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2021 (2) TMI 1077 - AT - Income TaxAddition u/s 68 or 56 - addition of bogus share premium/share capital - as per AO valuation of the share premium charged by the assessee and observed that the provisions of section 56(1)(viib) are not applicable on the alleged transaction - AO not satisfied with the genuineness of the transaction and creditworthiness of the subscribers - HELD THAT:- Flow of funds shows that major fund was already lying with the assessee company in the form of loans/advance from partnership firms where the assessee is partners which was refunded to the respective entities and were received back from the share applicants in the form of share application money by the assessee. So there remains no question of doubt about the genuineness of alleged transaction and creditworthiness of the two investor Pvt. Ltd. companies with regard to share capital and share premium received from them during the year. As regards 3rd investor namely Pritesh Jain HUF who has subscribed 93333 equity shares for which it paid ₹ 9,33,330/- towards the share capital and ₹ 60,66,645/- towards share premium as mentioned above, the copy of Income Tax PAN card, copy of income tax return and bank statement reflecting the transaction was furnished. Karta of HUF is relative of Mr. Rajendra Jian who is director in the assessee company. So genuineness of transaction is proved being carried at through banking channel and with a related party who knows the assessee company. As regards the creditworthiness and the source of funds used to make investment tail of fund has been provided in this case. Details of funds leave no scope to doubt the genuineness of creditworthiness of the investor Pritesh Jain, HUF. Assessee has proved the identity of the alleged shareholders and there creditworthiness and has also proved the genuineness of transactions of applying for equity share along with share premium paid thereon. Since both the lower authorities have not found any iota of evidence to disprove the facts filed by the assessee to discredit the documents produced before them as well as before us, no addition was called for u/s 68 of the Act for the alleged amount of equity share capital and share premium received - no reason to interfere in the finding of Ld. CIT(A) and the same stands confirm. Accordingly all the grounds raised by the revenue stands dismissed.
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