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2018 (4) TMI 1561 - AT - Income TaxCash Credits/unaccounted payments - Held that:- From the appraisal of the records before us, it emerges that the assessee received share application money from two companies ₹ 8 Crores from M/s BPO Finance & Investment Pvt. Ltd., Kolkata and ₹ 10.00 Crores from M/s Panchmukhi Properties Pvt. Ltd., Kolkata, totaling to ₹ 18.00 Crores routed through normal banking channels. Investigations by the Departments authorities below reveal that Shri Dinesh Kumar Singhi and Snehalatha Singhi are owners and 100% share holders of the aforesaid two companies who introduced the share application money in the assessee company and it was in this context that the investments in the assessee company and its 4 group companies i.e M/s BMM, M/s BMM Cements Ltd., M/s Ranjitpura Infrastructure Pvt. Ltd., and M/s Singhi Holdings Pvt. Ltd., was brought to tax in the hands of Smt. Snehalatha Singhi and Shri Dinesh Kumar Singhi in the ratio of their share holding in the two aforesaid companies M/s BPO Finance & Investments Pvt. Ltd., and M/s Panchmukhi Properties Pvt. Ltd., on substantive basis u/s 69 of the Act. It is in this factual matrix of the case that the ld CIT(A) deleted the protective additions made u/s 68 in the case on hand. Respectfully following the decision of the Hon’ble Apex Court in the case of Lovely Exports Pvt. Ltd., (2008 (1) TMI 575 - SUPREME COURT OF INDIA) which was followed by the jurisdictional High Court in the case of CIT Vs. Arunananda Textile Pvt. Ltd., (2010 (3) TMI 724 - KARNATAKA HIGH COURT), the addition made by the AO in respect of share application money on protective basis as unexplained cash credits u/s 68 of the Act and deleted by the ld CIT(A) in the impugned order cannot be treated as unexplained cash credits in the hands of the assessee. Consequently, the grounds (i) and (ii) raised by Revenue are dismissed.
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