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2016 (6) TMI 1390 - HC - Income TaxAddition u/s 68 - unexplained share capital - HELD THAT:- Supreme Court has in the case of Commissioner of Income – tax v. Lovely Exports (P) Ltd., [2008 (1) TMI 575 - SC ORDER] held that if the share application money is received by the assessee company from alleged bogus shareholders, whose names are given to the Assessing Officer, then the Department is free to proceed to reopen the individual assessments in accordance with law. Such amounts cannot be regarded as undisclosed income u/s 68 of the assessee company. Applying the said principles to the facts of the present case, the Assessing Officer having traced out the source of funds to specific persons who had invested the same in share of the assessee company, it was open for the Assessing Officer to proceed against the said persons. The funds not having emanated from the assessee company, there was no warrant for making addition of the said amount as undisclosed income under section 68 of the act in its hands. In the circumstances, the tribunal was justified in deleting the addition made under section 68 - Decided in favour of the assessee
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