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TMI Blog2023 (4) TMI 1349X X X X Extracts X X X X X X X X Extracts X X X X ..... erent projects were in partnership with different persons and the existing projects were matured and operational, so it became necessary to form Special Purpose Vehicles (SPVS) to undertake the new projects. Once the project was complete or during its continuation, it becomes easier to attract an investor which helps in arranging funds for the project. It was not considered viable to keep the level of Authorized Paid-up Share Capital at a very high level. If the Authorized Share Capital of the company is kept at a higher level, the company has to pay mammoth fees to ROC. So the company purposively kept the paid up capital base at a low level to save on unnecessary fees to ROC and also to save on servicing cost of the capital in future. Asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... einafter referred to as the Act ). 2. The Revenue in this appeal is aggrieved by the action of the CIT(A) in deleting the additions made by the Assessing Officer in respect of receipt of Rs. 17,61,40,800/- by the assessee company which was treated by the Assessing Officer as unexplained income of the assessee u/s 68 of the Act on the ground that the assessee had failed to establish the identity, genuineness and creditworthiness of the share subscribers. 3. At the outset, the ld. Counsel for the assessee has submitted that there were only two shareholders of the assessee company, out of which, one shareholder has subscribed to the shares in the Financial Year 2010-11 relevant to assessment year 2011-12 and had made payment in 2010-11, itself ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es in aggregate at Chhatikara Road, Vrindavan - 281121, Uttar Pradesh. The assessee company would develop the project in phases and currently Phase-l was in progress. In the Phase-L, the assessee-company plans to develop Villas/Bungalows and residential apartments. The estimated cost of the project as ascertained till date was approximately Rs. 300 crore. That the assessee-company has also registered its project with Real Estate Development Authority (RERA), Uttar Pradesh. Phase-I was also commercially launched and started receiving bookings from customers. Its Registered Office was situated at Plot A3, Block- GP, Saltlake, Sector-V, Kolkata - 700091. The site office of the company was situated at Chhatikara Road, Vrindavan - 281121, Uttar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... udes Rs. 44.64 crore to M/s Infinity BNKe Infocity Private Limited. In the backdrop of the above said facts, it is submitted that the transactions were wholly and exclusively between the holding and the subsidiary companies. The funds were only provided by the parent company out of its own resources / borrowed funds from Banks. The subsidiary companies were promoted by the parent company only for the purpose of expanding its business and the deals were purely commercial in nature. The main purpose or object of carrying business through subsidiaries was to mitigate the risk associated with a specific project and to create a distinct identity of the project. It also results in operational efficiency and control. Since different projects were ..... X X X X Extracts X X X X X X X X Extracts X X X X
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