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2019 (2) TMI 1910 - AT - Income TaxAddition u/s 68 - unexplained share application money where the identity, genuineness and creditworthiness of the lenders were not proved - HELD THAT:- Assessee has raised money by way of share capital and share application money from 12 parties during the financial year 2006-07 from Shri Pravin Kumar Jain group companies. A search conducted on the said group revealed that the said group was engaged in providing hawala accommodation entries without any business. This was also confirmed by the directors during the recording of their statements during search. So the AO treated the entire money raised as bogus share capital and share application money just on the basis of statements of the directors of these companies. Asessee’s name was nowhere mentioned by the said entities during search to be beneficiaries of such entries. During the course of assessment proceedings the assessee filed various evidences such as share application forms along with letters of acceptance, confirmation letters, copies of PAN numbers, copies of ITR acknowledgment, balance sheets, profit and loss accounts, master data of companies from MCA website, copies of bank accounts to evidence the transactions through banking channels, copies of MA & AA and share certificates of all the companies. All these transactions were entered into through banking channels and these companies are active on the website of Ministry of Corporate Affairs. Despite the filing all these information with the AO, he did not conducted any verification or investigation to dig out the truth but acted on the information supplied by the investigation wing. CIT(A) considered the contentions of the assessee in detail and came to the conclusion that assessee has duly proved the genuineness, identity and creditworthiness of the parties by filing all the necessary evidences during assessment proceedings. Addition made under Section 68 is bad in law. These Companies are the assessee's Shareholders - Decided against revenue.
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