| The Tax Publishers2021 TaxPub(DT) 6032 (Ind-Trib) INCOME TAX ACT, 1961
Section 68
Assessee had filed affidavit of director, certification of incorporation of share applicants, full particulars of directors of share applicant companies, bank account of PAN of share applicants, tax returns audited final accounts i.e. balance sheet and profit & loss account of the share applicants. All these documents proved the identity and creditworthiness of the share applicants and genuineness of the transactions. Further, the assessee's case was on strong footing as by the Finance Act, 2012, the provision for source of source was inserted with effect from 1-4-2013 but, the instant case pertained to the assessment year 2012-13. Hence, insertion of that provision was also not applicable. Accordingly, addition made by AO was not sustainable.
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Income from undisclosed sources - Addition under section 68 - Receipt of share application money -
AO required assessee to explain share application money received by it. Assessee filed requisite details relating to the shareholders e.g. complete names and addresses, relevant documents. However, AO did not accept the same and held that assessee failed to offer satisfactory explanation in respect of the nature and source of share application money credited in the books of account and accordingly AO made addition of Rs. 2,41,25,000 to income of assessee on account of undisclosed income under section 68. Held: Assessee had filed affidavit of director, certification of incorporation of share applicants, full particulars of directors of share applicant companies, bank account of PAN of share applicants, tax returns audited final accounts, i.e., balance sheet and profit & loss account of the share applicants. All these documents proved the identity and creditworthiness of the share applicants and genuineness of the transactions. Further, the assessee's case was on strong footing as by the Finance Act, 2012, the provision for source of source was inserted with effect from 1-4-2013 but instant case pertained to the assessment year 2012-13. Hence, insertion of that provision was also not applicable. Accordingly, addition made by AO was not sustainable.
Relied:Asstt. CIT v. Supretech Diamond Tools (P) Ltd. (2012) 146 TTJ (Jd-Trib) 596 : 2012 TaxPub(DT) 2156 (Jod-Trib), CIT v. Gangeshwari Metal (P) Ltd. (2013) 84 CCH 037 (Del) HC : (2013) 361 ITR 0010 (Del) : 2013 TaxPub(DT) 1319 (Del-HC), CIT v. Winstral Petrochemicals (P) Ltd. (2011) 330 ITR 603 (Del-HC) : 2011 TaxPub(DT) 259 (Del-HC), CIT v. Dwarkadhish Investment (P) Ltd. (2011) 330 ITR 298 (Del) : 2011 TaxPub(DT) 374 (Del-HC), CIT & Anr. v. Arunananda Textiles (P) Ltd. (2011) 333 ITR 116 (Karn-HC) : 2011 TaxPub(DT) 177 (Karn-HC), CIT v. Steller Investment Ltd.- (1991) 99 CTR (Del-HC) 40 : (1991) 192 ITR 287 (Del-HC) : 1991 TaxPub(DT) 1347 (Del-HC) and CIT v. Orissa Corporation-(1986) 159 ITR 78 (SC) : 1986 TaxPub(DT) 1425 (SC)
REFERRED :
FAVOUR : In assessee's favour.
A.Y. : 2011-12 & 2012-13
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