2019 (2) TMI 618

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....application money received from various parties, in earlier years, asunexplained cash credit u/s 68 of the I.T. Act. The Appellant submits that on the facts and circumstances of the case of the Appellant and in law, share application money received from various parties, in earlier years, cannot be treated as unexplained cash credit u/s 68 of the I.T. Act; hence addition made by the AO shall be deleted. (b) The CIT(A) erred in confirming the addition of Rs. 1,21,50,000/- u/s 68 of the Act without appreciating that the Appellant has duly proved the identity and creditworthiness of various parties and genuineness of transaction; hence on the facts and circumstance of the case of the Appellant and in law no addition is attracted u/s 68 of t....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....s. 2,14,14,659/- appearing in its books of accounts as on 31.03.2011. The assessee submitted before the AO that since shares could not be allotted to these parties a sum of Rs. 1,77,80,000/- were refunded to these parties in subsequent years and balance amount of Rs. 36,34,659/- is also due for refund to these parties. However, the AO did not accept the contention of the assessee and made addition of entire sum of Rs. 1,77,80,000/- being share application money treating above amount as unexplained cash credit u/s 68 of the Act. The addition of Rs. 1,77,80,000/- (Rs.2,14,14,659 - Rs. 36,34,659) made by the AO in respect of three parties treating the share application money as unexplained cash credit u/s 68 of the Act was challenged by the a....

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 respect of share application money which has been modified by the CIT(A) to the extent of Rs. 36,34,659/-. 9. We have considered rival contentions and carefully gone through the orders of the authorities below. We had also deliberated on thejudicial pronouncements referred by lower authorities in their respective orders as well as cited by learned AR and DR during the course of hearing before us. From the record, we found that on earlier years assessee was in receipt of deposit from three parties amounting to Rs. 2,14,14,659/- It was contention of learned AR that before AO assessee has already submitted that since shares cannot be allotted to these parties, a sum of Rs. 1,77,88,000/- were refunded to these parties in the subsequent ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....r' then if the assessing officer is not satisfied about the nature and source thereof the sum so credited may be charged to income-tax as the income of the assessee of that previous year'. Thus, section 68 of the Act is applicable only if any sum is found to be credited in books of accounts of the assessee in the previous year. The share application money of Rs. 1,21,50,000/- was not credited to books of accounts of the assessee during the year under consideration. The impugned sum of Rs. 1,21,50,000/- was received by the assessee as deposits in earlier years and was shown under the head liabilities year after year in earlier years. During the year under consideration, the assessee has only passed a journal entry in respective part....