TMI Blog2012 (10) TMI 487X X X X Extracts X X X X X X X X Extracts X X X X ..... nd the companies were duly registered with the ROC and that it had been submitted on behalf of the assessee that the companies were having PAN and were regularly filing their returns of income, but the AO had not tried to ascertain their latest addresses from the assessee, for conducting any further inquiry in their cases, thus In the absence of these inquiries and non-verification of the details at the time of assessment proceedings, the factual findings recorded by the Assessing Officer were incomplete and sparse - in favour of assessee. - ITA No.1177/Del/2012 - - - Dated:- 5-10-2012 - G. D. Agrawal And A. D. Jain , JJ. Assessee by : R. S. Singhvi, Advocate Revenue by : Satpal Singh, Sr. DR ORDER Per A. D. Jain, Judicial Member This is an appeal filed by the department for Assessment Year 2001-02 against the order dated 03.01.2012 passed by the CIT (A)-XV, New Delhi, contending that the Ld. CIT (A) has erred in deleting the addition made u/s 68 of the Income-tax Act on account of failure of the assessee to prove the genuineness/credit-worthiness of the share applicants. 2. The facts of the case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on record) has been passed on 11.04.2012 by the Hon ble Delhi High Court, wherein, on similar facts and circumstances, the issue has been decided in favour of the assessee; and that further, in Income-tax Officer vs. M/s Excellence Town Planner (P) Ltd. , the Delhi Bench of the Tribunal, vide order dated 25.05.2012 (copy is placed on record) in ITA No.871/Del/2010, for A.Y. 2003-04, co-authored by one of us the Hon ble V.P, has, in similar facts and circumstances, again decided the issue in favour of the assessee, while taking into consideration Nova Promoters (supra). Then, it has been contended that in CIT vs. Expo Club India Ltd. , vide order dated 20.07.2012 (copy is placed on record) in ITA No.1257/Del/2011, the Hon ble Delhi High Court has again decided the issue in favour of the assessee while considering Nova Promoters (supra). 6. The ld. counsel for the assessee has also sought to support the impugned order under Rule 27 of the Income-tax (Appellate Tribunal) Rules, 1963 as per which, the respondent in an appeal before the Tribunal, though he may not have appealed, may support the order appealed against on any of the grounds decided against him. The ld. couns ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alf. 8. We have heard the parties and have perused the material on record. The issue is as to whether the addition made u/s 68 of the IT Act by the Assessing Officer, on account of alleged failure of the assessee to prove the genuineness/credit worthiness of the share applicants, has rightly been deleted by the Ld. CIT (A). 9. First off, it is contended on behalf of the assessee, a perusal of the grounds of appeal taken by the department shows that the department does not dispute before us the factum of the assessee having duly proved the identity of the share applicants. On this lone score, Lovely Exports (supra) is attracted. As per Lovely Exports (supra), if the identity of the share applicants is proved, no addition can be made in the hands of the company, even if it is a case of bogus share capital, in the absence of any evidence adverse to the assessee. 10. On facts, before the Assessing Officer, the assessee duly furnished the following particulars with regard to the two share applicants:- a) Star Garments Pvt. Ltd. i. Copy of share application ii. Copy of cheque iii. Copy of Bank Statement iv. Copy of Board resolution v. Copy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... share capital money transaction. It was held that the Assessing Officer had not brought any material on record to prove that the money in question was the assessee s own undisclosed income; that the Assessing Officer had simply explained the modus operandi involved in accommodation entry transactions; that the Assessing Officer had merely relied on the information received from the Investigation Wing, without verifying the facts; that from the evidence on record, it was observed that the subscription of share capital was received by the assessee from the two investor companies through cheques and the companies were duly registered with the ROC; and that it had been submitted on behalf of the assessee that the companies were having PAN and were regularly filing their returns of income, but the Assessing Officer had not tried to ascertain their latest addresses from the assessee, for conducting any further inquiry in their cases. 13. The Ld. CIT (A) placed reliance on CIT vs. Lovely Exports Pvt. Ltd. (supra), applying it to the present case on the basis of the aforesaid evidence filed by the assessee before the Assessing Officer. Further, the Ld. CIT (A) placed reliance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... em. The Assessing Officer did not consequent thereto conduct any inquiry and closed the roceedings. This is a case where the Assessing Officer has failed to conduct necessary inquiry, verification and deal with the matter in depth specially after the affidavit/confirmation along with the bank statements etc. were filed. In case the Assessing Officer had conducted the said enquiries and investigation probably the challenge made by the Revenue would be justified. In the absence of these inquiries and non-verification of the details at the time of assessment proceedings, the factual findings recorded by the Assessing Officer were incomplete and sparse. The impugned order passed cannot be treated and regarded as perverse. The appeal is dismissed as no substantial question of law arises. 14.2. Further, in Expo Globe India Ltd. (supra), it was held as follows:- 6. Counsel for the Revenue submitted that ITAT s order gives indication to the fact that some shareholders were refunded the amounts initially given by them to the assessee and that this aspect itself prima facie pointed that an order under Section- 68 was warranted. Counsel also relied upon the decision in ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
