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2022 (1) TMI 824 - AT - Income TaxAssessment u/s 153A - Addition u/s 68 - Bogus share application money - CIT(A) deleted the addition - HELD THAT:- All the investor companies are group companies who were allotted shares by the assessee company during the relevant period under consideration. It is also an admitted fact that the assessee has filed the details of source of source i.e., the source of funds received by the investors. It is also an admitted fact that the assessee filed copies of bank statements and ledger accounts of the group companies which made the funds available to the investor companies which, in turn, invested such funds in the assessee company in the shape of share application money and share premium. So far as the allegation of the AO that certain funds were received in the form of accommodation entries in a layered structure and that the assessee has received undisclosed funds in the share capital in the shell companies of the group which in turn remitted the same to the operating companies are concerned and that the assessee failed to substantiate the source of funds received by its investors and that the assessee did not produce the directors or other office bearers of the investor companies are concerned, we find the ld.CIT(A) has discussed all these issues thoroughly. We find, the assessee, in the instant case, has discharged the initial burden cast on it by filing the requisite details before the AO, summons u/s 131 were replied, there was compliance to the notice u/s 133(6), the investor companies have shown huge reserves and surplus and own capital. Merely because these companies have taxable income which is less than the amount invested during the year in our opinion cannot be a ground for making the addition especially when all the investor companies have got huge net worth in shape of own capital and free reserves and are group companies and all transactions are through proper banking channel. As further find from the various details furnished by the assessee in the paper book that Shri Narendra Kumar and Shri Deepak Kumar are Directors of M/s. Veneet Capital Services Pvt. Ltd., and Shri Kishore Kargeti and Shri Pawan Kumar Bagri are the Directors of M/s. Lakhotia Impex (P) Ltd. It is seen from the assessment order that no enquiries have been conducted by issue of notice u/s. 131 or u/s.133(6) of the I.T. Act, 1961 in respect of the above Directors - these are all group companies and no incriminating material was found as a result of search to support the allegation that money invested by the investors is unaccounted money of the assessee. In the instant case, it is an admitted fact that the investors are group companies and no incriminating material was found as a result of search to support the allegation that money invested by the investor is unaccounted money of the assessee. The Hon’ble Delhi High Court in the case of CIT vs. Nipuan Auto (P) Ltd.. [2013 (5) TMI 476 - DELHI HIGH COURT]has held that the addition is not tenable where investment has been made by group Companies. - Decided in favour of assessee.
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