{"id":52144,"date":"2025-03-19T10:38:26","date_gmt":"2025-03-19T05:08:26","guid":{"rendered":"https:\/\/itatonline.org\/digest\/pcit-v-buniyad-chemicals-ltd-bom-hc-www-itatonline-org\/"},"modified":"2025-07-26T14:44:42","modified_gmt":"2025-07-26T09:14:42","slug":"pcit-v-buniyad-chemicals-ltd-bom-hc-www-itatonline-org","status":"publish","type":"post","link":"https:\/\/itatonline.org\/digest\/pcit-v-buniyad-chemicals-ltd-bom-hc-www-itatonline-org\/","title":{"rendered":"PCIT v. Buniyad Chemicals Ltd. 2025) 474 ITR 452 \/ 304 Taxman 560  \/  343 CTR  773 \/ 248 DTR 65  ( Bom)( HC) www.itatonline.org."},"content":{"rendered":"<p>The assessee\u00a0 company \u00a0is in the business of providing accommodation entries on commission basis . \u00a0\u00a0The\u00a0 assessee has admitted that\u00a0 they are in \u00a0<strong>\u201c a racket of illegal business of providing accommodation entries\u201d <\/strong>\u00a0In the assessment proceedings the director of the assessee\u00a0 company Mr. Mukesh Choksi, on oath\u00a0 has admitted that the company is providing accommodation entries .\u00a0\u00a0 The Assessing Officer made addition under Section 68 of the Act \u00a0amounting to Rs.10,73,52,553\/- under the head Income from other sources. The said addition was made on the ground that the credits appearing in the disclosed and undisclosed bank accounts of the respondent-assessee are unexplained, and since no details or explanation regarding the identity, source and genuineness of such deposits were submitted, the same were treated as unexplained cash credits. On appeal the CIT(A) confirmed the addition of 0.37% as against 0.15% offered by the assessee\u00a0 . \u00a0\u00a0On appeal the Tribunal reduced the addition from 0.37% to 0.15% . \u00a0On appeal by Revenue the Court held that the \u00a0Respondent assesseee can not contend that they will not give details of beneficiaries, but at the same time, credits cannot be assessed in its hands. \u00a0Court observed that \u00a0how the revenue can find out to whom the credits belong to unearth unaccounted income. The respondent-assessee cannot act as a shield for beneficiaries by making such a submission and at the same time refuse to pay taxes for the unexplained amounts in its bank accounts. \u00a0\u00a0Court observed that \u201c<strong>we will be failing in our duty as a Court of law if we do not comment on the accommodation entry provider, Mr. Mukesh Choksi through his web of shell companies and various admissions made by the counsel for the respondent-assessee. It is also important to note that Mr Mukesh \u00a0Choksi, director of the respondent-assessee in his answer to question No.14 of the statement has admitted that he was a practicing Chartered Accountant but has surrendered the Certificate of Practice (COP) in 1993 and thereafter is only engaged in the business of providing accommodation entries. He has also stated that search action has been taken against him\/his companies more than once.\u201d \u00a0. The Court allowed the appeal of the Revenue \u00a0and affirmed the order of the CIT( A) . \u00a0<\/strong>\u00a0The Court directed the Institute of Chartered Accountant of India to take disciplinary \u00a0action , the appropriate authority to initiate proceedings \u00a0under \u00a0\u00a0Prevention of Money Laundering Act, 2002 , Prosecution under Income -tax Act , directed \u00a0the CCIT to conduct an enquiry and fix the responsibility against the officer responsible for the same for not giving effect to the order of CIT( A) . Court also directed the Registry \u00a0of the High Court \u00a0to forward copy of the \u00a0order to Disciplinary Committee of the Institute of Chartered Accountants of India; National Financial Reporting Authority; The Commissioner of Police-Economic Offence Wing, Mumbai; Enforcement Director under PMLA Act; The Chief Commissioner of Income-tax, Mumbai \u00a0Ministry of Corporate Affairs. . (ITA .1796 of 2018 dt.17 -3 -2025) (AY. 2009 -10 )<\/p>\n","protected":false},"excerpt":{"rendered":"<p>S. 68 : Cash credits \u2013 Failure to furnish source , identity of parties and genuineness of transaction  -Shell companies  &#8211; A racket of illegal business of providing accommodation entries  -Accommodation entry provider -Credit appearing in the bank account -Books of account -, Data appearing in 2 CDs are extracted by the investigating wing from books of account- Statement on oath- Order of the Tribunal is reversed \u2013 Order of CIT(A) is affirmed &#8211; The Court also  directed the Institute of Chartered Accountant of India to take disciplinary  action  , initiate  proceedings under  Prevention of Money Laundering Act, 2002 , launch  prosecution under Income -tax Act ,and also directed the CCIT to conduct an enquiry and fix the responsibility against the officer responsible for the  for not giving effect to the order of CIT( A) . Court also directed the Registry  of the High Court is  to forward copy of the  order to Disciplinary Committee of the Institute of Chartered Accountants of India,  National Financial Reporting Authority,  The Commissioner of Police-Economic Offence Wing, Mumbai,  Enforcement Director under PMLA Act,  The Chief Commissioner of Income-tax, Mumbai  Ministry of Corporate Affairs.   [ S. 2(12A), 44AB,69, 131, 132(4) , 279, Chartered Accountant\u2019s Act, 1949. Indian Penal Code\/BNS, 2023. ] <\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21],"tags":[],"class_list":["post-52144","post","type-post","status-publish","format-standard","hentry","category-income-tax-act"],"acf":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p9S2Rw-dz2","jetpack-related-posts":[],"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/52144","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/comments?post=52144"}],"version-history":[{"count":2,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/52144\/revisions"}],"predecessor-version":[{"id":55569,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/52144\/revisions\/55569"}],"wp:attachment":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/media?parent=52144"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/categories?post=52144"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/tags?post=52144"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}