TMI Blog2006 (1) TMI 74X X X X Extracts X X X X X X X X Extracts X X X X ..... o discharge the onus that lay upon the assessee. - In the absence of any perversity in the view taken by the Tribunal or anything to establish conclusively that the finding regarding the genuineness of the subscribers and the transaction suffers from any irrationality, we see no substantial question of law arising for our consideration - - - - - Dated:- 23-1-2006 - Judge(s) : T. S. THAKUR., B. N. CHATURVEDI. JUDGMENT The judgment of the court was delivered by T.S. Thakur J.-In its return for the assessment year 1998-99, the assessee claimed to have received share application money of Rs. 62 lakhs. Confirmations of the persons in whose favour the shares were issued were also filed apart from evidence to show that the share capital ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t all the payments were received by the assessee by cheques and that the assessee had, in the process, fully discharged the onus that lay upon it for proving the identity of the subscribers and the genuineness of the transactions. It has, on that basis, deleted the addition made by the authorities below. The present appeal assails the correctness of the above order passed by the Tribunal. Mr. Jolly, learned counsel for the Revenue, strenuously argued that the Tribunal was in error in placing reliance upon the Division Bench decision of this court in Stellar Investment's case [1991] 192 ITR 287. He submitted that the view taken in the said case no longer held the field having been varied by a Full Bench decision of this court in CIT v. Sophi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sioner. In a petition under section 256(2), seeking a reference to the Tribunal, this court observed: "It is evident that even if it be assumed that the subscribers to the increased share capital were not genuine, nevertheless, under no circumstances, can the amount of share capital be regarded as undisclosed income of the assessee. It may be that there are some bogus shareholders in whose names shares had been issued and the money may have been provided by some other persons. If the assessment of the persons who are alleged to have really advanced the money is sought to be reopened, that would have made some sense but we fail to understand as to how this amount of increased share capital can be assessed in the hands of the company itself ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me of non-existing persons." There is no dispute with the proposition stated in the above passage. An Income-tax Officer is indeed entitled to examine the truthfulness of the explanation. In cases where the credit entry relates to the issue of share capital, the Income-tax Officer is also entitled to examine whether the alleged shareholders do in fact exist or not. Such an inquiry was conducted by the Assessing Officer in the present case. In the course of the said inquiry, the assessee had disclosed to the Assessing Officer not only the names and the particulars of the subscribers of the shares but also their bank accounts and the permanent account numbers issued by the Income-tax Department. Superadded to all this was the fact that the ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
