Income Tax Appellate Tribunal - Delhi
Surya Manufacturing P.Ltd, New Delhi vs Dcit, Circle-24(2), New Delhi on 15 March, 2022
IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCH 'G', NEW DELHI
Before Sh. Saktijit Dey, Judicial Member
Dr. B. R. R. Kumar, Accountant Member
(Through Video Conferencing)
ITA No. 6014/Del/2017 : Asstt. Year : 2014-15
M/s Surya Manufacturing Pvt. Ltd. Vs DCIT,
2937/3, Chuna Mandi, 1st Floor, Circle-24(2),
Paharganj, New Delhi-110055 New Delhi
(APPELLANT) (RESPONDENT)
PAN No. AACCS2412B
Assessee by : None
Revenue by : Sh. Umesh Takyar, Sr. DR
Date of Hearing: 09.03.2022 Date of Pronouncement: 15.03.2022
ORDER
Per Dr. B. R. R. Kumar, Accountant Member:
The present appeal has been filed by the assessee against the order of the ld. CIT(A)-28, New Delhi dated 30.08.2017.
2. Following grounds have been raised by the assessee:
"1. That on facts and circumstances of the case, the order passed by the Ld. CIT (Appeal) is bad both in the eyes of law and on facts.
2. That on facts and circumstances of the case, the CIT (A) has erred in holding that assessee has not raised any ground vis-a-vis issuance of notice under section 143(2), without the fulfillment of basic conditions stipulated therein.2 ITA No. 6014/Del/2017
Surya Manufacturing Pvt. Ltd.
3. The CIT (A) has failed to appreciate that AR of the assessee has orally argued the validity of notice under section 143(2) read with 142(1) of the Act.
4. Without prejudice to the above, the CIT (A) has erred in confirming the addition of Rs.9,00,50,000/- made by AO u/s 68 of the Act, received by assessee against the allotment of shares.
5. On the facts and under the circumstances of the case the CIT(A) has erred in observing that the AO has directed the assessee to produce the directors of the companies who had subscribed for shares of the assessee Company.
6. The observation of the CIT(A) that the AO has directed the assessee Company to produce the directors of the subscribers companies is factually incorrect and also contradictory in as much as in first part of the impugned order the CIT(A) has not made any such observations.
7. The CIT(A) has erred in holding the companies who have subscribed for shares of the assessee Company were paper Company and not have any identity and does not have any creditworthiness.
8. On the facts and under the circumstances of the case the CIT(A), while holding the subscribers as paper companies, has erred in not appreciating tha t all the Companies were at the master roll of the ROC and possessing substantial reserve and surplus and were having substantial income during the under consideration and before that.
9. The Ld CIT(A) has further failed to appreciate that assessee has duly allotted shares to the subscriber even before the commencement of the assessment proceedings.
10. The CIT (A) has further failed to appreciate that assessee has successfully discharged his burden as envisaged under section 68 of the Act read with newly inserted proviso.3 ITA No. 6014/Del/2017
Surya Manufacturing Pvt. Ltd.
11. On the facts and under the circumstances of the case both the AO as well as CIT(A) has failed to refute any of the documentary evidence filed by the assessee to prove the identify creditworthiness and genuineness of the transactions.
12. On the facts and under the circumstances of the case both the authorities have passed the orders in a whimsical manner without refuting the documentary evidence produced by the assessee in support of his claim."
3. The appeal has been filed in the Tribunal on 25.09.2017 and listed for the first time on 23.12.2017. The case has been posted on various dates till 06.11.2019.
4. On the date of hearings conducted on 09.01.2020, 13.02.2020, 20.01.2021, 30.03.2021, 08.06.2021, 25.08.2021, 15.12.2021. None appeared on behalf of the assessee nor any adjournment letter has been filed. On 09.03.2022 also, nobody represented the assessee hence a reasonable conclusion could be drawn that the assessee is not inclined to pursue the matter which could lead to the dismissal of the appeal. However, in the interest of justice, the matter is being adjudicated on merits of the case.
5. The return of income was filed on 28.11.2014 disclosing income at Rs. 1,37,62,044/-. During the assessment proceedings, it was observed by AO that the assessee company has received share capital and premium of Rs. 9,00,50,000/- from three entities namely,
1. V M Tie Up Pvt. Ltd. 9/12, Lal Bazar Street, 3rd Floor, Block-B, Room No. 16, Kolkata 4 ITA No. 6014/Del/2017 Surya Manufacturing Pvt. Ltd.
2. Pearl Developers P. Ltd., 7, Lyons Range, Room No. 5B, 2 n d Floor, Kolkata
3. Jainex Securities P. Ltd., 66, Ezra Street, 3rd Floor Kolkata
6. In order to examine the genuineness of share capital / share premium, AO asked the assessee to file confirmation of the creditors, supported by their bank statements, ITRs, Audit Accounts etc. Simultaneously, commission u/s 131(1)(d) of IT Act was also issued to DDIT (Inv), Kolkata to verify the genuineness of share capital / share premium. After getting reply from the assessee and perusal of details, financial statements, bank statements etc, it was observed by AO that the share applicant companies are not doing any real business and ITRs have been filed for income either at Nil or with some small values. The scan copies of ITRs and its annexures have been reproduced by AO in the assessment order in support of his contention. The AO has also reproduced the enquiry report of DDIT, (Inv), Unit-l(i), Kolkata at page no. 14 of assessment order wherein the DDIT (Inv) has reported that the summons were issued u/s 131 to the Principal Officers of the creditors companies, but in the cases of M/s V.M. Tie Up (P) Ltd. and M/s. Pearl Developers (P) Ltd, no documents were filed and in the case of M/s Jainex Security (P) Ltd., summons u/s 131 was returned by post. It is further mentioned by DDIT(Inv.) in his report that the departmental Inspector was deputed to enquire about the said creditor companies in order to verify identity/existence and creditworthiness and genuineness of the investments made by them in assessee company, but the Inspector reported that offices of all the said creditor companies were found to be non-existent. In view of the reply of the 5 ITA No. 6014/Del/2017 Surya Manufacturing Pvt. Ltd.
assessee and report of DDIT (Inv.), AO issued show cause letter to assessee giving him final opportunity to treat the share capital / premium as unexplained cash credit within the meaning of section 68 of the Act. The reply given by assessee was not satisfactory in the eyes of AO and he observed about the creditor companies as under:-
"3.8 The Reply of the assessee and the report of DDIT (Inv) has been carefully considered and following conclusions has been drawn:-
3.8.1 The assessee has failed to either reply or replied unsatisfactorily which itself proves that the assessee is not able to substantiate the genuineness of the share capital/share premium transaction due to following observations:
a. All the companies, which have provided share capital / share premium to the assessee companies are non- existent. It means these companies are only shell companies which has been incorporated just to accommodate the finance to the assessee company and share capital/premium in only a colorable device just to accommodate the finance to the assessee company. b. Doubt on genuineness of the transaction in the absence of existence of share applicant companies.
c. There is no credit worthiness of any of the share applicant companies to advance such huge share capital/ share premium.6 ITA No. 6014/Del/2017
Surya Manufacturing Pvt. Ltd.
3.9 Despite non existence of these share applicant companies, a close look at the balance sheet and the ITR reveals generally typical features of these companies.
1. Funds Source:- the funds of the companies are generated only through huge share premium.
2. Reserves:- Other than paid up share capital there is no reserve in the form of accumulated profits.
3. Application of funds:- Short Term Advances/ Investment:- The funds are invested in Pvt. Ltd.
companies as Short Term Loans and advances or non current investment which if scrutinized are not big names in any industry. They hardly have any profits and hardly ever pay any return to such advance provider.
4. Fixed Assets:- There is no investment in fixed assets.
5. Liability:- The liability are shown in small numbers against the expenses claimed and the creditors are mostly, not verifiable for such expenses. However, if subject to scrutiny then the documentary evidences are produced because such payment is in cash as the amounts payable are small.
6. Revenue:- Revenue is mostly Nil or nature of operation not disclosed.
7. Expenses:- The kind of expenses shown are such on which there is little or no TDS. If there is TDS then such TDDS by the beneficiary is claimed as a refund in its income. The expenses are mostly very general and in small amounts under different heads which when are subjected to scrutiny are not verifiable.
7 ITA No. 6014/Del/2017Surya Manufacturing Pvt. Ltd.
8. Bank Statements:- In the instant case the bank statement of the share applicant have been made available and it is seen that there are matching deposits with withdrawals. The deposits and withdrawals are almost on the same day or within a period of 2-3 days. The deposits of amounts are in whole numbers and so are withdrawals with last 2 to 4 digits as "Zeros".
7. After relying on the several judgments of different Courts, the AO concluded that identity and creditworthiness of share applicants and genuine of transactions are not established as per provisions of section 68 of the Act and he, therefore, treated the share application money and share premium, aggregating to Rs. 9,00,50,000/- as unexplained in the hands of assessee and added back to its income and completed the- assessment proceedings.
8. Before the ld. CIT(A), the assessee submitted the financial position of V.M. Tie Up Pvt. Ltd. as having Rs.14.83 Crore of Reserve and Surplus, Pearl Developers Pvt. Ltd. as having Rs.71.64 Crore of Reserve and Surplus and revenue from operations is Rs.7.9 Crore and Jainex Securities as having Rs.43.13 Crore Reserve and Surplus and other income is Rs 8,53,669/-.
9. The submissions of the assessee before the revenue authorities is as under:
"15. In order to discharge its burden under section 68 of the Act has filed following documents with the AO:8 ITA No. 6014/Del/2017
Surya Manufacturing Pvt. Ltd.
a. Copies of Return of Income of all these companies b. Copies of their Balance Sheet and Profit and Loss accounts c. Copies of audited report of these companies d. Master Data of ROC proving the existence and identity of these Companies e. Copies of Bank Statement showing that payments for allotment of shares were received via banking channel.
16. It is submitted that all the above documents proves beyond doubt that assessee has duly proved the ingredients of section 68 of the Act and has successfully discharged his burden. However, the AO discarded these documentary evidences and master Data of ROC in a whimsical manner and has framed the assessment on the basis of report of DDIT investigation Kolkota.
17. It is submitted that perusal of the commission issued by the AO of the assessee, as reproduced at page No. 3 and 4 of the assessment order would prove beyond doubt that the DDIT Kolkota has not conducted proper enquiries from the concerned AO of the share subscribers companies. The AO of the assessee has asked for around 15 documents from the DDIT. However, not a single document was provided by the DDIT.
18. The DDIT has simply answered that inspector has conducted enquiries and found that no such companies are there. The DDIT has not even revealed the name of the inspector the date and time of inspection. The DDIT has also not annexed the so called report of the inspector with his reply to the AO the assessee.9 ITA No. 6014/Del/2017
Surya Manufacturing Pvt. Ltd.
19. It is submitted that AR of the assessee vide his reply dated 29.12.2016 has categorically asked for the report of inspector received from Kolkota so that the assessee can make its submissions. However the AO denied the existence of the same and has discarded the submissions and documentary evidences produced by the assessee.
20. It is submitted that perusal of the last Para of final show cause notice dated 27.12.2016 would prove beyond doubt that the AO has neither asked any further information nor has brought any material on record to rebut the documentary evidences produced by the assessee. The AO has simply concluded that in view of the report of DDIT Kolkota it is his view that share capital received by the assessee is taxable under section 68 of the Act.
21. It is submitted that it is settled position of law that an assessee cannot be punish on account of inaction of the revenue authorities. A reference can be made to the following decisions:
a. 203 CTR 601(P&H) b. Orrisa Cement 159 ITR 79( SC)
22. Assessee further seeks to rely on the following judgments:
23. CIT Vs Gangeshwari Metals 361 ITR 0010- Delhi
24. The other decisions which the assessee seeks to rely are as under:-
a) ACIT Vs Divine Infracon 42 CCH 22(Del)
10 ITA No. 6014/Del/2017
Surya Manufacturing Pvt. Ltd.
b) CIT Vs Kamdhenu Steels 361 ITR 220(Del):- SLP against
this decision has been dismissed by the Hon'ble Apex Court in SLP No. 15640 of 2012. In this case their lordships have observed as under:-
25. It is next submitted that it is once again reiterated that it is not a case wherein there is any investigation wing report or any material has been found in search or any other action under the income tax act. It is a case wherein the return of income has been picked up for scrutiny under the normal provisions of the income tax and hence balance of convenience lies in favour of assessee particularly the fact that the assessee has already allotted the shares to the subscribers before its case would have been picked up for scrutiny.
26. It is next submitted that it is also not a case where there is any material to show that there was immediate cash deposit in the banks of those companies who had subscribed for shares of the Company. Further the AO failed to bring any material on record to show that amounts received by assessee for allotment of shares is the assessee's own money. It is submitted that it is settled position of law that if share applicants are bogus then department is free to proceed in their cases as held by Hon'ble Apex Court in Lovely Export.
27. In view of the above it is most respectfully submitted that appeal of the assessee may be allowed."
11 ITA No. 6014/Del/2017Surya Manufacturing Pvt. Ltd.
10. The ld. CIT(A) held that the AO asked the assessee to produce the share applicants, along with relevant documentary evidence, in order to establish the identity, creditworthiness and genuineness of transactions in respect of these share applicants. However, the assessee failed to do so. Since the assessee failed to produce the creditors, AO issued commission u/s 131(1)(d) to DDIT(Inv), Kolkata to make enquiry about the identity, creditworthiness and genuineness of transactions about these creditors. The DDIT (Inv), Kolkata issued summons to these creditors but no fruitful result came out. Either the summonses were not complied with or returned back by postal authorities. The ITI deputed by DDIT (Inv), Kolkata also made field enquiry to know about these creditors and after making enquiries, he reported that these creditors are non-existent at the given addresses. Thus, the assessee failed to prove that even these creditors actually exist. In absence of any relevant details related to cash creditors about existence, AO was unable to go further for making any enquiry / investigation to examine the identity and credit worthiness of creditors and genuineness of transactions in this regard.
11. The ld. CIT(A) further held that the assessee company which has taken the entries of share application money from share applicants, is a private limited company different from the public limited companies wherein public are substantially interested and where the share application money comes out with an initial public offers and wherein shares are listed on stock exchange and are widely traded. In such cases, it is very difficult for the company to know the creditors closely and have no control / mechanism to verify their creditworthiness and the 12 ITA No. 6014/Del/2017 Surya Manufacturing Pvt. Ltd.
burden of prove in such cases are different. But there is another class of companies which are closely held companies in which public are not substantially interested which are mostly family controlled closely held companies and they raise their share capital from their family members, relatives and friends and in these companies since share capital is received from the close knit circles who are mostly known to the companies / promoters, the onus as cast upon u/s 68 of the Act is very heavy to prove the capacity of the share holders and genuineness of the transactions. Since such companies are closely held companies, unlike of public limited companies wherein if the share application money is not found as explained, AO may proceed against the share holders u/s 68 instead of proceeding against the company, share capital are mostly raised from family, close relatives, friends and the assessee is expected to know the share subscribers and the burden is very heavy on the assessee to satisfy cumulatively the ingredients of section 68 of the Act as to identify and establish the creditworthiness and genuineness of the transactions to the satisfaction of the AO, otherwise he shall be free to proceed against the assessee company and make addition u/s 68 of the Act as unexplained. In the case of assessee also, being a private limited company, heavy onus is on it to establish the identity, credit worthiness and genuineness of transactions in the cases of its creditors.
12. The ld. CIT(A) further observed as under:
"6.2 The aforesaid onus has been made much he avier now in the cases o f such co mpanies as to check this pe rnicious practice of conversion of unaccounte d money through masquerade of investment 13 ITA No. 6014/Del/2017 Surya Manufacturing Pvt. Ltd.
in the share capital o f companies, the pro visions of section 68 have been further strengthene d by inserting the Proviso w.e.f. 01.04.2013, applicable from A.Y. 2013-14, of casting a highe r onus on such companie s requiring them to pro ve the source of money in the hands of such share holders or persons making payments towards issue of shares before such sum is accepte d as genuine credit and if the company fails to discharge the additional onus, the sum shall be tre ated as income o f the company and adde d to its income. Ho wever, in the case o f appe llant company, it failed to discharge the initial burden of establishing the identity, creditwo rthiness and genuineness o f transactio n in the case of its applicants / creditors, leave aside the source of funds of those creditor companie s.
6.3 Incidentally, the discussion about such types of companies who provide acco mmodation entries in lieu o f commission has found place at the national leve l whe n Hon'ble Prime Ministe r of I ndia, while spe aking on Foundation Day of I nstitute of CA in India, revealed that more than 37,000 such she ll companie s have already been de tecte d and re gistratio ns o f more than 1 lakh othe rs have been cancelled. In his speech, Hon' ble Prime Ministe r indicate d about such 'suitcase co mpanies' who exists only on paper and all the documentary evidence about their e xistence and cre ditworthiness are available but on ground they actually do not exist. These companies are used as a too l for giving accommodation entries and have no real business o f any kind exce pt e xecuting the transactions re late d to accommodatio n e ntries only. In subseque nt discussions also at the national level, a concern has been raised abo ut these she ll companies. These concerns sho w that such shell companies actually exist on pape r who provide accom modatio n entries in the fo rm of share application / share capital / share premium to the beneficiaries and they do not exist on gro und in re al terms.14 ITA No. 6014/Del/2017
Surya Manufacturing Pvt. Ltd.
6.4 Now, in the light of above , it has to be seen that to what extent, appe llant has been able to satisfy all three conditio ns, i.e ., identity o f cre ditor, cre ditworthiness and ge nuineness o f transactions in its case . So far as the word 'identity' is co ncerned, Hon' ble jurisdictio nal High Court in the case N.R. Po rtfolio Pvt. Ltd., [2014] 2 ITR-OL 68, has define d that 'the identification of the perso n wo uld include the place of work, the staff, the fact that it was actually carrying on busine ss and recognition of the said company in the eyes of public. Mere ly producing PAN or assessment particulars did no t establish the ide ntity o f the perso n. The actual and the true identity of the pe rson or a company was the business unde rtaken by them.' In the case of appellant, it has failed to establish the identity of creditor companie s. Despite of asking by AO to produce the directors of cre dito r companies, it failed to do so. The summons issue d by DDIT(Inv), Ko lkata and field enquiry made by ITI proved that the creditor companie s do not actually exist. The afo resaid view is suppo rte d in the other decisions also of Hon' ble jurisdictional High Court. In the case CIT vs. Nova Pro moters and F inlease (P) Ltd. 342 ITR 169, on the similar facts regarding info rmatio n from Investigatio n Wing about accommodation entry pro viders and their modus- operandi, it was held that identity of the cre dito rs was not prove d as the summons issued to such credito rs were not responde d to. It was furthe r held that once the conditions as pe r section 68 are not proved o r not satisfied, one could reasonably come to the conclusion that monies emanated from the coffe rs of the assessee company. S imilar view has been taken by Hon' ble jurisdictional High Court in the case CIT vs. Youth Constructio n Pvt. Ltd., 357 ITR 197 and CIT vs. N ipun Builders and Developers Pvt. Ltd., 350 ITR 407, where in, it has been held that onus is on assesse e to prove the identity of share applicants, failing which it has to be conclude d that the assessee com pany has intro duced its o wn money thro ugh non- existing companie s using the banking channels in the shape o f share application money. In view of above, it is cle ar that the appe llant 15 ITA No. 6014/Del/2017 Surya Manufacturing Pvt. Ltd.
has failed to establish the identity of cre ditors in its case. T he othe r evide nce give n by appellant to e stablish the identity have no relevance he re as the physical prese nce of the credito r companies is not pro ved. Thus, the first co nditio n as stipulated in section 68 of the Act is not satisfie d.
6.5 As regards the other conditions, i.e., cre ditworthiness and genuineness, Ho n'ble jurisdictio nal High Court in the case N.R. Portfo lio Pvt. Ltd. (supra) has he ld that 'T he bank accounts do not reflect the creditworthiness or e ven genuineness o f the transaction. The beneficiaries, including the responde nt- assessee , did not give any share divide nd or interest to the said entry operators/subscribers. The pro fit motive is normal in case of investment, was entirely absent. In the prese nt case, no pro fit or divide nd was declared o n the share s. Any pe rson, who would invest money or give loan, would ce rtainly seek re turn or income as conside ratio n. The se facts are no t adverted to and as noticed be low are true and co rrect. The y are undoubtedly relevant and material facts for asce rtaining the cre ditwo rthiness and the genuineness of the transactions.' It is further held by Ho n'ble Court that 'mere production of incorporation de tails, PANs or the fact that third persons or company had filed income tax details in case of a private limite d company may not be sufficient when surro unding and atte nding facts predicate a co ver up. These facts indicate and reflect proper paper wo rk or documentation but genuine ness, creditwo rthiness, are deeper and o btrusive . Companie s no doubt are artificial or juristic person but they are soulless and are dependent upon the individuals behind them to run them and manage them. I t is the perso ns be hind the company who take the de cision, control and manage them.' In the case o f appe llant company, tho ugh the soulless juristic entity is existe nt on paper but the individuals, running and managing them are found non-existing as the director of the appellant co mpany could not give a single detail abo ut the 16 ITA No. 6014/Del/2017 Surya Manufacturing Pvt. Ltd.
existence o f the share applicant co mpanies. S ince the creditors are non-existing, its creditwo rthiness is also not established. Moreove r, the re port from I nvestigatio n Wing and discussion by AO that the creditor companies are merely a tool of providing accommodatio n entry to appellant also suppo rt the fact that the appe llant company has taken accom modatio n entrie s and rotated its o wn unexplaine d money thro ugh these credito r entities. Similarly, the genuineness of transactio ns in the case of appe llant has also not been pro ved for the reaso n that these were accom modatio n entries as established during the inquiry made by Investigation Wing and subsequently during assessment proceedings. The mere submissions of PAN, ITRs, balance shee t, bank statement etc of the share subscriber is not sufficient as the AO is not satisfie d as to their creditwo rthiness as well as genuine ne ss of the credito rs in the instant case, eve n the identity and cre ditworthiness o f the creditors is not pro ved as the appe llant has failed to produce the directo r/ persons from credito rs companies and DDIT (Inv), Ko lkata found such these creditors. Thus, the onus cast upo n by the provisio ns of the 68 of the Act has not been discharged by appe llant to treat the cash cre dit as genuine .
7. In view o f abo ve discussion, I ho ld that the share applicatio n money / share pre mium of Rs. 9,00,50,000/- cre dited to the books o f account of appellant are unexplaine d cash cre dits as per provisions of sectio n 68 of the Act."
13. We have gone through the entire gamut of the issue and the rationale of the ld. CIT(A). The returned income of the V.M. Tie Up Pvt. Ltd. for the relevant A.Y. was Rs.609/- only. The total revenue from operations was Rs.12,000/- for the year ending March 2013 and Rs.17,530/- for the year ending March 2014. The profit for the year ending March 2013 was Rs.430/- only. Further, the returned income of Pearl Dealers Pvt. Ltd. was Rs.2,01,570/-. Similarly, in the case of Jainex Securities P. 17 ITA No. 6014/Del/2017 Surya Manufacturing Pvt. Ltd.
Ltd., the returned income was Rs.51,160/- and the revenue's from operation for the year ending 2014 was Nil whereas for the year ending 2013 was Rs.12,24,294/- and the returned income for that year was Rs.21,195/-. Further, we find that the assessee could not discharge the primary onus of establishing the genuineness and creditworthiness of the parties.
14. The Hon'ble Apex Court in the case PCIT Vs. NRA Iron & Steel Pvt. Ltd. in SLP(Civil) No. 29855 of 2018 dated 05.03.2019 held that, "13. The lowe r appellate autho rities appe ar to have igno red the detaile d findings o f the AO from the fie ld e nquiry and investigations carried out by his office. The authorities belo w have erroneously held that mere ly because the Respo ndent Company - Asse ssee had filed all the primary e vidence, the onus o n the Assessee sto od discharge d. The lowe r appe llate authorities faile d to appreciate that the investo r companies which had file d income tax returns with a meagre or nil income had to explain ho w the y had investe d such huge sums of money in the Assesse Company - Responde nt. Clearly the o nus to establish the credit worthiness o f the investo r companies was not discharged. The entire transaction seemed bogus, and lacked credibility. The Court/Autho rities below did not even advert to the field enquiry conducte d by the AO which re vealed that in several cases the inve stor companies we re found to be no n-existent, and the onus to e stablish the identity o f the investo r companies, was no t discharged by the assessee.
14. The practice of conve rsio n of un-acco unte d money through the cloak of S hare Capital/ Premium must be subjected to care ful scrutiny. This would be particularly so in the case of private placement of shares, whe re a highe r onus is re quired to be placed on the Assessee since the information is within the personal 18 ITA No. 6014/Del/2017 Surya Manufacturing Pvt. Ltd.
knowle dge of the Assessee. The Assessee is under a legal o bligation to prove the rece ipt o f share capital/premium to the satisfaction o f the AO, failure o f which, would justify addition of the said amount to the income o f the Assessee.
15. On the facts o f the present case, clearly the Assessee Company
- Respondent failed to discharge the onus required under Section 68 of the Act, the Assessing Office r was j ustified in adding back the amounts to the Assessee's income".....
15. Hence, keeping in view, the facts elucidated above, the judgments of various Courts, especially of the Hon'ble jurisdictional High Court in the case of Nova Promoters and Finlease Pvt. Ltd. 342 ITR 169, NR Portfolio Pvt. Ltd. in ITA No. 1018/2011 dated 22.11.2013 and the judgment of Hon'ble Apex Court in the case PCIT Vs. NRA Iron & Steel Pvt. Ltd. (supra), we affirm the order of the ld. CIT(A) in confirming the addition made by the AO u/s 68 of the Act.
16. In the result, the appeal of the assessee is dismissed. Order Pronounced in the Open Court on 15/03/2022.
Sd/- Sd/-
(Saktijit Dey) (Dr. B. R. R. Kumar)
Judicial Member Accountant Member
Dated: 15/03/2022
*Subodh Kumar, Sr. PS*
Copy forwarded to:
1. Appellant
2. Respondent
3. CIT
4. CIT(Appeals)
5. DR: ITAT
ASSISTANT REGISTRAR