2013 (7) TMI 453 - MADHYA PRADESH HIGH COURT

Unexplained investment - NRI company made share subscription to the capital of respondent - A.O. directed addition of the amount of share subscription to assessee's income due to doubt ob crediworthiness of subscriber company - Tribunal deleted the addition - Held that:- It is not the case of any of the parties that subscriber is a bogus company or a non-existent company and the amount which was subscribed by the said Company by way of share subscription was in fact the money of the respondent assessee - assessee had established the identity of investor who had provided the share subscription and it was established that the transaction was genuine though as per contention of the respondent the creditworthiness of the creditor was also established.

If assessee Company having received subscriptions and furnished complete details of the shareholders, no addition could be made under section 68 in the absence of any positive material or evidence to indicate that the shareholders were benamidars or fictitious persons or that any part of the share capital represented company's own income from undisclosed sources - Following decisions of Commissioner of Income Tax vs. Lovely Exports (P) Ltd [2008 (1) TMI 575 - SUPREME COURT OF INDIA] and Commissioner of Income Tax vs. Divine Leasing & Finance Ltd. [2006 (11) TMI 121 - DELHI HIGH COURT] - Decided against Revenue.