Meenakshi Gupta v. Income Tax Officer, Ward- 35(6), New Delhi

$~34 *IN THE HIGH COURT OF DELHI AT NEW DELHI %Date of Decision : 09.07.2025 +ITA 205/2025 & CM APPL.39138/2025 MEENAKSHI GUPTA .....AppellantThrough:Mr Sankalp Malik, Advocate.versus INCOME TAX OFFICER, WARD- 35(6),NEW DELHI .....RespondentThrough:Mr Sanjay Kumar, SSC with MsMonica Benjamin, JSC. CORAM:HON'BLE MR. JUSTICE VIBHU BAKHRUHON'BLE MR. JUSTICE TEJAS KARIA VIBHU BAKHRU, J. (ORAL) 1.The appellant [Assessee] has filed the present appeal under Section260A of the Income Tax Act, 1961 [the Act] impugning an order dated06.01.2025 passed by the learned Income Tax Appellate Tribunal inITA No.4710/Del/2024 in respect of Assessment Year 2012-13. TheAssessee had preferred the aforesaid appeal [ITA No.4710/Del/2024]against an order dated 09.02.2024 passed by the Commissioner of IncomeTax (Appeals)/National Faceless Appeal Centre [CIT(A)].The Assesseehad preferred the said appeal impugning an assessment order dated23.12.2019 passed under Section 143(3) read with Section 147 of the Act.The assessment for the AY 2012-13 had been reopened by the Assessing ITA 205/2025 Officer by issuing a notice under Section 148 of the Act on30.03.2019.The said notice was premised on information received fromInvestigation Wing, which had reported that the Assessee was a beneficiaryof receipt of an amount of ₹25 lakhs from an account of one M/s Oxygen Projects Pvt. Ltd. Enquiries regarding the said company revealed that a sumof ₹15.70 crores had passed through its bank account during the Financial Years 2009-10 to 2014-15. Enquiries into the income tax returns of the saidcompany revealed that the revenue from the operations during the said FYswas NIL. 2.The relevant extract of the reasons to believe that the income of theAssessee has escaped assessment which sets out the reasons for doubting theidentity, genuineness and the creditworthiness of M/s Oxygen Projects Pvt.Ltd. is set out below: “Identity, Genuineness and Credit worthiness of M/s OxygenProjects Pvt. Ltd. 4.A perusal of the Income Tax Returns of the M/s OxygenProjects Private Limited revealed that no business operations arecarried out by the company. The business profile of the company asgathered from the ITBA system is tabulated as under: 4.1From the above table it can safely be inferred that thesubject company is merely a paper concern and is not involved in any real business activity. The pattern of transactionsappearing in the bank account suggests that account is used forproviding accommodation entries to the actual beneficiaries. 5.In order to identify the actual beneficiaries, the concernedbank was asked to furnish the details of beneficiaries to whichamount of more than Rs. 5 lakh has been debited. 5.1The details of beneficiaries as provided by the bankauthorities for F.Y. 2011-12 are tabulated as under: Signature Not Verified 6.2Letters were issued to the above parties/persons calling forinformation in respect of their transactions with M/s OxygenProjects Pvt. Ltd. and treatment thereof in their books. 6.3Out of the above beneficiaries, 12 entities have filed theirresponses and remaining beneficiaries failed to file their responses. 6.4Submissions filed by the above said 12 beneficiary entities is summarized as under:XXXXXXXXXXXX(xi)Meenakshi Gupta (PAN- ): 5.In order to identify the actual beneficiaries, the concernedbank was asked to furnish the details of beneficiaries to whichamount of more than Rs. 5 lakh has been debited. 5.1The details of beneficiaries as provided by the bankauthorities for F.Y. 2011-12 are tabulated as under: Signature Not Verified 6.2Letters were issued to the above parties/persons calling forinformation in respect of their transactions with M/s OxygenProjects Pvt. Ltd. and treatment thereof in their books. 6.3Out of the above beneficiaries, 12 entities have filed theirresponses and remaining beneficiaries failed to file their responses. 6.4Submissions filed by the above said 12 beneficiary entities is summarized as under:XXXXXXXXXXXX(xi)Meenakshi Gupta (PAN- ): As per the response filed by Ms. Meenakshi Gupta vide letterdated Nil on 26.12.2018 (Copy enclosed), she is a partner in a firmM/s M.R.S. Corporation which is into the business of Audio Visualequipments and installation of Multi media classrooms etc. Duringthe period F.Y. 2011-12, she has received interest free unsecuredloan of Rs.25,00,000/- from M/s Oxygen Projects Pvt. Ltd. on26.03.2012 and claimed that the same was repaid on 13.07.2012,24.09.2012 and 27.09.2012 for Rs.10,00,000/-, Rs.10,00,000/- andRs.5,00,000/- respectively through RTGS. A copy of confirmationfrom M/s Oxygen Projects Pvt. Ltd. has been submitted in supportof its claim which is undated. In view of the fact that thegenuineness and credit worthiness of M/s Oxygen Projects Pvt. Ltd.cannot be established, the unsecured loan of Rs.25,00,000/- is liableto be added to the income of Ms. Meenakshi Gupta for F.Y. 2011-12 relevant to A.Y.2012-13. Accordingly, the AO may be advisedto take appropriate remedial action in the case of Ms. MeenakshiGupta for F.Y. 2011-12 relevant to A.Y. 2012-13.” 3.The AO issued notices under Section 133(6) of the Act to M/sOxygen Projects Pvt. Ltd. but the same were returned unserved.Theappellant was also granted an opportunity to produce the Principal Officer ofthe said company but the Assessee failed to do so. 4.It is the Assessee’s case that the Assessee had received ₹25 lakhs as unsecured loans but had also repaid the same in the next financial year[within the period of seven months from receipt of the loan]. However, theAssessee could not provide any explanation as to the identity of the personsin control of M/s Oxygen Projects Pvt. Ltd. There are no credible reasonsprovided as to why the said entity had given interest free loan to theAssessee. 5.In the aforesaid circumstances, the AO made an addition of the amount of loan received during the relevant financial year as unexplainedcredit and passed an assessment order dated 23.12.2019 under Section143(3)/147 of the Act. 6.The Assessee appealed the said assessment order before the learnedITAT. The Assessee sought to challenge the assessment order on the groundthat the notice under Section 148 of the Act was issued without approval ofthe specified authority in addition to the validity of the reasons for reopeningthe assessment. However, the learned ITAT has rejected the same. 7.The learned ITAT did not find any fault with the assessment order andaccordingly dismissed the appeal. 8.The learned counsel appearing for the appellant submits that the orderpassed by the learned ITAT is without application of mind as it proceeds onthe basis that M/s Oxygen Projects Pvt. Ltd. is found to be anaccommodation entry provider pursuant to the department’s search actionand the statement of its authorized person. Paragraph 5 of the impugnedorder is set out below: “5. The Revenue has invited the tribunal’s attention to the caserecords which sufficiently prove that the assessee had got anamount of Rs.25 lakhs transferred in her bank account fromone entity M/s. Oxygen Projects Ltd. which was found to be anaccommodation entry provider as per the department’s searchaction as well as the statement of it’s authorized person whichhas been discussed in the reopening reasons.” 8.The learned counsel appearing for the appellant submits that the orderpassed by the learned ITAT is without application of mind as it proceeds onthe basis that M/s Oxygen Projects Pvt. Ltd. is found to be anaccommodation entry provider pursuant to the department’s search actionand the statement of its authorized person. Paragraph 5 of the impugnedorder is set out below: “5. The Revenue has invited the tribunal’s attention to the caserecords which sufficiently prove that the assessee had got anamount of Rs.25 lakhs transferred in her bank account fromone entity M/s. Oxygen Projects Ltd. which was found to be anaccommodation entry provider as per the department’s searchaction as well as the statement of it’s authorized person whichhas been discussed in the reopening reasons.” 9.There is merit in the contention that the record does not indicate thatthere was any search or any finding returned pursuant thereto that M/sOxygen Projects Pvt. Ltd. was an accommodation entry provider. The recordalso does not indicate that the statement of the authorised person of M/s Oxygen Projects Pvt. Ltd. was recorded in any proceedings. 10.However, we do not consider it apposite to interfere with the orderpassed by the learned ITAT as the facts in the present case are undisputed.There is no explanation provided by the Assessee as to why the entity inquestion (Oxygen Projects Pvt. Ltd.) had furnished an interest freeunsecured loan to the Assessee. There is also material on record to indicatethat enquiries made by the department did not find the entity in question M/sOxygen Projects Pvt. Ltd. operating from its office. Admittedly, the noticesissued by the AO under Section 133(6) of the Act were returned unserved.The Assessee had not produced any authorised person to establish the realidentity of persons controlling M/s Oxygen Projects Pvt. Ltd. 11.In the given facts, the finding of the learned AO that the Assessee hadfailed to establish the creditworthiness of M/s Oxygen Projects Pvt. Ltd andthe genuineness of the transaction, cannot be faulted.12.In our view, no substantial question of law arises for consideration ofthis court. The appeal is accordingly dismissed. Pending application is alsodisposed of. VIBHU BAKHRU, J JULY 9, 2025/tr TEJAS KARIA, J