TaxTMI 
TaxTMI 
2015 (6) TMI 1023
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.... and are disposed of by this common order for the sake of convenience and brevity. 2. Facts of the case are that the assessee is a dealer in steel & iron. The return for the year under consideration was selected for scrutiny assessment and accordingly statutory notices were issued and served upon the assessee. While scrutinizing the accounts of the assessee, the Assessing Officer noticed that the assessee has issued new 92700 shares of face value of Rs. 100/- at a premium of Rs. 1000/-. Total shares issued amounted to Rs. 10,19,70,000/-. Out of the total share capital issued Rs. 9,60,30,000/- i.e.( 87,300 shares X Rs. 1100) is to various companies and remaining Rs. 59,40,000/- i.e. (5400 X 1100) is to family members of the Directors. ....
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.... in their respective balance sheet, no investment is shown in the name of Krishna Sheet Processors Pvt. Ltd (assessee). Proceeding further and on the basis of specific information received from the Dy. Director of Income Tax (Inv.) Unit- 1(4), Mumbai, the AO came to know that search action u/s. 132 of the I.T. Act was carried out in the case of M/s. Mahasagar Securities Pvt. Ltd. and its group concerns. The companies mentioned hereinabove are group concerns of this group which are floated by Shri Mukesh Choksi. The AO further found that M/s. Mahasagar Securities Pvt. Ltd., and its group concerns were engaged in fraudulent billing activities and in the business of providing bogus speculation profit/loss, short term/long term capital gain/los....
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.... Kaycee share Broking Pvt. Ltd. 2) M/s. Mihir Agencies Pvt. Ltd. 3) M/s. Alliance Intermediateries & Network Pvt. Ltd., 4) M/s. Mahasagar Securities Pvt. Ltd., 3.1. The Ld. CIT(A) was also convinced with the genuineness of the transaction in respect of other two companies viz., (1)M/s. Premier Soya Ltd.,(2) M/s. Indo Con Core Pvt. Ltd., and confirmed the addition respect of other six companies. 4. Aggrieved by this both Revenue and the assessee are in appeal before us. 5. First we will take up Revenue's appeal in ITA No. 546/M/2013. 6. We have heard the rival submissions and given a thoughtful consideration to the orders of the authorities below and with the assistance of the Ld. Counsel, we have considered the relevant....
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....TR 195 has held that if the share application money is received by the assessee company from alleged bogus shareholders, whose names are given to the AO, then the department is free to proceed to reopen their individual assessments in accordance with law, but it cannot be regarded as undisclosed income of the assessee company. 6.1. In respect of other two companies viz., (1)M/s. Premier Soya Ltd.,(2) M/s. Indo Con Core Pvt. Ltd., the AO at page-19 of his order has observed that on verification of the details submitted by the assessee it is seen that the money has been advanced by the assessee themselves which have been ploughed back as share capital in the books of the assessee. The transaction is therefore, appears to be not genuine.....
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....rders of the authorities below. The additions have been made by the AO in respect of the above named companies for the following reasons: i) Prior to issue of cheque to the assessee company these companies have received monies from their sister concerns and their sister concerns have deposited cash before giving cheque to these companies. ii) The Director of the Company did not attend the proceedings. All these companies were represented by their respective Chartered Accountants who have furnished the necessary details. iii) In respect of one company viz., WAH Foods Pvt. Ltd., the address given by the assessee was found to be not correct. 8.1. The AO finally concluded by holding that the assessee has failed to establish the identit....
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....en made only because the Directors did not appear before the AO but the companies were represented by their respective Chartered Accountants. This cannot be a reason to treat a genuine company as a non-genuine company. Keeping in mind that a company is a legal person created by an Act of Parliament, the AO could have easily verified the genuineness or otherwise of these companies through the Registrar of companies, when the Chartered Accountants have supplied the certificate of incorporation of these companies. 11.1. Further the allegation that these companies have taken money from their sister concerns who have deposited cash before lending money to these companies is baseless. The assessee has to prove that the money has come from thes....