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2023 (7) TMI 1389 - AT - Income TaxAddition u/s 68 - Bogus share transactions - assessee has failed to prove identity, creditworthiness and genuineness of the transaction - summons u/s 131 were not complied by the directors of the assessee company - CIT(A) deleted the addition - HELD THAT:- Since the alleged sum has been added in the case of Honesty Dealers Pvt. Ltd. and the sum received by it was invested in the form of loans and advances and investments, during the year under consideration some of the funds have been received backed by Honesty Dealers Pvt. Ltd., and has been utilized for investing in the equity share capital of the assessee company. These details have gone uncontroverted at the end of the revenue authorities and it remains an admitted fact that the source of the source stands proved with the details filed before us and, therefore, making an addition again in the hands of the assessee would tantamount to double addition and, therefore, the addition in the year under consideration is not warranted and the CIT(A) has rightly deleted the same. Assessee company is having a huge turnover and for financial year 2012-13, the same is amounting to Rs.145.38 Crores and net profit from continuing operations is Rs.1.45 Crores. In the return of income, total income has been declared at Rs.1.74 Crores. We find that the genuineness of the transactions is proved since the investment which has been made by the alleged share applicants is in a profit making company and, therefore, since the future prospect of investments are good, this decision of the share applicant company to invest in the equity of the assessee company is prudent one and, therefore, the genuineness of the transactions is established. Since the assessee has successfully proved the three necessary ingredients i.e., identity and creditworthiness of the share applicants and genuineness of the transactions as provided u/s 68 are of the view that no interference is called for in the order of the CIT(A) deleting the addition made by the AO u/s 68 of the Act and the same is upheld. Decided against revenue.
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