TMI Blog2014 (11) TMI 676X X X X Extracts X X X X X X X X Extracts X X X X ..... rments made by such depositors of money - As far as aggregated amount of ₹ 18,97,000/- received from 115 workers in concerned, it is seen that ₹ 11,27,500/- has been stated to have been received through YICS and it is stated to be the amount, which was deposited by the workers in YICS - no material has been placed by Revenue to controvert the submission of assessee - in the case of 47 workers where the aggregate amount received is ₹ 7,79,500, the assessee has not been in a position to discharge the onus as required u/s 68 - addition can only be sustained with respect to ₹ 7,79,500/- decided partly in favour of revenue. - ITA No. 274/Ahd/2011 - - - Dated:- 17-10-2014 - G. C. Gupta, VP And Anil Chaturvedi, AM,JJ. For the Petitioner : Shri Nimesh Yadav, Sr. DR For the Respondent : Shri R. N Vepari, AR ORDER Per : Shri Anil Chaturvedi, Accountant Member This appeal is filed by the Revenue against the order of ld. CIT(A)-I, Surat, dated 26.10.2010 for the assessment year 2007-08. 2. The facts as culled out from the materials on record are as under: 3. The assessee is a Company stated to be engaged in the business of manufacturing a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... number of share applicants were submitted by assessee. He was further of the view that mere furnishing of the list of names and incomplete address does not prove the identity, creditworthiness and genuineness of the transaction. He, therefore, relying upon various case laws cited in the order, concluded that assessee has failed to establish the identity, creditworthiness and genuineness of the capital brought into the books of account. He, therefore, considered the aggregate amount of ₹ 85,89,500/- (comprising of ₹ 50,58,500/- towards share application money and ₹ 35,31,000/- being the share capital) as unexplained cash credit within the meaning of Section 68 and added to the income. 5. Aggrieved by the order of A.O., the assessee carried the matter before the CIT(A). CIT(A) after considering the submissions of the assessee, remand report and the reply of the assessee to the remand report, deleted the addition by holding as under: 9. DECISION: I have gone through the assessment order, submissions of the appellant, remand report and also comments of the appellant on the remand report of the A.O. The addition made on this count is hereby deleted due to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... application money and capital received from various individuals were below ₹ 20,000/- and the entire amount was received in cash. He further submitted that before A.O., 4 persons whose names were listed at page no.6 of the assessment order had admitted that they had neither applied for the shares of the company nor have they been allotted the shares. He further submitted that the assessee s explanation that the money was withdrawn from society and deposited with the company cannot be accepted as no proof of source like the withdrawal made from the society was produced before the A.O. and CIT(A). He further submitted that CIT(A) has just relied on the submissions of the assessee. Ld. D.R. further pointed to page 1 of the paper book of the assessee and pointed out that the assessee has not filed affidavits in case of 150 persons and the aggregate amount of which is ₹ 18,97,000/- and in these cases, the assessee has not at all discharged the initial onus. He, thus, submitted that A.O. was fully justified in making the addition and thus supported the order of A.O. 8. Ld. A.R. on the other hand gave the brief background about the assessee and stated that Navsari Cotton ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... otect the interest of the workers and to ensure their employment and the workers had contributed and had become the share holders of the assessee. It was submitted that the share capital of the assessee is mainly held by workers of erstwhile NCSM and others and by this unique experiment the workers have started the closed mill. It was further submitted that the amount was contributed by the workers and in each case the share capital was below ₹ 20,000/- as the workers were mostly uneducated and were also not having bank account or PAN nos. Ld. A.R. further submitted that assessee had obtained affidavits of as many workers as were possibly who have affirmed the investment of funds by them in the company. The affidavits were also obtained from the workers whose money was routed through YICS and affidavits from 122 workers were filed before the A.O. during the remand proceedings. Ld. A.R. further submitted that in the original proceeding the 4 workers who were summoned to the A.O. had denied to have contributed to share capital because the workers were uneducated and were in fear but, however, in the remand proceeding, they were cross examined and had agreed to have contributed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs. Through Yarn Co-op society ltd 337 5,615,000 269 4,497,500 68 1,117,500 Other Workers and officers 169 2,974,500 122 2,195,000 47 779,500 506 8,589,500 391 6,692,500 115 1,897,000 The assessee has also submitted that the amount was received from the workers was initially placed with YICS and later on the money of the workers that was received by YICS was transferred to the assessee and the workers were allotted the shares and in support of which, the assessee has also placed the affidavits and statements of the workers. The aforesaid submission of the ld. A.R. has not been controverted by the Revenue by placing any contrary material on record. It is seen that one of the reason for making the addition was that out of 506 workers 4 workers in their statement made before A.O. had denied about investing in the company. It is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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