TMI Blog2010 (5) TMI 869X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of share application money in the hands of the company. Our view finds support from the decision in Shri Barkha Synthetics Limited v. ACIT.[ 2005 (8) TMI 67 - RAJASTHAN HIGH COURT] The case like CIT v. GP International Limited [ 2009 (12) TMI 33 - PUNJAB AND HARYANA HIGH COURT] ,CIT v. Steller Investment Limited [ 1991 (4) TMI 100 - DELHI HIGH COURT] supports the case of the assessee. charging of interest u/s 234B - HELD THAT:- We have found that no specific section has been mentioned for charging of interest and merely it has been mentioned that charge interest if any, as per law. Since the issue of share application has been decided in favour of the assessee and the addition made u/s 68 has been deleted, therefore, charging of interest is consequential in nature, meaning thereby that it is not leviable/chargeable. In view of these facts and judicial pronouncements both these appeals of the assessee are allowed. Finally, the appeals of the assessee are allowed. - SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI V.K. GUPTA, ACCOUNTANT MEMBER Appellant by : Shri Prakash Jain Respondent by : Shri K.K. Singh O R D E R PER BENCH Both these ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was placed on the decision in CIT v. Lovely Exports; 216 CTR 195 (SC); CIT v. Divine Leasing Finance Limited; 299 ITR 268 (Del); CIT v. GP International Limited; 229 CTR (P H) 86; CIT v. Stellar Investment Limited; 192 ITR 287 (Del) and CIT v. Sophia Finance; 205 ITR 98 (Del). 3. We have considered the rival submissions of ld. representatives of both sides and perused the material available on record. Ground no. 1 is general in nature, therefore, requires no deliberation from our side. For ground no. 2 the brief facts are that the assessee company is engaged in the business of manufacturing and trading of PVC rigid pipes, originally filed its return of loss of ₹ 22,91,022/- on 30.11.2000. A search u/s 132 was carried out at the premises of the assessee company on 8.10.2003. Consequent to search, a notice u/s 153C read with section 153A was served upon the assessee on 3.6.2004 to which the assessee again filed the return of loss i.e. ₹ 22,91,022/- as originally filed. During assessment proceedings the assessee was asked about the details of increase in share capital of the assessee to which the assessee filed a list containing nine share holders from whom the share ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... act is that the assessee has proved the identity of the subscribers with the help of affidavits which were not found to be bogus or false. An affidavit is not a mere piece of paper rather it carries its authenticity as the contents of the same are duly sworn before the a Magistrate or a Notary Public/Oath Commissioner, as the case may be. During signing of these affidavits, the deponent appears before the person before whom they are sworn and their signatures are duly taken on the register maintained by such Notary Public. If the Assessing Officer was apprehensive on the authenticity of such affidavit, nothing prevented him to cross examine the deponents and to verify the contents of such affidavit but that was not done in the present appeals. Therefore, in view of a decision of the Hon ble Apex Court in the case of Mehta Parikh Company v. CIT (supra), these affidavits become unchallengeable. The ratio laid down by the Hon ble Delhi High Court in the case of CIT v. Shiv Prasad Agrawal (306 ITR 324) (relevant page 326) further fortifies our view. As far as the reliance of the revenue upon the decision from Hon ble jurisdictional High Court in the case of CIT v. Rathi Finlease Limi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pany. Our view finds support from the decision in Shri Barkha Synthetics Limited v. ACIT; 155 Taxman 289 (Raj). The case like CIT v. GP International Limited; 229 CTR (P H) 86, CIT v. Steller Investment Limited; 192 ITR 287 and Sophia Finance Limited; 205 ITR 98 (Del) supports the case of the assessee. 4. As far as charging of interest u/s 234B is concerned, it is argued to be consequential in nature. We have found that no specific section has been mentioned for charging of interest and merely it has been mentioned that charge interest if any, as per law. However, since the issue of share application has been decided in favour of the assessee and the addition made u/s 68 of the Act has been deleted, therefore, charging of interest is consequential in nature, meaning thereby that it is not leviable/chargeable. 5. In view of these facts and judicial pronouncements both these appeals of the assessee are allowed. Finally, the appeals of the assessee are allowed. Order pronounced in open Court on 10th May, 2010. SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI V.K. GUPTA, ACCOUNTANT MEMBER IT(SS)A No.259 and 260/Ind/08 STL Extrusion (P) Limited Versus Dy. Commis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (SC). Another argument preferred by the assessee is that the amount of share application cannot be regarded as undisclosed income u/s 68 for which reliance was placed on the decision in CIT v. Lovely Exports; 216 CTR 195 (SC); CIT v. Divine Leasing Finance Limited; 299 ITR 268 (Del); CIT v. GP International Limited; 229 CTR (P H) 86; CIT v. Stellar Investment Limited; 192 ITR 287 (Del) and CIT v. Sophia Finance; 205 ITR 98 (Del). 3. We have considered the rival submissions of ld. representatives of both sides and perused the material available on record. Ground no. 1 is general in nature, therefore, requires no deliberation from our side. For ground no. 2 the brief facts are that the assessee company is engaged in the business of manufacturing and trading of PVC rigid pipes, originally filed its return of loss of ₹ 22,91,022/- on 30.11.2000. A search u/s 132 was carried out at the premises of the assessee company on 8.10.2003. Consequent to search, a notice u/s 153C read with section 153A was served upon the assessee on 3.6.2004 to which the assessee again filed the return of loss i.e. ₹ 22,91,022/- as originally filed. During assessment proceedings the assessee w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng that the share application money is bogus without appreciating the fact and even the contents of the affidavit have not been disapproved. The undisputed fact is that the assessee has proved the identity of the subscribers with the help of affidavits which were not found to be bogus or false. An affidavit is not a mere piece of paper rather it carries its authenticity as the contents of the same are duly sworn before the a Magistrate or a Notary Public/Oath Commissioner, as the case may be. During signing of these affidavits, the deponent appears before the person before whom they are sworn and their signatures are duly taken on the register maintained by such Notary Public. If the Assessing Officer was apprehensive on the authenticity of such affidavit, nothing prevented him to cross examine the deponents and to verify the contents of such affidavit but that was not done in the present appeals. Therefore, in view of a decision of the Hon ble Apex Court in the case of Mehta Parikh Company v. CIT (supra), these affidavits become unchallengeable. The ratio laid down by the Hon ble Delhi High Court in the case of CIT v. Shiv Prasad Agrawal (306 ITR 324) (relevant page 326) further ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the assessee company itself. Once the confirmation letters are filed, no addition can be made on account of share application money in the hands of the company. Our view finds support from the decision in Shri Barkha Synthetics Limited v. ACIT; 155 Taxman 289 (Raj). The case like CIT v. GP International Limited; 229 CTR (P H) 86, CIT v. Steller Investment Limited; 192 ITR 287 and Sophia Finance Limited; 205 ITR 98 (Del) supports the case of the assessee. 4. As far as charging of interest u/s 234B is concerned, it is argued to be consequential in nature. We have found that no specific section has been mentioned for charging of interest and merely it has been mentioned that charge interest if any, as per law. However, since the issue of share application has been decided in favour of the assessee and the addition made u/s 68 of the Act has been deleted, therefore, charging of interest is consequential in nature, meaning thereby that it is not leviable/chargeable. 5. In view of these facts and judicial pronouncements both these appeals of the assessee are allowed. Finally, the appeals of the assessee are allowed. Order pronounced in open Court on 10th May, 2010. - - ..... X X X X Extracts X X X X X X X X Extracts X X X X
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