TMI Blog2014 (2) TMI 1124X X X X Extracts X X X X X X X X Extracts X X X X ..... , necessary documentary material such as the share application forms, copies of bank accounts, income tax returns and balance sheet – Relying upon Commissioner of Income Tax Vs. Lovely Exports (P) Ltd. 2008 (1) TMI 575 - SUPREME COURT OF INDIA] - the assessee had discharged the onus of establishing the identity, credit worthiness and genuineness of the transactions which had formed the basis of the addition that was made under Section 68 - whether the documentary materials which had been produced by the assessee were sufficient to displace the onus is a matter to be decided upon the facts of each case - Both the CIT(A) and the Tribunal having held that the assessee had duly discharged the onus, thus, there is no substantial question of law ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g to the assessee through various channels in a colourable manner and the amount was liable to be added to the income of the assessee as an unexplained investment. A search had been carried out at the premises of the assessee on 26 March 2010. A survey under Section 133-A was carried out and the case of the department was that a Chartered Accountant by the name of Aseem Kumar Gupta was involved in providing accommodation entries to various beneficiaries under the guise of share application money. A summons was issued to the Chartered Accountant under Section 131(1A) and his statement was recorded on 22 April 2010. During the course of this exercise, the Chartered Accountant was confronted with the notings contained in a black diary which ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isting of ; (i) share application forms; (ii) copies of bank accounts of the share applicants; (iii) copies of the income tax returns of the share allottees; (iv) balance sheets; and (v) copies of share allotment certificates and of the Board's resolution of the share applicants. The identity of the applicants was held to be established by the production of copies of the PAN cards and registration certificate with the Registrar of Companies. The financial capacity was held to be proved by the filing of copies of the bank accounts from where the share application money was transferred through banking channels to the assessee. Finally, it was held that the genuineness of the transaction had been established by filing of the documents and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pplicant companies, credit worthiness as well as genuineness. Now, in so far as the statement of Aseem Kumar Gupta is concerned, the Tribunal in the course of the discussion observed that in his initial statement, he had not named the assessee. A further statement of Aseem Kumar Gupta was obtained by the Assessing Officer in pursuance of the remand directions of the CIT(A) at the appellate stage. Hence, this statement was not before the Assessing Officer at the initial stage in spite of which an addition had been made by the Assessing Officer. When the summons were issued to Aseem Kumar Gupta, he had, in reply, denied any transaction between the assessee and the share applicant companies. Having regard to the contradictory statements of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... share holders, whose names were furnished to the Assessing Officer, the department was free to reopen their assessment proceedings in accordance with law. This decision has been considered in a subsequent judgment of the Delhi High Court in Commissioner of Income Tax Vs. Nova Promoters and Finlease (P) Ltd.2. Applying the dictum in Lovely Exports (supra), the Division Bench of the Delhi High Court observed as follows:- So understood, it will be seen that where the complete particulars of the share applicants such as their names and addresses, income tax file numbers, their creditworthiness, share application forms and share holders' register, share transfer register etc. are furnished to the Assessing Officer and the Assessing Offic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... laced upon him under section 68 to prove and establish the identity and creditworthiness of the share applicant and the genuineness of the transaction. In such a case, the Assessing Officer cannot sit back with folded hands till the assessee exhausts all the evidence or material in his possession and then come forward to merely reject the same, without carrying out any verification or enquiry into the material placed before him. The case before us does not fall under this category and it would be a travesty of truth and justice to express a view to the contrary. In the present case the assessee had discharged the onus of establishing the identity, credit worthiness and genuineness of the transactions which had formed the basis of the ad ..... X X X X Extracts X X X X X X X X Extracts X X X X
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