TMI Blog2012 (11) TMI 755X X X X Extracts X X X X X X X X Extracts X X X X ..... RI A.N. PAHUJA, JJ. Appellant by : Shri Salil Mishra Sr. DR Respondent by : Shri Salil Agarwal Adv.,Shri Ravi Pratap Mall Adv. Shri Shailesh Gupta CA ORDER PER R.P. TOLANI, J.M : This is Revenue s appeal against CIT(A) s order dated 8-6-2010 relating to A.Y. 2003-04. Following grounds are raised: 1. On the facts and circumstances of the case and in law, the order of the CIT(A) is wrong, perverse, illegal and against the provisions of law which is liable to be set aside. 2. On the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in deleting the addition of Rs. 1,20,00,000/- made by the AO on account of income from undisclosed sources u/s 68 of the IT Act 1961. 3. On the facts and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hed beyond doubt. On the issue of genuineness, AO though admitted that the money routed through bank accounts but the long trail of transfer of money from one account to another and deposit of cash immediately in original bank account, indicated that the money originated from one Mohan Enterprises Ltd., which was controlled by one Shri Sanjay Mohan Agarwal. According to AO, due to these factors the genuineness of the transaction was also questionable. 2.2. On the issue of creditworthiness also, it was held that statements of audited accounts of the share applicants, filed by assessee, were only instrument of window dressing and not credible. The above share application money was added accordingly as unexplained cash credits u/s 68. 2.3. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed above the addition on account of share capital cannot be sustained. The AO has no where proved that documents in support of the identity of the parties have not been placed on record or they were forged documents. The AO also has not brought any evidence on record regarding the facts that the share applicants were not creditworthy or genuine, despite the fact that their PAN and copies of I.T. return were submitted by the appellant. After considering the facts on record judicial pronouncements of the jurisdictional High Court and Hon ble Supreme Court it can be concluded that the appellant has undoubtedly proved the identity of the share applicant. Once the identity of these share applicants is proved, no addition can be made in the hands ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nts of the share applicants, who in turn received the money from other companies. The money trail itself demonstrates that the share applicants received the money by way of banking channel from other companies; they deposited the money in their bank accounts, it was beyond the prowess of the assessee to discover the source of applicants source. Therefore, adverse inference drawn by the AO on these facts is uncalled for. The assessee s burden to prove the creditworthiness is duly discharged. (iii) Genuineness of the transaction: Assessee has filed copies of the bank accounts of the share applicants. The share applications, allotments and confirmations have been filed. All these evidences clearly demonstrate the genuineness of the transact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pen their individual assessments in accordance with law. Hence, we find no infirmity with the impugned judgment. Consequently, the doctrine of merger would apply and the judgment of the Supreme Court in Lovely Exports P Ltd. (2009) 319 ITR (St.) 5 would cover the field with regard to interpretation of section 68 of the Act, 1961. In any matter, the onus of proof is not a static one. Though in section 68 proceedings, the initial burden of proof lies on the assessee yet once he proves the identity of the creditors/ share applicants by either furnishing their PAN number or income-tax assessment number and shows the genuineness of transaction by showing money in his books either by account payee cheque or by draft or by any other mode, the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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