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TMI Blog2014 (11) TMI 65X X X X Extracts X X X X X X X X Extracts X X X X ..... eived total share application money amounting to Rs. 2,50,00,000/- including share premium of Rs. 2,37,50,000/- from as many as sixteen concerns. The assessee had furnished the list of such concerns along with copy of share application forms etc. The Assessing Officer asked the assessee to produce the directors of the following three companies:- Name of the Company Amount 1. Arun Finvest Pvt.Ltd. Rs.25,00,000 2. Sri Niwas Leasing & Finance Ltd. Rs.25,00,000 3. Polo Leasing & Finance Ltd. Rs.25,00,000/- Rs.75,00,000/- 5. The assessee could not produce the directors of these companies but a written reply was filed stating that all the details along with permanent account number of these companies have already been furnished. In view of non-production of directors of these companies, the Assessing Officer treated share application money received from them to be the bogus money of the assessee. He also made reference to the CD provided by the Investigation Wing and stated that these three companies are known as entry providers. In view of this, the Assessing Officer held that the credit in the shape of share application money is unexplained ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nies along with the following details and documents in order to prove the physical identity, creditworthiness and genuineness of the transactions:- a) M/s Arun Finvest Pvt.Ltd. b) M/s Shrinivas Leasing & Finance Ltd. c) M/s Polo Leasing & Finance P.Ltd. In respect of the above companies the following were also required:- a) Personal deposition of the principal officer/directors of the above companies. b) Copy of account of the above parties in your books of account for A.Y. 2006-07. c) Their confirmations as on date. d) Copies of their complete return of income with computation of income for asst. year 2006-07. e) Copies of their audited balance-sheet and profit & loss account with all the schedules & annexures. f) Details of all the bank accounts maintained by them during the financial year 2005-06 & 2006-07 in the name of the company and their directors with complete bank statements of all the bank accounts with complete narration of all debit and credit entries. g) Their books of account for the assessment year 2006-07. 8. In compliance to the above the assessee company on 24.12.2012 filed its reply dated 24.12.2012 (copy enclosed). The assessee company has also enclo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... course of assessment proceedings, the assessee could not produce the directors of the above companies which is indicative of the fact that these are not genuine investments. Moreover, the balance sheets and other documents filed by the above mentioned companies, by no means prove the creditworthiness to advance the share capital to the assessee company. During the course of assessment proceedings, the assessing officer has rightly made the additions u/s 68 of the I.T. Act, on account of unexplained share capital. Therefore, the additions made by the A.O. deserve to be confirmed." 6. From paragraph No.9 of the remand report, it is evident that on 4.1.2013, the assessee company produced the director of all the three companies and they also produced the necessary evidences i.e. photocopy of their permanent account number and their voter-ID, photocopy of the confirmation for investment in the assessee company, photocopy of confirmation of account, photocopy of acknowledgement of income tax return for the relevant assessment year and photocopy of the bank statement of the company. The Assessing Officer recorded their statements as is evident from paragraph 9 but has not discussed the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nclusion that the assessee company has duly discharged the onus of proving the cash credit in its books of account. From the facts of the case, it is evident that the assessee has duly established the identity and creditworthiness of the creditor (i.e. share applicant), and the genuineness of the transaction. We, therefore, do not find any justification to interfere with the order of the CIT(A). 7. The facts in the case of all the three companies are identical. In all the three cases, the directors of the share applicant companies were produced during remand proceedings and necessary evidences were furnished by them. The Assessing Officer in all the cases doubted the creditworthiness of the share applicants. Therefore, we have examined the balance sheet of each three share applicants in the case of all the three appeals before us. 8. In the case of Global Investments Pvt.Ltd. i.e. ITA No.4923/Del/2013, there were three share applicants from whom total Rs. 60 lakhs were received. The details of the share applicants is as under:- Name of the Company Amount 1. M.V. Marketing Pvt.Ltd. Rs.10,00,000 2. Sri Niwas Leasing & Finance Ltd. Rs.25,00,000 3. Satwant Singh Sod ..... X X X X Extracts X X X X X X X X Extracts X X X X
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