2018 (3) TMI 672

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....s to the extent of Rs. 12 crores invested by two share applicants i.e. M/s Khaitan United Sales Pvt. Ltd. and M/s Garg Corporation Ltd. After taking into account the material placed before him, the AO concluded that the identity of the shareholders and the genuineness of the transaction had not been established and accordingly brought to tax the said amount. The CIT(A), who sought a remand report, noted that the AO had recorded in the course of his order that the assessee was a sick company to start with and that it had come out of the woods in 2010. The CIT(A) also noticed that the remand report disclosed that the AO did not carry out any enquiries with respect to the identity of the share applicants whose address was provided. The assesse....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ion in case of Lovely exports 216 CTR 195 wherein it is held that: "2. Can the amount of share money be regarded as undisclosed income under s. 68 of IT Act, 1961? We find no merit in this 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 AO, then the Department is free to proceed to reopen their individual assessments in accordance with law. Hence, we find no infirmity with the impugned judgment." It is noteworthy that in period under consideration for AY 2007-08 said decision was fully applicable. 7. Further, the case of assessee is also covered on facts noted in learned CIT(A) order by Hon'ble Apex....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... Thus, neither suspicion/doubt, nor the quantum shall determine the exercise of jurisdiction by the Assessing Officer ..... Further a deeming provision requires the Assessing Officer to collect relevant facts and then confront the assessee, who is thereafter, required to explain incriminating facts and in case he fails to proffer a credible information, the Assessing Officer may validly raise and inference of deemed income under section 69-A. As already held, if the assessee proffers an explanation and discloses all relevant facts within his knowledge, the onus reverts to the revenue to adduce evidence and only thereafter, may an inference be raised, based upon relevant facts, by invoking the deeming provisions of Section 69-A of the Act. I....