TaxTMI 
TaxTMI 
2011 (7) TMI 1285
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....eted, there remains no justification for sustaining this addition." 3. In this case Assessing Officer noted that there was information that assessee has received amount from entry operators as under:- Sl.No. Amount Date of Entry Name of the Entry Giver 1 600000/- 15/7/03 Globe Tech Solutions Pvt. Ltd. 2 900000/- -do- Kohinoor Oil Mills Ltd. 3 600000/- 17/7/03 Rapid Impex Pvt. Ltd. 4 1000000/- 27/12/03 Niti Housing Development & Fin. Cor. Ltd. 5 500000/- 12/7/03 Shattarchi Fin & Leasing 6 1000000/- 12/7/03 Polo Leasingh & Finance Pvt. Ltd. 7 800000/- 12/7/03 Satwant Singh Sodhi Const. 8 700000/- 12/7/03 Saheb Enterprises 9 800000/- 15/7/03 Labh Tronics Overseas Pvt. Ltd. 10 800000/- 15/7/03 Shashi Sales and Marketing Pvt. Ltd. 11 500000/- 15/7/03 Fair 'N' Square Exports Pvt. Ltd. 12 500000/- 15/7/03 Dignity Finvest Pvt Ltd. 13 800000/- 17/7/03 Tashi Contractors Pvt. Ltd. 14 600000/- 17/7/03 VPS Values & Tubes P Ltd. 15 800000/- 17/7/03 Nishant Finvest 16 500000/- 22/7/03 Division Trading Pvt. Ltd. 17 50000/- 26/7/03 Mestro MKT & Advertising 18 700000/- 17/7/03 Dinanath Luhariwal Spl. Mill 19 600000/- 17....
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.... the case of Addl. C.I.T. vs. Hanuman Pd. Aggarwal 151 ITR 151 (Patna) it was held that assessee having furnished the correct name and address of the creditor, having confirmatory letter from the creditor and all materials show prima facie not only identity of the creditor but also the genuineness of the transaction, no adverse inference can be drawn. Reference can also be made to the judgement of Hon'ble Apex Court in the case of Stellar Investment Ltd. (2001) 251 ITR 263 (SC), wherein it was held that even if the subscribers to the increased share capital of assessee company were not genuine, the amount could not be regarded as undisclosed income of the assessee company. The above view point of the Hon'ble Apex court has also been expressed by Jurisdictional Delhi High Court in the case of Divine Leasing and Finance Ltd. (2008) 299 ITR 268 (Del). A One Housing Complex Ltd. vs. ITO 110 ITD 361 (Del), C.I.T. v. Value Capital Service Pvt. Ltd. 307 ITR 334 (Del) and C.I.T. vs. General Exports and Credits Ltd. (2008) 299 ITR 268 (Del). In the case of C.I.T. vs. Lovely Exports Pvt. Ltd. (2008) 299 ITR 268 (Del), A-One Delhi High Court held that once the identity of the share holder has....
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....urse of the assessment proceedings hence, I do not see any justification on the part of the Assessing Officer to make any addition on account of share application money received from different parties especially when the Assessing Officer has been provided with PAN and other documentary evidences to prove the identity of the share subscribers. It has been held in plethora of judicial pronouncements that if the information or the source of that information is collected at the back of the assessee and the same is not confronted to the assessee or the assessee is not given reasonable opportunity to rebut the same, then the said information/material cannot be used against the assessee. Reliance in this regard is placed on the following judicial pronouncements given by Hon'ble Apex court and jurisdiction High Court :- * C. Vasantlal & Co. v. C.I.T. (1962) 45 ITR 206 (SC) * Meenglas Tea Estate vs. Its Worken, 1963-(050)-AIR1719-SC * Dhakeswari Cotton Mills Ltd. v. C.I.T. 26 ITR 775, 782-3 (SC) * Menka Gandhi v. UOI (AIR 1978 SC 597) * J.T. (India) Exports and another vs. UOI and another (2003) 262 ITR 269 (Del-FB) As the facts are present in the instant case coupled with th....
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....s are given to the Assessing Officer, 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. 6.2 We further place reliance upon the decision of the Hon'ble Jurisdictional High Court in the case of C.I.T. v Gourdin Herbals India Ltd. in ITA No. 665/2009 vide order dated 17.4.2009 wherein it has been held as under:- "Three companies, viz., M/s Kuberco Sales Pvt. Ltd., M/s Garg Finvest Pvt. And M/s Mafico Leasing and Consultants Pvt. Ltd. had subscribed to the share capital issued by the assessee. The Assessing Officer had some doubts about the source of the investment made by those three companies and therefore, made certain inquiries. In response, the assessee produced the copy of the bank accounts of all the three companies, their certificates of incorporation and also the income tax returns filed by them. From the above documents, the identity and genuineness of these companies is clearly established. The only ground for making addition by the Assessing Officer was that the bank accounts of the three companies revealed that the amounts in cash were deposited in those ....
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....t number and shows the genuineness of transaction by showing money/his books either by account payee cheque or by draft or by any other mode, then the onus of proof would shift to the revenue. Just because the creditors/share applicants could not be found at the address given, it would not give the revenue the right to invoke section 68. One must not lose sight of the fact that it is the revenue which has all the power and wherewithal to trace any person. Moreover, it is settled law that the assessee need not to prove the source of source." 6.4 On examining the present case on the anvil of the above said Hon'ble Apex Court decision and two Hon'ble Jurisdictional High Court decisions , we do not find any infirmity or illegality in the order of the Ld. Commissioner of Income Tax (Appeals), accordingly, we uphold the same. 7. In the result, the appeal filed by the Revenue stands dismissed. ITA No. 558/Del/2010 8. The issues raised read as under:- "That on the facts and circumstances of the case and in law the Ld. Commissioner of Income Tax (Appeals) erred in deleting the addition of Rs. 1,77,00,000/- made on account of share application u/s 68 of the Income Tax Act, 1961. That....