Indian Kanoon - Search engine for Indian Law

3. During the course of assessment proceedings, the AO noted that the information was received in the case that the assessee has received accommodation entries from M/s Ambaranuj Finance and Investments Pvt. Ltd. of Rs.25 lakhs and M/s Zen Tradex Pvt. Ltd. of Rs.14 lakhs. During the course of assessment proceedings, the assessee filed confirmations from the above two companies and it was submitted that it had taken loans from these two parties. In order to verify the genuineness of these two parties, summons u/s 131 were sent to the above two parties on the address available at ROC website as well as on e-mail id. It was made clear in the summons that personal deposition of the principal officer is required. However, on the appointed date, i.e., on 18th December, 2018, neither anybody attended nor any request for adjournment was received. In the meanwhile, on 16th December, 2018, the assessee was also asked to produce these parties for personal appearance. Since the assessee showed his inability to produce these parties and in absence of personal deposition of these parties, the AO rejected the confirmation so filed by the assessee holding that the same cannot be relied upon. The AO analysed the amount of Rs.39,00,055/- received by the assessee as accommodation entry. He considered the documents and electronic data seized from various premises by the Investigation Wing according to which a number of bank statements and signed and unsigned cheque books pertained to the shell companies of the Jain brothers were found. He noted as to how these two entities were being run by Shri Naresh Kumar Jain and the modus operandi. Rejecting the various explanations given by the assessee, the AO made addition of Rs.39,00,055/- u/s 68 of the IT Act.