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TMI Blog2017 (11) TMI 312X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the assessee are allowed. - ITA No. 2452/DEL/2017 - - - Dated:- 31-10-2017 - SHRI B.P. JAIN, ACCOUNTANT MEMBER For The Assessee : Shri K. Sampat Shri V. Rajakumar, Advs For The Revenue : Shri T. Vasanthan Sr. DR ORDER This appeal of the assessee arises from the order of the ld. CIT(A), Delhi vide order dated 19.03.2015 for A.Y. 2007-08.. 2. The assessee has raised by the following grounds of appeal:- Based on the facts and circumstances of the case, the appellant respectfully submits that : 1. The Hon ble CIT (Appeals)-3, New Delhi has erred on facts and circumstances of the case and in law in confirming additions of ₹ 47,00,000/- under Section 68 of the I.T. Act; 2. The Ld. A.O and the Hon ble CIT(A) have erred on the facts and in the circumstances of the case and in law, in making and upholding respectively the addition of ₹ 47,00,000/- on account of share application money received by the appellant, ignoring the facts that identity and creditworthiness of the share applicants and genuineness of the transactions had been proved by the appellant; 3. The Ld. AO and the Hon ble CIT(A) have erred on the facts and in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t. Ltd. 700,000.00 01/05/06 70000 10.00 Polo Leasing Finance Pvt. Ltd. 1,000,000.00 17/05/06 100000 10.00 Laxmi Infin Pvt Ltd. 1,000,000.00 11/09/06 100000 10.00 3. During the course of appellate proceedings before the CIT(A), the Appellant filed photo copies of the confirmations, copy of the Balance Sheet and copy of the bank accounts in the case of Laxmi Infin Pvt. Ltd. The Appellant was directed by the CIT(A) to establish identity, genuineness and creditworthiness of the subscribers in the light of the observations of the Hon'ble Delhi High Court in the case of N.R. Portfolio Pvt. Ltd. and MAF Academy Pvt. Ltd. The CIT(A) citing the observations of the Hon ble High Court in CIT vs. N.R. Portfolio Pvt. Ltd. noticed that the Appellant had submitted the requisite details through the Company Director Shri Praveen Bhatnagar. According to the CIT(A) the Appellant had not filed any evidence with regard to the profit making apparatus of the o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ubject case was not one such. The Ld. Counsel further submitted that during the course of the assessment proceedings the assessee had submitted before the Assessing Officer the requisite details of share application monies, including the confirmations of the several share applicants, their addresses, details of allotment with bank particulars and such other similar details and evidences which had all gone to confirm the identity, credit-worthiness and the genuineness of the share subscribers. The Ld. Counsel further submitted that all transactions were invariably through banking channels. 6. Referring in detail to the Assessing Officer s order, the Ld. Counsel pointed out that the Assessing Officer has erroneously relied upon court cases which had no resemblance with the facts of the present case. The decision in the case of CIT vs. Mussadi Lal Ram Bharose (1987) 165 ITR 14 and CIT vs. Sardar Store (1986) 161 ITR 53 were mainly in the context of the penalty provisions. The other decision cited by the Assessing Officer as CIT vs. S. Kamaraj Pandian of the Madras High Court (1984) 150 ITR 703 was in the context of a case where in response to summons issued for verification of loan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Del), b) CIT v. Creative World Telefilms Ltd. (2011) 333 ITR 100 (Bom), c) CIT v. Victor Electrodes Ltd. (2010) 329 ITR 271 (Del), d) CIT v. Winstral Petrochemicals (P) Ltd. ((2011) 330 ITR 603 (Del), e) CIT v. Gangeshwari Metal (P) Ltd. (2013) 361 ITR 10 (Del) and, f) Unreported order of the Hon ble Delhi High Court in CIT v. Goel Sons Golden Estate Pvt. Ltd. ITA 212/2012 dated 11.04.2012 The Ld. Counsel for the assessee submitted that the parameters enunciated in the above mentioned cases was duly complied with in the subject case in the case of all the subscribers. The objection taken by the Assessing Officer was, therefore, erroneous, needless and untenable. 10. On the other hand, the Ld. DR vehemently supported the orders of the authorities below. He submitted that credentials of the parties to the subscription of the share capital of the appellant did not inspire confidence. The assessee company had not produced the mandatory basic documents from the parties from whom subscription for share capital had been received. The identity, creditworthiness and genuineness of the parties subscribing to the shares remained un-established. The cases cited by the Asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tatement of the respective parties were submitted before the Assessing Officer. In particular there is no allegation by the authorities that there is any involvement of cash in the subject transactions. It is also a fact that there is no remark or complaint brought on record by the Assessing Officer with regard to the character and conduct of any of the share applicants by the Investigation Wing. All the subscribers are tax assessees. Their identity has been accepted by the AO. Further, the subscriptions are invariably through banking channels. In the bank accounts as submitted before the lower authorities, there is no report of any pre-deposit of cash to clear the cheques issued for share subscription by the several parties. In that background the confirmation submitted by the assessee of the subscribers to the share capital appear prima facie to be complete and in order. No specific flaw or discrepancy of any nature has been either noticed by the revenue authorities or otherwise brought on record by them. 14. The revenue authorities state that verification is incomplete in the context of the rulings of the jurisdictional High Court in N.R. Portfolio Pvt. Limited (supra) and MA ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r before the departmental authorities on summons. These are also not such cases where cash has been deposited by the subscribers in their bank account to pay for the share subscriptions. 16. I have noted that the Assessing Officer has been provided confirmations from all the share subscribers. Their master data from the ROC records has also been obtained and placed on record. Their own individual bank statements have been scrutinized and nothing intriguing or questionable has been found in them. Copies of all these documents have been filed at pages 74 to 111 of the paper book. No specific flaw or discrepancy has been noticed in them. They all go to confirm that necessary and adequate enquiries and investigations have been carried out by the revenue authorities. Not only that, the CIT(A) in the appeal proceedings had referred the matter back to the Assessing Officer and obtained a remand report from him on the various points in controversy. That remand report has been considered by the CIT(A) while passing the impugned order. In fact, therefore, this is not a case of any inadequate enquiry so as to compel me to refer the matter back to the revenue authorities for a scrutiny and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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