TMI Blog2015 (4) TMI 1236X X X X Extracts X X X X X X X X Extracts X X X X ..... the order. However, this finding is only with reference to the provisions of the Act and should not come in the way of CBI investigating the various sources of funds and Revenue is free to take necessary action in case the funds are found to be un-explained. - Decided against revenue - I.T.A. No. 249/HYD/2014 - - - Dated:- 17-4-2015 - SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER For the Appellant : Smt. G. Aparna Rao, DR For the Respondent : Shri K.C. Devdas, AR ORDER PER B. RAMAKOTAIAH, A.M. : This is a Revenue's appeal filed against the order of the Commissioner of Income Tax(Appeals)-V, Hyderabad dated 31-10-2013. 2. Briefly stated, assessee-company is engaged in the bu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f share application money as its income and the same was brought to tax. AO did not mention under which section of the Income Tax Act, the share application money was considered as income. 3. Before the Ld.CIT(A), assessee claimed that the amount of ₹ 15 Crores was borrowed by Mr.L. Sridhar, Director of M/s. Lanco Group Ltd., as unsecured loan. This amount was received through RTGS from the lender and introduced in assessee-company as share application money from Shri L. Sridhar. This amount was finally paid by Shri L. Sridhar to M/s. Lanco Group Ltd., and hence in support of introduction of capital into the company, a confirmation from the lender was filed. It was further submitted that shares were also allotted to Shri L. Sridhar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... T(Appeals)- II, Hyderabad on the remand report of the A.C. and the assessment order. I am of the considered view that the addition is not called for the following reasons: i)The Assessing officer has not disbelieved the initial source of loan of ₹ 15 crores incurred by Sri L Sridhar through banking channel from Lanco Group Ltd. Appellant had filed necessary evidence in this regard. This is an undisputed fact on record as there is no adverse comment of the Assessing officer in the assessment order. ii) Assessing officer has not doubted the fact that said amount of ₹ 15 crores received from Lanco Group Ltd was invested in appellant company by Sri Sridhar towards share application money and shares were allotted to him. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g. On the other hand, he was satisfied with the origin of fund which was invested in the appellant company. AO cannot add any amount merely on the ground that the explained amount was subsequently invested in another company. v) It would be relevant to mention here that in the A.Y.2008-09 and A.Y.2010-11, similar transaction had been accepted in scrutiny assessment after necessary verification of books and bank account. vi) Even the CIT (Appeals)-II, Hyderabad, vide her letter dated 7-11-2012 addressed to the DCIT Circle 3(1), Hyderabad, commenting on his remand report dated 1- 11-2012 had held in Para.3 that as observed from the assessment order, the order was passed on surmises without any supporting clarifications before maki ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. Be that as it may, the source of fund in the hands of appellant company (Larsco Entertainment), which was invested in jubilee Media, having not been doubted, the addition of ₹ 15 crore is not called for in the hands of the appellant company. 8.3 For the fore-going reasons, I hold that the A.D. was not justified in making addition of ₹ 15 crores towards share application money, particularly when the source of investment was explained and not doubted by the A.D. and hence, delete the addition. 4. After considering the rival contentions and perusing the Paper Book placed on record by assessee, we are of the opinion that there is no merit in the Revenue's appeal. First of all, AO gives a finding that the money was ..... X X X X Extracts X X X X X X X X Extracts X X X X
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