9911796707
TMI Blog2011 (9) TMI 958X X X X Extracts X X X X X X X X Extracts X X X X ..... nue against the order of the learned CIT(Appeals), Salem in ITA No. 56/08-09 dated 30-04-2010 for the assessment year 2004-05 in the case of Shri R. Thangavelu and ITA No. 1111/Mds/2010 is an appeal filed by the Revenue against the order of the learned CIT(Appeals), Salem in ITA No. 74/08-09 dated 290-04-2010 for the assessment year 2004-05 in the case of Shri P. S. Sundaram. As the issues in all the three appeals are inter-connected, the three appeals are disposed of by this common order. 2. Shri K.E.B. Rengarajan, Jr. Standing Counsel represented on behalf of the Revenue. Shri S. Sridhar, Advocate represented on behalf of the assessee, M/s. Victory Spinning Mills Ltd. and Shri G. Bhaskar, Advocate represented on behalf of the assessees ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it had been categorically held that if the share application money is received by the assessee company from alleged bogus shareholders, whose names are given to the Assessing Officer, then the department is free to proceed to re-open the individual assessments in accordance with law and the same cannot be treated as the undisclosed income of the assessee company. 5. The learned Jr. Standing Counsel placed before us detailed paper book consisting of 210 pages containing the paying-in-slips as also copies of the Manager s Cheques, Demand Drafts and Pay Orders in respect of the various share applications. It was the submission that all the applications submitted to the bank were filled and signed by the same person and the money remitted wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ound in the course of search in the cases of Shri R. Thangavelu and Shri P. S. Sundaram. Out of the 181 share applicants, 129 had appeared when summons were issued to them. In any case, the names and identity of the share applicants are clearly available. Once this is so, in view of the decision of the Hon'ble Supreme Court in the case of CIT v. Lovely Exports Pvt. Ltd., referred to supra, the share application money cannot be treated as the undisclosed income of the assessee and the Revenue is free to proceed to re-open the individual assessments of the alleged share applicants in accordance with law. In the circumstances, the appeal of the Revenue in ITA No. 2098/Mds/2010 stands dismissed. 8. In regard to the appeals in the cases o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e unexplained investment of the Managing Directors of the company, Shri R. Thangavel and Shri P. S. Sundaram. Here we may specifically mention that what has been found in the course of search is only the list of share holders. Nothing has been found to show that the assessees, Shri R. Thangavel and Shri P. S. Sundaram have advanced the monies to the alleged share applicants. In the circumstances, we are of the view that no addition on this count can be made in the hands of Shri R. Thangavel and Shri P. S. Sundaram. In the circumstances, we are of the view that the finding of the learned CIT(A) on this issue is on a right footing and does not call for any interference. In the circumstances, the appeals of the Revenue in ITA Nos. 1110, 1111 a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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