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2016 (3) TMI 206 - AT - Income TaxAddition u/s 68 on account of share application money received by the assessee - issue of notice u/s 133(6) came back un-served - Held that:- Notice u/s 133(6) is issued by the AO could not be served on the share applicants and Inspector’s report also shows that this companies do not exists at the given address, we are of the view that no fault can be found against the assessee for this. Instead of the assessee has persuaded these companies to file confirmation independently along with all the requisite details and those parties have responded submitting independent information before the AO. The AO instead of making any further enquiry with respect to those details has tried to analyze information contained in those submissions. According to us he should have proceeded to make inquiries with the assessing officers of those share applicant companies and should also have used extensive powers granted to him u/s 131 of the Act when there was an information available that these companies are dubious. Instead, Ld AO walked on the path shown by the assessee to issue notice u/s 133(6) of the Act. Ld AO found there is meager balance in the bank account of that company after issue of the cheques of share application to the assessee. It is not the case of the AO that money that has been deposited with the assessee company which is not properly explained. We failed to understand how the remaining meager bank balance in the bank account of share applicants can affect the transaction entered into by the share applicants with the assessee company. Further the late allotment of shares made by assessee to the share applicant may result in to some contravention of the Companies Act 1956 however that cannot be used for making an addition u/s 68 of the act as same is irrelevant. The ld DR could not controvert any of the findings given by the learned Commissioner of Income-tax (Appeals) and no infirmity was pointed out. In view of the above we confirm the order of the learned Commissioner of Income-tax (Appeals) for deleting the addition made u/s 68 of the Act - Decided in favour of assessee
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