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2018 (9) TMI 1753 - AT - Income TaxUnexplained cash credit u/s 68 - explanation of source of the capital contribution, identity of the creditor and also credit worthiness - Held that:- The assessee had received the share application money, complied with the requirements of the AO in the assessment proceedings and allotted the shares to the respective shareholders. The assessee also furnished the confirmation letters containing the details of land holdings. All the share applicants are agriculturists having no taxable income, therefore, there is no case for submission of PAN details, and hence we hold that the assessee has explained the source of the capital contribution, established the identity of the creditor and also credit worthiness, hence there is no case for making addition u/s 68 in the hands of the company. As rightly argued by the Ld.AR, the share capital required to be made addition in the hands o fthe assessee company by virtue of proviso introduced in Finance Act, 2012 to section 68 from 2013-14 onwards, but not prior to the amendment. If the revenue is of the opinion that the share application money received by the company is bogus, the revenue is free to take appropriate action in the hands of the shareholders. But having explained the source and established the identity, the revenue is not permitted to make addition in the hands of the company. - Decided in favour of assessee
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