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TMI Blog2002 (6) TMI 593X X X X Extracts X X X X X X X X Extracts X X X X ..... ers/depositors as share application money. After necessary examination during the assessment proceedings the Assessing Officer was not satisfied with the genuineness of the share application money amounting to ₹ 8,28,000 claimed to have been received from 23 applicants and added the same under section 68 holding that the said amount represented unexplained cash credit introduced in the guise of share application deposit. According to him mere establishing the identity and filing of confirmations from the investors was not enough. Their financial capability, source of investment and genuineness of transactions are also to be established. On appeal, the Commissioner (Appeals) deleted the addition mainly relying on the order of the Delhi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng making application for allotment of shares by applicants, acknowledgements granted by Directors for receipt of payment for share application money from the applicants, acknowledgements made by the applicants for receipt of shares and details of shares issued by the Company the Commissioner (Appeals) was satisfied that the deposit for allotment of shares to the of ₹ 8,28,000 extent was indeed made by the applicants before crediting books of account of the company. He also held that in view of the details filed it was proved that the share holders do exist and hence it was not the liability of the assessee-company to prove the sources of making deposits by the share-holders. He was also satisfied about their existence in view of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ividual verification. It was also submitted that the Commissioner (Appeals) erred in not setting aside the assessment for re-consideration by the Assessing Officer in the light of the decision of the Delhi High Court in the case of Sophia Finance Limited. On the other hand, it was submitted by the learned AR of the assessee that nowhere the companies Act, 1956 authorises a company to seek information from its share holders regarding the source of their investment made in shares. The provisions of the Act also shows that the company is not authorised to enquire the source of investment of the share holders. It was enough for the company to know that they had invested in shares, the number of shares subscribed and the full particulars of addr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of an assessee-company under section 68 of the Act, as such view has been approved by the Hon ble Supreme Court in the case of Stellar Investment Ltd. ( 251 ITR 263). It was argued that the facts prevailing in the assessee s case are similar to the facts in the case of Stellar Investment and therefore, the appeal filed by the Department is no more contentious nor warranted and therefore, the same should be dismissed. 6. We have carefully considered the submissions made by the rival parties and the case laws relied upon. We find from the order of the learned Commissioner (Appeals) that he has given a clear finding after examining the necessary details that the share holders genuinely existed and were identifiable. They had also confirme ..... X X X X Extracts X X X X X X X X Extracts X X X X
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