TMI Blog2019 (6) TMI 147X X X X Extracts X X X X X X X X Extracts X X X X ..... tatements of the investor companies. The factum of investment was confirmed by all the four entities. The three parties responded to notice u/s 133(6) and confirmed the transactions whereas new address was provided with respect to the fourth entity. However, no further inquiry has been made by AO so as to confirm the transactions. The Ld. DR has relied upon the judgement of Hon ble Apex Court rendered in PCIT Vs. NRA Iron Steel Pvt. Ltd. [ 2019 (3) TMI 323 - SUPREME COURT] which we have carefully studied. However, the factual matrix, before us, in the present case is quite different. In the present case, we find that the assessee has duly discharged the initial onus of proving the identity of the investors, creditworthiness of the transactions and genuineness of the transactions. Notices issued u/s 133(6) have been responded to. In such a scenario, the onus to dislodge the assessee s claim, in our opinion, was shifted back to Ld. AO and he was duty bound to investigate the case further. However, the facts on record nowhere establishes that such further inquiries / investigations have subsequently been conducted by AO in the present case. Additions could not be mad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reopened by issuance of notice u/s 148 on 13/02/2015 which was followed by statutory notices u/s 143(2) 142(1). The reason recorded for reopening the assessment were duly supplied in due course. 2.3 During reassessment proceedings, it transpired that the assessee received Share Application Money on 2.80 Lacs Shares of face value of ₹ 10/- each at a premium of ₹ 20/- per shares. Theses shares were issued to four entities. Accordingly, the gross amount received on this account aggregated to ₹ 84 Lacs. Accordingly, the assessee was directed to file requisite documentary evidences in support of identity of the investor, creditworthiness of the investors genuineness of the transactions and also justify the financial worth of the investors. 2.4 In response, the assessee furnished acknowledgement of return of income, audited financial statements bank statements of all the four entities. Notices were issued u/s 133(6) to confirm the transactions which were duly responded to by three entities whereas one notice was returned back unserved. The assessee was directed to produce the said parties for confirmation of the transactions. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ies 2. Resolution of the Board Authorizing the company to invest in share capital of the appellant company 3. Covering letter of investment in share capital 4. Confirmation of investment by each of the four companies 5. Financial Statements of the investing companies 6. The copies of ITR acknowledgements of the four companies 7. The copies of the bank statement of the four companies 8. The copy of the bank statement of the appellant company 9. The copy of Form No. 2 filed with ROC about allotment of shares and increase in capital After considering the same, Ld. CIT(A) reached a conclusion that there could be no doubt with regard to identity, genuineness and creditworthiness of the investors since the investors were regularly filing Income Tax Returns, the transactions were through banking channels and the assessee had filed requisite details with Registrar of companies as to allotment of Shares. 3.3 Regarding non-service of notice on one of the entities, it was noted that there was change of addr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hing on record suggest that any cash was exchanged / transacted between the assessee and the investor entities. The perusal of bank statements of all the four entities, as placed on record, reveal that there is no immediate cash deposit in the respective bank accounts which has later been transmitted to the assessee in the shape of Share Application Money. The investments were duly reflected in the financial statements of the investor companies. The factum of investment was confirmed by all the four entities. The three parties responded to notice u/s 133(6) and confirmed the transactions whereas new address was provided with respect to the fourth entity. However, no further inquiry has been made by Ld. AO so as to confirm the transactions. 5.2 The Ld. DR has relied upon the judgement of Hon ble Apex Court rendered in PCIT Vs. NRA Iron Steel Pvt. Ltd. [412 ITR 161] which we have carefully studied. Upon perusal, we note certain distinguishing features vis- -vis factual matrix of the present case. Upon perusal of para 3.7 3.8 of the said judgement, it is noted that Ld. AO had issued summons to as many as 19 investor entities but nobody appeare ..... X X X X Extracts X X X X X X X X Extracts X X X X
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