2025 (5) TMI 973

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.... (A) as made by the ld. AO on account of unexplained cash credit u/s 68 of the Act in respect of share capital/ share premium. 03. The facts in brief are that the assessee filed the return of income on 27.09.2012, declaring total income of Rs. 37,317/-. The case of the assessee was selected for scrutiny under Computer Assisted Scrutiny Selection (CASS) for the reason of large share premium received. Accordingly, statutory notices and questionnaire were duly issued and served upon the assessee. During the assessment proceedings, the assessee partially made compliance before the ld. AO by furnishing certain evidences. The ld. AO pointed did not point out any defect or deficiency in the said evidences. In order to independently verify the t....

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....e ld. AR vehemently submitted before us that the findings of both the authorities below were that the assessee lacks the credential to issue shares at a very high premium is wrong and against the facts on record. The ld. AR referred to page no. 13 of the Paper Book, which is the audited profit and loss account of the assessee. The ld. AR stated that during the year the assessee has revenue from operation of Rs. 47,66,767/- and other income of Rs. 37,317/- with net profit of Rs. 3,88,704/-. The ld. AR further referred to page no. 20, which is the schedule of fixed assets and submitted that the gross assets of the assessee as on 31.03.2012, was Rs. 7,12,75,418/-. The ld. AR therefore prayed that the observations of the authorities below that ....

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....details and evidences called for. However, both the authorities below have not commented on the evidences furnished by the assessee and merely relied on the fact that the summons u/s 131 of the Act were not complied with. The ld. AR submitted that it is not the case of the ld. AO that the money was received from some shell companies and therefore, the order of ld. CIT (A) may kindly be revered and AO may be directed to delete the addition. In defense of his arguments, the ld. AR relied on the following decisions:- (i) CIT Vs. Orissa Corporation Pvt. Ltd. (1986) 159 ITR 78 (SC); (ii) CIT Vs. Orchid Industries Ltd. 397 ITR 136 (Bom); (iii) Crystal Networks Pvt. Ltd. Vs. CIT 353 ITR 171 (Kol); (iv) ITO Vs. M....

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....We further note that for independent verification of these transactions, the AO issued notice u/s 133(6) of the Act to all the subscribers which were duly complied by these subscribers by furnishing evidences/ details qua the investment made. We note that the ld. AO as well as the ld. CIT (A) have not commented on these evidences and have harped on the fact that there was no compliance by the directors of the assessee company to the summons issued u/s 131 of the Act. We have even examined the facts filed before us in the form of ITRs, bank statements, copy of computation of income, Profit and Loss account and balance sheet and find that the subscribers were having sufficient sources to invest in the assessee company. Therefore, we are not i....