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TMI Blog2017 (7) TMI 210X X X X Extracts X X X X X X X X Extracts X X X X ..... g addition of Rs. 5,52,65,000/- made by the Assessing Officer u/s 68 of the I.T. Act 1961 ignoring the fact that even if paper identify of the share applicants have been established, yet for the purpose of accepting the genuineness of funds u/s 68 of the I.T. Act, the physical identity of the share application has to be established and in the present case the same has not happened. Reliance is placed on the recent decisions of Hon'ble Tribunal in several cases namely Omega Biotech Ltd. in ITA No. 2850/Del/2009, Optibelt Pvt. Ltd. in ITA No. 1967/Del/2009; Aryan Management Services Pvt. Ltd. in ITA No. 2986/Del/2009 Beautex in ITA No. 217/Del/2008." 2. The facts in brief as culled out from the impugned order are that the assessee is engage ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... him and he also issued summons u/s 131 to five entities namely;- M/s. CGG Global Trading Co. Ltd. M/s. Locus Software Solutions Pvt. Ltd. M/s. Rolex Exports Pvt. Ltd. M/s. Vimsai Trading India Pvt. LTd. M/s. Gamma Avionics Distribution Pvt. Ltd. He also deputed ITI to make enquiries in respect of two companies, however he had reported that no such Company existed on the given addresses. Based on these information, and also the fact that some of notices issued u/s 133(6) were not responded by these parties, he held that the assessee could not prove the genuineness of the transaction and added the entire amount of share application of money of Rs. 3,52,65,000/- u/s 68. 3. Before us Learned CIT(Appeals), the assessee submitted tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment order that results of these enquiries were made available to the assessee. In such circumstances, when the appellant has not been provided opportunity to rebut the results of enquiries conducted u the back of assessee. The Assessing Officer was not justified in drawing any adverse conclusion. Moreover, the issue in the present case relates to the share capital money received by the assessee. This issue is covered in favour of the appellant by various decisions wherein it has been held that once the assessee has filed the requisite details e.g. PAN confirmation etc. before the Assessing Officer, the initial onus is discharged. In the present case the appellant has filed the requisite information/ details regarding share capital during ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... el for the assessee submitted that, the assessee had discharged its prima-facie onus to prove the genuineness and credit worthiness of the share application money and the share applicants. He submitted that all the six entities were private limited companies who have given their letter of confirmations, their bank statements, PAN and acknowledgement of IT return. These document itself goes to prove the source and genuineness of the transaction. The ld. Assessing Officer, did not confront to the assessee with the fact that either the notices could not be served or confronted with the report of the ITI that these companies were not available on the given addresses. The assessee had given the correct address to the Assessing Officer later on w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been that all the details of share applicants have been filed, viz., confirmation letters from share holders; details of amount invested by them; a copy of their bank statements; copy of PAN; and copy of their acknowledgement of return of income. It had been further submitted that AO got the enquiries done on the wrong addresses as the addresses were changed. The Ld. CIT (A) in light of these assertions of the assessee has deleted the additions and observed that AO has not rebutted these evidences. 7. After going through the entire contentions raised by the parties before us and also on perusal of material on record, we find that though the assessee may have filed certain information and details to prima facie prove the nature and source o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... None of such exercise has been done by Ld. CIT (A) which he is required to do so under law as a first appellate authority having co-terminus power with the Assessing officer. Even the confirmations letters which have been given along with the other details have not been examined properly by the Ld. CIT (Appeals) or even as a matter of fact by the Assessing Officer, especially when during the year the assessee has only received the share application money and none of the share applicants were allotted shares in this year and it has also not been properly scrutinized as to how much money has been refunded back in the subsequent years and to whom shares have been allotted and when. All these facts needs to thoroughly scrutinized and examined b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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