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2019 (7) TMI 1576 - AT - Income TaxUnexplained cash credit u/s 68 - notices issued under section 133(6) to parties were received back unserved - onus to prove - HELD THAT:- We find from the returned envelopes as produced the reasons given by the postal authorities is incomplete address. Thus it is clear that due to wrong/incomplete address, the notices issued by the AO to some of the share applicants were received unserved. Once the reason of non delivery of the notices was known to the AO, then further steps could have been taken by the AO to conduct a proper enquiry. Instead of taking further steps, the AO asked the assessee to produce all the share applicants. The assessee submitted the letters from all six individual share applicants along with the affidavits wherein they have confirmed the investment in the shares of the assessee. Once the assessee has produced the letters and affidavits, then the primary onus on the assessee has been discharged. In respect of these companies, the AO has himself accepted that they have filed all the relevant details, ITRs, financial statements, bank statements and replies to the notices issued by the AO under section 133(6). Once all these documentary evidences were produced before the AO and the genuineness of these documents were not doubted by the AO, then the assessee has proved the identity of the share applicants which is otherwise cannot be disputed when these companies are tax assessees and their status is also available on the website of Ministry of Corporate Affairs/ROC. When these companies are assessed to tax, then merely because they have declared very less income in the return of income cannot be a reason for doubting their creditworthiness. The source of investment was already available with the AO from the financial statements as well as the bank accounts of these companies. We further note that in the case in hand, the AO has made the addition only on the basis of suspicion and not on the basis of any evidence or other material to show that these companies are either indulged in providing accommodation entries or having no source of investment. AO has not brought any material on record to show either these share applicant companies are providing accommodation entries or they are bogus paper companies. The AO has only expressed his doubt about the genuineness but this is only a suspicion without any basis. When the assessee has produced all the relevant documents which includes PAN, ITRs, financial statements, audit report, bank accounts, share applications etc. then in the absence of any contrary material to controvert or disprove the documentary evidence produced by the assessee, the addition made by the AO under section 68 is not justified. - Decided in favour of assessee.
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