TaxTMI 
TaxTMI 
2026 (5) TMI 677
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....tax Act, 1961 (hereinafter referred to as 'the Act') dated 26.12.2018 by the Assessing Officer, DCIT, Central Circle-1, Faridabad (hereinafter referred to as 'ld. AO'). 2. The only issue argued by the Learned AR is that whether the Learned CITA was justified in confirming the addition of Rs 2 crores on account of share application money under section 68 of the Act in the facts and circumstances of the instant case. 3. We have heard the rival submissions and perused the materials available on record. A search action under Section 132 of the Act was conducted on 23-11-2012 on CHD Developers group of cases including the Assessee. The return of income for the assessment year 2011-12 was filed by the Assessee Company on 22-08-2013 declarin....
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....the Assessee that share application money of Rs 2 crores was received from the said party. No reply in response to the said notice was received from Rangoli International Private Limited. The Learned AO also noted that M/s Rangoli International Private Limited had not shown share application / share premium paid to the Assessee company in its balance sheet. Accordingly, the Assessee was show caused as to why the amount received from Rangoli Investment Private Limited of Rs 2 crores be not treated as unexplained cash credit under Section 68 of the Act in the hands of the Assessee company. The Learned AO noted that in the first round of proceedings, the Learned CITA while confirming the addition of Rs 2 crores had observed that Assessee had f....
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....ts Pvt. Ltd. had indeed replied vide letter dated 1-4-2015 by furnishing the following documents:- a) Copy of audited financial statements as on 31-3-2011 b) Copy of its bank statements c) Copy of its confirmation d) Copy of its income tax return acknowledgement for assessment year 2011-12. This goes to prove that Assessee was able to discharge its primary onus by furnishing the requisite details from its side which were also duly confirmed by the concerned investor company Rangoli Investments Pvt. Ltd. directly before the Leonard AO. Hence the statement made by the Learned AO that no response was made to notice under Section 133(6) of the Act is factually incorrect. Further, we find from the letter da....
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....ax department is able to frame an assessment on Investor Company, how the Inspector of income tax was not able to notice the said company is not known. It is a fact that the investor company is duly assessed to income tax thereby proving its identity beyond doubt. From its audited financial statements, it has sufficient net worth to advance Rs 2 crores towards share application money with the Assessee Company thereby proving its credit worthiness. All the transactions have been duly routed through regular banking channels and duly reflected in the books of accounts of Rangoli Investments Pvt. Ltd. Hence, the genuineness of the transactions are also proved beyond doubt. The Assessee had also refunded the said share application money on 21-02....