2019 (4) TMI 1988 - ITAT MUMBAI

Addition u/s. 68 - Onus to proof - unexplained cash credit in respect of share premium received by assessee - HELD THAT:- In view of the evidences furnished by the assessee, we are of the view that the assessee has discharged its onus of proving the identity, genuineness and creditworthiness of the creditors/shareholders and fulfilled the requirement of ingredients of section 68 - Thus, the addition made u/s. 68 of the Act which is purely based on the investigation reports and statements recorded from PKJ and whose statements were not provided to the assessee for rebuttal and no cross examination was provided to assessee and therefore is in violation of principles of natural justice.

No sort of enquiries were made by the AO to disprove the evidences furnished by the assessee. Assessing Officer accepted the subscription of share capital by the shareholders as genuine and no addition has been made in respect of the same. Assessing Officer treated only the share premium as unexplained cash credit. Having accepted the share capital as genuine the Assessing Officer cannot treat only the share premium as non-genuine and bring to tax as unexplained cash credit u/s. 68 of the Act. The addition cannot be sustained. Thus, we direct the Assessing Officer to delete the addition made u/s. 68 of the Act. - Decided against revenue.