9911796707
TMI Blog2021 (12) TMI 701X X X X Extracts X X X X X X X X Extracts X X X X ..... nsactions and creditworthiness of share applicants. For proving the identity of share applicants, the assessee furnished the name, address, PAN of share applicants together with the copies of balance sheets and Income Tax Returns. With regard to the creditworthiness of share applicants, we noted that these Companies are having capital and reserves and the investment made in the assessee company is only a small part of their capital. These transactions are also duly reflected in the balance sheets of the share applicants, so creditworthiness is proved. Even if there was any doubt if any regarding the creditworthiness of the share applicants was still subsisting, then AO should have made enquiries from the AO of the share subscribers. In t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rom the concerns in the form of bogus share application money. During the course of search and seizure, Shri Pravin Kumar Jain, Hawala entry operator had stated on oath that he had provided accommodation entries to many parties. During the assessment proceeding, the AO issued show cause notice to explain about the accommodation entries from the three parties i.e. (1). Javda India Impex Ltd, ₹ 9,00,000/-, (2). Olive Overseas Pvt. Ltd, ₹ 5,00,000/- and 3. Vanguard Jewel Ltd, ₹ 5,00,000/- total amount of ₹ 19,00,000/-, in the forms of share application money during the F.Y. 2008-09 relevant to A.Y.2009-10. The assessee was asked to produce the Directors of the investors companies along-with complete books of accounts of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from unaccounted money to accounted money. Hence based on these findings, assessing officer made addition of ₹ 19,00,000/- under section 68 of the Act. 5. Aggrieved by the order of the Assessing Officer, the assessee carried the matter in appeal before the ld. CIT(A) who has confirmed the action of the Assessing Officer. 6. Aggrieved by the order of the ld. CIT(A), the assessee is in further appeal before us. 7. Shri Hiren M. Diwan, FCA, Learned Counsel for the assessee begins by pointing out that assessee submitted enough documents and evidences in respect of share applicant companies/share subscribing companies to prove three ingredients of section 68 of the Act, such as: (i) Confirmation from the company for having made th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er may be deleted. 9. On the other hand, Shri Deependra Kumar, Learned DR for the Revenue has primarily reiterated the stand taken by the Assessing Officer, which we have already noted in our earlier para and is not being repeated for the sake of brevity. 10. We have heard both the parties and carefully gone through the submission put forth on behalf of the assessee along with the documents furnished and the case laws relied upon, and perused the fact of the case including the findings of the ld CIT(A) and other materials brought on record. We note that assessee submitted the following documents and evidences for each share subscribing companies: (A) Javda India Impex Ltd: (i) Confirmation from the company for having made the payme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... year ending on 31-03-2009. (Copy enclosed at Pages No. 70 to 87), (vi) The details of company's registration no. with Registrar of Companies, Mumbai being U51909MH2003PTC139464, confirming that the company is duly registered as private Co. with the Registrar of Companies, Mumbai. (C) Vanguard Jewels Limited: (i) Confirmation from the company for having made the payment to the assessee company of ₹ 5,00,000/- by way of share investments. (Copy enclosed at Page No. 89), (ii) Copy of relevant page of bank statement indicating the fact of payment of above sum of ₹ 5,00,000/- to the assessee company by account payee cheque (Copy enclosed at Page No. 90), (iii) Copy of PAN Card (Copy enclosed at Page No. 91), (iv) Copy of ackno ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s a duty casted upon the assessee to explain the nature and source of credit found in his books. In the instant case, the credit is in the form of receipt of share capital from share applicants. The nature of receipt towards share capital is seen from the entries passed in the respective balance sheets of the companies as share capital and investments. In respect of source of credit, the assessee has to prove the three necessary ingredients i.e. identity of share applicants, genuineness of transactions and creditworthiness of share applicants. For proving the identity of share applicants, the assessee furnished the name, address, PAN of share applicants together with the copies of balance sheets and Income Tax Returns. With regard to the cr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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