AI Drafter 
TaxTMI 
TaxTMI 
2014 (1) TMI 693
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.....2007 which was duly served on the assessee on 29.3.2007. In response to the said notice nobody attended. Again on 17.4.2007 a notice u/s 142(1) was issued alongwith a questionnaire fixing the hearing on 30.4.2007. The notice remained unattended. Again on 4.5.2007 a letter was issued asking the assessee to comply with the earlier notices. Since there was no compliance on 18.5.2007 a show cause notice u/s 271(I)(b) was issued. On 7.6.2007 a letter requesting to drop the penalty proceedings was filed at the dak stage. 2. Again on 4.6.2007 letter was issued requiring the assessee to comply with the notices already issued. This time also no compliance was made and therefore, again a show cause notice u/s 271(1)( b) was issued on 21.06.2007 alongwith a request letter for compliance. The case was fixed for hearing on 5.7.2007. On 5.7.2007 Shri Manoj Pandya, director attended alongwith Shri Shanker Singh, ITP, and on request the case was adjourned for 20.72007. Since no compliance was made on that date, penalty u/s 271(1)(b) was levied on 6.7.2007. On 20.7.2007 Shri Manoj Pandya, Director and Shri Shanker Singh, ITP attended and furnished part compliance vide their written submission. In ....
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....17.10.2007 Shri Shanker Singh, ITP, attended and stated that since the fatherin-law of the director suffered from a heart attack, the required details could not he produced on that date. Therefore, on his request the case was adjourned to 2.11.2007. On 2.11.2007 Shri Shanker Singh, ITP, attended and furnished a list containing name and address of the parties in which investments were made. He was required to furnish the other required details on 20.11.2007. On 26.11.2007 Shri Manoj Pandya, Director, and Shri Shanker Singh, ITP, attended and stated that due to death of friend's father, the required information could not be furnished. They requested for an adjournment to furnish the required details. Therefore, once again the case was adjourned to 30.11.2007. lt was clearly written in the order sheet dated 26.11.2007 that this is the final opportunity for compliance and in case of non-compliance the assessment will he completed ex-parte without affording any further opportunity. The order sheet entry was duly noted by both the director and the AR of the assessee. "6. Meanwhile on a test check basis, notices u/s 133(6) of the Act were issued to ....
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....ailable at the address or no reply was given by any of the four persons mentioned at serial nos. 3 to 6 at page 3 of his assessment order. 7. In the case of Pramila Investment, the Assessing Officer observed that the assessee has shown share application money of Rs. 1,29,50,000/- out of Rs.95,000/- received during the year. In this regard, the assessee was required to prove the identity and credit worthiness of depositors and also genuineness of transaction with complete supporting evidence. The Assessing Officer observed that the assessee completely failed to prove its claim. The assessee was not able to furnish even an iota of evidence nor substantiated its claim and, therefore, failed to discharge its onus of proving the entries appearing in its books of accounts to the satisfaction of the Assessing Officer. The Assessing Officer further observed that the assessee has offered no explanation about the nature and source of share application money of Rs. 95 lacs credited in the books and shown in the balance sheet as on 31.3.2005 therefore in the absence of any supporting documentary evidence, the claim of the assessee was not accepted with regard to credit of Rs.95 lacs and the....
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....ued summons to following parties :- 1. Rajendra Fincom Ltd. 2. Rajendra Bafna 3. Rajkumar 4. Jitendra Porwal 5. Ramchandra. The Assessing Officer further observed that in response to summons, none of the above parties appeared in his office. On verifying the letter dated 26.12.2007 which was adjournment application for grant of adjournment of 2/3 days by Rajendra Bafna, Rajkumar Choudhary and Pradeep Bafna, the Assessing Officer observed that all these letters were received through speed post on 28.12.2007, all these letters were sent from one post office bearing consecutive serial numbers of the post office whereas the senders are having different destinations. Three persons having three different addresses, sending similar line of letters at a time from one post proves beyond doubt that these letters were arranged by one person. The Assessing Officer further observed that the tactic of seeking adjournment after the due date is a calculated attempt of the assessee to take the stand that due opportunity was not provided for defending its case. As the cases were already time barring, the Assessing Off....
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....s but it did not produce the bank account of these persons. The AO also required the assessee to produce the loan creditors but it failed to do so. The AO, therefore, issued summons to the following share applicants for appearing before him :- 1. Shri Parasmal Jain 2. Shri Mahesh Sethi 3. Shri Pradeep Agrawal 4. Ms Sunita Khatod 5. Smt. Shyamabai Rathore 6. Smt. Sangeeta Rathore 7. However, none of the above persons appeared before the AO. The AO, therefore, served upon the assessee a notice calling upon it to explain as to why the amount of Rs. 1,47,50,000/- received as share application money and Rs. 3,97,48,000/- received as sundry creditors should not be treated as unexplained cash credit and added to its income u/s 68 of the Act. Here also the assessee became adamant and did not respond. The AO, therefore, held that since the assessee did not establish the identity, credit worthiness and genuineness of the transaction, satisfactorily, he had no option but to make additions of Rs. 1,47,50,000/- on account of share application money and Rs. 3,97,48,900/- towards sun....
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....roduced. He also observed that the Assessing Officer in his report dated 2.7.2008 enclosed as Annexure-2 of his order has made detailed discussion in respect of financial position of the company and made mention that during the assessment proceedings the assessee did not produce the depositors and prove the genuineness of transaction. The CIT(A) also observed that investigation wing of the department recorded statement of Shri Rameshchand Khatod (Jain) son of Shri Mangilalji aged 48 years on 16.4.2009 wherein CIT(A) quoted the answer given by him in question nos. 6, 7, 13, 19 and 22. In reply to question no. 6 he stated that he was receiving Rs. 50,000/- from two companies, namely, Nema Investment Private Ltd. and M/s Money Penny Fincon Prt. Ltd. In reply to question no. 7 he stated that in this company he himself and Pratik Kothari are directors. In reply to question no. 19 he stated that "we have not maintained books of accounts for earlier years". In reply to question no. 22 he stated that the transactions of business were done only on loose papers and also got audited on the same. Later these papers had been destroyed. In reply to question no. 4.1 attention of Shri Rameshchand ....
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....Penny Fincom Ltd. has taken shares of 52000 in the assessee company (Pramila Investment). It was further found that these companies are maintained by one person i.e. Ramesh Chandra Khatod who was basically an entry provider as per his own statement. Thereafter, the CIT(A) analysed the facts of all these companies in the light of principle laid down by the Hon'ble Supreme Court in Durgaprasad More; 82 ITR 540, Sumati Dayal; 214 ITR 801 and P. Mohan Kala; 291 ITR 78. After giving detailed finding, the CIT(A) further fortified the order of the Assessing Officer and held that all these companies are paper companies and that transactions done by these companies are not genuine. However, in the case of Pramila Investment & Finance Ltd., the CIT(A) by relying upon then decision of the coordinate Bench in the case of Narmada Extrusion; 19 ITJ (2012) held that the addition to be made on protective basis in the hands of the assessee company and on substantive basis in the hands of the person to whom money was given. Precise observations of the case of Narmada Extrusion are as under :- "15. First, we take up the preliminary objection raised bv the ld. Authorized Representative....
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....t was observed that no option has been given under the 1961 Act, and it has been specifically provided that tax has to be levied on right person notwithstanding the fact that the amount has already been added in the hands of some other person. Meaning thereby addition should be made in the hands of the right person and the same cannot be deleted only on the plea that the same amount has been added in the hands of some other person. It was observed by the Supreme Court that there is no option under the 1961 Act, unlike the one given under 1922 Act and the AO must tax the right person and right person only. By "right person" is meant the person, who is liable to be taxed according to the law with respect to a particular income. The expression "Wrong Person" is obviously used as opposite of the expression "right person". Merely because a wrong person is taxed with respect to a particular income, the AO is not precluded from taxing the right person with respect to that income. This is so irrespective of the fact, which course is more beneficial to the Revenue. A person lawfully liable to be taxed can claim no immunity because the Assessing Officer has taxed the said income in the hands....
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.... of the CIT(A), the Tribunal held that since Narmada Extrusion (supra) was the beneficiary of the loan amount and using the loan amount in respect of which genuineness of transaction and credit worthiness of loan creditor was not established, accordingly, it was held that the addition was to be made in the hands of Narmada Extrusion (supra) which is a beneficiary not-with-standing the fact that the amount has already been added in the hands of the loan creditor. However, the facts of the instant case are quite different wherein addition has been upheld by CIT(A) in the hands of the assessee company insofar as all the three ingredients i.e. identity, genuineness and credit worthiness are not proved. Accordingly, CIT(A) was not justified in applying the principle laid down in the case of Narmada Extrusion (supra) which was on entirely different facts. 20. The issue with regard to introduction of money through share capital/share application money has been examined elaborately by ITAT Coordinate Bench in the case of Agrawal Coal Corporation Pvt. Ltd. In ITA Nos. 151/Ind/2009 and 283/Ind/2010 vide order dated 31st October, 2011 wherein following observations were made by the Bench :....
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.... entries to various parties who want to launder their unaccounted money in the guise of share application or unsecured loan or long term capital gain. The assessee is a closely held Pvt. Ltd. Company in which public is not substantially interested. Thus as per section 68 onus was upon the assessee to establish depositor's identity, creditworthiness and genuineness of transaction. Assessee in its written submission stated that company has received share application money of Rs. 40,00,000/- from Hindustan Continental Ltd. 19, Shubh Kamna Apartment, Gul Bazar, Jabalpur. As per the report of the ACIT 5(1), Indore, it is clear that no such company exist at the given address. The creditworthiness of the company has also not been established in view of the fact that there is huge inflow and outflow of fund in the Bank account without any logic. There is huge cash deposit in the Bank account of Hindustan Continental Ltd. maintained UTI Bank Ltd. copy of which is filed by the assessee in support of its contention. The company is not existing in real sense the genuineness of transaction is also doubtful. Since assessee failed established identity, creditworthiness and genuine....
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....h in bank account of M/s Sahayata Marketing and transfer thereof through account payee cheque to the bank account of M/s Sunil Shares Stocks Private Limited and thereafter to the ultimate beneficiary. It was submitted that the transactions of cash transfer and deposition of cash has nothing to do with the assessee. A strong plea was raised by the Ld. Counsel for assessee that identity of share applicants is established which was strongly denied by the learned CIT DR. At this stage, a query was raised by the Bench as to whether the assessee is in a position to produce before this Bench any of the Directors or the employees of these companies? The Ld. Counsel for assessee conveniently contended that the assessee cannot be put to adverse burden meaning thereby that the assessee was not in a position to produce such persons. The Bench again contended that in view of the above reply of the Ld. Counsel for assessee, an adverse view may be taken against the assessee. The Ld. Counsel for assessee remained mum and nothing was canvassed against the query raised by the Bench. 23. The notices issued u/s 133(6) of the Act to M/s HCL Limited and M/s Optimates Textiles Industries ....
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....xistent and their identity is not proved. It is pertinent to mention here that there is a difference between a private and public limited company as in a private limited company, the public at large is not subscribing the shares as the shares are allotted to close relatives, friends and other known persons who are having faith in the subscribing company on personal relations whereas there is an invitation to the public at large by a public limited company and not necessarily having personal relations and in that case, the individual relations are normally found to be non-existent. In view of these facts, the share applicants are known to the assessee company, being private limited company, and there should be no difficulty to produce them or their representative to enable the Assessing Officer to verify the identity, genuineness of the capital claimed to be subscribed by them, therefore, the assessee cannot claim ignorance about these companies. Unless the assessee is able to establish identity of the companies who have subscribed in their share capital, how the department will proceed against these companies in terms of the verdict of the Hon'ble Supreme Court in the case of Lovel....
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....bsp; Identically, the Hon'ble Calcutta High Court in the case of Hindustan Tea Trading Company Limited; 182 CTR 585 at page 23 (para 21) where the identity of 12 persons who were not found at the addresses it was held that identity is not established. On the issue of onus, it was held that "principle regarding onus is laid down u/s 68 whereby once a reasonable enquiry is made, then the Assessing Officer can do no further except arriving at a conclusion. When such conclusion is communicated to assessee, onus shifts on the assessee. Likewise, Hon'ble jurisdictional High Court in the case of M/s Rathi Finlease Limited; 215 CTR 429 at page 28 when company is not found at the given address against the summons issued by the Assessing Officer observed as under - "The assessee tried to explain the genuineness of the credit on the basis of letters of confirmations. It could not be explained as to how the transaction was materialised when the companies were not in existence and the amount was paid by cheque only on the date on which the amount was credited to the account of the company. The assessee failed to discharge the burden with regard to the credit in its books and the....
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....8, when the inquiry pertained only to section 263." 25. In view of the facts narrated above and the judicial pronouncements discussed hereinabove, it can be said that the assessee did not discharge the onus cast upon it by the provisions of the Act. We tend to reproduce section 68 of the Act :- "68. Where any sum is found credited in the books of an assessee maintained for any previous year, and the assessee offers no explanation about the nature and source thereof or the explanation offered by him is not, in the opinion of the [Assessing] Officer, satisfactory, the sum so credited may be charged to income-tax as the income of the assessee of that previous year." If the aforesaid provision of the Act is analysed, it speaks about cash credits and the sum found credited in the books of an assessee and the assessee offers no explanation about the nature and source thereof or the explanation is not found satisfactory by the Assessing Officer then the same may be charged to tax as the income of the assessee. In the present appeal, at any stage the assessee did not file any explanation regarding the identity of the share applicants, therefo....
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.... In the case of Shri Barkha Synthetics Limited vs. ACIT; 155 Taxman 289 the Hon'ble Rajasthan High Court held that where the matter concerns money receipts by way of share application from the investors through banking channel, the assessee has to prove the existence of the person in whose name the share application is received. Once the existence of the investor is proved, it is not further the burden of the assessee to prove whether that person itself has invested the money or so me other person has made investment in the name of that person. The burden then shifts to the revenue to establish that such investment has come from the assessee company itself. 26. Once the receipt of the confirmation letter from the creditor is proved and the identity and existence of the investor has not been disputed, no addition on account of share application money in the name of such investor can be made in the hands of the assessee. In the case of CIT v. Divine Leasing & Finance; 158 Taxman 440 (Del), the Hon'ble Court clearly held that in case of public issue the company concerned cannot be expected to know every detail pertaining to identity as well as financial worth of each o....
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....(2011) 333 ITR 119 held as under :- " We are of the view that ratio laid down in Steller Investment Ltd. (2001) 251 ITR 263 is applicable only in those cases where the assessee is a limited company and the shares were quoted in the stock exchange. But whenever the issue is subscribed without quoting it on the stock exchange by a limited or private limited company, the presumption is very strong against the assessee that subscription is available only to the closely connected persons of the assessee. Once the inference is against the assessee that the issue is subscribed by its closely connected person, the onus is upon the assessee to prove the identity of the subscribers and their creditworthiness." 27. There is another perception to look into the decision of the Hon'ble Apex Court in the case of Lovely Exports Private Limited wherein the Hon'ble Apex Court held that if the share application money is received by the assessee from alleged bogus share holders, whose names are given to the Assessing Officer, then the department is free to proceed to reopen their individual assessment in accordance with law, but it cannot be regarded as undisclosed inco....
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....ffirmed by Hon'ble jurisdictional High Court in the case of STL Extrusions, it has become binding precedent on the Tribunal especially when the decision of the Hon'ble Apex Court in the case of Lovely Exports was very much available. Hon'ble jurisdictional High Court while coming to a particular conclusion followed the decision of the Hon'ble Karnataka High Court in CIT v. ASK Brothers Limited (2011) 333 ITR 333 and duly considered the decision from the Hon'ble Apex Court in CIT v. Lovely Exports Private Limited and Steller Investment Limited (supra). In another latest decision in CIT v. Oasis Hospitalities Private Limited, UP Bone Mills India Limited and Vijay Power Generators Limited, etc. (2011) 333 ITR 119 (Del), identically held that identity and credit worthiness of share applicants was not proved, therefore, the addition u/s 68 of the Act was justified. While coming to the aforesaid decision the Hon'ble Delhi High Court considered the following decisions :- 1. Bhola Shankar Cold Storage P. Ltd. v. JCIT; (2004)270 ITR 487 (Cal (Para 40) 2. CIT v. AKJ Granites P. Ltd. (2008) 301 ITR 298 (Raj) (para 18) 3. CIT v. Arunananda Textil....
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....sessee had disclosed to the Assessing Officer not only the names and the particulars of the subscribers of the shares but also their bank accounts and the permanent account numbers issued by the Incometax Department. Super added to all this was the fact that the amount received by the company was all by way of cheques. This material was, in the opinion of the Tribunal, sufficient to discharge the onus that lay upon the assessee." The Hon'ble High Court took note of many other judgments of many other High Courts and on analysis of those judgments, formulated the following propositions which emerge as under (Divine Leasing & Finance Limited; 299 ITR page 282 (Del):- "In this analysis, a distillation of the precedents yields the following propositions of law in the context of section 68 of the Income Tax Act. The assessee has to prima facie prove- The identity of the creditor/subscriber The genuineness of the transaction, namely, whether it has been transmitted through banking or other undisputable channels The credit worthiness or financial strength of the creditor/subscriber If relevant d....
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....account of Hindustan Continental Private Limited, Agrawal Road Carriers Private Limited and Sunil Shares & Stock Limited. It was submitted that on certain occasion there is inter-transfer of funds amongst the three companies, then the cheques were issued to desiring parties in the garb of loan or share capital. Not only that, the shares of Hindustan Continental were claimed to be traded by Sunil Shares & Stock Limited, M/s Jai Share Fin Limited and others through manipulation giving rise to artificial height so as to enable certain parties to reintroduce their black money as huge capital gain. It was claimed that in those case also the cash was deposited first in certain account and thereafter the funds were transferred to the share brokers involved in the manipulation and then ultimately to the accounts of the party concerned as sale proceeds of shares. It was also submitted that SEBI has even penalised Hindustan Continental Private Limited and Sunil Shares & Stock Private Limited. This assertion of the learned Commissioner of Income Tax was not controverted by the assessee but merely argued that the money was transacted through banking channel and in view of the decision in the c....
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....cision of the Hon'ble Supreme Court in the case of Lovely Exports, the issue is covered in favour of the assessee, as per our considered view, the case of Lovely Exports (supra) will be applicable only after the identity of the share applicant is established. Since in the instant appeals before us, the identity itself has not been established, there is no justification to apply the ratio laid down by the Hon'ble Supreme Court in the case of Lovely Exports (supra). 34. The Hon'ble jurisdictional High Court in the case of Rathi Finlease (supra) has clearly laid down the proposition with respect to circumstances wherein the identity is established in case the share applicants are companies. It was held that even filing of confirmation of share applicants by the assessee will not serve the purpose of establishing the identity insofar as the inquiry conducted by the Assessing Officer and the letter issued by the Assessing Officer were returned unserved by the postal department with the remark that the addressees are not existing at the given addresses which clearly establishes that either the share applicants are non-existent or if exist, then merely exist on papers and ....
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....d by the Assessing Officer was furnished to the assessee only one day prior to the completion of assessment, we found that the assessee has got full opportunity to substantiate its claim and negate the report before the ld. CIT(A) but the assessee grossly failed to rebut the report regarding non-establishment of identity of share applicants. The ld. CIT(A) has got co-terminus powers to do what the Assessing Officer has failed to do. Proceedigns before ld. CIT(A) is also extension of assessment proceedings in addition to the appellate proceedings. However, inspite of full opportunity the assessee failed to rebut the contents of the report which indicated that no shareholders exist in the name of the companies so provided by the assessee. Even though, the report relied by the Assessing Officer was in respect of another assessee but the fact remains that the inquiry was in the case of same share subscribers i.e. M/s. Hindustan Continental Ltd. & M/s. Optimates Textiles Ind. Ltd. Under these circumstances, the inquiry conducted in respect of M/s. Hindustan Continental Ltd. & M/s. Optimates Textiles Ind. Ltd. which are common applicants in the case of all the assessees before us, could ....
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....that the assessee has proved the identity of the subscribers. therefore, no addition was warranted in the hands of the assessee. However, in the instant case before us, the identity of the subscribers has not been established as per our discussion detailed hereinabove. This finding of the Tribunal was affirmed by the Hon'ble High Court and, therefore, the appeal filed by the revenue was dismissed, whereas in the present appeal the matter was investigated by the Assessing Officer and even the Inspector of the department who was directed by the Assessing Officer to know the whereabouts reported that the share subscribing companies are non-existent and the addressees given of four places were also found to be fictitious. The summons/notices issued by the department were also returned unserved by the postal department with the remark that no such companies are existing at the given addresses, therefore, in the present appeals, the identity of share holders was not proved at any stage, consequently, the decision in the case of Shri Kela Prakashan Private Limited is not applicable being on different findings, therefore, may not help the assessee. Likewise, the Hon'ble Karnatka High Court....
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....the assessee was Rs. 25,23,500. The investment in these shares was ranging from Rs. 1 lakh toRs. 2.5 lakhs. In order to verify the genuineness of these transactions, the Assessing Officer issued summons to these parties which were received back either with the remarks "incomplete address" or "in spite of best efforts the address not found" or "not met" or "no such person" or "not found", etc. The Assessing Officer thereafter asked the assessee to produce these persons who had introduced the share capital in the company. The assessee was also asked to furnish cheque numbers/draft numbers for payment of share application money along with the names of the drawee bank and branch of the bank. However, no details were furnished despite various opportunities. The assessee could not even identify the entries in the bank account regarding the receipts of the share application money nor could he produce the relevant ledger for verifying the receipts, according to the Assessing Officer. Ultimately, the assessee produced five persons whose statements were recorded. The assessee did not cross examine these persons. They did not furnish any proof of their identity in the form of ration card, ele....
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....on is open to public at large, the assessee cannot have control over the subscription and also cannot make a verification of the subscribers as subscription can be done by any person. But whenever the issue is subscribed without quoting it on the stock exchange by a limited or private limited company the presumption is very strong against the assessee that subscription is available only to the closely connected persons of the assessee. Once the inference is against the assessee that the issue is subscribed by its closely connected persons, the onus is upon the assessee to prove the identity (sic. Identification) of the subscribers and their credit worthiness. Their Lordships of the Hon'ble Calcutta High Court in the case of Bhola Shankar Cold Storage P. Ltd. v. Joint CIT (2004) 270 ITR 487 have examined the judgment of the apex court in the case of Steller Investment Ltd. and that of the Hon'ble Delhi High Court in the case of Sophia Finance Ltd (1994) 205 ITR 98 and have held that in the case of Steller Investment Ltd. the ratio laid down by the Full Bench of the Delhi High Court was not overruled and it still holds the field. Whenever the issue was subscribed by closely connected....
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.... are to be weighed and examined as to whether a particular ratio decided in a particular casae could be applied. As noted above, the initial onus is upon thye assessee to establish three things necessary to obviate the mischief of section 68 of theAct. These are : (i) the identity of investors; (ii) their creditworthiness/investments, and (iii) the genuineness of the transaction. Only when these three ingredients are established prima facie it is only then the department is required to undertake further exercise as discussed above. In the instant casae, no such documents are filed and no steps taken by the assessee which could establish the aforesaid three ingredients. Additional evidence in the form of bank statement, etc. is given but the assessee has not done anything to prove these bank accounts. On this evidence produced by the assessee remand report was called for and the Assessing Officer in his remand report dated December 23, 2003 submitted as under :- " None of the 6 alleged shareholders produced any documents in support of their identity. The fact was intimated to the assessee vide order sheet entries dated June 13, 2002 and March 17, 2003....
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....found non-existent, therefore, this judicial pronouncement clearly goes against the assessee. It is pertinent to mention here that while coming to the aforesaid conclusion the Hon'ble Court also discussed the decisions like AKJ Granites Private Limited; 301 ITR 291 (Raj), CIT v. Arunalanda Textiles Pvt. Ltd. (2011) 333 ITR 116 (Karn.) (para 17) order dated 2nd March, 2010, CIT v. ASK Brothers (2011) 333 ITR 111 (Karn.) order dated 18th February, 2010 . In both these cases, the Hon'ble Karnataka High Court has duly discussed the decision in Lovely Exports Pvt. Ltd. and Steller Investment Ltd. (supra) meaning thereby that both these decisions were rendered after the pronouncements of decisions from Hon'ble Apex Court in Lovely Exports Private Limited (supra). As discussed in other paras of this order, so far as the decision in the case of M/s STL Extrusion vs. DCIT (2010) 15 ITJ 872 (I.T.A.T., Indore) is concerned, that decision was rendered by the Bench on the facts that since the assessee proved the identity of the investors, therefore, it was held that no addition can be made in the hands of the assessee company whereas in the present appeals, the existence/identity of share subsc....
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....otal expenses of Rs. 12,29,154/-. We find that first no reason has been assigned for making such ad hoc disallowance by the Assessing Officer and secondly we are of the view that since the company is a juristic person, no disallowance of personal nature can be made in the case of a company. We, therefore, reverse the orders of the authorities below on this issue and allow this ground of appeal of the assessee. In the result, the appeal of the assessee is partly allowed. 43. In the case of Ad-Manum Packaging Limited (ITA No. 158/Ind/2010) for the assessment year 2004-05 the first ground relates to maintaining the addition of Rs. 10 lacs on account of loan taken by the assessee from Hindustan Continental Limited and addition as cash credit u/s 68. The ld. Counsel for the assessee, Mr. Hitesh Chimnani, contended that the learned Assessing Officer/the learned Commissioner of Income Tax (Appeals) have gone stray in passing lengthy orders discussing about capital gains on shares of M/s Hindustan Continental and the investment of the same company in fixed assets and capital work in progress. The financial position of M/s Hindustan Continental was highlighte....