Shark Communication Pvt. Ltd.,, New ... vs Assessee

M/s Shark Communication Pvt. Vs. A.C.I.T., Ltd., H-108, IInd Floor, Central Circle-9, New Asiatic Bldg. Connaught New Delhi Place, New Delhi (PAN:AAACS4876P) (Appellant) (Respondent)

Appellant by : Sh. K. Sampath, Adv. Respondent by: Sh. Ramesh Chander, CIT(DR) Date of hearing: 30.04.2015 Date of pronouncement: 06.05.2015

ORDER

PER INTURI RAMA RAO, A.M.:

This is an appeal filed by the assessee for the assessment year 2006-07

impugning the order of the learned CIT(A)-XXXII, Delhi, dated 05.03.2012

raising the following grounds of appeal:

That on the facts and in the circumstances and in the law the authorities below erred in:

i. Determining taxable income of Rs. 3,62,230/- as against the returned income of Rs. 4,674/-

ii. Passing order U/s 143(3) r.w.s. 153A of the Income Tax Act, 1961 relying on the estimates and not on the basis of seized material: iii. In applying provisions of section 145(3) of the Act even though books of account were never produced before the authority and no material defects were pointed out thereion; iv. In estimating undisclosed income of sum of Rs. 12,050/- and Rs.

3,45,511/- based figure appearing in balance sheet despite the facts that such books of account were never relied upon;

2 ITA No. 3211/Del /2012 Assessment Year: 2006-07

All the above actions being most arbitrary, erroneous, untenable and unlawful, it is prayed that same must be quashed.

2. The brief facts of the case are that the appellant is one of the AOP concern

operated and controlled by one Sh. S.K. Gupta, Chartered Accountant by

profession, from his office situated at H-108, 2 nd Floor, New Asiatic Building,

Connaught Place, New Delhi. A search and seizure operation under Section 132

of the Income-tax Act, 1961 (for short "the Act") was conducted on 12.12.2006

at the business and residential premises of Sh. S.K. Gupta along with his various

concerns. A notice under Section 153A of the Act was issued to the assessee

company on 25.02.2008. During the course of search operation, it was reported

by the investigation wing that a large number of companies were being operated

and controlled by Sh. S.K. Gupta from his main office indulged in the business

of entry provider. Subsequently, the case was selected for scrutiny and finally

the assessment order came to be passed on 29.12.2008 at a total income of Rs.

3,62,235/- after making additions of Rs. 3,45,511/- on account bogus fresh

investment entries and Rs. 12,050/- on account of accommodation sale

bills/turnover. Aggrieved by this order, an appeal was preferred before the

learned CIT(A) who vide order dated 05.03.2012 confirmed the addition made

by the assessee and dismissed the appeal. Aggrieved, the present appeal of the

assessee is before us.

3. Learned Authorized Representative has placed reliance on following

cases:

3 ITA No. 3211/Del /2012

Assessment Year: 2006-07

i. M/s Konichiva Builders Pvt. Ltd. Vs. ACIT, in ITA Nos. 3213-3214 & 3856/Del/2012 and 1080/Del/2013 for A.Ys 2004-05, 2005-06, 2007-08 & 2006-07, dated 14.02.2014.

ii. Era Advertising & Marketing Ltd. Vs. ACIT, in ITA Nos. 3046- 3049/Del/2012 & 3069/Del/2012, dated 28.01.2015 iii. Camsoft India Pvt. Ltd. Vs. ACIT in ITA Nos. 1070 & 1074/Del/2013, dated 20.04.2015

4. On the other hand, the learned DR placed reliance on the order of learned

CIT(A).

5. After hearing the rival submissions and perusing the material available

and the decisions cited supra, we are of the considered opinion that since the

assessee company also relates to the same group. Accordingly, we also restore

the matter to the file of Assessing Officer for de novo assessment to examine the

issue of allowability of expenditure in the light of the orders cited supra by

affording adequate opportunity to the assessee of being heard.

6. In the result, the appeal stands partly allowed for statistical purposes.

The decision is pronounced in the open court on 6 th May, 2015.

Sd/- Sd/- (I.C. SUDHIR) (INTURI RAMA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 6th May, 2015. RK/- Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, New Delhi