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2021 (11) TMI 318 - AT - Income TaxAddition u/s 68 - unexplained share application money - undisclosed income - As per AO assessee failed to prove the identity of the alleged lenders, the credit worthiness of the lenders and the genuineness of the transactions - HELD THAT:- In the course of assessment proceedings, confirmation letters were filed, affidavit of directors are also filed. The full addresses of the companies were also given - bank accounts of the creditors were also furnished. In the said bank accounts, there are also no cash deposits by the creditors before issuing cheque to the assessee. No cogent material or any other incriminating material was found which showed that it is the assessee’s money which has gone to the aforesaid share applicants in cash and then it came back to the assessee in the form of share capital - there are no findings of the A.O. that the creditors’ bank accounts are the benami bank accounts of the assessee. There are also no evidences which show the various credits in the bank accounts of the creditors are the undisclosed income of the assessee deposited in those bank accounts and, therefore, the receipt of share application from the aforesaid share applicants could not be assessed as a deemed income of the assessee u/s.68 - We find that all transactions are from the regular banking channel verifiable from the bank account of the assessee as well as the bank accounts of the share applicants It is not a case that the assessee had filed merely a confirmatory letters of share applicants but it is a case that the assessee had filed affidavit of the director, certification of incorporation of the share applicants, full particulars of directors of the share applicant companies, bank account of the share applicants, PAN of share applicants, tax returns of the share applicants, audited final accounts i.e. balance sheet & profit & loss account of the share applicants. All these documents proved the identity of the share applicants, creditworthiness of the share applicants and genuineness of the transactions - We also find that the assessee’s case is on strong footing as by the Finance Act, 2012, the provision for source of source was inserted w.e.f. 1.4.2013 but the present matter pertains to the assessment year 2012-13. Hence, the insertion of that provision is also not applicable in the present matter. Thus assessee in these circumstances had duly discharged its burden lay upon it u/s.68. The case-laws referred by the Revenue Authorities are distinguishable on facts and they are not applicable on the facts of the assessee’s case. Therefore, the addition made u/s.68 in assessment year 2012-13 is bad in law and unjustified and, therefore, we delete the addition. Decided in favour of assessee.
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