TaxTMI 
TaxTMI 
TaxTMI 
2023 (3) TMI 464
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....r 2012-13. 2. The revenue has raised the following grounds of appeal:- "1. In the facts and circumstances of the case, the Ld. CIT(A) has erred in deleting the addition made by AO of Rs.3,53,32,000/- u/s. 68 of the I.T. Act as because the assessee has failed to substantiate the genuineness of transaction and creditworthiness of the share holding company and summon u/s 131 of the I.T. Act issued to the assessee company for producing director of the share holding company was not complied with. 2. The appellant craves the leave to make any addition, alteration, modification etc. of the grounds either before the appellate proceedings, or in the course of appellate proceedings." 3. The brief facts of the case are that the Assessing Offic....
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....um of Rs. 50/- per share totalling to Rs.1,46,75,000/-. The total amount of share capital and share premium was thus Rs.1,76,10,000/-. However, the Assessing Officer without consulting the record, had taken the figure at Rs.3,53,32,000/-. It was also explained that the share subscriber M/s. Tara Silk Pvt. Ltd. was the group company of the assessee company having common directors. That, there was no suspicion about the identity of the share subscriber. The financial statements of the share subscriber were also submitted to show its creditworthiness and further the said group company was highly interested in the assessee company having common directors, therefore, there was even no suspicion about the genuineness of the transactions. The ld. ....
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....o furnished documents in respect of Tara Silk (P) Ltd to establish the identity and creditworthiness of share applicants as well as genuineness of the whole transaction. The appellant has filed certificate of incorporation, memorandum & articles of association, PAN details, copy of Income Tax Return acknowledgement, copy of bank statement, copy of share application form, payments details through RTGS, share allotment letter and delivery of shares, confirmation from the share applicant explaining the source of making investment, audited accounts of the share applicants. All the documents are forming part of paper book filed before me. It is observed that the AO has independently issued summon w/s 131 to the said Tara Silk Real Estate (P) Ltd....
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....e more so when the money has been received from the same group company and not from any outsider. It is further observed that the identity of the investor entity M/s. Tara Silk (P) Ltd. is not in dispute and also that both the appellant and the said investor entity are group concerns having common Directors. The first component of identity therefore vis-à-vis Section 68 of the Act duly stands satisfied. It is evident thereafter that the appellant's paper book forming part of record before me contain all necessary details of its copy of return and computation for the impugned assessment year with Auditor's report, audited accounts, its replies to the AO during the course of assessment proceedings, copy of ledger account of ....
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.... this money could have been verified by him since the payments were from banking channels. The investment made by Tara Silk (P) Ltd is duly recorded as investment in its balance sheet furnished before the AO, thus in my considered opinion the genuineness of the transactions regarding receipt of share capital along with share premium is got to be accepted. It is seen from page 110 of the paper book which is the share application form by Tara Silk (P) Ltd and it contains the entire payment details which match with the appellant's bank statement also. The allotment letter given by the appellant to Tara Silk is also at page 111 of the paper book. From the allotment advice the distinctive number of share certificates, being 487501 to 781000,....
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....e heard the rival contentions and gone through the record. The ld. Counsel for the assessee has drawn attention to the note put up by the Assessing Officer at the end of the assessment order which for the sake of ready reference is reproduced as under:- "NOTE NOT FOR THE ASSESSEE: The case was selected under CASS to examine the large share premium received during the year. Pursuant to CBDT's Restructuring of jurisdiction considerable time and energy have been spent towards transfer in and transfer out of assessment records. On account of this time available for disposal of large number of Time Barring cases is very little. Suitable remedial action will be taken as per law, if any errors and omission detected subsequently." 6. A p....