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TMI Blog2022 (6) TMI 1159X X X X Extracts X X X X X X X X Extracts X X X X ..... d assessment year 2011-12 to tax the aforesaid share application money in the hands of the assessee, which could not be taxed in assessment year 2012-13 since it did not pertain to that year. However, since Ahmedabad ITAT in the assessee s own case and in respect of the share application money received from the same parties (as in the impugned assessment year 2011-12) has deleted the addition under section 68 which formed the basis for reopening of assessment for the assessment year 2011-12, respectfully following the above ITAT decision the assessee s own case for assessment year 2012-13, we hereby delete addition in respect of share application money under section 68 of the Act. In the result, ground number 1 of the assessee s appeal is allowed. - ITA No. 1570/Ahd/2019 - - - Dated:- 24-6-2022 - Shri Waseem Ahmed, Accountant Member And Shri Siddhartha Nautiyal, Judicial Member For the Assessee : Shri P.D. Shah, A.R. For the Revenue : Shri Atul Pandey, Sr. D.R. ORDER PER : SIDDHARTHA NAUTIYAL, JUDICIAL MEMBER:- This is an appeal filed by the assessee against the order of the ld. Commissioner of Income Tax (Appeals)-1, Ahmedabad in Appeal no. CIT(A)- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8377; 3,87,72,000/-. As the assessee failed to prove the creditworthiness and genuineness of the transaction, the AO made addition of the said amount under section 68 of the income tax act, 1961 (Act). In first appeal, Ld. CIT(Appeals) confirmed addition to the extent of ₹ 2,29,28,000/- and deleted addition to the extent of ₹ 1,59,53,000/- for the reason that the said share application money was not received during the assessment year 2012-13, but the same pertained to assessment year 2011- 12. The Ld. CIT(Appeals) in the appeal for assessment year 2012-13 held that same was outstanding balance and therefore, the said balance cannot be added as current income i.e. assessment year 2012-13 under section 68 of the Act. The AO for the impugned year under consideration noted that share application money amounting to ₹ 1,59,53,000/-which pertained to assessment 2011-12 pertains to Maars software International Ltd. (₹ 1,35,70,000/-) and Shri Anil Jain (₹ 23,83,000/-). The AO noted that the assessee company during the course of assessment proceedings for assessment year 2012-13 could not establish the creditworthiness and genuineness of the transactions in res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld not be : any doubt regarding receipt of the funds and genuineness of the transactions, mere proof of identity of creditor or that transaction was by cheque, is not sufficient as held by Hon'ble High Courts reported in the following cases: i) Mangilal Jain Vs. ITO (Mad.) 315 ITR 105 ii) CIT Vs. Preusion Finance P. Ltd. (Cal.) 208 ITR 465 iii) CIT Vs. United Commercial Industrial Co. (P) Ltd., Cal. 187 ITR 596 and iv) KCN Chandrasekhar Vs. ACIT (ITAT Bang.) 66 TTJ 355. v) CIT Vs. Sophia Finance Ltd. (Del.FB) 205 ITR 98 vi) CIT Vs. Nivedan Vanijya Niyojan Ltd. (Cal.) 263 ITR 623. vii) CIT Vs. Rathi Finlease Ltd. (MP) 215 CTR 429. viii) Dingra Global Credence P. Ltd. Vs. ITO (ITAT) Del. ix) Agarwal Coal Corporation (P) Ltd. Vs. Addl.CIT (ITAT, Indore) 135 ITD 270. In view of the above facts and circumstances of the case, judicial pronouncements and also the facts as elaborately discussed in the assessment order and appellate order in the case of the assessee on similar issues, the credit of Rs.1,59,53,000/- appearing in the balance sheet in the form of share application money received is taxed as assessee's income u/s.68 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s failed to prove the genuineness of the transaction and also failed to prove the creditworthiness of the parties investing in the share capital of the assessee company. He relied on the observations made in the CIT(A) order. 7. We have heard the rival contentions and perused the material on record. We note that the Ahmedabad ITAT in the assessee s own case for assessment year 2012-13, and in respect of the share application money received from the same parties i.e. M/s Mars Software International Ltd. and Mr. Anil Jain, has deleted the additions made in respect of the share application money, with the following observations: 18. The stand of the AO is that, complete bank statement was not submitted in the case of Ski High Financial Services Ltd. Similarly, with regard to Maars Softwares all details were submitted, but copy of bank statement reflecting this transaction has not been submitted. With regard to Shri Anil Kumar copy of acknowledgment of return, and bank statements were submitted, but he has shown only income of Rs.1,84,617/-. Thus, according to him, their credit-worthiness is doubtful. To our mind, these are not evidence based on which he can draw such inference ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... howing transaction received by it. The document was submitted by the assessee in order to demonstrate that it has received money through account payee cheques. PAN details were submitted in order to demonstrate that this assessee is assessable to tax, and it proves its identity. That concern, responded to the notice received under section 133(6) of the Act. The AO, thereafter did not conduct any inquiry. We deem it appropriate to mention that investigation wing of the department is able to unearth details of various accommodation entry providers mainly Kolkatta based companies, but the AO nowhere observed that these concerns were ever engaged in providing accommodation entries, and this fact came to notice of the Department through its investigation wing. Thus, if he has any doubt, he should have called for further information from the share applicants. He should have asked the assessee to produce directors of share applicant companies or Shri Anil Kumar who is brother of one of the directors. The AO could have issued summons under section 131 of the Income Tax Act. But instead of conducting any inquiry, he just draw certain inference for disbelieving the documents produced by the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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