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Issues involved: Appeal by Revenue against ITAT order for assessment year 2006-07 regarding deletion of sums u/s 68 and u/s 40(a)(ia) of the Income Tax Act.
Issue I - Deletion of sum u/s 68: The assessee submitted various documents to support the claim of Rs. 36 lakh, including share application forms, balance sheets, and IT returns of share applicants. The assessing officer found no discrepancies in the documents. The Revenue alleged that the share application was sourced to a non-existent entity, M/s. Satyam Traders, who deposited a large sum in their bank account. However, the Tribunal found that the share application money was received by the assessee before the deposit in M/s. Satyam Traders' account. The Tribunal concluded that the assessee proved the identity, genuineness, and creditworthiness of the share applicants, and the addition of Rs. 36 lakh u/s 68 was not justified based on subsequent events. The High Court upheld the Tribunal's decision, stating that the Tribunal correctly ignored the subsequent transaction and found no error in its findings. Issue II - Deletion of sums u/s 40(a)(ia): The Tribunal noted that payments of Rs. 24,000 and Rs. 1,75,702 were made to individuals without TDS deductions under Sections 194C and 194J. The Tribunal found no need for TDS deduction as the payments were made for specific services and not subject to TDS. The High Court agreed with the Tribunal's findings, stating that no substantial question of law arose from the materials submitted. Consequently, the High Court summarily dismissed the appeal. In summary, the High Court upheld the ITAT's decision to delete the sums u/s 68 and u/s 40(a)(ia) of the Income Tax Act for the assessment year 2006-07, finding that the assessee had provided sufficient evidence to support the claims and that no errors were made in the Tribunal's findings.
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