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2022 (12) TMI 685 - AT - Income TaxAddition u/s 68 - unexplained investment - Addition on protective basis - assessee company invested in the shares / given loans and advances to companies of JP Minda group and in respect of amount so invested addition have been made in the hands of companies of JP Minda group u/s 68 of the Income Tax Act on substantive basis and the addition in the hands of appellant have been made on protective basis - HELD THAT:- For AY 2011-12 and 2012-13 we observe that the Ld. CIT(A) has recorded finding of fact and came to the conclusion that all the investments made by the assessee are genuine. DR could not controvert the above finding recorded by CIT(A) in both the years. We, therefore, decline to interfere with the order of the CIT(A) for both the years and reject the appeals of the Revenue for AY 2011-12 and 2012-13. AY 2013-14 perusal of the appellate order would reveal that it was contended by the assessee that the substantive addition is the amount credited to the bank account which have been realised by liquidation of investment/loans and advance. The amount so realised by liquidation of investment/loans and advance have been invested in the companies in respect of which addition have been made on protective basis. CIT(A) agreed with the above contention of the assessee and recorded the finding that the addition to the extent of Rs. 1,35,10,464/- cannot be made as it amounts to double taxation and the assessee deserved to be allowed the benefit of telescoping. Accordingly, the Ld. CIT(A) directed deletion of this addition. We agree with the approach of the Ld. CIT(A). Addition on account of equity on protective basis, the Ld. CIT(A) examined the issue in the light of the proviso to section 68 inserted by the Finance Act, 2012 w.e.f. 1.4.2013. He observed that the onus which lay upon the assessee has not been discharged as the assessee has neither produced the investors nor arranged to provide the requisite information and documents directly from it. He, therefore, sustained the addition of Rs. 1,44,00,000/- (made by the Ld. AO on protective basis) on substantive basis. CIT(A) looked into the matter from the angle of the provision of section 56(2)(viib) brought on the statute book by the Finance Act, 2012 w.e.f. 01.04.2013. He observed that the premium charged by the assessee has to be subjected to the provisions of section 56(2)(viib) read with Rule 11UA(1)(c)(b) and it is for the assessee to furnish reliable valuation determining such share premium from a qualified valuer. The same premium are to be brought to tax. The Ld. CIT(A) gave necessary direction to the Ld. AO in this regard. Nothing has been brought on record by the Revenue to enable us to take a different view.
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