TaxTMI 
TaxTMI 
2023 (7) TMI 379
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....tion of Share Capital, Share Application money and unsecured loans respectively u/s 68 of the Income Tax Act, 1961 ( hereinafter referred as "the Act") by ignoring the findings of the Assessing Officer(hereinafter referred as "the AO") that during assessment proceedings the assessee failed to prove the three basic conditions ie identity, creditworthiness of investors and genuineness of transactions in this regard ? 2. Whether on the facts and circumstances of the case, the Ld. CIT (A) is legally justified in deleting the addition on account of unexplained cash credits for want of proper enquiry by the Assessing Officer (hereinafter referred as "the AO") but without making enquiry or directing further enquiry u/s 250(4) of the Act as laid ....
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....ings of the AO in assessment order that the assessee had failed to substantiate the reason of difference between circle rate of the land in question and price actually paid to the seller?" 3. The appeal was first listed for hearing on 09.08.2021 on which date none appeared on behalf of the assessee and the appeal was adjourned. Several notices were issued thereafter but on each occasion none represented the assessee. Inspite of so many repetitive notices neither the assessee nor its authorized representative is attending the proceedings, therefore, we are left with no choice but to proceed exparte. 4. The DR was heard at length. Case records carefully perused. 5. Briefly stated the facts of the case are that the assessee during the year ....
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....nt the AO found entry of Rs. 461268/- only. 10. The AO observed that surprisingly none of the share holders acknowledge the payment of share capital of Rs. 1 lac each as claimed by the assessee. 11. The AO was of the firm belief that the initial onus is upon the assessee to explain the credit entries in its books of account u/s. 68 of the Act which it has grossly failed to discharge and proceeded by making the addition of Rs. 3,00,000/-+19258000/- +2359600/- u/s. 68 of the Act. 12. Proceeding further the AO found that the assessee has made certain advances out of borrowed funds and was of the opinion that the assessee has used borrowed funds in making interest free advances and, therefore, disallowed proportionately interest and bank cha....
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....of NR Portfolio Private Limited 2 ITR -OL - 68 which was subsequently upheld by the Hon'ble supreme Court. Further we find that the assessee has simply filed documents but has not given any explanation to the adverse observations in respect of the bank statements. Even the CIT(A) has ignored the specific findings of the AO that cash were deposited immediately before issuing the cheque. Merely because the lenders / applicants are promoters / directors of the company would not discharge the assessee from initial onus of proving the credit entries in his books of account. Considering the facts of the case in totality we are of the considered view that the assessee has grossly failed in discharging the initial burden and the CIT(A) erred in acc....
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....f the interest is that the asset for which the capital has been borrowed should be put to use. Interest paid for any period beginning from the date on which the capital was borrowed for acquisition of the .asset till the date on which such asset was first put to use shall not be allowed as deduction. The Assessing Officer has not disputed the fact that assets were put to use and interest was claimed after that period. Moreover, the appellant states that borrowed capital was also utilized for the purchase of raw material and advances given to the suppliers of the milk. Hence, no disallowance can be made by the Assessing Officer. Accordingly, addition is deleted and the ground taken by the appellant is allowed." 17. We have carefully conside....