TaxTMI 
TaxTMI 
2018 (11) TMI 132
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....long with the premium and the notice u/s. 133(6) dated 29.11.2013 was issued by the AO to the shareholders and having received the replies from the shareholders, thereafter the AO issued notice u/s. 131 of the Act on 13.03.2014 to the directors of the assessee company for recording their statement on oath. However, since the director of assessee company did not turn up, the AO added the entire share application money along with the premium to the tune of Rs. 91,35,00,000/- u/s. 68 of the Act. Aggrieved, the assessee preferred an appeal before the Ld. CIT(A) who confirmed the action of AO. Aggrieved, assessee is before us. 3. According to Ld. AR, the assessee company since was incorporated only on 15.09.2010 as a Private Ltd. Company under the Companies Act, 1956 and this assessment year being the first year of its operation earned gross income of Rs. 59,491/- from commodities trading profit through the MCX. The company was incorporated with authorized share capital of Rs. 2,00,00,000/- divided into 2,00,00,000 equity shares of Rs. 1 each. According to him the issued/subscribed paid up share capital was Rs. 1,41,35,000/- divided into 1,41,35,000 equity shares of Rs. 1 each fully pa....
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....nimay Pvt Ltd. 4 4,50,000 4,50,000 4,45,50,000 4,50,00,000 Gujarat NRE Energy Resources Ltd. 7 8,60,000 8,60,000 8,51,40,000 8,60,00,000 Critical Mass Multilink Ltd 5 7,25,000 7,25,000 7,17,75,000 7,25,00,000 Madhur Coal Mining Pvt. Ltd 3 3,00,000 3,00,000 2,97,00,000 3,00,00,000 Wonga Traders Pvt Ltd 14 20,00,000 20,00,000 19,80,00,000 20,00,00,000 Mahanidhi Vyapaar Pvt Ltd. 14 20,00,000 20,00,000 19,80,00,000 20,00,00,000 Bhachau Traders Pvt Ltd. 14 20,00,000 20,00,000 19,80,00,000 20,00,00,000 Total 100 1,41,35,000 1,41,35,000 90,43,65,000 91,85,00,000 6. The Ld. AR pointed out that the assessee company and all its share applicant companies are group concerns and the individual share applicants are either common directors or managers of the group to manage day to day activities of the assessee company and its group companies. Therefore, it is submitted that since all the share applicants are either group concerns or common directors, no outside funding was involved in the assessee company. 7. The Ld. AR drew our attention to a chart which shows the Directors of all the concerned companies for the subject assessment year are as und....
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.... Newage Vinimay Pvt Ltd (NVPL) 8.00 7. W onga Traders Pvt Ltd (WTPL) 20.00 8. Mahanidhi Vyapaar Pvt Ltd (MVPL) 20.00 Total 91.35 11. It was also brought to our notice that during the course of assessment proceedings in response to notice dated 29.07.2013 u/s. 142(1) served by the Ld. A.O., the assessee company vide reply dated 12.08.2013 submitted the following documents: * Brief note in respect of business activities of the company * List of shareholders with their names, address and PAN * Copies of share application received from shareholders * Copy of Form -2 (Return of Allotment) filed with Registrar of Companies * List of Investments showing name of company, face value, cost price and number of shares, copies of Company's application along with allotment advice. * Details of sundry creditors of Rs. 11,030/- * Basis of writing off preliminary expenses alongwith supporting evidence * Details of Miscellaneous Income credited in the profit & Loss account * Copy of Bank Statement along with Bank Reconciliation Statement. 12. It was also submitted that pursuant to notice u/s. 133(6) of the Act issued upon all shareholders on 29.11.2013 which ....
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....de along with Bank Statement, Balance Sheet, profit & Loss Account and IT Return Acknowledgment for A.Y. 2011-12 were already provided vide letter dated 23.12.2013. 16. It was pointed out that after the said reply dated 20.03.2014, the Income Tax Officer issued no further notice to the directors of the share applicant companies to comply with the summon u/s 131 of the Act or to personally represent before the A.O. After examining all the details filed by the assessee company, shareholders of the assessee company and the directors of the share applicant companies the A.O. opined that verification of identity, genuineness and creditworthiness of the share applicants could not be done because the assessee company and the shareholders failed to comply to the summons. Thus the entire amount of share application money received along with premium to the tune of Rs. 91,35,00,000/- was added u/s 68 of the Act. 17. In the light of the aforesaid facts it was contended before us that the assessee had successfully explained the source of source of receipt by matching each entry with the bank statement and thus, the assessee has successfully proven the source of source and origin of origin of ....
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.... aside. The assessment order, that of the Commissioner (Appeals) and of the Tribunal are also set aside. The matter shall now be remanded to the assessing authority for fresh consideration, as aforestated." 18. We also note that the Hon'ble Delhi High Court in the case of CIT Vs. Jansampark Advertising & Marketing Pvt. Ltd. in ITA No. 525/2014 dated 11.03.2015 wherein after noticing inadequate enquiry by authorities below have held as under: "41. We are inclined to agree with the CIT(Appeals), and consequently with ITAT, to the extent of their conclusion that the assessee herein had come up with some proof of identity of some of the entries in question. But, from this inference, or form the fact that the transactions were through banking channels, it does not necessarily following that satisfaction as to the creditworthiness of the parties or the genuineness of the transactions in question would also have been established. 42. The AO here may have failed to discharge his obligation to conduct a proper inquiry to take the matter to logical conclusion. But CIT(Appeals), having noticed want of proper inquiry, could not have closed the chapter simply by allowing the appeal and del....