TaxTMI 
TaxTMI 
2023 (8) TMI 273
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....of the case and in law, the Ld. CIT(A) has erred in observing that the assessee had discharged the onus laid upon it. 4. Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in admitting additional evidences filed by the assessee even as the case of the assessee does not fall in any of the exceptions laid down in Rule 46A of the Income Tax Rules, 1962." 3. The Assessing Officer made addition of Rs. 2.3 Cr. on account of share capital received from seven corporate entities of which two were registered at West Bengal and the remaining five at Delhi. The shares of face value of Rs. 10/- has been issued with a premium of Rs. 90/-. Before the AO, the entities has submitted replies to the notices issued u/s 133(6) of the Income Tax Act, 1961 and also filed their respective ITRs, bank statement and confirmed copy of account. The AO held that there were transfer of monies in the account of these entities a few days before subscribing to the shares of the assessee company. From the page no. 7 of the Assessment Order, it can be observed that the notices issued u/s 133(6) of the Income Tax Act, 1961 have been duly complied and summons issued u/s 1....
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...., in support of its arguments, have also been examined and it was found that:- * All the investors are companies incorporated by law. * Unique identification nos., named as Company Identity Numbers (CIN) have been allotted to the investors by the MCA. * CIN is allotted on the basis of certain set of documents duly certified by a CA or CS. * PANs have been allotted to all the investors by the I.T. department. * Being artificial persons, companies work through their directors, to each of whom Director Identity (DIN) is allotted by the MCA. * Again, DIN is allotted on the basis of certain set of documents duly certified by a CA or CS. * Appellant had issued shares to all the investors. Copy of register of share holders/members of the appellant company containing details of the aforesaid Seven (7) companies, has been filed. It is pertinent to note that shares cannot be allotted to any non existing entity. * Under these circumstances, non existence of a company cannot be imagined. * Further all the investors have filed their financials which show that the net worth of each is much more than the amount invested by it in the appellant company. * It is not the ....
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....se parties, their share application forms, allotment letters and share certificates, as also the books of account; ITAT had upheld assessee's reliance on Division Bench ruling in Gagandeep Infrastructure (P.) Ltd. which had the same facts and ruled in assessee's favour; ITAT had noted that the balance sheet and profit and loss account of these persons disclosed that they had sufficient funds in their accounts for investing in the shares of the assessee [TS-304- HC-2017 (BOM)]" Therefore, the addition made by AO without any evidence deserves to be deleted. 3.5.5 Reliance is placed on the recent judgment of the Hon'ble Jurisdictional Delhi High Court, extracts of which are as under- "Fifthly, statements recorded under Section 132 (4) of the Act of the Act do not by themselves constitute incriminating material as has been explained by this Court in Commissioner of Income Tax v. Harjeev Aggarwal (supra). Lastly, as already pointed out hereinbefore, the facts in the present case are different from the facts in Smt. Dayawanti Gupta v. CIT (supra) where the admission by the Assessees themselves on critical aspects, of failure to maintain accounts and admission that the seized docum....
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....essee ] Commissioner of Income-tax v. Expo Globe India Ltd. [2014] 51 taxmann.com 208 (Delhi)." 3.5.8 Hon'ble High Court of Allahabad in the case of CIT (Central) v. Vacmet Packaging (India) (P.) Ltd. [2014] 45 taxmann.com 204 has held that Assessing Officer made addition under section 68 on account of share application money received by the appellant company even though appellant had filed all documentary evidences, like share application forms, copies of bank statements, income-tax returns, balance sheets, share allotment certificates, board resolutions of share applicants, PAN cards, certificate of Registrar - Moreover, applicant companies also confirmed investments made by them and submitted all relevant documents - since the appellant had discharged onus establishing identity and creditworthiness of applicant companies and genuineness of transactions, addition made by Assessing Officer under section 68 was to be deleted. 3.5.9 Jurisdictional Hon'ble Delhi High court in the case of CIT v. Fair Finvest Ltd. 357 ITR 146(Delhi) has held that - "Where assessee had filed documents including certified copies issued by Registrar of Companies in relation to share applications and....
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....ce-sheets of creditors, and that creditors who were called by Assessing Officer did affirm fact of giving money and explained source - findings of Tribunal being based on appreciation of evidence and relevant considerations and not shown to be perverse could not be interfered with" Thus in my considered opinion, based upon the position of law and facts as discussed above, the appellant has been able to discharge its onus and AO's action in making addition of the above said amount was contrary to law and facts of the case. Therefore, keeping in view the entire facts of the case and the position of law discussed above, this ground of appeal is decided in favour of the appellant and the addition of Rs. 2,30,00,000/- is hereby deleted." 6. Heard the arguments of both the parties and perused the material available on record. 7. We find that AO has not brought any material on record to dislodge the sanctity of the above documents submitted that after the filing of the above documents the burden casted upon the assessee, stood discharge and the burden is on revenue to refute the documentary evidences filed by assessee with cogent material. It is not a case of share application money ....
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.... which they invested with the assessee, it would not automatically follow that the said money belongs to the assessee and becomes unaccounted money. According to us, the assessee appears to be correct on this aspect. We feel that something more which was necessary and required to be done by the AO was not done. The AO failed to carry his suspicious to logical conclusion by further investigation. After the registered letters sent to the investing company had been received back undelivered, the AO presumed that these companies did not exist at the given address. No doubt, if the companies are not existing, i.e., they have only paper existence, one can draw the conclusion that the assessee had not been able to disclose the source of amount received and presumption under s. 68 of the Act for the purpose of addition of amount at the hands of the assessee. But, it has to be conclusively established that the company is non-existence. 36. The AO did not bother to find out from the office of the Registrar of Companies the addresses of those companies from where the registered letter received back undelivered. If the address was same at which the letter was sent or the Inspector visited an....