TMI Blog2023 (3) TMI 464X X X X Extracts X X X X X X X X Extracts X X X X ..... rom one party which was a group company of the assessee company who was substantially interested in the business and development of the assessee company and further the assessee had duly proved the identity, creditworthiness and genuineness of the transactions. The ld. D/R has failed to controvert the factual findings of the ld. CIT(A). Appeal of the revenue stands dismissed. - I.T.A. No. 2437/Kol/2019 - - - Dated:- 6-2-2023 - SHRI SANJAY GARG , HON BLE JUDICIAL MEMBER And SHRI GIRISH AGRAWAL , HON BLE ACCOUNTANT MEMBER For the Assessee : Shri Miraj D. Shah , Advocate For the Revenue : Shri Vijay Kumar , Addl. CIT , Sr. D / R ORDER Per Shri Sanjay Garg , Judicial Member : The present appeal is directed at the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion and share premium amounting to Rs.3,53,32,000/- as unexplained income of the assessee and added back the same u/s 68 of the Act into the income of the assessee. 3.1. Aggrieved the assessee preferred an appeal before the ld. CIT(A). Before the ld. CIT(A), the ld. Counsel for the assessee submitted that, the Assessing Officer had failed to correctly appreciate the facts on the file, that all the required details and documents were furnished which included interalia name and address of the share subscribers, PAN of the shareholders, ITR acknowledgements, statement of accounts and bank statements. It was also submitted before the ld. CIT(A) that there was a complete non-application of mind by the Assessing Officer. That the Assessing Off ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... its letter dated 15.10.2014. It also filed copy of Form-2 which is return of share allotment filed with the Registrar of Companies. The AR drew my attention to reply dated 16.03.2015 filed by the appellant in course of assessment proceedings. The copy of said letter is placed at page 77 of the paper book filed by the appellant. I find that in this letter the appellant has categorically explained the fact that the share allotee company and the appellant are group companies. The appellant also filed photo copies of PAN Card, passport, voter card, audited accounts along with income tax acknowledgements, bank statement, and status of Directorship of the directors with Ministry of corporate affairs of common director Mr Shri Gopal Jhunjhunwala. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... find that the AO has not considered any of these documents filed by the said Tara Silk Real Estate (P) Ltd in course of assessment proceedings. There is no adverse findings by the AO in the assessment order on any of these evidences filed. In fact the AO's sole assertion in the entire assessment order is that there was no compliance by the appellant which I decline to agree with. I find that the observation of the AO that there was no compliance by the appellant is not correct. On the contrary I find that the appellant has completely discharged its onus u/s 68 of the Act. I also find that the appellant has given an explanation for charging the share premium which has not been rejected by the AO. Therefore in my considered opinion withou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nvestment in question made the impugned investment. I do not find any material on record to agree to the AO's plea fact that it is the appellant's group company having common Directors and shareholders who has that the share capital is unexplained. I do not find any cogent material indicating M/s. Tara Silk Pvt. Ltd. to have first deposited cash sums followed by its reinvestment in appellant's equity shares. It is observed that the total net worth of Tara Silk (P) Ltd is Rs. 4,51,08,651/- out of which it has invested in the shares of the appellant company. There is no reason to doubt about the creditworthiness of the said company belonging to the same group. The said share applicant possessed sufficient net worth out of wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... find without any significance since there is no instance therein dealing with a group entity having invested in concerned appellant's share. Thus the case laws are therefore held to be not relevant to the issue in hand. The A/R has placed reliance upon the decision of Pr.CIT-2 Vs. Gyscoal Alloys Ltd. in R/Tax Appeal No. 180 of 2018 by Gujarat High Court wherein the High Court has upheld the order of ITAT deleting the addition of share capital received from group companies. To conclude in light of all these facts and circumstances that the appellant has been able to prove all three components of identity, and creditworthiness and genuineness of the transaction from its group company M/s. Tara Silk (P) Ltd., the A.O. is not justified in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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