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TMI Blog2016 (1) TMI 31X X X X Extracts X X X X X X X X Extracts X X X X ..... the view that the impugned order of the ld. CIT(A) does not call for any interference. Therefore, the impugned order is liable to be upheld and the appeal of the Revenue deserves to be dismissed. - Decided in favour of assessee. - ITA No. 508/Del./2012 - - - Dated:- 30-9-2015 - SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI L.P. SAHU, ACCOUNTANT MEMBER For The Appellant : Md. Mohsin Alam, CITIDR For The Respondent : Sh. Salil Kapoor, Advocate ORDER Per L.P. Sahu, Accountant Member: This appeal is filed by the Revenue against the order dated 16.11.2011 passed by CIT(A)-III, Delhi for the assessment year 2006-07 on the following effective ground: 1. On the facts and in the circumstances of the case, the CIT( A) has erred in law and on facts in deleting the addition of ₹ 50,00,000/- made by the AO u/s. 68 of the Income tax Act, 1961 on account of bogus share application money/share premium received by the assessee company. 2. In this appeal, the only issue pertains to deletion of addition of Rs.50,00,000/- made by the Assessing Officer u/s. 68 on account of bogus share application money received by the assessee. In the assessment proceed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he appellant has further stated in its submissions that the action of the AO to treat these share holder companies as non-existent is arbitrary and is based on surmises and conjectures and is contradictory to the facts on record as evident from the master data of these shareholder companies drawn from the website of Department of Corporate Affairs, which clearly shows that all these companies are active and have filed their Balance sheets up to 31.03.10. That all these shareholder companies are having Income Tax Pan Number. It is further observed from the assessment order that the appellant company had filed confirmation, copy of ITR, share application form and copy of bank statements of the share applicant companies. The appellant in its written submission has quoted and relied on the legal proposition enunciated by Hon 'ble Delhi High Court in case of Oasis Hospitalities Limited (supra) and Winstral Petrochemical Pvt. Ltd. (supra) and other earlier decisions of the Hon 'ble Courts on the issue. It is seen from the submissions and paper book filed by the appellant that in order to substantiate the claim that the share applicants are existing and the the transactions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wherein the court inter alia observed that there is additional burden on the revenue in as much as even if the applicant does not have the means for the investment, it must show that the investment made by the applicant actually emanated from the confers of the assessee, so as to enable it to be treated as undisclosed income of the assessee. Further the following observation of the jurisdictional H. C in case of CIT vs. Divine Leasing and Finance Ltd (207 CTR 38), which has been quoted with approval in the case of Dwarkadhish Investment (supra) are also quite relevant viz. In this analysis, a distillation of the precedents yields the following propositions of law in the context of s. 68 of the IT Act. The assessee has to prima facie prove (1) the identity of the creditor/subscriber. (2) the genuineness of the transaction, namely, whether it has been transmitted through banking or other indisputable channels; (3) the creditworthiness or financial strength of the creditor/subscriber; (4) if relevant details of the address or PAN identity of the creditor/subscriber are furnished to the Department along with copies of the shareholders register, share application forms, share tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by account payee cheque or by draft or by any other mode, then the onus of proof would shift to the Revenue. Just because the creditors/share applicants could not be found at the address given, it would not give the revenue the right to invoke section 68. Moreover law that the assessee need not to prove the source of source . In view of the above discussion it is held that the appellant s case is squarely covered by the ratio of various decisions of the High court Supreme Court discussed above. From the necessary evidences/details provided to the AO during the proceeding it is seen that the initial onus has been duly discharged by the appellant company. As discussed above, the investigation done by the AO is not sufficient/adequate to controvert the appellant s explanation and to hold that the impugned share application money is the undisclosed income of the appellant. The AO has also raised doubts on the genuineness of the share application money on the premises that it is at abnormally high premium, even where the shares of the applicant company are not listed. On this issue it is observed that such features are trigger for further investigation but the m ..... X X X X Extracts X X X X X X X X Extracts X X X X
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