AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2010 (10) TMI 1143
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....at Nil. Similarly in the case of M/s Arora Methy Limited outstanding credit shown in the books of the assessee was ₹ 45,900/- whereas the party had shown outstanding balance of ₹ 5895/-. The difference was explained to be on account of opening balance in this connection under which the assessee had shown opening balance of ₹ 45,900/- whereas the party had shown opening balance at Nil. In respect of other accounts, the difference was reconciled to be on account of certain cheques and rebate and discount. The Assessing Officer rejecting the explanation of the assessee made an addition of ₹ 1,42,656/- and ₹ 45,900/- being remission/cessation of liability u/s 41(1) of IT Act as liability had not been confirmed by the creditors. The CIT(A) confirmed the addition made by the Assessing Officer though observing that the difference in the accounts has no bearing on the accounts of the current year as both the accounts had opening balance outstanding since last year and the party had failed to confirm the balance. 4. The Ld. Counsel for the assessee pointed out that the reconciliation statement was filed before the authorities and the copies of the same are fur....
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....r thumb impression v None of them is an income Tax assessee and do not even have PAN except Ms. Rekha Goal who has allegedly advanced an amount of ₹ 2.00 lakhs in cash. The most important fact to be noted is that huge amounts in lakhs of rupees have been deposited in cash by non assessees having no PAN, without any photographs and without any evidence regarding their credit worthiness to advance such large amount in cash. 8. The Assessing Officer invoked the provisions of Section 68 of IT Act and made the addition of ₹ 42,78,756/-. 9. Before the CIT(A) the stand of the assessee was that under the Company's Act the assessee can receive share application money either in cash or cheque. It was further submitted by the Ld. Counsel for the assessee before the CIT(A) that the applicants did not possess any PAN and the copies of share application forms were furnished before the Assessing Officer, which had requisite details of the said person. It was further pointed out by the Ld. Counsel for the assessee that in view of the ratio laid down by the Hon'ble Supreme Court in CIT V. Lovely Export Pvt Ltd [(2008) 216 CTR (S.C) 195] even though the share application money wa....
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....bserved that if the relevant details of the address or PAN identity of the creditor/subscriber were furnished along with other details i.e. share holder register, share application form, share transfer register etc. it would constitute acceptable proof or acceptable explanation by the assessee. The onus of the assessee therein was held to stand discharged where the identity of the creditor/subscriber was proved and it was further held that the Assessing Officer was duty bound to investigate the creditworthiness of the creditor/subscriber and the genuineness of the transactions and the veracity of the repudiation of the creditor/subscriber. The Special Leave Petition filed by the Revenue against the said decision of the Court was dismissed by the Supreme Court vide its decision reported in (2008) 216 CTR SC 195, which reads as under:- "Can the amount of share money be regarded as undisclosed income under section 68 of the Income Tax Act? We find no in Special Leave Petition for the simple reason that if the share application money is received by the assessee company from alleged bogus shareholders, whose names are given to the Assessing Officer, then the department is free to proc....
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....e Hon'ble Punjab & Haryana High Court in M/s Abhishek Industries Ltd, 286 ITR 1 (P&H), the interest relatable to advances of such amount was disallowable. The Assessing Officer invoked the provisions of Section 36(1)(iii) of the Act and noted that as per the proviso under this section, amount of the interest paid in respect of capital borrowed for the acquisition of new asset for extension of existing business or profession for any period prior to the such asset being put to use, the interest relatable to such period is not to be allowed as deduction. In view of the proviso inserted with effect from 1.4.2004, the Assessing Officer held that such interest in respect of capital borrowed for acquisition of new asset for expansion of existing business shall not be allowed as deduction for any period beginning from the day or which capital was borrowed for acquisition of asset, till the date of which the asset were first put to use. The Assessing Officer disallowed sum of ₹ 6.00 lakhs on this account. 15. The Ld. CIT(A) observing that the investment was made by the assessee for the expansion of business to earn profits but the advance was not given for existing business held ....