TaxTMI 
TaxTMI 
2023 (2) TMI 563
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.... grounds of appeal but it has submitted that grounds are annexed in a separate sheet. It is very difficult to discern the grounds in the separate sheet. It is running into 30 pages, whereas the impugned order in itself is running into 10 pages only. 3. In brief, the sole grievance of the assessee is that ld. CIT(Appeals) has erred in confirming the addition of Rs.1,43,50,000/-, which was added by the ld. Assessing Officer with the aid of section 68 of the Income Tax Act. 4. Brief facts of the case are that the assessee-company has filed its return of income electronically on 12.02.2013 declaring total income at NIL. The case of the assessee was selected for scrutiny assessment and a notice under section 143(2) was issued and served up....
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....his case, the application money deluding premium was received in cash. This was confirmed by notices u/s 133(6) of the I.T. Act, 1961 which were issued to all the share applicant parties and reply received accepting that they had paid cash for subscribing to the shares of the appellant company. The receipt of such huge amounts of share premium in cash raised doubts about the genuineness of these transactions. There are plethora of case laws which have held that it was incumbent on the appellant not only to prove the identity but also the creditworthiness of the share applicants and genuineness of the transactions. The analysis of the ITR of the share allottte companies revealed that the most of the companies had nil income which ra....
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....ed that the appellant had received share capital including premium in cash. During both assessment and appeal proceedings, the A/R of the appellant could not provide details about the source of investment made by the applicant company. On perusal of the audited Balance sheet, the appellant company had brought in the share capital including share premium of Rs.1,43,50,000/- in assessment year 2012-13. What was interesting to note was that in the financial year 2011-12, relevant to the A.Y 2012- 13, the assessee company had declared Nil income. The high premium for shares of the company with nil income, has given rise to serious doubts about the genuineness of the transactions. The share capital including premium was also subscribed by compan....
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....usal of the audited statement of accounts of these companies, demonstrate, that there is hardly any income was disclosed or any expenditure worth mentioning was claimed. There is no activity whatsoever in these companies. The Reserve Bank of India, the Institute of Chartered Accountants of India, and certain other organisations, have laid down various methods based on which the amount of share premium can be decided. None of these methods have been followed in this case. The exorbitant quantum of share premium collected shocks the conscience of any reasonable person. A mockery has been made of the whole system. These are not transactions which can be justified by any stretch of imagination. Thus, in our view, the genuineness of these transa....