Section 68 share application money addition failed where confirmations, notice service, and applicant identity established the onus was discharged.

In a section 68 share application money dispute, the addition was restricted to the amount linked to one applicant where notice remained unserved and no confirmation was filed, while the remaining credits were supported by confirmations, service of notice, and confirmation by the recipients. On those facts, the assessee was held to have discharged the onus under section 68, and the Tribunal accepted the factual findings. The addition was therefore not sustainable and was deleted.

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Issues: Whether the addition made under section 68 of the Income-tax Act, 1961 in respect of share application money was justified, and whether the assessee had discharged the onus by producing confirmations and by establishing the identity of the share applicants.

Analysis: The addition was confined by the appellate authority to the amount received from one party for which the notice remained unserved and no confirmation was filed. In respect of the remaining share application money, confirmations were produced, notices were served, and the recipients confirmed the payments. On these facts, the assessee was held to have discharged the burden cast upon it under section 68, and the factual findings were accepted by the Tribunal.

Conclusion: The addition of Rs. 81,40,000 was not sustainable and was deleted.

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