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2020 (1) TMI 1360 - AT - Income TaxUnexplained cash credit u/s 68 - assessee challenges that proper opportunity was not provided by the A.O -assessee also filed additional evidence under Rule 46(1)(A) comprising bank statement, annual report of KMC Construction Ltd and confirmation from it - HELD THAT:- In the additional evidence noted by the ld. CIT(A), which was said to have been remanded to the A.O. for comments, there is only mention of bank statement, annual report of KMC and confirmation from it. However, in his order, the ld. CIT(A) has also referred and relied that the copy of share subscription agreement between KMC Constructions Ltd. B. Seenaiah & Coo., Kanwaldeep Investment Co. P. Ltd. and appellant company and promoters dated 14.2.2008 has been filed. From this, he opined that this sets out the plans of the Appellant company, the milestones for allotment of shares, the plan to go for an IPO at a later stage, and conversion schedule in various scenarios. This agreement was not remanded to the A.O. as evident from the order of ld. CIT(A). Hence, clearly the ld. CIT(A) has erred in admitting that said document in violation of Rule 46A. There is no reference to the detailed financials of the company in the order of the learned CIT appeals. It is not at all clear that the CIT appeal has examined the sources of fund of the assessee company properly. There is nothing on record to rule out that the amount of share premium granted to the company having a very poor financial record was not out of circuitous route of rotation of share capital with premium. It is also not the case that the CIT appeals had himself examined the issue that assessing officer is doubting the very identity of the company when there was no service of notice u/s.133(6) at the given address. There is no detail as to what was the authorized capital. Whether the assessee company was authorized to raise the said amount of share capital. In this view of the matter since the assessing officer has not been provided adequate opportunity to go through the additional evidences, the examination of the ld. CIT(A) is wholly inadequate. Accordingly, in the interest of justice, we remit the issue to the file of assessing officer. Assessing officer is directed to examine the veracity of the additional documents being submitted by the assessee before the learned CIT appeals. AO shall also keep our observations hereinabove in mind. The assessing officer shall also examine as to how the share premium account of the assessee in this regard has been dealt with .Appeal by the revenue stands allowed for statistical purposes.
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