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TMI Blog2020 (3) TMI 1141X X X X Extracts X X X X X X X X Extracts X X X X ..... the present case and the Ld. CIT(A) was fully justified in deleting the addition made by the AO u/s 68 by holding that the said provision was not applicable. - Decided in favour of assessee. - I.T.A. No. 2246/KOL/2017 - - - Dated:- 18-3-2020 - Shri P.M. Jagtap, Vice-President And Shri A.T. Varkey, Judicial Member For the Appellant : Shri Imokaba Jamir, CIT For the Respondent : Shri K.M. Roy, F.C.A. ORDER PER SHRI P.M. JAGTAP, VICE-PRESIDENT: This appeal is preferred by the Revenue against the order of ld. Commissioner of Income Tax (Appeals)-9, Kolkata dated 11.07.2017. 2. At the outset, it is noted that there is a delay of ten days on the part of the Revenue in filing this appeal before the Tribunal. In th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment. (2) The assessee company did not have any regular business transaction or regular acquaintance with the investor. (3) The investor has no reason to invest such huge amount in the business of the assessee. (4) The investor has no business transaction with the assessee company in past or future except this one time entry. (5) Assessee cannot withstand the cross examination before AO, if the above questions arise. (6) Entire transactions were done to beat the new provision of Income Tax Act . On the basis of the above findings/observations recorded by him in the assessment order, the Assessing Officer treated the entire share capital and share premium amount aggregating to ₹ 6,00,00,000/- as unexplained ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ok Entry. It is submitted on behalf of the Appellant Assessee Company that the shares were issued to two corporate entities namely M/s. Gokul Realtors Pvt. Ltd and M/s. Arman Advisory Pvt Ltd and in consideration of such allotment of shares no cash was received. The Appellant assessee company issued shares against the purchase of shares from the corporate entities; therefore, it is a book entry. According to the law of the land prevailing during the relevant period, the consideration received in respect of the issue of shares was not in cash then the provision of section 68 of the Income Tax Act, 1961 cannot be invoked . 6. The above submission made by the assessee was forwarded by the ld. CIT(Appeals) to the Assessing Officer for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es were issued by the assessee company during the year under consideration at premium to certain companies in lieu of the shares held by the said companies and there was thus no inflow of cash involved in these transactions. The said transactions were entered into in the books of account of the assessee company by way of journal entries and it did not involve any credit to the cash amount. The learned DR at the time of hearing has not brought anything on record to rebut or controvert this position. He however has contended by relying on the decision of Hon ble Madhya Pradesh High Court in the case of V.I.S.P. (P) Ltd. (supra) as well as the decision of Mumbai Bench of this Tribunal in the case of Panna S. Khatau (supra) that section 68 was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... against the said sale of shares was adjusted by the NBFCs against the loan amount payable to proprietary concern. The partnership firm of M/s. Jatia Investment Co. thus received shares from the three NBFCs and also took over the loans payable by the said NBFCs to the proprietary concern. These transactions were entered into in its books of account by the partnership firm through cash book by debiting the investment in shares and crediting the loan amount of the proprietary concern. This credit appearing in the books of account of the partnership firm, M/s. Jatia Investment Co. was treated by the AO as unexplained cash credit u/s 68 and on confirmation of the same, when the matter reached to the Hon ble Calcutta High Court, it was held by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ayable to Damodar Valley Corporation (in short DVC ) for the period from January, 2012 to March, 2012. According to the Assessing Officer, this provision made by the assessee was contingent liability and not the actual liability. He, therefore, disallowed the power expenditure of ₹ 1,61,21,595/- claimed by the assesese on provisional basis. 11. The disallowance of ₹ 1,61,21,595/- made by the Assessing Officer on account of provision made for power expenditure was challenged by the assessee in the appeal filed before the ld. CIT(Appeals). During the course of appellate proceedings before the ld. CIT(Appeals), it was submitted on behalf of the assessee-company that the amount provided for was on account of electricity actually ..... X X X X Extracts X X X X X X X X Extracts X X X X
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