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2016 (3) TMI 1073 - ITAT KOLKATA

2016 (3) TMI 1073 - ITAT KOLKATA - TMI - Unexplained share application money - Held that:- In the light of the factual position which is not disputed by the revenue, it cannot be said that the identity of the share applicants remained not proved by the assessee. Non production of directors of the investor company for examination by the AO it cannot be held that the identity of a limited company has not been established. For the reasons given above we uphold the order of CIT(A) and dismiss the ap .....

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e circumstances of the case, the Ld. CIT (A) is correct in holding that the share applicants companies were in existence in spite of the fact that Departmental enquiries could not able to trace out the alleged share applicants at the given addresses. 2) Whether, on the facts' and in the circumstances of the case, the Ld. CIT (A) is correct in holding that the onus of the assessee was held to stand discharged where the identity of the alleged share subscribers were not proved even after suffi .....

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s :- Sl.No. Name of the Investor Companies Address Amount Invested (Rs.) i. Shree Shyam Trexim Pvt. Ltd. 161/1, M.G.Road, 4th Floor, Room No.94, Kol-7. 31,00,000/- ii. Navalco Commodities Pvt. Ltd. 36, Shree Hariram Goenka Street, 4th Floor, Kolkata-7. 7,00,000/- iii. Jewellock Trexim Pvt. LKtd. 19A/B, Muktaram Babu Street, 3rd Floor, Kolkata-7. 16,00,000/- The AO called upon the assessee to prove the identity and capacity of the aforesaid three companies and also the genuineness of the transact .....

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ck Trexim Pvt. Ltd., was being assessed by the same ITO assessing the Assessee, viz., ITO-Ward-9(3), Kolkata. Copy of the order of assessment completed u/s 143(3) of the Act for A.Y.2005-06 in the case of M/s. Navalco Commodities Pvt. Ltd., and for A.Y.2004-05 in the case of Shree Shyam Trexim Pvt. Ltd and for A.Y.2005-06 for M/s. Jewellock Trexim Pvt. Ltd., were also furnished. The financial statements of the three parties were also furnished wherein the investment made in the form of share app .....

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the assessee. Thereafter AO called upon the assessee to produce the directors of the investee companies. The assessee submitted before the AO that it had requested the directors to appear before the AO and some time may be allowed for their appearance. Thereafter the directors did not appear before the AO. In the circumstances AO drew adverse inference and came to the conclusion that the assessee failed to satisfactorily explain the identity, capacity and genuineness of the transactions of the .....

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'I am of the opinion that the AO was not justified in making, the addition aggregating to ₹ 54,00,000/- u/s.68 of the Act being the amount of' share application money by holding that the appellant company has failed to prove the identity, and credit worthiness of. The creditors as well as the genuineness of transactions. It is observed that all the three share applicant companies i.e. M/s. Shree Shyam Trexim Pvt. Ltd., M/s Navalco Commodities Pvt. Ltd. and M/s. Jewellock Trexim Pv .....

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A.Y.2005-06 was completed by the ITO, Ward 9(3), Kolkata and the assessments in the case of M/s. Navalco Commodities Pvt. Ltd. and M/s. Shree Shyam Trexim Pvt. Ltd. for A.Y.2005-06 and A.Y.2004-05 respectively were completed by the ITO, Ward 9(4), Kolkata. Under the circumstances, I am of the opinion that the AO was not justified in holding that the share applicant companies were not in existence. The assessment orders were completed on the address as provided by the appellant company in the co .....

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hat the view taken as above is also supported by them. In view of above the AO is directed to delete the addition of ₹ 54,00,000/-. The ground nos.2 and 3 are allowed. 7. Aggrieved by the order of CIT(A) the revenue is in appeal before the Tribunal. 8. We have heard the submissions of the learned DR, who relied on the order of AO. The learned counsel for the assessee relied on the order of CIT(A) and further drew our attention to the decision of Hon ble Allahabad High Court in the case of .....

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