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TMI Blog2023 (5) TMI 405X X X X Extracts X X X X X X X X Extracts X X X X ..... with share premium by merely stating that shares were issued for consideration other than cash for making investment in some other companies and drawing a conclusion that u/s. 68 this addition cannot be sustained, if cash has not been received, is incomprehensible. We do not disagree with the contention that provisions of Sec. 68 cannot be applied if no cash/money has been received by the assessee for issue /allotment of shares. We do not find any material on record which demonstrates such a claim made by the assessee and accepted by the Ld. CIT(A) while granting relief to the assessee. There is neither a paper book nor any written submission to look at for substantiating the claim made by the assessee. We are not in agreement with th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Law Ld. CIT(A) has errred in granting relief to the assessee in respect of addition made u/s 68 of Rs.5,01,00,000/- by the AO for lack of explanation and for want of satisfaction, simultaneously, in respect of: i. Identity of the persons with whom transactions took place. ii. Genuineness of transactions for which credit entries entered in the books of Accounts. iii. Capacity of the persons or their creditworthiness from whom such receipts were recorded. 2) That on the facts and circumstances of the case and on Law Ld. CIT(A) has erred in granting relief to the assessee without taking into account the Journal entries being passed and accounting entries made in the respective Ledger of books of accounts maintained by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctor, Shri Sanjoy Kumar Bajoria which according to the records with the Ld. AO was served but remained uncomplied. Later on, assessee filed a submission on 18.02.2015 containing certain documents which included audited financial statement of the assessee, Form No. 2 and Form No. 5 filed with ROC, copy of I. T. Return Acknowledgment, Memorandum Articles of Association and a list of shareholders. 3.1. In the course of assessment proceeding, Ld. AO enquired about the share capital and share premium totalling to Rs.5,01,00,000/- raised during the year by the assessee. In this respect, Ld. AO noted that assessee company was incorporated on 16.03.2012 i.e. at the fag end of the relevant FY 2011-12. Within these fifteen days of the financial ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en made had been adjusted. The share capital was not issued on receipt of any cash. Shares were issued for consideration other than cash in lieu of assessee company making investment any shares in some other company. (emphasis supplied by us by underline) 4. From the above observations of Ld. CIT(A) it is difficult to decipher the details of the transaction which transpired leading to relief granted to the assessee. There are no de tails on facts as to what was the investment which was made by the assessee against which it has issued its share capital along with share premium amounting to Rs.5,01,00,000/- by merely stating that shares were issued f or consideration other than cash for making investment in some other companies a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... explanation which were sought from the assessee in respect of the claim that no fresh capital was introduced in the books of the assessee company rather shares were issued against investments made by it. 5. Principally, we are also of the view that where cash credit towards share capital is by way of book entries/adjustment and no actual cash/money is received/credited towards share subscription, no addition is called for under the provisions of section 68 of the Act. However, it is important that such a conclusion is arrived at only after due examination and verification of facts on record with corroborative evidence which should demonstrate that shares were issued against corresponding investments made as claimed by the assessee in the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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