TaxTMI 
TaxTMI 
2021 (4) TMI 762
X X X X Extracts X X X X
X X X X Extracts X X X X
....8 of the Income Tax Act, 1961 without appreciating that issue of shares at such high premium by assessee company whose net worth is negative and purchase of the same by M/s. Anyushka Investments Pvt. Ltd. (both assessee company and AIPL has common directors) is unacceptable. 3. The appellant prays that the order of the CIT(A) on the grounds be set aside and that of the Assessing Officer be restored. Apropos ground No. 1 3. Brief facts during the relevant previous year, the assessee received a loan of Rs. 1,18,00,000/- from one M/s. Anyushka Investments Private Limited (AIPL). The Assessing Officer found that AIPL was a related company. The shareholding of the assessee and AIPL were as under (as at 1.4.2009):- Company Name of the share holder Share holding M/s. Anyushka Investments Private Limited Suyash Pandey 51% Bhavna Pandey 49% M/s. Everglades Minerals & Reserve Pvt. Ltd. Suyash Pandey 50% Bhavna Pandey 50% The Assessing Officer observed that both Suyash Pandey and Bhavna Pandey held more than 20% voting power in the payer Company (AIPL) and more than 20% in the payee company (assessee). The Assessing ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ame by the assessee cannot be termed as deemed dividend under section 2(22)(e) of the Act. 9. Hence following the precedent as above, we do not find any infirmity in the order of learned CIT(A), accordingly this ground raised by the revenue stands dismissed. Apropos ground No. 2 10. Brief facts are that during the relevant previous year, the appellant credited Rs. 2,00,00,000/- in its books. The assessee claimed that the sum represented share application money; that out of that sum, Rs. 400,000/- represented share capital and the remaining sum represented share premium that shares of Rs. 10 each had been issued a premium of Rs. 490/- each. The assessee claimed that the sum of Rs. 2 crores was received from AIPL. The course of the assessment proceedings, notice under section 133(6) of the Act was issued to AIPL calling for details pertaining to its transactions with the assessee. In its reply, AIPL confirmed having invested the sum of Rs. 2 crore in shares in the appellant company. As regards the source, AIPL submitted that the source was accumulated reserve & surplus of the company. The Assessing Officer observed that the onus to establish the identity of the person from w....
X X X X Extracts X X X X
X X X X Extracts X X X X
....he assessee to establish the capacity of the creditor (AIPL) or the genuineness of the payment per se. The learned CIT(A) noted that in fact the AR pointed out, in para 5.2 of the assessment order, the AO has mentioned that the AIPL had in response to notice issued u/s. 133(6) confirmed the transaction. 13. He further noted that assessee has filed following documents in support of genuineness of the money received from AIPL. Copies of Balance Sheet, Profit And Loss A/c. and Directors Report of the appellant of A.Y. 2007-08 to A.Y. 2010-11:- a) Copies of Balance sheet, profit and loss account and directors report of the appellant for A.Y. 2007-08 to A.Y. 2010-11 b) Copies of Income Tax Return, Balance Sheet, Profit And Loss A/c. and Directors Report of AIPL of A.Y. 2007-08 to A.Y. 2010-11 c) Copies of ROC Returns of AIPL for A.Y. 2008-09 to A.Y. 2011-12 d) Copies of ROC Returns of the appellant for A.Y. 2008-09 to A.Y. 2011-12 He noted that assessee has pleaded that AO did not call for these documents specifically hence assessee did not have the opportunity to submit the same before assessing officer. The learned CIT(A) noted that these docu....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s unexplained credit u/s. 68 of the Act." Accordingly learned CIT(A) deleted the addition. Against this order assessee is in appeal before us. We have heard both the Counsel and perused the records. Learned Counsel of the assessee made following submission:- "1. During the year under consideration, the Appellant has received equity share application money from the following Investor's companies: S. No. Name of investor's companies Date of incorporation PAN Qty. Amount of Share capital Amount of Premium Total Amount 1 M/s. Anyushka Investments Private Limited 08/08/1996 AACCA8423E 40,000 4,00,000 1,96,00,000 2,00,00,000 Grand Total 40,000 4,00,000 1,96,00,000 2,00,00,000 a. During the assessment proceedings, the AO asked the Appellant to give the certain information/explanations as stated in the notice dated February 19, 2016 (refer page No. 12 to 20 of PB-II). In response to the said notices, the Appellant has filed the following information/documents during the assessment proceedings vide letters dated March 30, 2016 (refer page No. 1 to 4 of PB-I). ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....he Appellant has filed the following information/documents during the assessment proceedings to the Assessing Officer. ii. Company's Master Data like company name, Company Identification Number (CIN), date of incorporation, registered address, e-mail ID, etc. of Investor's companies downloaded from www.mca.gov.in; iii. Name, Address, PAN, Income-tax Jurisdiction, etc. of the Investor's companies; iv. Certificate of Incorporation of the Investor's companies; v. Form of application for equity shares filled by the Investor's companies, vi. Copies of Allotment Advices given by the Appellant to the Investor's companies; vii. Copy of Director Report, Audit Report and Balance Sheet of the Investor's b. The company's Master Data, Income Tax Jurisdiction details and financials of the Investor's companies proved the identity as well as financial capacity i.e. creditworthiness of the Investor's companies. Hence, the aforesaid document has proved the identity of the shareholders. ii) As regards the Genuineness of the transaction; The Appellant has received the share applicat....
X X X X Extracts X X X X
X X X X Extracts X X X X
....re application forms, etc. clearly brought out the nature of the transactions, amount involved and scope of the transaction. 12. The Appellant submit that the Appellant has discharged its onus of proving the identity of the parties, genuineness of the transactions and the creditworthiness of the shareholder. Therefore, the Appellant humbly submit that the addition made under section 68 of the Act be deleted." 15. Thereafter learned counsel of the assessee placed reliance upon a catena of case laws and pleaded that the learned CIT(A) order deserves to be upheld. Per contra, learned Departmental Representative relied upon the Assessing Officer's order. 16. Upon careful consideration we note that assessee has submitted all the necessary documents required to satisfy the extant provisions of section 68. The required documents as noted above in the order of learned CIT(A) and submission of the assessee's counsel were available before the assessing officer also. The said party is a group concern and it has also confirmed the transaction. Furthermore we note that assessee company has received the share capital including premium from the same group company that is AI....