9911796707
TMI Blog2017 (2) TMI 1304X X X X Extracts X X X X X X X X Extracts X X X X ..... A) -1, Coimbatore, has grossly erred in holding that the appellant has made investments, as stated by the A.O. and sustaining the addition to the extent of Rs. 25,58,68,579/-, as investment in acquiring assets, without a corresponding liability, as undisclosed investment made by the appellant, in the facts and circumstances of the case and in law. (2) The learned CIT(A) ought to have held that the appellant did not make investments and the mere entries in the books of account did not amount to any investment actually made by the appellant, when no payment was, in fact, received, by the Investee Companies, in the facts and circumstances of the case and in law. (3) The learned CIT(A) ought to have held that in the absence of actual invest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,00,000/-, such investments never existed. Assessee has also submitted the details of existing non-current investments as under:- Non Current Investments Investments in Equity Sri Padmabalaji Steels P. Ltd. - Unit I : Rs. 1,14,00,000/- Sri Padmabalaji Steels P. Ltd. - Unit II : Rs. 7,13,00,000/- Sri Padmabalaji Steels P. Ltd. - Unit III : Rs. 2,99,50,000/- Sri Suryabalaji Steels P. Ltd. : Rs. 5,48,20,000/- SBSRM : Rs. 55,00,000/- Rs.17,29,70,000/- 3. Assessee also stated that the loans and advance of Rs. 24,17,62,914/- shown in its balance sheet were also not real amounts. The break-up of these were submitted as under:- Loans and advances to related parties Unsecured, Considered Good Sr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... companies. Thus, according to A.O., contention of the assessee that these were only book entries and there was no real investment, could not be accepted. Though the assessee stated that the recipients had no corresponding credits in their bank accounts, it was not accepted by the Assessing Officer. According to the A.O., the balance sheets of all these companies were audited and duly certified by the Chartered Accountant along with a report under Companies (Auditor's Report) Order, 2003. She held that the investments were correctly shown by the assessee but there being no matching loans, the source of such investments were unexplained. The unsecured loans from bank of Rs. 25,58,68,579/- shown by the assessee in its balance sheet was conside ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id companies were never presented by them for payments nor was it realised from the bank accounts of the assessee. When there was no actual investment, as per the Ld. A.R., the question of source of such investments was irrelevant. Contention of the Ld. A.R. was that lower authorities had simply gone by the balance sheets of the assessee and that of M/s Sri Padmabalaji Steels Pvt. Ltd. and M/s Suryabalaji Steels Pvt. Ltd. ignoring the real situation. Contention of the Ld. A.R. was that only real income could be taxed and not fictitious income. 7. Per contra, Ld. Departmental Representative supported the order of the lower authority. 8. We have perused the orders and heard the rival contentions. What we notice is that assessee is a private ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... denied giving any loans to the assessee. However, if the source of investment was not out of loan, the question of bank giving any confirmation does not arise. The addition was made, in our opinion, due to failure of the assessee to give proper source for investment made by the assessee in M/s Sri Padmabalaji Steels Pvt. Ltd. and M/s Suryabalaji Steels Pvt. Ltd. Assessee's claim that it was only book entry cannot be accepted since the amounts were correctly reflected in the balance sheet of the assessee as well as the balance sheets of M/s Sri Padmabalaji Steels Pvt. Ltd. and M/s Suryabalaji Steels Pvt. Ltd. We are of the opinion that the addition was rightly made by the A.O. and confirmed by the CIT(Appeals). We do not find any reason to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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