TaxTMI 
TaxTMI 
2007 (9) TMI 226
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.... 2. Whether, on the facts and circumstances of the case, the Tribunal was right in holding that the onus of proving the source for the share application money is not entirely on the assessee but largely on the Assessing Officer? 3. Whether, on the facts and circumstances of the case, the Assessing Officer has to prove that the cash credit is unexplained or that the explanation given is not true, to make an addition under section 68 of the Income-tax Act?" The necessary facts as culled out from the statement of facts are as follows: For the assessment year 1996-97, the assessee-company filed its return of income on November 29, 1996, declaring a total loss of Rs. 72,21,172. The assessment was completed under section 143(3) of the I....
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....nfirmed by the Commissioner of Income-tax (Appeals) on appeal. As against the orders of Commissioner of Income-tax (Appeals) confirming the assessment order as well as imposition of penalty, two appeals were filed before the Income-tax Appellate Tribunal. The Tribunal on the basis of the materials on record held that the assessee had discharged the onus cast upon it by providing the basic information, and the Assessing Officer failed to disprove the claim of the assessee as not genuine. By so holding, the Tribunal allowed both the appeals. The correctness of the said order is now put in issue before this court. We heard the argument of learned counsel on either side and perused the materials on record. The ultimate fact finding author....
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.... in [2007] 291 ITR 278. We have gone through the said judgment, wherein the Supreme Court after referring to section 68 of the Income-tax Act has held as follows: "The question is what is the true nature and scope of section 68 of the Act? When and in what circumstances would section 68 of the Act come into play? A bare reading of section 68 suggests that there has to be credit of amounts in the books maintained by an assessee; such credit has to be of a sum during the previous year; and the assessees offer no explanation about the nature and source of such credit found in the books; or the explanation offered by the asses sees in the opinion of the Assessing Officer is not satisfactory, it is only then the sum so credited may be charged....
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....Bench of this court in the case of CIT v. Electro Polychem Ltd. [2007] 294 ITR 661 (Mad) made in T.C. (A) Nos. 782 and 783 of 2007 dated June 21, 2007, had an occasion to consider the issue similar to the issue in the case on hand and rejected the case of the Revenue. The relevant portion of the order reads as follows: "4. In CIT v. Stellar Investment Ltd. [1991] 192 ITR 287 (Delhi), where the increase in subscribed capital of the respondent-company, accepted by the Income-tax Officer and rejected by the Commissioner on the ground that a detailed investigation was required regarding the genuineness of subscribers to share capital, as there was a device of converting black money by issuing shares, with the help of formation of an investme....