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Income Tax Officer, Ward 1 (1) , Bathinda Versus Amravati Infrastructure Developers Pvt. Ltd.

2016 (2) TMI 1129 - ITAT AMRITSAR

Addition u/s 68 - Held that:- From the e facts and figures not only the source of investments but the source of source has also been established. All the three ingredients required for fulfillment of provisions of section 68 of the Act are met and therefore, the ld. CIT(A) has rightly deleted the addition made by the AO u/s 68 of the Act. - Decided in favour of assessee. - Addition u/s 68 of the Act on account of loan from M/s. Golden Laminates Ltd - Held that:- The assessee had received a t .....

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lden Laminates Ltd., whereas the ld. CIT(A) has made a finding of fact that the source of this ₹ 1.20 crore was from HDFC Bank and the ld. CIT(A) had also forwarded a copy of Bank Account of HDFC to AO for his comments. The AO in the remand report has not objected to the documents and has requested the ld. CIT(A) to consider the case while disposing of the appeal. The ld. CIT(A) has further made a finding of fact that in the statement of HDFC, all the entries relating to advancing of loan .....

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d in the circumstances of the case, the ld. CIT(A) has erred in deleting the addition of : i) ₹ 1,65,00,000/- on account of failure of the assessee to prove identity and genuineness of the persons having introduced share capital and share premium. ii) ₹ 1,10,00,000/- on account of failure to account for the accrued income @ ₹ 10,00,000/- per month from May, 2008 to March, 2009 for eleven month from M/s. Satya Developers Limited as per agreement. iii) ₹ 1,20,00,000/- on ac .....

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rnishing of inaccurate particulars of income. The ld. CIT(A), Bathinda vide order dated 20.12.2012, deleted the entire additions. 3. These additions were as follows: i) ₹ 1,65,00,000/- on account of failure of the assessee to prove identity and genuineness of the persons having introduced share capital and share premium. ii) ₹ 1,10,00,000/- on account of failure to account for the accrued income at the rate of ₹ 10,00,000/- per month from May, 2008 to March, 2009 for eleven mon .....

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Pvt. Ltd., New Delhi. Vide letter dated 16.11.2011, the AO asked the assessee for the following information: 4. Paid up share capital as on 31.03.2009 stands at ₹ 17,65,000/-. Please furnish names, addresses, holding, date of purchase of share holders alongwith their PAN. 5. An amount of ₹ 1,53,35,000/- has been introduced as share premium during the year Please furnish the following particulars in this regard:- i) Name of the share-holder & PAN ii) Amount paid as premium per sh .....

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y them and source of amount alongwith copies of audit report of the concerned share-holders and also required to produce these persons for examination. The counsel for the assessee asked for adjournment for supply of the information. However, no adjournment was granted to the assessee, observing that the case was getting time barred. The AO proceeded to make the addition on account of share application money as income of the assessee company u/s 68 of the I.T. Act. For this addition, the AO plac .....

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the assessee for the reason that the case was getting time barred, was filed by the assessee before the ld. CIT(A). The ld. CIT(A) furnished the same to the AO asking for remand report. In the remand report furnished, the AO did not object to the information so filed by the assessee before the ld. CIT(A) at pages 1 to 57 of the paper book filed before the ld. CIT(A). Rather, the AO asked for the same to be considered at the time of disposal of the appeal. The ld. CIT(A) found the detail contain .....

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held by the Hon ble Supreme Court in the case of CIT vs. Lovely Exports (P) Ltd., 216 CTR 195 (SC), wherein, the Hon ble Supreme Court held that if the share application money was received from alleged bogus shareholders, whose names were given to the AO, then the department is free to proceed to reopen their individual assessments in accordance with law, but it cannot be regarded as undisclosed income of the assesseecompany. The ld. CIT(A) found the Hon ble jurisdictional Punjab & Haryana H .....

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d creditor, or the genuineness of the transaction in introducing the share capital and share premium. 9. On the other hand, the ld. counsel for the assessee, placing strong reliance on the impugned order, has contended that the additions were made by the AO only for want of documents which can prove that the transactions of increase of share capital were genuine; that the AO had himself accepted the evidence for the same in his remand report and had not given any adverse comment against the subm .....

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Dadu Auto P. Ltd. in ITA No.704 of 2009 (P&H). iii) CIT vs. GP International Ltd. 325 ITR 25 (P&H) iv) CIT vs. Gangeshwari Metal Pvt. Ltd., 361 ITR 10 (Del.) v) CIT vs. Winstral Petrochemicals P. Ltd., 330 ITR 603 (Del.) 10. Further, reliance has been placed on ACIT vs. Kisco Casting (P) Ltd., 147 ITD 269 (Chandigarh), CIT-II, Ludhiana vs. M/s. Shree Dadu Auto (P.) Ltd., rendered by the Hon ble Jurisdictional High Court of P & H on 30.03.2010 in ITA No. 704 of 2009, for the assessme .....

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CIT(A), the assessee had filed the copy of ITR, bank account, copy of audited account alongwith balance sheet and other relevant record as per paper book containing pages 1 to 22. This found by the ld. CIT(A) to be sufficient to hold that the assessee had discharged the initial burden as per Lovely Exports Pvt. Ltd. (supra) and GP International Ltd., (supra). In Lovely Exports Pvt. Ltd. (supra), the Hon ble Supreme Court has held where the share application money is received by the assessee comp .....

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d upon the above judgments. He has not commented on the merits of the case. However, we have examined the issue from the angle of merits also. We find that the three shareholders from whom share capital money alongwith share premium has been collected are all Private Limited Companies which have been incorporated under the Companies Act and all these Companies are having PAN numbers and have filed their income tax returns. Therefore, there cannot be any doubt about the identity of these Companie .....

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at paper book page 8 (in short PB-8 ) is ₹ 99,34,843/- out of which it had made investments to the tune of ₹ 75,45,930/- in various companies as is apparent from Schedule-VI of balance sheet placed at PB-9. The Schedule reflects the name of assessee company where the investment has been reflected to the tune of ₹ 70,00,000/-. 14. Similar is the position with other investing company, M/s. S.K.M. Securities (P) Ltd. The second investing company has net worth of ₹ 1,01,05,37 .....

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investment made in the assessee company is included in this total investment. 16. From the above facts and figures, the creditworthiness of the investing Companies is also proved. 17. As regards the genuineness of transactions, we find that the assessee company has received the share capital alongwith share premium amount through Banking channels and from the analysis of the Bank Accounts of the investing companies, we find that there were no cash deposits before investments in the assessee comp .....

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hich ₹ 50,00.000/- has been invested in the assessee-company on 12th July, 2008. The analysis of bank account statement reveals that the deposit in the bank account before investments in the assessee company were all through Banking transactions. Therefore, the genuineness of transaction cannot be doubted. 18. As regards the investment made by M/s. Dhir Management Consultants Pvt. Ltd., its bank statement is placed at PB-10. From the analysis of this bank account, we find that the assessee .....

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Securities on 5.6.2008 and out of this amount of ₹ 30,00,000/- for investment was made in the assessee company. 18.1. Therefore, the above facts and figures not only the source of investments but the source of source has also been established. 19. In view of the above facts and findings, we find that all the three ingredients required for fulfillment of provisions of section 68 of the Act are met and therefore, the ld. CIT(A) has rightly deleted the addition made by the AO u/s 68 of the Ac .....

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Satya Developers Pvt. Ltd. was an exhaustive agreement containing 33 clauses and one of the conditions as per clause-14 says that if the delay is because of the force-majeure conditions, no compensation is payable. He submitted that the PUDA had not given possession for development of the property even till 11.09.2006 and therefore, the delay in the execution of the project work was beyond the control of the developer. The ld. counsel for the assessee further submitted that from the balance shee .....

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the assessee. 22. We find that the ld. CIT(A) has made a finding of fact that as per clause-14, the developer had to complete the project within 24 months from the date of sanction of plan or handing over possession, whichever is later excepting force majeure circumstances or any action of the Statutory Authority or Court orders. The clause-14 reproduced by the ld. CIT(A) at page 10 of his order states that period of 24 months shall be subject to force majeure conditions and in view of the facts .....

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