY HI M. THEREFORE THE LEARNED CIT(APPEALS) AND THE INCOME-TAX APPELLATE T RIBUNAL IN OUR VIEW WERE JUSTIFIED IN HOLDING THAT THE IDENTITY OF SHAR E APPLICATIONS AND THE GENUINENESS OF THE TRANSACTIONS HAD BEEN ESTABLISHE D BY THE ASSESSEE. ITA NO. 911/DEL/10 8. IN ANY MATTER THE ONUS OF PROOF IS NOT A STATIC ONE. THOUGH IN SECTION 68 PROCEEDINGS THE INITIAL BURDEN OF PROOF LIES ON THE ASSESSEE YET ONCE HE PROVES THE IDENTITY OF THE CREDITOR/SHARE APPLICANT S BY EITHER FURNISHING THEIR PAN NUMBER OR INCOME-TAX ASSESSMENT NUMBER AND SHOW S THE GENUINENESS OF TRANSACTION BY SHOWING MONEY IN HIS BOOKS EITHER BY ACCOUNT PAYEE CHEQUE OR BY DRAFT OR BY ANY OTHER MODE THEN THE ONUS OF PRO OF WOULD SHIFT TO THE REVENUE. JUST BECAUSE THE CREDITORS/SHARE APPLICANT S COULD NOT BE FOUND AT THE ADDRESS GIVEN IT WOULD NOT GIVE THE REVENUE THE RI GHT TO INVOKE SECTION 68. ONE MUST NOT LOSE SIGHT OF THE FACT THAT IT IS THE REVENUE WHICH HAS ALL THE POWER AND WHEREWITHAL TO TRACE ANY PERSON. MOREOVER IT IS SETTLED LAW THAT THE ASSESSEE NEED NOT TO PROVE THE SOURCE OF SOURC E. ITA NO. 356/DEL/10 ASSTT. YEAR 2001-02 9 7. IN THE LIGHT OF THESE OBSERVATIONS IF WE EXAMI NE THE MATERIAL PLACED ON RECORD BY THE ASSESSEE AS WELL AS THE FINDING OF LD . CIT(A) THEN IT WILL REVEAL THAT ASSESSEE HAS DISCHARGED ITS ONUS. THE AO HAS J UST MADE GENERAL OBSERVATION. WHATEVER MATERIAL HE WAS POSSESSING IT WAS SUFFICIENT TO START THE INVESTIGATION BUT LD. AO INSTEAD OF COLLECTING CON CRETE MATERIAL TREATED THAT HALF BAKED INFORMATION AS A CONCLUSIVE PROOF FOR DO UBTING THE SHARE APPLICATION MONEY RECEIVED BY THE ASSESSEE IN THIS YEAR. AS FAR AS THE DECISIONS OF THE TRIBUNAL RELIED UPON LD. DR ARE CONCERNED WE ARE OF THE VIEW THAT IN THE CASE OF DHINGRA GLOBAL CREDENCE PVT. LTD. TRIB UNAL HAS MADE AN OBSERVATION ON PAGE 10 THAT ALL THE PAPERS ARE MANU FACTURED AT THE INSTANCE OF ASSESSEE AND DO NOT DEPICT THE REAL TRANSACTION. WE DO NOT FIND ANY EVIDENCE COLLECTED BY THE AO IN THE PRESENT CASE FOR HOLDING SO. THE OTHER TWO DECISIONS ARE ALSO BASED ON APPRECIATION OF THE FACTS IN THOS E CASES. THERE IS NO RATIO OF LAW LAID DOWN IN THESE ORDERS. IN VIEW OF THE ABOVE DISCUSSION WE DO NOT FIND ANY MERIT IN THE APPEAL IT IS DISMISSED. 7. AS FAR AS THE QUALITY OF EVIDENCE POSSESSED BY T HE AO IN THAT CASE AND IN THE PRESENT CASE ARE CONCERNED THERE IS NO DISPARITY ON FACTS. THEREFORE RESPECTFULLY FOLLOWING OUR ORDER IN THE CASE OF FUNNY TIME FINVEST LTD. WE ALLOW THIS GROUND OF APPEAL OF THE ASSESSEE AND DELETE THE ADDITION OF RS. 2 LACS CONSEQUENTLY ADDITION OF RS. 500/- IS ALSO DELETED. 8. IN THE RESULT APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 21 ST JANUARY 2011. SD/- [K.G. BANSAL] [RAJPAL YADAV] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 21 ST JANUARY 2011 VEENA ITA NO. 356/DEL/10 ASSTT. YEAR 2001-02 10 COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR ITAT TRUE COPY BY ORDER DEPUTY REGISTRAR ITAT