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2018 (9) TMI 414 - AT - Income TaxAddition made towards share capital u/s 68 - treating the entire share capital and share premium as bogus - the common director of 5 share subscribing companies was not produced for examination - Held that:- Section 68 provides that if any sum found credited in the year in respect of which the assessee fails to explain the nature and source shall be assessed as its income of the previous year in which the same was received. In the facts of the present case, both the nature & source of the share capital received with premium were fully explained by the assessee. The assessee had discharged its onus to prove the identity, creditworthiness and genuineness of the share applicants. PAN details, bank account statements, audited financial statements and Income Tax acknowledgments were placed before the AO. All the three conditions as required u/s. 68 i.e. the identity, creditworthiness and genuineness of the transaction were placed before the AO and the onus shifted to the ld AO to disprove the materials placed before him. Without doing so, the addition made by the ld AO is based on conjectures and surmises cannot be justified - no addition was warranted under Section 68 - Decided in favour of assessee Disallowance u/s 14A - Held that:- We hold that the provisions of section 14A of the Act could be applied only when there is a claim of exempt income by the assessee. Hence we find no infirmity in the order of the ld CITA in this regard. Accordingly, the Ground No. 2 raised by the revenue is dismissed.
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