VamHiFashion Garments Pvt. Ltd. v. Asstt. CIT

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The Tax Publishers2016 TaxPub(DT) 1579 (Del-Trib) Vam-Hi-Fashion Garments Pvt. Ltd. v. Asstt. CIT INCOME TAX ACT, 1961 --Income from undisclosed sources--Addition under section 68Assessee discharged primary onus to prove that credit entry was not accommodation entry----Where, for discharging primary onus to prove genuineness of credit entry under section 68, assessee had provided confirmation letter of investor, copy of PAN card, assessment order of investor under section 143(3) of year under consideration, copy of bank statement showing investment made and source thereof, and other required details, it could be said that assessee had fully proved its burden and discharged onus. Further, where department had not shown any contrary evidence, addition made under section 68 was deleted.--Assessee was engaged in the business of manufacturing and exporting of ready made garments. During the year under consideration, one person 'S' had made payment against share capital of assessee. Assessee provided details to AO that 'S' was an NRI and was assessed to income-tax in India. It provided all other details of 'S' including PAN card copy, copy of assessment order under section 143(3), copy of bank statement showing investment made and source thereof, confirmation letter of 'S', etc. AO alleging that assessee had not discharged its primary onus to prove that credit entry was not accommodation entry, made addition under section 68. *Held:* The assessee had fully proved its burden and discharged the onus cast upon it however, no contrary evidence had been shown by the AO which would prove that the tranactions were not genuine and, therefore, addition made was totally unwarranted and was cancelled. Income Tax Act, 1961, Section 68 *Followed:CIT v. Rhombus International Pvt. Ltd. ITA No. 223/13 : ITA NO.494/Del/2016, CIT v. Gangeshwari Metal (P) Ltd. (2014) 361 ITR 10 (Del-HC), CIT v. Kamdhenu Steel & Alloys Ltd. SLP (CC) No. 15640 of 2012, dt.17-9-2012 and CIT v. Harishbhai Raojibhai Patel HUF (2013) 219 Taxman 125 (Mag.) (Guj.). Distinguished:*CIT v. Empire Builtech (P) Ltd. 366 ITR 110 (Del). SUBSCRIBE FOR FULL CONTENT

The Tax Publishers2016 TaxPub(DT) 1579 (Del-Trib)

Vam-Hi-Fashion Garments Pvt. Ltd. v. Asstt. CIT

INCOME TAX ACT, 1961

--Income from undisclosed sources--Addition under section 68Assessee discharged primary onus to prove that credit entry was not accommodation entry----Where, for discharging primary onus to prove genuineness of credit entry under section 68, assessee had provided confirmation letter of investor, copy of PAN card, assessment order of investor under section 143(3) of year under consideration, copy of bank statement showing investment made and source thereof, and other required details, it could be said that assessee had fully proved its burden and discharged onus. Further, where department had not shown any contrary evidence, addition made under section 68 was deleted.--Assessee was engaged in the business of manufacturing and exporting of ready made garments. During the year under consideration, one person 'S' had made payment against share capital of assessee. Assessee provided details to AO that 'S' was an NRI and was assessed to income-tax in India. It provided all other details of 'S' including PAN card copy, copy of assessment order under section 143(3), copy of bank statement showing investment made and source thereof, confirmation letter of 'S', etc. AO alleging that assessee had not discharged its primary onus to prove that credit entry was not accommodation entry, made addition under section 68. Held: The assessee had fully proved its burden and discharged the onus cast upon it however, no contrary evidence had been shown by the AO which would prove that the tranactions were not genuine and, therefore, addition made was totally unwarranted and was cancelled.

Income Tax Act, 1961, Section 68

Followed:CIT v. Rhombus International Pvt. Ltd. ITA No. 223/13 : ITA NO.494/Del/2016, CIT v. Gangeshwari Metal (P) Ltd. (2014) 361 ITR 10 (Del-HC), CIT v. Kamdhenu Steel & Alloys Ltd. SLP (CC) No. 15640 of 2012, dt.17-9-2012 and CIT v. Harishbhai Raojibhai Patel HUF (2013) 219 Taxman 125 (Mag.) (Guj.). Distinguished:CIT v. Empire Builtech (P) Ltd. 366 ITR 110 (Del).