M/s Inter Labs(India) Private LImited, Hyderabad V. Income Tax Officer, Ward-2(1), Hyderabad

ITA 125/HYD/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 66323 (ITAT-HYDERABAD)
• Duration Of Justice: 7 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-09-2012
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2006-2007
• Appeal Filed On: 30-01-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: M H NAIK
• Keywords: Unexplained cash credit; Gift; Additional evidence
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD A BENCH, HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER ITA NO.125/HYD/2011 ASSESSMENT YEAR: 2007-08 M/S. INTER LABS (INDIA) PVT. LTD. HYDERABAD. .... APPELLANT PAN:AABCI 4069 H VS. ITO, WARD-2(1), HYDERABAD. RESPONDENT APPELLANT BY : SHRI AMRIT KUMAR KOTA RESPONDENT BY : SHRI M.H. NAIK DATE OF HEARING : 22-08-2012 DATE OF PRONOUNCEMENT : 28-09-2012 ORDER PER SAKTIJIT DEY, J.M.: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 23-11-2011 PASSED IN ITA NO.0271/CIT(A)-III/2008-09 AND IT PERTAINS TO THE ASSESSMENT YEAR 2006-07. 2. FOLLOWING EFFECTIVE GROUNDS ARE RAISED BEFORE US :- 1. IN THE CASE OF MISS. JAYA, THE LD. CIT (A) IS NOT CORRECT IN CONFIRMING RS.3,00,000/- ADDITION MADE BY LD. AO U/S 68 THAT THE APPELLANT HAS FAILED TO FURNISH THE CONFIRMATION LETTER FROM MISS. JAYA 2 ITA NO.125 OF 2012 M/S. INTER LABS INDIA P.LTD.. DURING THE ASSESSMENT PROCEEDINGS. THE AO DIRECTLY MAILED THE LETTER TO MISS. JAYAS OLD ADDRESS. HENCE THE NOTICE WAS RETURNED UN- SERVED, AND THE AO APPREHENSION OF DD PURCHASED BY SOMEONE WAS SHOWN AS HER INVESTMENT IS FAR FROM TRUTH AND NOT CORRECT. 2. IN THE CASE OF MISS. DHANA LAKSHMI LD. CIT (A) I S NOT CORRECT IN UPHOLDING OF RS.1 LAKH ADDITION MADE BY THE AO U/S 68 BY REJECTING THE CONFIRMATION LETTER AS ADDITIONAL EVIDENCE FURNISHED BEFORE CIT (A) AND NOT BEFORE HIM AT TIME OF HEARING. 3. IN THE CASE OF MISS. SEETHA MAHALAKSHMI, THE D. CIT (A) IS NOT CORRECT IN CONFIRMING RS.1,50,000 ADDITION MADE BY LD. AO AS APPELLANT HAS FAILED TO FURNISH THE CONFIRMATION LETTER FROM MISS. SEETHA MAHALAKSHMI IN TIME BEFORE HIM AND THE NOTICE WAS RETURNED UN SERVED. IT IS UNFAIR FOR NOT CONSIDERING THE ADDITIONAL EVIDENCE FILED BEFORE THE CIT (A) THOUGH THE INVESTMENT FOUND GENUINE BY THE AO. 4. IN THE CASE OF MISS. T. BHARATI, THE LD. CIT (A) IS NOT CORRECT IN CONFIRMING THE AMOUNT OF RS.3,00,000/- ADDITION MADE BY LD. AO THAT APPELLANT WAS FAILED TO FURNISH THE CONFIRMATION LETTER FROM MISS. BHARATI IN TIME BEFORE HIM AT THE TIME OF HEARING. THE AO HAS CONFIRMED THAT THE AGRICULTURE INCOME OF RS.1,50,000/- IN GENUINE AND CIT (A) IS NOT CORRECT IN STATING THAT THE AO 3 ITA NO.125 OF 2012 M/S. INTER LABS INDIA P.LTD.. HAS NOT MADE ANY ENQUIRY HOW THE SAID PERSON HAS PAID BY THAT PERSON DURING THE PREVIOUS YEAR. 3. BRIEFLY THE FACTS ARE THE ASSESSEE IS A PRIVATE LIMITED COMPANY. FOR THE ASSESSMENT YEAR UNDER DISPUTE, IT FILED A RETURN OF INCOME ON 22-11-2006 DECLARING NIL INCOME , SINCE THE ASSESSEE COMPANY HAS NOT COMMENCED ITS COMMERCIAL P RODUCTION DURING THE RELEVANT FINANCIAL YEAR AND ONLY CONSTRU CTION OF THE BUILDING WAS IN PROGRESS. IN COURSE OF SCRUTINY AS SESSMENT PROCEEDINGS, THE AO WHILE EXAMINING THE FINAL ACCOU NTS OF THE ASSESSEE FOUND THAT AN AMOUNT OF RS.1,28,00,000/- H AS BEEN INTRODUCED AS SHARE APPLICATION MONEY DURING THE RE LEVANT FINANCIAL YEAR. THE AO CALLED FOR THE DETAILS OF SH AREHOLDERS INVESTMENT MADE BY THEM, THEIR INCOME-TAX PARTICULA RS AND ALSO CONFIRMATION FROM THEM. SINCE THE ASSESSEE COULD NO T PRODUCE CONFIRMATION ALONG WITH ASSESSMENT PARTICULARS EXCE PTING SIX SHARE HOLDERS, LETTERS WERE ISSUED BY THE AO TO THE RESPECTIVE SHAREHOLDERS CALLING FOR CONFIRMATION LETTERS FROM ALL THOSE PERSONS ALONG WITH THEIR ASSESSMENT PARTICULARS. TH E AO DID NOT RECEIVE CONFIRMATION FROM 10 SHAREHOLDERS AND IN CA SES OF TWO OUT OF THEM, LETTERS ISSUED BY THE AO WERE RETURNED UN -SERVED BY THE POSTAL AUTHORITIES. THE AO OBSERVING THAT THE ASSE SSEE BEING A PRIVATE LIMITED COMPANY, IT IS UPON THE ASSESSEE T O DISCHARGE THE ONUS OF PROVING THEIR IDENTITY AND GENUINENESS OF T HE SHAREHOLDERS, ADDED THE AMOUNT OF RS.20,50,000 STA TED TO HAVE BEEN INVESTED BY 10 SHAREHOLDERS WHO FAILED TO RESP OND TO THE AOS LETTER, BY TREATING IT AS UNEXPLAINED CREDIT U/S 68 OF THE ACT. THE ASSESSEE CHALLENGED THE ADDITION BEFORE THE CIT (A). IN COURSE OF HEARING BEFORE THE CIT (A), THE ASSESSEE SUBMITTED CONFIRMATION LETTERS FROM 10 PERSONS WHO DID NOT RE SPOND TO THE 4 ITA NO.125 OF 2012 M/S. INTER LABS INDIA P.LTD.. LETTERS OF THE AO DURING THE ASSESSMENT PROCEEDINGS . THE ASSESSEE REQUESTED FOR ADMISSION OF THE CONFIRMATIO N LETTERS AS ADDITIONAL EVIDENCE. THE CIT (A) AFTER ADMITTING T HE CONFIRMATION LETTERS AS ADDITIONAL EVIDENCE CALLED FOR A REMAND REPORT FROM THE AO ON THE ADDITIONAL EVIDENCE FILED BY THE ASSESSEE . THE AO SUBMITTED ITS REMAND REPORT TO THE CIT (A) SUGGESTI NG TO SUSTAIN THE ADDITION. THE CIT (A) EXTENDED AN OPPORTUNITY TO THE ASSESSEE TO HAVE ITS SAY ON THE REMAND REPORT. THE CIT (A) AFTER CONSIDERING THE COMMENTS OF THE AO IN THE REMAND RE PORT AS WELL AS THE CONTENTION OF THE LEARNED AR OF THE ASSESSEE FOUND THE FOLLOWING ADDITIONS TO BE SUSTAINABLE SINCE THE CO NCERNED SHAREHOLDERS WERE NOT HAVING CREDITWORTHINESS TO MA KE THE INVESTMENT:- I) M. JAYA RS. 3,00,000 II) DHANALAKSHMI RS. 1,00,000 III) M. SITA MAHALAKSHMI RS.1,50,000 IV) T. BHARATI RS.3,00,000 4. SO FAR AS M. JAYA IS CONCERNED, SHE HAS STATED T O BE A HOUSEWIFE. SHE CLAIMED TO HAVE ADVANCED THE AMOUNT OUT OF SALE PROCEEDS OF CERTAIN LAND. THE AO IN REMAND PROCEED INGS FOUND THAT THOUGH THE SAID SMT. JAYA STATED TO HAVE RECEI VED THE AMOUNT TOWARDS SALE PROCEEDS OF CERTAIN LAND IN THE MONTH OF MAY, SHE HAD INVESTED THE SAME IN THE MONTH OF NOVE MBER AND THEREFORE THERE HAS BEEN A CONSIDERABLE TIME GAP BE TWEEN SALE AND INVESTMENT AND SHE HAS MADE INVESTMENT OF RS. 3 LAKHS IN FORM OF CHEQUE AND DDS. THE AO OBSERVED THAT DDS C AN BE PURCHASED BY ANYONE IN THE NAME OF SMT. M. JAYA AN D THEREFORE THE AUTHENTICITY OF SUCH PAYMENT CANNOT BE ESTABLIS HED. THE CIT (A) CONSIDERING THE FACT THAT THE ASSESSEE HAS NOT BEEN ABLE TO 5 ITA NO.125 OF 2012 M/S. INTER LABS INDIA P.LTD.. REBUT THE OBSERVATIONS OF THE AO WITH PROPER EVIDEN CE SUSTAINED THE ADDITION OF RS. 3 LAKHS TOWARDS INVESTMENT IN S HARE APPLICATION BY SMT. M. JAYA. SIMILARLY, IN CASE OF SMT. M.DHANALAKSHMI, THE AO IN HIS REMAND REPORT HAD STA TED THAT SMT. DHANALAKSHMI IN THE COURSE OF STATEMENT RECOR DED FROM HER THAT THE INVESTMENT WAS MADE OUT OF AGRICULTURAL IN COME OF AC.1.5 SAID TO HAVE BEEN GIFTED TO HER AT THE TIME OF HER MARRIAGE. HOWEVER, NO DOCUMENT COULD BE PRODUCED BY SMT. DHA NALAKSHMI TO SHOW THAT THE AGRICULTURAL LAND STOOD IN HER NAM E. SMT. DHANALAKSHMI FURTAHER STATED DD FOR RS.1 LAKH WAS PURCHASED BY STAFF OF M/S. INTERLABS I.E., THE ASSESSEE COMPANY. THE CIT (A) CONSIDERING THE FACT THAT NO PROPER EVIDENCE WAS PRODUCED TO PROVE THE GENUINENESS OF THE INVESTMENT, SUSTAINED THE ADDITION. 5. IN CASE OF SMT. M. SITA MAHALAKSHMI WHO STATED TO HAVE ADVANCED A SUM OF RS.1.50,000 TOWARDS SHARE APPLICA TION MONEY, THE LETTER ISSUED BY THE AO TO HER RETURNED UN-SERV ED BY THE POSTAL AUTHORITIES. EVEN THOUGH IN THE REMAND REPO RT, THE AO COMMENTED THAT THE TRANSACTIONS APPEAR TO BE GENUIN E, HOWEVER THE CIT (A) FOUND FROM THE CONFIRMATION LETTER THA T THOUGH SHE HAS MENTIONED THE CHEQUE NUMBER, SHE HAS NOT FURNIS HED THE NAME AND ADDRESS AND BANK ON WHICH THE CHEQUE WAS I SSUED BY HER. FURTHER, SHE HAS NOT FURNISHED THE COPY OF ACKNOWLEDGMENT OF RETURN FOR THE ASSESSMENT YEAR 2006-07 DURING WH ICH THE SAID AMOUNT WAS INVESTED BY HER IN THE ASSESSEES COMPAN Y. ON THE AFORESAID CONSIDERATION, THE CIT (A) HELD THAT THE TRANSACTION CANNOT BE ACCEPTED AS GENUINE AND SUSTAINED THE ADD ITION OF RS.1,50,000/- SIMILARLY, IN THE CASE OF SMT. T. BHA RATI, THE CIT (A) FOUND THAT THE AO DURING REMAND PROCEEDINGS HAS NOT MADE ANY ENQUIRY AS TO HOW THE SAID T. BHARATI HAS PAID THE AMOUNT OF RS.3 LAKHS TO THE ASSESSEE COMPANY DURING THE RELEV ANT 6 ITA NO.125 OF 2012 M/S. INTER LABS INDIA P.LTD.. ASSESSMENT YEAR. THE CONFIRMATION LETTER ALSO DID N OT REVEAL AS TO HOW THE MONEY WAS PAID BY SMT. T. BHARATI. THE CIT (A) THEREFORE SUSTAINED THE ADDITION OF RS. 3 LAKH. 6. THE LEARNED AR FOR THE ASSESSEE SUBMITTED BEFORE US THAT SO FAR AS INVESTMENT OF MRS. JAYA IS CONCERNED, SHE HA D SOLD AND OF 2.5 ACRES FOR RS.2,51,500 AND KEPT CASH WITH HER A ND LOOKING FOR GOOD OPPORTUNITY OF INVESTMENT. SUBSEQUENTLY, SHE INVESTED RS.3 LAKHS IN THE ASSESSEES COMPANY. THEREFORE, THE IN VESTMENT CANNOT BE TREATED AS UNEXPLAINED ONLY BECAUSE THERE IS A TIME GAP BETWEEN THE SALE OF LAND BY HER AND INVESTMENT MADE IN SHARE APPLICATION. THE LEARNED AR FURTHER SUBMITTE D THAT NO ADVERSE INFERENCE COULD BE DRAWN OF THE FACT THAT THE SUMMONS RETURNED UN-SERVED. THIS MIGHT HAVE HAPPENED BECAU SE OF THE FACT THAT THE SUMMONS WERE SENT TO THE WRONG ADDRES S. SO FAR AS INVESTMENT MADE BY DHANALAKSHMI IS CONCERNED, THE L EARNED AR SUBMITTED THAT THE AO HAS NOT COMMENCED ANYTHING NE GATIVE SO FAR AS THE INVESTMENT OF RS.1 LAKH MADE BY DHANALAK SHMI. ONLY BECAUSE THE AGRICULTURAL LAND WAS NOT IN HER NAME W ILL NOT BE ENOUGH TO DISBELIEVE THE STATEMENT MADE BY HER THAT ACTUALLY SHE WAS THE OWNER OF THE LAND AND SHE HAD INVESTED HER SAVINGS TOWARDS SHARE APPLICATION MONEY IN THE ASSESSEES C OMPANY. THE LEARNED AR SUBMITTED THAT IN CASE OF SITA MAHALAKSH MI, THOUGH THE AO IN THE REMAND REPORT HAS COMMENTED THAT THE SOURCE OF INCOME, THE FACT OF PAYMENT THROUGH CHEQUE MAKES TH E TRANSACTION APPEARS TO BE GENUINE, THE CIT (A) HAS ARRIVED AT A CONTRADICTORY FINDING WITHOUT CONSIDERING THE OPINI ON OF THE AO AS MADE IN THE REMAND REPORT. SO FAR AS THE INVEST MENT MADE BY SMT. T. BHARATI AMOUNTING TO RS.3,00,000/- IS CO NCERNED, THE LD.AR SUBMITTED THAT EVEN THOUGH THE AO IN HIS REMA ND REPORT HAS MENTIONED THAT AFTER VERIFYING ALL DETAILS IT WAS F OUND THAT THERE 7 ITA NO.125 OF 2012 M/S. INTER LABS INDIA P.LTD.. WAS DRAWING OF RS.1,50,000/- ON 15-9-2000 BY WAY OF SELF CHEQUE AND THE EARNING OF AGRICULTURAL INCOME IS ALSO GENU INE, THE CIT (A) HAS NOT ACCEPTED THE OPINION OF THE AO GIVEN IN THE REMAND REPORT AND TREATED THE AMOUNT OF RS.3 LAKH AS UNEXP LAINED INVESTMENT. 7. THE LEARNED DR STRONGLY SUPPORTED THE ORDERS OF THE REVENUE AUTHORITIES. 8. WE HAVE HEARD RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. WE HAVE ALSO CONSIDERED THE WRITTEN SUB MISSIONS OF THE LEARNED AR FOR THE ASSESSEE. IT IS A FACT ON R ECORD THAT DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSEE FAILED TO SUBMIT CONFIRMATION LETTERS IN CASES OF 10 SHAREHOLDERS AN D ASSESSMENT PARTICULARS OF THE PERSONS WHO INVESTED IN SHARE AP PLICATION OF THE ASSESSEE COMPANY. THE AO THEREFORE HAD TO ISSUE SU MMONS TO THE CONCERNED SHAREHOLDERS/SHARE APPLICANTS. IN SP ITE OF ISSUE OF SUMMONS, 10 MEMBER OF SHAREHOLDERS DID NOT SUBMIT A NY CONFIRMATION AND IN SOME CASES ALSO SUMMONS WERE RE TURNED UN- SERVED. THE AO THEREFORE ADDED AN AMOUNT OF RS.20, 50,000 BEING INVESTMENT MADE BY THESE 10 PERSONS. IN COUR SE OF APPEAL PROCEEDINGS, THE ASSESSEE HAD SUBMITTED CONFIRMATIO N LETTERS FROM THE CONCERNED 10 PERSONS WHO HAD INVESTED THE AMOUNT OF RS.10,50,000/-. THE CIT (A) AFTER CONSIDERING THE EVIDENCES SUBMITTED BY THE ASSESSEE AND ALSO THE OPINION OF T HE AO IN THE REMAND REPORT HAS ACCEPTED INVESTMENT MADE BY ALL O THER PERSONS EXCEPTING THE FOLLOWING FOUR PERSONS OUT OF TOTAL O F 10 PERSONS:- 1) M. JAYA RS. 3,00,000 2) DHANALAKSHMI RS. 1,00,000 3) SITA MAHALAKSHMI RS. 1,50,000 8 ITA NO.125 OF 2012 M/S. INTER LABS INDIA P.LTD.. 4) T. BHARATI RS.3,00,000 9. THE LEARNED AR FOR HE ASSESSEE HAS SUBMITTED THA T SMT. M. JAYA IS A HOUSEWIFE OF 55 YEARS OF AGE. IT IS SEE N FROM THE REMAND REPORT THAT SHE HAD STATED TO HAVE INVESTED AN AMOUNT OF RS.3 LAKHS IN FORM OF CHEQUE AND DDS. THE SOURCE OF WHICH BEING THE SALE PROCEEDS FROM SALE OF AGRICULTURAL LAND OF 2.5 ACRES. A COPY OF SALE DEED WAS ALSO SUBMITTED BEFORE THE AO. HOWEVER AS HAS BEEN OBSERVED BY THE AO IN THE REMAND REPORT AN AMOUNT OF RS.2,51,000/- RECEIVED TOWARDS SALE CONSIDERATION O F AGRICULTURAL LAND ON 4-5-2005. HOWEVER, THE INVESTMENT IN THE A SSESSEES COMPANY WAS MADE BY HER IN THE MONTH OF SEPT. OCTOB ER AND DECEMBER, 2005 BY WAY OF ONE CHEQUE AND 5 DDS. TH E ASSESSEE HAS NOT BEEN ABLE TO EXPLAIN AS TO HOW SMT. M. JAYA HAD KEPT THE SALE CONSIDERATION WITH HER FOR SUCH A LONG TIME. THIS COUPLED WITH THE FACT THAT THE SUMMONS ISSUED WERE RETURNE D BY THE POSTAL AUTHORITIES RAISES A VALID PRESUMPTION AGAIN ST THE GENUINENESS OF THE TRANSACTION. SINCE THE ASSESSEE HAS NOT BEEN ABLE TO PROVE THE CREDITWORTHINESS AND THE GENUINEN ESS OF THE INVESTMENT, IN OUR OPINION, THE CIT (A) WAS JUSTIFI ED IN SUSTAINING THE ADDITION OF RS.3 LAKHS BEING THE INVESTMENT MAD E BY SMT. M. JAYA. 10. SO FAR AS THE INVESTMENT OF RS.1 LAKH MADE BY D HANALAKSHMI IS CONCERNED, THE INVESTMENT HAS BEEN MADE IN CASH. IT WAS STATED BY SMT. DHANALAKSHMI, SHE HAD MADE INVESTMEN T OUT OF AGRICULTURAL INCOME FROM 1.5 ACRES OF LAND SAID TO HAVE BEEN GIFTED TO HER AT THE TIME OF HER MARRIAGE. HOWEVER , THE AO FOUND ON VERIFICATION THAT NO AGRICULTURAL LAND IS STANDI NG IN THE NAME OF SMT. DHANALAKSHMI. THAT APART THE DDS FOR RS. 1 LAK H WAS PURCHASED BY THE STAFF OF M/S INTERLAB, THE ASSESSE E COMPANY. CONSIDERING THE AFORESAID FACTS AND ALSO THE FACT T HAT THERE IS NO 9 ITA NO.125 OF 2012 M/S. INTER LABS INDIA P.LTD.. CREDIBLE EVIDENCE SUBMITTED BY THE ASSESSEE TO PROV E THE CREDITWORTHINESS OF SMT. DHANALAKSHMI, WE ARE OF TH E VIEW THAT THE CIT (A) WAS JUSTIFIED IN SUSTAINING THE ADDITIO N OF RS. 1 LAKH. 11. IN CASE OF SMT. M. SITA MAHALAKSHMI, WHO HAS IN VESTED AN AMOUNT OF RS.1,50,000/-, THE LEARNED AR HAS ADMITTE D THAT SHE IS A HOUSEWIFE. THOUGH TH0-E AO IN HIS REMAND REPORT HAS COMMENTED THAT THE TRANSACTION APPEARS TO BE GENUIN E IN VIEW OF THE FACT THAT THE INVESTMENT WAS MADE THROUGH CHEQU ES. THE CIT (A) HAS FOUND FROM THE CONFIRMATION LETTER FURNISHE D BY THE SAID SHARE APPLICANTS THAT EVEN THOUGH THE CHEQUE NUMBER HAS BEEN MENTIONED, THE NAME AND ADDRESS OF THE BANK ON WHI CH THE CHEQUE WAS ISSUED BY HER HAS NOT BEEN MENTIONED. F URTHERMORE, SHE HAD ALSO NOT SUBMITTED THE RETURN OF INCOME FOR THE ASSESSMENT YEAR 2006-07 IN WHICH THE INVESTMENT WAS MADE. THE CIT (A) THEREFORE SUSTAINED THE ADDITION DUE TO LACK OF PROPER EVIDENCE TO PROVE THE CREDITWORTHINESS AS WELL AS T HE GENUINENESS OF THE TRANSACTION. WE FIND THE CONCLUSION ARRIVED AT BY THE CIT (A) TO BE REASONABLE. THE ONUS IS ON THE ASSESSEE TO PROVE THE CREDITWORTHINESS AND GENUINENESS OF THE TRANSACTION . IN ABSENCE OF PROPER EVIDENCE, THE CIT (A) WAS JUSTIFIED IN SU STAINING THE ADDITION. SIMILARLY IN CASE OF T. BHARATI WHO CLAI MED TO HAVE MADE INVESTMENT OF RS. 3 LAKHS TOWARDS SHARE APPLIC ATION MONEY, IN COURSE OF APPEAL PROCEEDINGS BEFORE THE CIT (A), THE ASSESSEE FILED A CONFIRMATION LETTER FROM SMT. T. BHARATI WH EREIN IT WAS EXPLAINED THAT SHE HAS INVESTED THE AMOUNT OF RS. 3 LAKHS OUT OF THE AMOUNT OF RS.1,50,000/- RECEIVED AS GIFT FROM H ER BROTHER AND THE BALANCE AMOUNT FROM THE SAVINGS MADE FROM AGRIC ULTURAL INCOME. THE CIT (A) SUSTAINED THE ADDITION ON THE FINDING THAT THE EXPLANATION SUBMITTED REGARDING RECEIPT OF GIFT BY SMT. T. BHARATI FROM HER BROTHER CANNOT BE ACCEPTED WITHOUT SUPPORTING 10 ITA NO.125 OF 2012 M/S. INTER LABS INDIA P.LTD.. EVIDENCE TO PROVE THAT ACTUALLY THE AMOUNT HAS BEE N GIVEN BY HER BROTHER. THE AO IN HIS REMAND REPORT HAS OBSER VED THAT ON 15-9-2005 AN AMOUNT OF RS.1,50,000 WAS DRAWN BY WAY OF SELF CHEQUE. SIMILARLY, THE POSTAL SAVINGS ACCOUNT INDI CATES THAT THE MONEY WAS WITHDRAWN IN MARCH, 2003 WHEREAS THE INVE STMENT IN THE ASSESSEE COMPANY WAS MADE IN 2005. THESE FACTS LEAD TO ONLY ONE CONCLUSION THAT THE EXPLANATION SUBMITTED BY THE ASSESSEE WITH REGARD TO THE SOURCE OF INVESTMENT IS A MAKE BELIEVE STORY. IT IS SEEN FROM THE ORDER OF THE CI T (A) THAT OUT OF 10 SHARE APPLICANTS IN WHOSE CASES ADDITIONS WERE M ADE BY THE AO, THE CIT (A) HAS DELETED THE ADDITIONS IN CASES OF SIX PERSONS WHERE THE ASSESSEE WAS ABLE TO FURNISH ADEQUATE EVI DENCE IN SUPPORT OF THE CREDITWORTHINESS OF THE SHARE APPLIC ANTS AND GENUINENESS OF THE TRANSACTIONS. HOWEVER, IN THE CA SES OF AFORESAID FOUR TRANSACTIONS SINCE THE ASSESSEE HAS FAILED TO PRODUCE CREDIBLE EVIDENCES, THE CIT (A) WAS JUSTIFI ED IN SUSTAINING THE ADDITION. WE THEREFORE UPHOLD THE ORDER PASSED BY THE CIT (A). THE GROUNDS RAISED BY THE ASSESSEE ARE DISMIS SED. 12. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE STANDS DISMISSED. ORDER PRONOUNCED IN THE COURT ON 28 -09-2012. SD/- SD /- (CHANDRA POOJARI) ACCOUNTANT MEMBER (SAKTIJIT DEY) JUDICIAL MEMBER HYDERABAD, DATED THE 28 TH SEPT., 2012. 11 ITA NO.125 OF 2012 M/S. INTER LABS INDIA P.LTD.. COPY TO:- 1) M/S. INTER LABS (INDIA) PRIVAE LIMITED, VEERA PA LACE, SUNDERNAGAR, HYDERABAD. 2)ADDL. CIT, RANGE-2, HYDERABAD. 3) THE CIT (A)-III, HYDERABAD 4) THE CIT CONCERNED, HYDERABAD 5) THE DEPARTMENTAL REPRESENTATIVE, I.T.A.T., HYDERABA D. JMR* 12 ITA NO.125 OF 2012 M/S. INTER LABS INDIA P.LTD..