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The assessee received share application money and premium from a company that admitted to providing accommodation entries. The AO rejected the assessee's claim, citing the non-appearance of the director as insufficient grounds. The ITAT held that the assessee failed to rebut the AO's finding that the share applicant company received cash from an accommodation entry provider and transferred it to the assessee. The accommodation entry provider's statement corroborated the initiation of assessment proceedings. The AO did not accept the assessee's procedural evidence, questioning how a newly incorporated company could command such a premium. The assessee failed to provide details of its assets and business prospects or produce the share applicant company's directors. Both authorities concluded that the investment was bogus, warranting treatment as unexplained cash credit u/s 68. Consequently, the assessee's appeal was dismissed.
The assessee received share application money and premium from a company that admitted to providing accommodation entries. The AO rejected the assessee's claim, citing the non-appearance of the director as insufficient grounds. The ITAT held that the assessee failed to rebut the AO's finding that the share applicant company received cash from an accommodation entry provider and transferred it to the assessee. The accommodation entry provider's statement corroborated the initiation of assessment proceedings. The AO did not accept the assessee's procedural evidence, questioning how a newly incorporated company could command such a premium. The assessee failed to provide details of its assets and business prospects or produce the share applicant company's directors. Both authorities concluded that the investment was bogus, warranting treatment as unexplained cash credit u/s 68. Consequently, the assessee's appeal was dismissed.
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