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2019 (5) TMI 1592 - AT - Income TaxRevision u/s 263 - notice issued alleging that AO had not examined the financial worth, genuineness and creditworthiness of transactions relating to introduction of share capital - assessee has not received any money in form of cash or cheque in lieu of share application or share premium; rather the assessee had received investments in form of equity shares - HELD THAT:- Here in this case, once there is no transaction in terms of any money, then there could be no question of seeing the creditworthiness by way of their annual revenue or income. The reason being, all these companies were holding investments right from the earlier years in the form of equity shares of various companies and the shares held as investment by them has been transferred to the assessee in consideration for allotment of equity shares. Thus, the source of shares received by the assessee is flowing from investments held by them in their balance sheet which have been part of their assessment records. Under the peculiar facts and circumstances of the case, we do not find any reason that there was any lack of enquiry done by the AO or non-application of mind qua the creditworthiness or genuineness of the transaction. Once, the Assessing Officer has found that a transaction is not in terms of any money after the detailed inquiry and getting the entire records from these 15 companies, then we are unable to appreciate as to how the CIT had reached to a conclusion that the Assessing Officer has failed to investigate the genuineness and creditworthiness of source of funds credited in the books of account of the assessee company. Here in this case, firstly, identity of the parties cannot be in dispute; secondly, the genuineness of the transaction is fully proven by the fact that these companies have given shares to the assessee in lieu of shares allotted to them; and lastly, there is no requirement to examine the creditworthiness of any sum advanced or invested by these companies because there is no transaction in terms of cash/money. The source of investment which has been transferred to the assessee company is flowing from their balance sheets as these shares were held by these companies as investment duly reflected in their balance sheets in earlier years. We do not find it a fit case wherein the Revisionary jurisdiction u/s. 263 could have been exercised in the light of the fact that the Assessing Officer had carried out detailed inquiry and examination directly from the parties in the course of assessment proceedings. Otherwise also, it is trite law that, if the ld. Pr. CIT was not satisfied with the inquiry conducted by the Assessing Officer, then at least he should have carried out some prima facie enquiry himself so as to reach to a conclusion that the inquiry conducted by the Assessing Officer was deficient or lacking. Without conducting any inquiry, Ld. PCIT cannot hold that the either the inquiry conducted by the Assessing Officer was insufficient or there is no verification of the evidences. Under these facts and circumstances the assessment order cannot be set aside on the ground that no inquiry has been made or such an order is erroneous and prejudicial to the interest of revenue. Accordingly, we quash the impugned revisionary order u/s. 263 and restore the assessment order. - Decided in favour of assessee.
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