Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2022 (1) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (1) TMI 727 - ITAT INDOREAddition u/s 68 - Bogus share transactions - onus to prove - absence of any adequate enquiry made by the Revenue - HELD THAT:- There must be more than the bare suspicion to support the assessment. Mere suspicion cannot take place of evidence, neither on the basis of procedural lapse on addition of share capital is sought to be justified. When the basic evidences are on record, as provided by the assessee to the Revenue mere failure of the creditor to appear cannot be the basis for making addition. In fact, the assessee has discharged its onus to prove credit-worthiness of the share holders and genuineness of the transaction by providing the documents and/or information to the AO. The documents filed in support of identity and credit-worthiness of the share holders and genuineness of the transactions being the balance sheet, bank statement, audited accounts, and the affidavit of the companies provided share premium were not doubted as non-genuine. The Ld. AO accepted genuineness of the share capital to the extent of its par value, it can be concluded that the Ld. AO was satisfied with three ingredients required to be proved under Section 68 of the Act. In fact, the addition even thereafter is not sustainable in the absence of any adequate enquiry made by the Revenue. As relying on decision of the ITAT, Kolkata Bench in the case of ITO Vs. Savera Towers P.Ltd., [2019 (1) TMI 1328 - ITAT KOLKATA] wherein it was observed that all the share subscribers are duly assessed to income tax and the transaction with the assessee company are duly routed through banking channels and are duly reflected in their respective audited balance sheets, as were placed on record. Once the receipt of share capital has been accepted as genuine within the purview of section 68 of the Act, there is no reason for the ld.AO to doubt the share premium component received from the very same shareholders as bogus. This fact is identical to that of the fact available with us. At the cost of repetition, we would like to mention that addition under section 68 cannot be justified in the absence of any inquiry done by the ld.AO by exercising powers conferred under the statutory provisions as already observed by us hereinabove. Thus, in the absence of proper inquiry made by the ld.AO, impugned addition cannot be sustained and the same is hereby deleted. The ground of appeal filed by the assessee is allowed.
|