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Commissioner Of Income Tax vs Dwarkadhish Financial Services on 7 April, 2005

Relying on the various documents placed on record and the principle laid down by the Hon'ble Supreme Court in the case of M/s Lovely Export Pvt. Ltd. which is directly on the issue of share capital and in view of the decisions cited above, the addition on account of share capital cannot be sustained. The AO has nowhere proved that documents in support of the identity of the parties have not been placed on record or they were forged documents. The AO also has not brought any evidence on record regarding the facts that the share applicants were not creditworthy or genuine, despite the fact that their PAN and copies of I.T. Return were submitted by the appellant. After considering the facts on record, judicial pronouncements of the jurisdictional High Court and Hon'ble Supreme Court it can be concluded that the appellant has undoubtedly proved the identity of the share applicant. Once the identity of these share applicants is proved, no addition can be made in the hands of the appellant even if the share applicants have been found to be persons of no means until and unless it is otherwise proved by the revenue. The revenue could not prove that the money received by the appellant in the form of share application money has come from its own sources.
Delhi High Court Cites 2 - Cited by 18 - Full Document

Commissioner Of Income-Tax, New ... vs East West Import & Export (P) Ltd.,(Now ... on 8 February, 1989

In this situation, the Commissioner of Income Tax(A) rightly relied and followed the decision of Hon'ble Apex Court in the case of C.I.T. vs Lovely 13 ITA No. 4086/Del/2010 Asstt.Year: 2003-04 Export P. Ltd.(supra). We also observe that the Assessing Officer has nowhere proved that the documents in support of the identity and creditworthiness of the share applicants have not been placed on record or they were found as forged documents in the course of verification. In the assessment order and remand report, the Assessing Officer has not brought any evidence regarding the fact that the share applicants were not creditworthy or genuine despite the fact that the PAN Nos. and the copies of the income tax returns were submitted before the Assessing Officer by the assessee. In this situation, when the identity of the share applicants is proved by the assessee and the Assessing Officer has not brought any adverse material or fact against the share applicants, then no addition can be made in the hands of appellants. We hold that the Assessing Officer could not prove that the money received by the assessee from alleged three companies in the form of share application money had come from the own sources of the assessee. In this situation, we are unable to see any perversity, infirmity or any other valid reason to interfere with the findings of the Commissioner of Income Tax(A). Accordingly, ground no.1 and additional ground no. (i), (ii) and (iii) being devoid of merits are dismissed.
Supreme Court of India Cites 5 - Cited by 633 - M Rangnath - Full Document
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