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2015 (4) TMI 755 - AT - Income TaxUnexplained share application money - Ao makes addition on general basis, no detailed enquiry undertaken by him - Profits from share trading - Business income or Short term capital gain - Held that:- No inquiries were conducted by AO to find out the genuineness of the transactions and creditworthiness of the companies who had applied for the share application money in the assessee company. We find considerable merit in the argument of ld. counsel for the assessee that merely because the directors were not produced the addition could not be made in view of the decision of Hon’ble Delhi High Court in the case of Victor Electrodes Ltd. [2010 (5) TMI 62 - DELHI HIGH COURT] and also in the case of Nova Promoters [2012 (2) TMI 194 - DELHI HIGH COURT] Hon’ble Delhi High Court had clearly distinguished between the cases where AO had carried out detailed inquiry and then arrived at a finding regarding accommodation entries and those cases where AO did not carry out any inquiry and merely made addition on general basis. The inquiry for arriving at a proper conclusion is a sine qua non and that cannot be dispensed with by making general observations. We find that the decision in the case of Goel Sons Golden Estate P. Ltd. [2013 (4) TMI 571 - DELHI HIGH COURT] is squarely applicable to the facts of the present case. Also refereed case - Fair Invest LTd. [2012 (12) TMI 170 - DELHI HIGH COURT]. Profits from share trading - The AO has categorically observed that assessee had not given any reply. However, at page 23 of the PB, the assessee refers to the reply filed by it before the AO. We find that before ld. CIT(A) the assessee had advanced detailed submissions, but there is no reference to the reply filed before AO dated 15-7-2008. Ld. CIT(A) has also not recorded any finding on this aspect. Therefore, we restore this issue to the file of AO to decide the issue de novo after considering the assessee’s submissions. Ground is allowed for statistical purposes. - Decided partly in favour of revenue.
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