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2016 (6) TMI 804 - CALCUTTA HIGH COURT

2016 (6) TMI 804 - CALCUTTA HIGH COURT - TMI - Addition u/s 68 - ITAT held that old loans being converted into share application money and since there was no fresh infusion of credit, section 68 of the Income Tax Act, 1961 is not applicable - Held that:- It is not the case of the revenue that any sum was found credited in the books of the assessee maintained for the previous aware. We are, in this case, concerned with the financial year ending on March 31, 2003 which commenced on April 1, 2002. .....

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oney had already found its way into the till of the assessee since prior to April 1, 2002. Only the nature of deposit had changed during the previous year. The money which was owed by the assessee by way of loan now became the capital of the assessee. We find that the views taken by the learned Tribunal are in conformity with section 68. Ms. Quereshi has also not been able to disclose any reason why any other view should be taken by us. - Decided against revenue - ITA 519/2008 - Dated:- 16-6-201 .....

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y the revenue. The assessee also filed a cross objection which was numbered as C.O. No.6/Kol/2007, connected with ITA No.126/Kol/2006. The aggrieved revenue has come up in appeal. At the time of admission of the appeal, the following questions were formulated: (a) Whether on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal was justified in holding that out of ₹ 95,00,000/-, ₹ 76,98,000/- constituted of old loans being converted into share application .....

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onsider that since the loan creditor has not given his consent to convert the unsecured loan to share application money treating the amount as cash credit under section 68 was justified? In so far as questions nos.(a) and (b) are concerned, the views expressed by the learned Tribunal are as follows: So far as the first limb of argument by the Ld. Senior Counsel that conversion of unsecured loan into the share application money does not come under the purview of Section 68, we find substantial fo .....

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nd, therefore, cannot be a subject matter of section 68. We, therefore, are of the opinion that the Ld. CIT(A) was justified in holding that the above amount to the extent of ₹ 76,98,000/- could not come under the purview of Section 68 and, therefore, uphold his order to this extent. Ms. Quereshi, learned Advocate appearing for the revenue, was unable to point out any fault with the aforesaid finding recorded by the learned Tribunal. Section 68 of the I.T. Act, in so far as the same is mat .....

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sessee maintained for the previous aware. We are, in this case, concerned with the financial year ending on March 31, 2003 which commenced on April 1, 2002. It is not the case of the revenue that during the period between April 1, 2002 and March 31, 2003, any sum was credited in the books of accounts of the assessee. The case of the revenue is that on April 1, 2002, the assessee owed a sum of ₹ 76,98,000/- to four several creditors. The debt owed by the assessee to those creditors was conv .....

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