2021 (11) TMI 564 - AT - Income Tax

Addition u/s 68 - discharge of onus - CIT-A deleted the addition - investor companies which information was already available in the record - HELD THAT - As find from a perusal of the assessing authority's remand report's conclusion that he had held the assessee to have discharged its onus of proving identity, genuineness and creditworthiness of the share application/premium amount of ₹ 49.18 Crs which ultimately led to the CIT(A) passing the impugned order granting relief. We deem it appropriate at this stage to quote the case law Smt. B. Jayalakshmi 2018 (8) TMI 208 - MADRAS HIGH COURT and CIT vs. D.M. Purnesh 2020 (9) TMI 731 - KARNATAKA HIGH COURT that the Revenue cannot be held as an aggrieved party once the Assessing Officer files a favourable remand report in appropriate proceedings. We therefore decline the Revenue's foregoing solely substantive ground raised in the instant appeal in very terms. - Decided against revenue.

Summary

Issues:
- Appeal against the order of the Ld. CIT(A) regarding addition of unexplained cash credits under section 68 of the Income Tax Act, 1961.

Analysis:
1. The Revenue appealed against the Ld. CIT(A)'s decision to delete the addition of ?52.18 Crs made by the Assessing Officer under section 68 of the Act for the Assessment Year 2010-11. The Revenue contended that the CIT(A) erred in allowing the appeal without proper examination of investor companies, despite the information being available in the record. Additionally, the Revenue argued that the CIT(A) should have considered the report of the Additional Commissioner of Income Tax, which provided value additions to the Assessing Officer's Remand Report.

2. During the hearing, the Revenue's representative emphasized the need to reinstate the section 68 addition of unexplained cash credits. The representative highlighted the Assessing Officer's detailed reasoning in the assessment order, stating that the assessee failed to prove the genuineness and creditworthiness of the share application/premium in question. Further, the representative submitted a petition and various documents, including a CBI Supplementary Charge Sheet, statements of individuals, details of invested entities, SEBI's order, and the Securities Appellate Tribunal's decision, to support the Revenue's case.

3. The Tribunal reviewed the assessing authority's remand report and noted that the authority had found the assessee to have discharged its onus regarding the identity, genuineness, and creditworthiness of the share application/premium amounting to ?49.18 Crs. Citing relevant case laws, the Tribunal pointed out that once the Assessing Officer files a favorable remand report, the Revenue cannot be considered an aggrieved party. Consequently, the Tribunal dismissed the Revenue's appeal, upholding the CIT(A)'s decision to delete the addition of ?52.18 Crs.

4. In conclusion, the Tribunal dismissed the Revenue's appeal, affirming the order of the CIT(A) regarding the deletion of the addition of unexplained cash credits under section 68 of the Income Tax Act for the Assessment Year 2010-11. The decision was based on the Assessing Officer's remand report, which found the assessee to have met the burden of proof regarding the share application/premium amount. The Tribunal's judgment was delivered on October 27, 2021.