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7.1 In response to the show-cause notice, the assessee submitted the entire details of the share applicant companies, their returns of income, bank statements, financial statements etc. and submitted that they were regularly assessed to tax even under scrutiny proceedings u/s 143(3). The assessee also gave details of nature of activities of these companies and the source of the funds. However, the ld. AO has discarded the assessee's submissions and held that even though ITRs, financial M/s. Avaada Ventures Pvt. Ltd statements, bank statements have been given, but such a meager profits and turnover of these entities does not instill confidence about their credentials. He also observed that the ultimate source of funds were again from share capital received from shell entities, which were dubious because during the enquiries they were found to be nonexistent on their given address and non compliance of notice u/s. 133(6) by these companies. Thereafter, he had discussed on how these hawala entities operate and referred to various decisions of the Hon'ble Supreme Court including CIT vs. Durga Prasad More reported in 82 ITR 540 and Sumati Dayal vs. CIT reported in 214 ITR 801.