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2022 (11) TMI 1166 - AT - Income TaxAddition u/s 68 - Unexplained cash credit - assessee has failed to produce the alleged shareholders before the ld. AO for identity, creditworthiness and genuineness of the transaction - HELD THAT - The assessee was asked to explain the cash credit received by it during the year. Assessee has failed to file necessary details to explain alleged cash credit and also unable to provide identity and creditworthiness of the cash creditors as well as genuineness of the transaction as per the provisions of law. The assessee has miserably failed to explain the source of alleged cash credit if the assessee has sufficient details to explain the alleged sum it could have certainly filed those details before the authorities below. The assessee consistently escaping from appearing before the ld. AO and the appellate authority plausible explanation to explain the source of alleged sum of share capital and security premium. If the assessee is unable to explain the alleged cash credit and consistent escaped, the provisions of section 68 are attracted. Thus, it is held that the assessee has routed its unaccounted income in the books of account in the form of share capital and security premium by arranging bogus share capital and share premium through accommodation entry provider. Therefore, we find no infirmity in the finding of the CIT(A) confirming the addition made u/s. 68 of the Act and the same is confirmed. Thus, instant grounds of appeal raised by the assessee are dismissed. Addition as undisclosed commission income from the share capital and share premium raised during the year - We after perusing the material available on record and findings of the authority below in respect of addition made by the AO on account of undisclosed commission income and same has been confirmed by the ld. CIT(A) in its order. We are of the considered view that since the assessee could not demonstrate any irregularity in the order passed by the AO at the time of hearing before the ld. CIT(A) and even before us also and the assessee completely failed to substantiate its claim before the authorities below, therefore, we find no infirmity in the findings of the CIT(A) on this issue and thus this ground of appeal is dismissed. The other grounds raised by the assessee are general and consequential in nature therefore need not required to be adjudicated.
Issues:
1. Addition of unexplained investment under section 69 of the Income Tax Act, 1961. 2. Confirmation of addition on account of share investment. 3. Inclusion of unexplained investment in total income. 4. Confirmation of the impugned assessment order. 5. Addition of undisclosed Commission Income on Share Capital & Share Premium. 6. Confirmation of addition based on observations without concrete evidence. 7. Reversal of assessment made under section 143(3) of the Act. 8. Confirmation of addition under sections 68 and 69 of the Act. 9. Contradiction in confirming addition under sections 68 and 69. 10. Failure to alter, amend, or modify grounds of appeal. Detailed Analysis: 1. Addition of unexplained investment under section 69: The assessee challenged the addition of Rs. 2,73,25,000 under section 69 of the Act. The AO added this amount as unexplained investment due to unexplained share capital and commission income. The assessee failed to provide necessary details to explain the cash credits, identity, creditworthiness, and genuineness of the transactions. The Tribunal upheld the addition as the assessee could not substantiate the source of the alleged cash credit, leading to the application of section 68 of the Act. 2. Confirmation of addition on account of share investment: The assessee contested the addition on the grounds of share investment, citing legal precedents. However, the Tribunal found that the assessee did not provide concrete evidence or submissions to support its claim. The Tribunal confirmed the addition made by the AO and upheld by the CIT(A) due to the lack of effort and evidence presented by the assessee. 3. Inclusion of unexplained investment in total income: The AO included the unexplained investment of Rs. 2,73,25,000 in the total income of the assessee. The Tribunal found that the assessee failed to demonstrate the legitimacy of the share capital and security premium raised, leading to the confirmation of the addition by the CIT(A). 4. Confirmation of the impugned assessment order: The Tribunal confirmed the impugned assessment order passed under sections 263 and 144 of the Income Tax Act for the Assessment Year 2008-09. The assessee's lack of participation and failure to provide evidence resulted in the confirmation of the assessment order by the Tribunal. 5. Addition of undisclosed Commission Income: The AO added Rs. 69,750 as undisclosed Commission Income on Share Capital & Share Premium raised during the year. The Tribunal upheld this addition as the assessee did not present any effort or documentary evidence to support its claim, leading to the confirmation of the addition by the CIT(A). 6. Confirmation of addition based on observations without concrete evidence: The Tribunal noted that the assessee failed to provide concrete evidence or submissions to support its claims. The confirmation of additions by the CIT(A) was based on the lack of effort and evidence presented by the assessee, leading to the dismissal of the grounds of appeal. 7. Reversal of assessment made under section 143(3) of the Act: The Tribunal addressed the issue of reversing the assessment made under section 143(3) of the Act. The assessee failed to substantiate its claims and provide necessary details, resulting in the confirmation of the additions made by the AO and upheld by the CIT(A). 8. Confirmation of addition under sections 68 and 69: The Tribunal found no infirmity in the finding of the CIT(A) confirming the addition of Rs. 2,73,25,000 under section 68 of the Act. The Tribunal upheld the addition as the assessee could not explain the source of the alleged cash credit, leading to the application of section 68 of the Act. 9. Contradiction in confirming addition under sections 68 and 69: The Tribunal addressed the contradiction in confirming the addition under sections 68 and 69 made by the Assessing Officer. The lack of substantiation and evidence provided by the assessee led to the confirmation of the additions, reflecting confusion and non-application of mind by the assessee. 10. Failure to alter, amend, or modify grounds of appeal: The assessee's appeal was dismissed by the Tribunal due to the failure to appear before the Tribunal and lack of substantive evidence or efforts to support the grounds of appeal. The Tribunal found no irregularity in the orders passed by the lower authorities and dismissed the appeal accordingly.
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