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2020 (9) TMI 757 - AT - Income TaxDisallowance of share premium received on issue of share - undisclosed income of the assessee u/s 68 - HELD THAT:- AO has not been able to prove that the premium charged by the assessee is unjustified or bogus or sourced from undisclosed or unexplained funds/ source. It is also noted from the available records that most of the corporate subscribers were filing returns and they were being regularly assessed to tax. The AO has not brought any adverse findings against them. Assessee had submitted a valuation report for charging of premium before the AO during the assessment proceeding but the same had neither been mentioned nor controverted in the assessment order by the AO. If the AO had any doubts regarding the source of investment of the subscribers, he could have examined the bank accounts from where the investment was routed. AO is duty bound to investigate the creditworthiness of the creditors/ subscribers, verify the identity of the subscribers and ascertain whether the transaction is genuine or these are bogus entries of name lenders but it was not properly done. - Decided against revenue.
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