TaxTMI 
TaxTMI 
2021 (10) TMI 1017
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.... Pvt. Ltd, it seen that it has invested only Rs. 20,00,000/- instead of Rs. 45,00,000/- in the assessee company. Schedule-4 appended to the balance sheet of Maxius Ventures Pvt. Ltd shows decrease of investment from Rs. 5,31,29,000/- to 2,48,93,845/- and no details of share application money invested in the assessee company is available. Hence amount of share application money invested by the Maxius Ventures Pvt. Ltd. could not be verified and credit worthiness of the investment was also could not be verifiable. It was held by the ld PCIT that it is factually clear that the A.O. has not verified the issue of unexplained share application money while completing the assessment and it appears that the assessment order passed u/s 147 r.w. s. u/s 143(3) of the I.T. Act 1961 for A.Y. 2011-12 on 31.12.2018 is erroneous in so far as it is prejudicial to the interest of the Revenue and a show cause notice u/s 263 of the I.T. Act, 1961 was issued to the assessee to explain as to why the assessment order passed by the DCIT Circle-7, Jaipur on 31.12.2018 may not be revised u/s 263 and may not be treated as erroneous and prejudicial to the interest of the Revenue. 4. In response to the show-....
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....s and source of money. In fact genuineness and creditworthiness, identity and source has been verified from the following documents of investor submitted during course of assessment proceeding: (i) Copy of Bank statement appearing payment as mentioned in para 1 above (ii) Confirmation (iii) Copy of ITR (iv) Copy of balance sheet (v) Company Master data available at MCA website The ld A.O also obtained same documents directly from investor company calling information u/s 133(6) and verified from books of accounts and document submitted by appellant company. 3. Further, the ld PCIT also create doubt on decrease in investment figure in balance sheet of Maxis Venture Pvt Ltd (Formerly known Happy Collection Pvt. Ltd) shows from Rs. 5,31,29,000/- in 2009-10 to Rs. 2,48,93,845/- in 2010-11, it is submitted that decrease in figure of investment in balance sheet of investor company is irrelevant to verify the transaction. The amount appearing in head Investment in the balance sheet is sum of total investment held as on date of balance sheet. In balance sheet showing a consolidated figure of all investment including investment t....
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....nd state that the order of then Assessing Officer is erroneous. Looking to above facts, the ld PCIT did not provide adequate reasons in support of his revisional order. Your honour is therefore requested to kindly accept the appeal against order of revision u/s 263 which is against the fact and bad in law." 6. In his submission, the ld. CIT/DR drawn our reference to the findings of the ld. PCIT, Jaipur which read as under:- "6. I have considered the contentions of assessee. I find that the same are not tenable. I have gone through the assessment order and case records and submission filed by the assessee, in the facts and circumstances of the case. The contention of assessee are not tenable. The fact is that in case of Maxius Ventures Pvt. Ltd., investment of Rs. 20,00,000/- as per the bank statements whereas the share capital subscription of Rs. 45,00,000/-. The assessee has contended that now his filing a bank statement and transaction inquiry from bank. However, the pertinent point is that at the time of assessment no such details were filed or brought on record. Absence of such details during assessment proceedings make it an erroneous order. From the above....
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....me Tax Act. Hence, the assessment order is set aside to be made de novo after proper examination of genuineness of share capital and providing opportunity of being heard to the assessee." 10. We have heard the rival contentions and perused the material available on record. Firstly, it is noted that the whole of the reassessment order passed u/s 147 r/w 143(3) has been set aside to be made de novo after proper examination of genuineness of share capital. To our understanding, the said finding of the ld PCIT will relates to the whole of the share capital amounting to Rs. 1.61 Crores which has been raised by the assessee company during the year under consideration. However, if we look at the show-cause notice and the discussions in the body of the impugned order, the matter is restricted to share application money received from one of the entities, namely Maxius Ventures Ltd amounting to Rs. 45 lacs. Therefore, we find that there is no basis for setting aside the whole of the reassessment order and if at all, the matter has to be set-aside, which we shall be discussing in the subsequent paragraphs, it is to be restricted to examining the matter relating to share application money r....
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.... total quantum of investment in the books of Maxius Ventures at the beginning of the year stood at Rs. 5,31,29,000/- and at the end of the year, it has no doubt reduced to Rs. 2,48,93,845/- but it continues to include the investment made in the assessee company amounting to Rs. 45 lacs and more so, the fact of such investment amounting to Rs. 45 lacs has been confirmed by Maxius ventures and also cross-verified by the AO calling for information u/s 133(6) from the said investor company. We agree with the contentions advanced by the ld AR that the share transactions totaling to Rs. 45 lacs are duly reflected in the bank statement as well as in the balance sheet of the investor company and therefore, the same cannot form the basis for holding that the order passed by the Assessing officer was erroneous as he failed to consider such discrepancies. 13. Regarding identity and creditworthiness of the investor company and genuineness of the transaction, we find that where the ld PCIT has himself accepted the fact that the share application money atleast to the extent of Rs. 20 lacs has been received through the banking channel from Maxius Ventures, the identity and nature of the transa....