AMBICA STEELS LIMITED Vs. DY COMMISSIONER OF INCOME TAX
LAWS(IT)-2008-4-2
INCOME TAX APPELLATE TRIBUNAL
Decided on April 30,2008

Appellant
VERSUS
Respondents

JUDGEMENT

P.M. Jagtap, Accountant Member - (1.) THIS appeal by the assessee is directed against the order of learned CIT(A)-IV, New Delhi dated 20.3.2006. The assessee in the present case is a company which filed its return of income for the year under consideration on 28.11.1997 declaring its total income at nil under the normal provisions and at Rs. 7,56,291/- Under Section 115JA. Subsequently, on 15.7.2002, there was a search and seizure operation conducted by the department in the case of Shri N.C. Bansal and Others. On the basis of material found and seized during the course of the said operation, it was found that M/s Jain Brothers & Co. and other entities belonging to Shri N.C. Bansal were entry operators. It was revealed that the modus operandi followed by the said entry operators was to deposit the cash into bank accounts and issue cheques to the different parties from the said bank account after charging certain percentage of commission.
(2.) It was also noticed that the assessee company was one of such parties who had received five cheques from M/s Jain Brothers & Co. from the current account No. 3197 maintained by the said concern with Corporation Bank, Karol Bagh. The details of such cheques like cheque number, date, amount etc. were also gathered by the AO. The said cheques were found to be signed by Mr. Padam Singh Jain as proprietor of M/s Jain Brothers & Co. and in his statement recorded by the department, he could not explain the source of the cash deposited in the bank accounts of the said concern with Corporation Bank. This specific information pertaining to the case of the assessee was forwarded by Investigation Wing of the Department was received by the AO on the basis of which he formed a belief that there was escapement of assessee's income. Accordingly, he initiated the reassessment proceedings for the year under consideration by issuing a notice Under Section 148 after recording the reasons. The said notice issued on 31.3.2004 was sent to the assessee by the AO by speed post. As there was no response to the said notice on the part of the assessee, a notice Under Section 142(1) was issued by the AO and in reply to the said notice, it was submitted on behalf of the assessee before the AO that the notice stated to be issued Under Section 148 was never received by it. A copy of the said notice alongwith proof of dispatch by speed post on 31.3.2004 was handed over by the AO to the representative of the assessee on 4.2.2005 giving one more opportunity to the assessee to file the return in response to notice Under Section 148 within a period of 30 days from 4.2.2005. No return, however, was filed by the assessee in compliance with the same. Even there was no satisfactory compliance by the assessee with the notices issued by the AO during the course of reassessment proceedings and keeping in view this non-cooperative and non-compliant attitude of the assessee, the assessment was completed by the AO ex-parte to the best of his judgement Under Section 144/147 making the various additions as under: JUDGEMENT_3617_TLIT0_20080.htm
(3.) THE aforesaid assessment completed by the AO Under Section 144/147 was challenged by the assessee in an appeal filed before the learned CIT(A) challenging the validity thereof as well as disputing the various additions made therein on merits. THE said appeal was disposed of by the learned CIT(A) by his appellate order dated 20.3.2006 upholding the validity of assessment completed by the AO. He, however, deleted most of the additions made by the AO in the said assessment and confirmed only the following additions made in the assessment: JUDGEMENT_3617_TLIT0_20081.htm ;


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