TMI Blog2020 (12) TMI 984X X X X Extracts X X X X X X X X Extracts X X X X ..... SIDHU, JUDICIAL MEMBER, This appeal by the Revenue is preferred against the order of the Ld. CIT(A) 2, New Delhi dated 22.06.2016 pertaining to A.Y 2012-13 on the following grounds:- The ACIT, Circle 5(1), New Delhi is hereby filing appeal in the above mentioned case before the ITAT, New Delhi on the following grounds of appeal. 1. Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in deleting the addition of ₹ 2,00,00,000/- as unexplained cash credit u/s. 68 of the I.T. Act, 1961 without appreciating the fact that the AO has judiciously perused all the facts and grounds as well as trustworthiness, creditworthiness and genuineness of the four companies from which the assesee company had received the money and later on which had been found that they were not having any financial worth of their own. 2. The appellant craves leave for reserving the right to amend, modify, alter, add or forego any grounds of appeal at any time before or during the hearing of this appeal. 2. The brief facts of the case are that assessee filed its return of income digitally on 21.9.2012 declaring an income of ₹ 1,32,57,610/- in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h documentary evidences filed by the assesee as mentioned by the AO as well as Ld. CIT(A) in the impugned order. For the sake of convenience, the relevant findings at para no. 3.2.1 to 3.2.3 of the Ld. CIT(A) reproduced as under:- 3.2.1 I have gone through the assessment order and the submissions of the appellant alongwith its paperbook filed at the time of hearing. In my opinion the judgment of the Hon'ble Delhi High Court in the case of CIT vs. Oasis Hospitalities Pvt. Ltd. [2011J 198 Taxman 247 (Delhi) dated 31ST January, 2011 has dealt with the issue of share application money at length and after examining the various judgments, has settled certain parameters to decide an issue like this. After analyzing the provisions of the Companies Act, Section 68 of the I T Act and the judgments delivered in the cases of CIT vs. Divine Leasing Finance Ltd. 299 ITR 268 (Del), CIT vs. Sophia Finance Ltd. (1994) 205 ITR 98 (Del) (FB), CIT vs. Dolphin Canpack Ltd. 283 ITR 190, CIT vs. Lovely Exports Pvt. Ltd. 216 CTR 195, it was held that the initial burden is upon the assessee to explain the nature and source of share application money received by it. The Court further observed tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icants did not have the means to make the investment, the investment made by them actually emanated from the coffers of the assessee to enable it to be treated as the undisclosed income of the assessee. After laying down the above principles, the Court dismissed the appeal filed by the Revenue where the applicants were companies despite the fact that the assessing officer had received information from the Investigation Wing whereby it was found that these investor companies were engaged in the business of providing accommodation entries. 3.2.2 Now applying the above judgment to the facts of this case, it is seen that the appellant has filed sufficient documents e.g. Permanent Account Numbers, bank statements, etc. to establish the identities of the four share applicants. The copies of the bank statements of the share subscribers wherein the transactions are reflected as well as the fact that they are assessed to income tax, alongwith copies of their final accounts wherein investments made by them in the appellant company are not only shown but constitute a small portion of their total investments, establish the creditworthiness of the parties concerned. The incomes of the four ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... equirements to justify its case. If the notices issued by the A.O. to the share subscribers were not complied with or came back unserved, this could not be held against the appellant, which had discharged the initial onus which lay upon it by proving the identity and capacity of the share applicants and the genuineness of the transactions. This principle has been laid down in the case of CIT. vs. Orissa Corporation Pvt. Ltd., [1986J 159 ITR 78 (SC), wherein it was held as follows:- In this case, the assessee had given the names and addresses of the alleged creditors. It was in the knowledge of the Revenue that the said creditors were income-tax assessees. Their index numbers were in the file of the Revenue. The Revenue, apart from issuing notices under section 131 at the instance of the assessee, did not pursue the matter further. The Revenue did not examine the source of income of the said alleged creditors to find out whether they were creditworthy or were such who could advance the alleged loans. There was no effort made to pursue the socalled alleged creditors. In those circumstances, the assessee could not do anything further. In the premises, if the Tribunal came t ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
