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2022 (5) TMI 543 - AT - Income TaxAddition u/s 68 - share application money invested by the share applicants are unexplained cash credit - CIT-A deleted the addition - HELD THAT - AO rightly found that, assessee has not discharged the burden of proving the genuineness and creditworthiness of the source of the cash credit of the 4 share applicants worth Rs. 4.5 crores. Beside the same, the addition has been made by the Assessing Officer based on the Report of the Investigation wing and other materials. But the learned CIT (Appeals) has neither discussed the said facts and nor even mentioned regarding the full exercise and investigation done by the Assessing Officer and the findings made thereon. The CIT (A) has not even discussed how the judgment of Hon ble Supreme Court in the case of CIT Vs. Stellar Investment Ltd. 1991 (4) TMI 100 - DELHI HIGH COURT and the judgment of Delhi High Court in the case of Sophia Investment Ltd 1993 (8) TMI 62 - DELHI HIGH COURT are applicable to the facts and circumstances of the case apart from mentioning the same in his order. Therefore, in our considered opinion, if the matter is restored to the file of CIT (Appeals) for fresh adjudication after verifying the materials on record with a direction to pass speaking order, the substantial justice would be rendered. - Decided in favour of revenue for statistical purposes.
Issues:
Appeal by Revenue against CIT(A) order for AY 2013-14 - Unexplained cash credit u/s 68 - Share application money - Identity, creditworthiness, genuineness of transactions - Non-appearance of assessee - Assessment order basis on Investigation Wing report - CIT(A) deletion of addition - Lack of discussion on facts by CIT(A) - Need for speaking order - Applicability of case laws - Restoration of matter to CIT(A) for fresh adjudication. Analysis: The appeal before the ITAT Delhi was filed by the Revenue against the order of the CIT(A) for the assessment year 2013-14. The issue revolved around the addition of Rs. 4.5 crore as unexplained cash credit under section 68 of the Income Tax Act, 1961, concerning share application money. The Revenue contended that the CIT(A) had erred in deleting the said addition, as the assessee failed to establish the identity, creditworthiness, and genuineness of transactions with specific companies. The assessee did not appear before the Tribunal despite repeated notices, leading to the decision being made in the absence of the assessee. The assessment order was based on an investigation report by the Investigation Wing, which highlighted discrepancies in the share applicants' details. The CIT(A) had partly allowed the appeal by deleting the addition, but the ITAT observed that the CIT(A) did not adequately discuss the facts or the investigation findings in the order. The ITAT noted that the CIT(A) did not reference relevant case laws such as CIT Vs. Stellar Investment Ltd. and Sophia Investment Ltd., indicating a lack of detailed analysis in the order. The ITAT, after considering the submissions of the Revenue, concluded that the matter needed to be restored to the CIT(A) for fresh adjudication. The ITAT emphasized the necessity of a speaking order that thoroughly addresses the facts, investigation findings, and legal precedents applicable to the case. The ITAT set aside the CIT(A) order and remanded the matter to the CIT(A) for a detailed reconsideration, ensuring that substantial justice is served. The parties were directed to be given an opportunity to present their case during the fresh adjudication process. In conclusion, the ITAT allowed the Department's appeal for statistical purposes, highlighting the importance of a comprehensive and reasoned decision-making process in tax matters. The judgment emphasized the need for thorough analysis, proper referencing of case laws, and the provision of opportunities for parties to be heard in tax dispute resolutions.
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