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2019 (8) TMI 834 - AT - Income TaxLegality of assessment passed u/s 144/143(3) - since the assessee has complied with the notices the order u/s 144/143(3) of the Act is not appropriate - the typographical error is curable u/s 292B - HELD THAT:- It is well settled principle of law that mention or application of a wrong provision of law to a given facts of case itself does not make an authority incompetent to deal with the factual situation unless there is no provision which can take care of the jurisdictional fact or the jurisdiction of the authority itself. Here in this case, the AO is vested with the power to assess the assessee’s income and mere mention of wrong provisions will not render the assessment order invalid. For this proposition of law we rely on the order of the Hon’ble Supreme Court in L. Hazari Mal Kuthiala vs ITO [1960 (9) TMI 7 - SUPREME COURT] . Therefore, we find force in ground no. 1 and 2 of the revised grounds of appeal of Revenue and we allow these grounds of appeal of the Revenue. Addition u/s 68 - alleged that subscribers of the share capital lacked financial credibility to make investment of this magnitude - no rely pursuant to notice u/s 133(6) - the directors of the share subscribers did not turn up before AO even after summon - HELD THAT:- In this case on hand, the assessee had discharged its onus to prove the identity, creditworthiness and genuineness of the share applicants, thereafter the onus shifted to AO to disprove the documents furnished by assessee cannot be brushed aside by the AO to draw adverse view cannot be countenanced. In the absence of any investigation, much less gathering of evidence by the Assessing Officer, we hold that an addition cannot be sustained merely based on inferences drawn by circumstance. Applying the propositions laid down in these case laws to the facts of this case, we are inclined to uphold the order of the Ld. Commissioner of Income Tax (Appeals) To sum up section 68 of the Act 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 undisclosed income. In the facts of the present case, both the nature & source of the share application received was fully explained by the assessee. The assessee had discharged its onus to prove the identity, creditworthiness and genuineness of the share applicants. The PAN details, bank account statements, audited financial statements and Income Tax acknowledgments were placed on AO's record. Accordingly all the three conditions as required u/s. 68 of the Act i.e. the identity, creditworthiness and genuineness of the transaction was placed before the AO and the onus shifted to AO to disprove the materials placed before him. Without doing so, the addition made by the AO is based on conjectures and surmises cannot be justified. No addition was warranted under section 68 - Decided in favour of assessee.
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