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2020 (8) TMI 593 - AT - Income TaxAddition u/s 68 - unexplained Share Capital/Share Application money - assessee failed to prove creditworthiness of the shareholders / share applicants and the genuineness of the transactions - HELD THAT:- In this case, on perusal of facts available on record, including the finding of the CIT(A), it is abundantly clear that there is no reference to any incriminating material found as a result of search to additions made towards share capital. In fact, the assessee has proved that share capital raised during block period was accounted in regular books of accounts and same has been scrutinized by the AO in the scrutiny assessment proceedings passed u/s 143(3) - Therefore there is no error in the findings recorded by the CIT(A), while deleting additions made towards share capital u/s 68 - even otherwise the assessee has filed various evidences to prove identity, genuineness of transactions and creditworthiness of the shareholders. Therefore, on this count also, the additions made by the Ld. AO cannot survive. Hence, we are of the considered view that the Ld.CIT(A) was right in deleting the additions made towards share capital and hence, we are inclined to uphold the finding of Ld.CIT(A) and reject ground taken by the revenue. Disallowances of bogus depreciation and bogus expenses - HELD THAT:- As regards, claim of depreciation, CIT(A) had recorded categorical finding that claim of depreciation was made on office equipments, furniture and fixtures etc., which were evidently put to use, but not on plant and machinery as claimed by the AO. Accordingly, he has directed the Ld. AO to verify the claim of the assessee, in light of various evidences and allow the depreciation, if the claim of the assessee is correct. Therefore when the issue has been set aside to the Ld. AO for verification of facts, there is no grievance for revenue to agitate such findings and hence, we are inclined to uphold the findings of the Ld.CIT(A) and reject arguments of the revenue. Disallowances of expenditure - CIT(A) has recorded categorical finding to the effect that major part of expenses for different assessment years were incurred through cheque and no adverse findings is borne from the records that the expenses were otherwise bogus, non genuine or inflated. Primary details having been furnished and no discrepancy was noticed or pointed out by the ld. AO. Noted that all expenses were recorded in regular books of accounts and were subject to verification from the Ld. AO during regular assessment proceedings. Assessee itself has disallowed major part of cash expenses as unaccounted. There would be no justification for making further addition, which evidently would lead to double taxation. Revenue has failed to controvert the findings recorded by the CIT(A) with any evidences. We, therefore are of the considered opinion that there is no error in the findings recorded by the CIT(A) to interfere by us at this stage. Hence, we are inclined to uphold the findings of Ld.CIT(A) and reject ground taken by the revenue.
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