TMI Blog2012 (12) TMI 170X X X X Extracts X X X X X X X X Extracts X X X X ..... whether the Tribunal fell into error in confirming the order of the Commissioner (Appeals) whereby the addition made under Section 68 of the Income Tax Act, 1961 on assessee s return in re-assessment proceedings, were deleted. 2. The facts of the case are that in the reassessment proceedings for assessment year 2002-03, the revenue sought to tax the income which had escaped assessment. This resulted in addition to the tune of Rs.55,01,125/-. This was on account of share application money which was received during the previous year in question. The proceedings under Section 148 have been initiated on 26th March, 2009. An investigation report received by the assessing officer which implicated on the basis of, inter alia, statement by one Mr. Mahesh Garg and other materials revealed that the assessee was involved in accommodation entry transactions. The assessing officer s order was carried in appeal to the CIT(A). The CIT(Appeals) allowed the same. The revenue unsuccessfully appealed against the decision before the ITAT. 3. It is argued on behalf of the revenue that the Tribunal and the CIT(Appeals) fell into error in citing a mere technicality i.e. the failure to cross-examine M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nancial year from Shri Vishnu Kumar Jain. Accordingly the total amount with respect to which the present appeal is to be decided is for Rs.45 Lacs and not Rs.55,01,125/-. On this issue it is seen from the submissions and paper book filed by the appellant that in order to substantiate the claim that the above mentioned 7 share applicant companies are existing and the transactions are genuine, the appellant had filed the following documents before the AO: - a. Copy of share application Form. b. Confirmation of share capital contribution from the above shareholders, giving copies of the cheques and Bank accounts through which the share application has been made. c. PAN details and assessing officers jurisdiction of the shareholders. d. IT returns copies of the share holders. e. Copy of resolution passed by Board of share applicant companies in respect of authorization to invest in shares in the appellant company. f. Copy of Bank Statements of the share applicant companies also of the appellant evidencing the share application money transfer through banking channels. g. Certificate of Incorporation of share holder companies. h. Memorandum and articles of association ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... court has observed that it is the revenue which has all the power and wherewithal to trace any person. Further in the case of CIT vs. Victor Electrodes Ltd. 329 ITR 271 it has been held that there is no legal obligation on the assessee to produce some Director or other representative of the Director or other representative of the applicant companies before the A.O. Therefore failure on part of the assessee to produce the Directors of the share applicant companies could not by itself have justified the additions made by the AO particularly when the 7 share applicant companies through their present Directors have now again filed fresh affidavits confirming the application and allotment of shares with respect to the total amount of Rs.45 Lacs. It is observed that no attempt was made by the AO to summon the Directors of the share applicant companies. Moreover, it is settled law that the assessee need not prove the source of source . Accordingly it was incumbent upon the department to have enforced attendance of Shri Mahesh Garg or the erstwhile Directors of the share applicant companies and confronted them with the evidences affidavits relied upon by the appellant and thereupon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly considered the rival submissions in the light of the material placed before us. It has already been mentioned that the shares are not issued at premium. The evidence relating to all the share applicants was filed before the Assessing Officer the details of such evidence have already been described in the above part of this order. Apart from that the assessee had also filed recent affidavits of all the share applicants. Those shares continue to be held by those share applicants till date. Keeping in view all these facts and the evidence filed by the assessee on record, we find no infirmity in the order of the CIT (A) vide which the aforementioned addition has been deleted. We decline to interfere. 6. This Court has considered the submissions of the parties. In this case the discussion by the CIT(Appeals) would reveal that the assessee has filed documents including certified copies issued by the Registrar of Companies in relation to the share application, affidavits of the Directors, Form 2 filed with the ROC by such applicants confirmations by the applicant for company s shares, certificates by auditors etc. Unfortunately, the assessing officer chose to base himself merely on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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