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2016 (10) TMI 974 - HC - Income TaxAddition u/s 68 - assessee could not prove the identity and creditworthiness of the alleged share subscribers and the genuineness of the share subscriptions - ITAT delted the addition - Held that:- In the case before us, there were 40 shareholders. 38 of them could not be found. Two of them stated that they had no connection with the company. They never applied for any share. They were drivers by profession. They did not give any money. Can the transaction resulting in contribution of a sum of ₹ 1,06,90,000/-, allegedly contributed by 40 applicants be said to have been proved genuine just because K.P.Kedia is said to have provided the funds ? The answer is no. That would on the contrary lead to a negative answer to all the three questions indicated above. As a result, addition under section 68 of the I.T.Act shall be perfectly justified. If K.P.Kedia has, in fact, provided any fund which is not accounted for in his Books of Accounts then it would attract addition to his income under section 69 of the I.T.Act. The addition to the income of Sri K.P.Kedia does not, in the least, diminish the liability of the assessee company under section 68. These are two different causes of action leading to addition against the income of two different persons. There is as such no question of any double taxation. We are sorry to say that the learned Tribunal has mixed up the matters. The addition in this case under Section 68 has nothing to do with any investment claimed or admitted to have been made by K. P. Kedia outside his books of accounts. In case that is found to have been done, that would attract addition under Section 69 against Shri K. P. Kedia. The addition in the case of the assessee is on account of the sum found credited in its books of accounts maintained for the previous year in respect whereof the assessee failed to offer any explanation and the Assessing Officer for justified reasons added the amount of ₹ 1,06,90,000/- to the income of the assessee. We may add that the right to offer explanation under Section 68 is that of the assessee. No third party has any right to offer such explanation. - Decided against assessee
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