DCIT, Circle, Bhilwara V. M/s. Saileela Synthetics Pvt. Ld. , Bhilwara

ITA 279/JODH/2018

• Counselvise Citation: [2020] 109 COUNSELVISE.COM (IT) 9976 (ITAT-JODHPUR)
• Duration Of Justice: 2 year(s) 6 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-12-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2015-2016
• Appeal Filed On: 06-06-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A.S. YADAV LD.
• Keywords: Unexplained cash credit; Income from undisclosed sources; Source of fund
• Section: 68; 43B; 143(3); 133(6); 195

Judgement Text

1 ITA NO.279/JODH/2018 M/S. SAI LEELA SYNTHETICS PRIVATE LIMITED ASSESSMENT YEAR: 2015-16 IN THE INCOME TAX APPELLATE TRIBUNAL JODHPUR BENCH , , BEFORE HONBLE SHRI SANDEEP GOSAIN, JM AND HONBLE SHRI MANOJ KUMAR AGGARWAL, AM (HEARING THROUGH VIDEO CONFERENCING MODE) ./ I.T.A. NO.279/JODH/2018 ( / ASSESSMENT YEAR: 2015-16) D CIT - BHILWARA CIRCLE SHASTRI NAGAR, BHILWARA RAJASTHAN. / VS. M/S. SAILEELA SYNTHETICS PVT. LTD. 147, NEW CLOTH MARKET PUR ROAD, BHILWARA RAJASTHAN-311 001. ./ ./PAN/GIR NO. AADCS-1103-N ( /APPELLANT ) : ( / RESPONDENT ) ASSESSEE BY : SHRI RAJENDRA JAIN (ADVOCATE) & MS. RAKSHA BIRLA (CA)LD.ARS. REVENUE BY : SHRI A.S. YADAV- LD. CIT- DR / DATE OF HEARING : 04/11/2020 / DATE OF PRONOUNCEMENT : 21/12/2020 / O R D E R MANOJ KUMAR AGGARWAL (ACCOUNTANT MEMBER): - 1. AFORESAID APPEAL BY REVENUE FOR ASSESSMENT YEAR [IN SHORT REFERRED TO AS AY] 2015-16 CONTEST THE ORDER LD. COMMISSIONER OF INCOME-TAX(APPEALS), AJMER, [IN SHORT REFERRED TO A S CIT(A)], 2 ITA NO.279/JODH/2018 M/S. SAI LEELA SYNTHETICS PRIVATE LIMITED ASSESSMENT YEAR: 2015-16 APPEAL NO.557/2017-18, DATED 13/03/2018 ON FOLLOWIN G EFFECTIVE GROUNDS:- ON THE FACTS AND IN LAW, THE LD. CIT(A), AJMER ERRE D IN :- 1) DELETING THE ADDITION ON ACCOUNT OF ALLOTMENT OF SHARES OF RS.3,04,39,780/- WITHOUT APPRECIATING THAT GENUINEN ESS THEREOF HAS NOT BEEN PROVED AS PROVIDED U/S.68 OF THE I.T. ACT, 1961.; 2) DELETING THE DISALLOWANCE OF LATE DEPOSIT OF EMP LOYEES CONTRIBUTION TOWARDS ESI AMOUNTING TO RS.5,540/- MADE BY THE AO U/S. 36(1)(VA) OF THE I.T. ACT, 1961 WITHOUT APPRECIATING THE FACTS OF THE CAS E. 3) RESTRICTING THE DISALLOWANCE OF EXPENSES FROM RS .1,50,000/- TO RS.75,000/-, WITHOUT APPRECIATING THE FACTS OF THE CASE THAT THE AO SPECIFICALLY POINTED OUT THE DEFECTS IN THE BILLS AND VOUCHERS; 4) DELETING THE ADDITION MADE ON ACCOUNT OF UNSECUR ED LOAN OF RS.25,00,000/- FROM M/S. INOX BUILDCON PVT.LTD. AND INTEREST PAID OF RS.24,658/- THEREUPON, WITHOUT APPRECIATING THE FAC TS OF THE CASE. 2. WE HAVE CAREFULLY HEARD THE RIVAL SUBMISSIONS AN D PERUSED RELEVANT MATERIAL ON RECORD INCLUDING WRITTEN SUBMI SSIONS AND DOCUMENTS PLACED IN THE PAPER BOOK. THE JUDICIAL PR ECEDENTS AS RELIED UPON DURING THE COURSE OF HEARING HAVE DULY BEEN DELIBERATED UPON. OUR ADJUDICATION TO THE SUBJECT MATTER WOULD BE AS GIVEN IN SUCCEEDING PARAGRAPHS. 3.1 FACTS ON RECORD ARE THAT ASSESSEE BEING RESIDEN T CORPORATE ASSESSEE STATED TO BE ENGAGED IN MANUFACTURING AND TRADING OF SYNTHETIC FIBER WAS ASSESSED FOR THE YEARS UNDER CO NSIDERATION U/S. 143(3) VIDE ORDER DATED 29/12/2017 WHEREIN THE RETU RNED INCOME OF RS.114.56 LACS WAS DETERMINED AT RS.420.76 LACS AFT ER CERTAIN ADDITIONS. 3.2 DURING ASSESSMENT PROCEEDINGS, IT TRANSPIRED T HAT THE ASSESSEE ISSUED CERTAIN SHARES ON TWO OCCASION DURI NG THE YEAR AT ISSUE PRICE OF RS.55/- & RS.60/- PER SHARE. IN TOTA L 522481 NUMBERS OF SHARES WERE ISSUED FOR RS.304.39 LACS TO FIFTEEN (15) CORPORATE 3 ITA NO.279/JODH/2018 M/S. SAI LEELA SYNTHETICS PRIVATE LIMITED ASSESSMENT YEAR: 2015-16 ENTITIES, THE DETAILS OF WHICH HAVE ALREADY BEEN EX TRACTED IN PARA-3 OF THE ASSESSMENT ORDER. DURING ASSESSMENT PROCEEDI NGS, THE ASSESSEE FILED COMPLETE DETAILS OF SHARE ALLOTMENT INCLUDING PERMANENT ACCOUNT NUMBER (PAN) OF THE SHARE APPLICA NTS. HOWEVER, UPON PERUSAL OF DETAILS SO FILED, IT WAS N OTED THAT ELEVEN (11) ENTITIES WERE LOCATED AT THE SAME OR NEARBY AD DRESSES. NOTICES U/S 133(6) WERE ISSUED TO CONFIRM THE TRANSACTIONS, HOWEVER, THE SAME DID NOT ELICIT ANY SATISFACTORY RESPONSE. ACCO RDINGLY, THE ASSESSEE WAS REQUIRED TO DEMONSTRATE THE FULFILLMEN T OF INGREDIENTS OF SECTION 68 BY PROVING THE IDENTITY AS WELL AS CR EDITWORTHINESS OF THE INVESTOR ENTITIES ALONG WITH GENUINENESS OF THE STATED TRANSACTIONS. 3.3 THE ASSESSEE SUBMITTED THAT ALL THE SHARE APPLI CANTS WERE REGULAR INCOME TAX RETURN FILERS AND HAVE SUFFICIEN T SOURCE OF INCOME TO MAKE THE INVESTMENT IN THE ASSESSEE ENTIT Y. THE FOLLOWING DOCUMENTARY EVIDENCES WERE FURNISHED IN S UPPORT OF THE TRANSACTIONS: - A) COPY OF THE SHARE APPLICATION B) COPY OF BANK STATEMENT OF SHAREHOLDER TO VERIFY THE CREDITWORTHINESS C) COPY OF INCOME TAX RETURN D) COPY OF PAN CARD E) COPY OF BALANCE SHEET CONFIRMING COMPLETE DETAILS O F SOURCE OF FUNDS AND INVESTMENTS MADE F) COY OF BALANCE CONFIRMATION TO VERIFY THE GENUINENE SS G) COPY OF MEMORANDUM AND COPY OF RESOLUTION H) COPY OF BANK STATEMENT OF THE COMPANY I) ROC SHARE ALLOTMENT FORM ALONG WITH COMPLETE ANNEXU RES J) LEDGER COPY OF SHARE APPLICATION MONEY, SHARE CAPI TAL AND SHARE PREMIUM K) PARTY WISE SHARE ISSUE CHART 4 ITA NO.279/JODH/2018 M/S. SAI LEELA SYNTHETICS PRIVATE LIMITED ASSESSMENT YEAR: 2015-16 THE RELEVANT FINANCIAL STATEMENTS OF THE INVESTOR E NTITIES HAVE ALSO BEEN EXTRACTED IN THE ASSESSMENT ORDER. HOWEVER, UP ON PERUSAL OF THE SAME, LD. AO OPINED THAT ALL THESE ENTITIES DID NOT CARRY OUT ANY SIGNIFICANT BUSINESS ACTIVITIES DURING THE YEAR AND THE PROFITS AS WELL AS RESERVES OF THOSE ENTITIES WERE LOW. THEREFORE, THE SOURCE OF INVESTMENTS SO MADE BY THEM REMAINED UNEXPLAINED. 3.4 TO FORTIFY THE SUBMISSIONS FURTHER, THE ASSESSE E FURNISHED AFFIDAVITS OF ALL SHARES APPLICANTS AND SUPPLIED LA TEST COMMUNICATION ADDRESS WITH A REQUEST FOR RE-CONFIRMATION OF ACCOU NTS. IN THE SAID BACKGROUND, IT WAS SUBMITTED THAT THE ASSESSEE PROV ED THE IDENTITY, CREDITWORTHINESS AND GENUINENESS OF ALL SHARE-APPLI CANTS BY FILING ALL THE REQUISITE DETAILS. ALL THE INVESTOR COMPANIES W ERE HAVING SUFFICIENT SOURCES TO MAKE INVESTMENTS AND THEREFOR E, INVOCATION OF PROVISIONS OF SEC. 68 WAS UNJUSTIFIED. RELIANCE WAS PLACED, INTER ALIA, ON THE DECISION OF HONBLE SUPREME COURT IN CIT V/S LOVELY EXPORTS PVT. LTD. 216 CTR 195 TO OPPOSE ANY ADDITION U/S 68. HOWEVER, NOT CONVINCED, LD. AO TREATED THE SHARE MO NEY SO RECEIVED BY THE ASSESSEE AS UNEXPLAINED CASH CREDIT U/S 68 AND ADDED THE SAME TO THE INCOME OF THE ASSESSEE. 3.5 THE ASSESSEE HAD DEBITED CERTAIN EXPENSES UNDER THE HEAD PRINTING & STATIONERY, OFFICE EXPENSES, VEHICLE EXP ENSES, REPAIR MAINTENANCE & TELEPHONE EXPENSES ETC. SINCE THE EXP ENDITURE WAS NOT FULLY VERIFIABLE, LD. AO ESTIMATED AN ADDITION OF RS.1.50 LACS AGAINST THE SAME. 3.6 IT ALSO TRANSPIRED THAT THE ASSESSEE DEPOSITED EMPLOYEES CONTRIBUTION OF ESI AMOUNTING TO RS.5,540/- AFTER D UE DATE AS 5 ITA NO.279/JODH/2018 M/S. SAI LEELA SYNTHETICS PRIVATE LIMITED ASSESSMENT YEAR: 2015-16 PRESCRIBED IN THE RESPECTIVE ACT AND HENCE, THE SAM E WAS TO BE DISALLOWED U/S 36(1)(VA) R.W.S. 2(24)(X). 3.7 THE ASSESSEE WAS IN RECEIPT OF UNSECURED LOAN O F RS.25 LACS FROM AN ENTITY NAMELY M/S INOX BUILDCON PRIVATE LIM ITED WHICH WAS ONE OF THE SHARE-APPLICANT AND FOR WHICH ADDITION U /S 68 WAS ALREADY MADE BY LD. AO. ACCORDINGLY, THE SAID LOAN AS WELL AS INTEREST PAID THEREFORE AGGREGATING TO RS.25.24 LAC S WAS DISALLOWED AND ADDED TO THE INCOME OF THE ASSESSEE U/S 68 IN T HE SAME MANNER. 4.1 AGGRIEVED, THE ASSESSEE CONTESTED ALL THE ADDIT IONS SUCCESSFULLY BEFORE LD. CIT(A) VIDE IMPUGNED ORDER DATED 13/03/2018. WITH RESPECT TO ADDITION OF SHARE APPLI CATION MONEY, THE ASSESSEE PLACED ON RECORD COMPLETE DETAILS OF S HARE ALLOTMENT INCLUDING PAN OF THE INVESTOR ENTITIES AND SOURCE O F SOURCE OF INVESTMENTS SO MADE IN THE ASSESSEE COMPANY. THE AT TENTION WAS DRAWN TO THE DOCUMENTARY EVIDENCES SUBMITTED BY THE ASSESSEE DURING ASSESSMENT PROCEEDINGS IN SUPPORT OF THE GEN UINENESS OF THE TRANSACTIONS, IT WAS SUBMITTED THAT ALL THE INV ESTOR ENTITIES HAD SUFFICIENT SOURCES TO MAKE INVESTMENT AND THEREFORE THE CONCLUSION DRAWN BY LD.AO WERE ERRONEOUS & BASELESS. THE DETAI LS OF FUNDS AS AVAILABLE WITH THE INVESTOR ENTITIES WERE ALSO P LACED ON RECORD. IT WAS FURTHER SUBMITTED THAT LD. AO DID NOT SERVE NEW NOTICES U/S 133(6) AT THE NEW ADDRESSES EVEN AFTER HAVING THE S AME. 4.2 THE LD. CIT(A) AFTER CONSIDERING THE ORDER OF L D. AO AND ASSESSEES SUBMISSIONS DELETED THE ADDITIONS SO MAD E U/S 68 BY OBSERVING AS UNDER: - 6 ITA NO.279/JODH/2018 M/S. SAI LEELA SYNTHETICS PRIVATE LIMITED ASSESSMENT YEAR: 2015-16 4.3 I HAVE GONE THROUGH THE ASSESSMENT ORDER, STATEMENT OF FACTS, GROUNDS OF APPEAL AND WRITTEN SUBMISSION CAREFULLY. IT IS S EEN THAT THE AO AFTER CONSIDERING THE EVIDENCES AND SUBMISSIONS OF THE AP PELLANT REGARDING IDENTITY AND CREDITWORTHINESS OF THE PERSONS FROM WHOM THE S HARE CAPITAL AND SHARE PREMIUM OF RS.3,04,39,780/- WAS RECEIVED AND GENUIN ENESS OF THE TRANSACTIONS, TREATED THE ENTIRE SHARE APPLICATION MONEY OF RS, 3,04,39,780/- AS UNEXPLAINED CREDIT U/S 68 OBSERVING AT PARA 3.5 AND 3.6 OF THE ASSESSMENT ORDER AS UNDER: '3.5 ALL THE SUBMISSIONS, FURNISHED BY THE A.R OF THE AS SESSEE, HAVE BEEN CONSIDERED BUT NOT FOUND SATISFACTORY AND ASSE SSEE COMPANY FAILED TO FURNISH ANY EXPLANATION IN THIS REGARD. T O SUBSTANTIATE ANY CREDITS THE BOOKS - IDENTITY OF CREDITORS, GENUINEN ESS OF TRANSACTIONS AND CREDITWORTHINESS OF THE CREDITORS IS REQUIRED T O BE PROVED. IN THE PRESENT CASE, ASSESSEE COMPANY HAS STATED TO HAVE R ECEIVED AMOUNT OF RS.3,04,39,780/- TOWARDS SHARE ISSUED TO THE 11 COMPANIES. IT IS WORTHWHILE TO MENTION HERE THAT THERE IS NO BUSINES S RELATION BETWEEN THE ASSESSEE COMPANY AND AFORESAID COMPANIES. THE A SSESSEE COMPANY IS A PRIVATE LIMITED COMPANY LOCATED IN BHI LWARA, RAJASTHAN. THEREFORE, MAKING A HUGE INVESTMENT OF RS.3,04.39,7 80/- BY 11 COMPANIES SITUATED AT A FAR PLACE IN MUMBAI RAISES DOUBT. NO SUBMISSION HAS BEEN MADE IN THE MATTER THAT HOW THE SE 11 COMPANIES CAME TO KNOW ABOUT ISSUANCE OF SHARES BY THE ASSESS EE COMPANY MOREOVER, IT IS THE INTENTION OF EVERY PERSON DOING BUSINESS TO EARN PROFIT OUT 01 ITS BUSINESS ACTIVITIES AND TO UTILIZ E THE FUND FOR MAXIMUM RETURN. IN THE PRESENT CASE, THE ABOVE COMPANIES HA VE MADE HUGE INVESTMENT IN AN UNKNOWN COMPANY AND FROM WHICH THE Y ARE NOT GETTING ANY RETURNS. COPIES OF AUDITED ACCOUNTS FOR A.Y. 2015-16 OF THE INVESTOR COMPANIES FURNISHED DURING ASSESSMENT PROCEEDINGS SHOWS THAT NO SIGNIFICANT BUSINESS ACTIVITY HAS BEEN CARRIED OUT IN THE RELEV ANT YEAR BY THESE COMPANIES. BALANCE SHEET OF THESE COMPANIES SHOW HU GE RESERVE AND SURPLUS WHICH CONSIST MAINLY OF SHARE PREMIUM. THER E IS A LITTLE OR NEGLIGIBLE RESERVE OUT OF BUSINESS ACTIVITIES IT TH ESE COMPANIES. EVEN TRANSACTIONS BY CHEQUE DO NOT MAKE THE TRANSACTIONS GENUINE. THIS HAS BEEN HELD BY THE HON'BLE ITAT, JAIPUR IN THE CASE O F M/S. KANCHANWALA GEMS V/S. JC1T IN ITA NO. 134/JP/02 DATED 10.12.201 3 AND AFFIRMED BY HON'BLE SUPREME COURT IN 288 ITR 10 (SC) THAT EV EN PAYMENT BY ACCOUNT PAYEE CHEQUE IS NOT SUFFICIENT TO ESTABLISH THE GENUINENESS OF THE TRANSACTION. IN VIEW OF THE AFORESAID FACTS, GE NUINENESS OF THE TRANSACTIONS BY THESE COMPANIES OF MAKING INVESTMEN T IN SHARES OF ASSESSEE COMPANY IS NOT PROVED. HENCE, SOURCE OF IN VESTMENT REMAINS UNEXPLAINED.' 3.6 AS PER THE PROVISION OF SECTION 68 OF THE ACT W HERE THE ASSESSEE IS A COMPANY (NOT BEING A COMPANY IN WHICH PUBLIC ARE SUBSTANTIALLY INTERESTED), AND THE SUM SO CREDITED CONSISTS OF SH ARE APPLICATION MONEY, SHARE CAPITAL, SHARE PREMIUM O: ANY SUCH AMO UNT BY WHATEVER NAME CALLED, ANY EXPLANATION OFFERED BY SUCH ASSESS EE COMPANY SHALL BE DEEMED TO BE NOT SATISFACTORY, UNLESS:- 7 ITA NO.279/JODH/2018 M/S. SAI LEELA SYNTHETICS PRIVATE LIMITED ASSESSMENT YEAR: 2015-16 (A) THE PERSON, BEING A RESIDENT IN WHOSE NAME SUCH CREDIT IS RECORDED IN THE BOOKS OF SUCH COMPANY ALSO OFFERS AN EXPLANA TION ABOUT THE NATURE TAW SOURCE OF SUCH SUM SO CREDITED; AND (B) SUCH EXPLANATION IN THE OPINION OF THE ASSESSIN G OFFICER AFORESAID HAS BEEN FOUND TO BE SATISFACTORY: IN THE INSTANT CASE THE ASSESSEE CLAIMED TO HAVE RE CEIVED CONSIDERATION TOWARDS ISSUANCE OF SHARE FROM THE CO MPANIES AS ABOVE WHICH ARE HAVING, RESERVE & SURPLUS IN THE FORM OF SHARE SECURITY PREMIUM ONLY. HOWEVER, IN VIEW OF THE FACTS DISCUSS ED ABOVE GENUINENESS OF THE TRANSACTION IS NOT PROVED. THUS, TOTAL CONSIDERATION OF RS.3,04,39,780/- RECEIVED AGAINST ALLOTMENT OF S HARES IT HEREBY TREATED AS UNEXPLAINED CASH CREDIT IN TERMS OF SECT ION 68 OF THE ACT AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE. PENALTY PROCEEDINGS U/S 271(L)(C) OF THE ACT IS HEREBY INITIATED FOR FURNIS HING INACCURATE PARTICULARS OF INCOME.' 4.4 THE APPELLANT HAS FURNISHED, IN RESPECT OF EAC H PERSON FOLLOWING DOCUMENTARY EVIDENCES TO PROVE THE IDENTITY AND CRE DITWORTHINESS OF THE PERSONS FROM WHOM THE APPELLANT HAS RECEIVED SHARE APPLICATION MONEY AND GENUINENESS OF THE TRANSACTIONS: > COPY OF THE SHARE APPLICATION > COPY OF BANK STATEMENT OF SHAREHOLDER SHOWING THAT IT HAD SUFFICIENT BALANCE IN ITS ACCOUNTS TO ENABLE IT TO SUBSCRIBE T O THE SHARE CAPITAL > ACKNOWLEDGEMENT COPY OF INCOME TAX RETURN OF SHAREH OLDER > COPY OF PAN CARD TO VERIFY THE IDENTITY > COPY OF BALANCE SHEET ALONG WITH AUDIT REPORT OF TH E ABOVE SHARE APPLICANTS CONFIRMING COMPLETE DETAILS OF SOURCES OF FUNDS AND INVESTMENTS MADE. > COPY OF BALANCE CONFIRMATION CUM AFFIDAVIT TO VERIF Y THE GENUINENESS > COPY OF MEMORANDUM AND COPY OF RESOLUTION. > DETAILS OF THE IMMEDIATE SOURCES OF THE FUNDS INVES TED BY THE SHARE APPLICANTS > COPY OF BANK STATEMENT OF THE COMPANY .> ROC SHARE ALLOTMENT FORM ALONG WITH COMPLETE ANNEXU RES > L EDGER COPY OF SHARE APPLICATION MONEY, SHARE CAPITA L AND SHARE PREMIUM 4.5 IT IS SEEN THAT THE APPELLANT HAS FILED EACH AN D EVERY DOCUMENTS REQUIRED FOR PROVING THE IDENTITY AND CREDITWORTHIN ESS OF THE SHARE APPLICANTS AND GENUINENESS OF THE TRANSACTIONS. THE AO HAD MAD E ENQUIRIES U/S 133(6) WITH 11 COMPANIES. THE AO HAS MENTIONED THAT NONE O F THE 11 SHARE APPLICANT FILED ANY REPLY IN RESPONSE TO NOTICE ISS UED U/S 133(6). FIVE NOTICES HAVE BEEN RETURNED BY THE POSTAL AUTHORITIES WITH T HE REMARK 'LEFT'. THE APPELLANT DID PROVIDE CURRENT ADDRESS OF THESE FIVE SHARE APPLICANTS BUT THE AO DID NOT ISSUE ANY NOTICE U/S 133(6) TO THESE PAR TIES, ON THE GROUND THAT 'NEW ADDRESS OF THESE COMPANIES SHOULD HAVE BEEN PR OVIDED AT THE FIRST INSTANCE'. THE AO HAS ALSO NOT BROUGHT ON RECORD AN Y EVIDENCE, RECEIVED FROM ANY OTHER SOURCE/ AUTHORITY, TO SHOW THAT THE APPELLANT HAS INTRODUCED ITS OWN INCOME FROM UNDISCLOSED SOURCES IN THE FORM OF SHARE APPLICATION MONEY FROM THE 15 COMPANIES FROM WHOM THE SHARE APPLICATI ON MONEY OF 8 ITA NO.279/JODH/2018 M/S. SAI LEELA SYNTHETICS PRIVATE LIMITED ASSESSMENT YEAR: 2015-16 RS.3,04,39,7807- WAS RECEIVED BY THE APPELLANT. THE APPELLANT HAS FILED COPY OF BALANCE SHEET OF EACH SHARE APPLICANT. IT CAN BE SEEN FROM THE BALANCE SHEET THAT EACH SHARE APPLICANT HAD MORE THAN SUFFI CIENT FUND FOR GIVING SHARE APPLICATION MONEY. THE REASON GIVEN BY THE AO FOR T REATING THE SUM OF RS.3,04,39,7807- AS UNEXPLAINED CREDIT OF THE APPEL LANT AT THE MOST CAN BE DESCRIBED AS SUSPICION OR DOUBT. I AM OF THE CONSID ERED VIEW THAT NO ADDITION CAN BE MADE U/S 68 MERELY ON THE BASIS OF SUSPICION OR DOUBT, ESPECIALLY WHEN THE APPELLANT HAS FURNISHED EVERY DOCUMENTARY EVIDENCE TO PROVE THE IDENTITY AND CREDITWORTHINESS OF THE SHARE APPLICAN TS AND GENUINENESS OF THE TRANSACTIONS. THE APPELLANT HAS DISCHARGED ITS ONUS BY FILING NECESSARY DOCUMENTARY EVIDENCES TO PROVE THE IDENTITY AND CRE DITWORTHINESS OF THE SHARE APPLICANTS AND GENUINENESS OF THE TRANSACTIONS AND THE AO HAS NOT BROUGHT ON RECORD ANY EVIDENCE TO SHOW THAT THE APPELLANT H AS INTRODUCED ITS OWN FUNDS FROM UNDISCLOSED SOURCES IN THE FORM OF SHARE APPLICATION MONEY. THEREFORE, IN VIEW OF THE VARIOUS DECISIONS RELIED UPON BY THE APPELLANT, THE ADDITION OF RS. 3,04,39,780/-MADE BY THE AO U/S 68 IS HEREBY DELETED. 4.3 THE ADHOC DISALLOWANCE OF EXPENDITURE FOR RS.1. 50 LACS WAS REDUCED TO RS.0.75 LACS. REGARDING DISALLOWANCE U/S 43B ON ACCOUNT OF DELAYED PAYMENT OF ESI, LD. AO WAS DIREC TED TO VERIFY THE FACT THAT THE SAME WAS DEPOSITED ON OR BEFORE T HE DUE DATE OF FILING OF RETURN OF INCOME AND ALLOW THE SAME IN TE RMS OF DECISION OF HONBLE JURISDICTIONAL HIGH COURT IN CIT V/S UDAIPUR DUGDH UTPADAK SAHKARI SANGH LTD. 35 TAXMANN.COM 616. THE ADDITION OF UNSECURED LOAN RAISED FROM M/S INOX BUILDCON PVT . LTD. WAS DELETED SINCE THE LOAN AS WELL AS INTEREST HAD ALRE ADY BEEN REPAID BY THE ASSESSEE IN 03/05/2016 AND THE ADDITION MADE ON ACCOUNT OF SHARE APPLICATION MONEY U/S 68 FROM THE SAID ENTITY WAS ALREADY DELETED. AGGRIEVED AS AFORESAID THE REVENUE IS IN FURTHER AP PEAL BEFORE US. 5. UPON CAREFUL CONSIDERATION OF FACTUAL MATRIX AS ENUMERATED IN PRECEDING PARAGRAPHS, WE FIND THAT THE ASSESSEE HAS PLACED ON RECORD REQUISITE DOCUMENTARY EVIDENCES AS PER THE R EQUIREMENT OF 9 ITA NO.279/JODH/2018 M/S. SAI LEELA SYNTHETICS PRIVATE LIMITED ASSESSMENT YEAR: 2015-16 SEC. 68 TO PROVE THE IDENTITY OF SHARE APPLICANTS, THERE CREDITWORTHINESS AND GENUINENESS OF THE TRANSACTION S. THE ONUS THUS CASTED UPON HIM UNDER LAW WAS ALREADY DISCHARG ED. IN FACT, IT WAS INCUMBENT UPON LD. AO TO DISLODGE ASSESSEES CL AIM BY BRINGING ON RECORD ADVERSE MATERIAL AGAINST THE ASS ESSEE. HOWEVER, EXCEPT FOR THE FACT THAT NOTICES U/S 133(6 ) WERE RETURNED BACK, THERE IS NO MATERIAL ON RECORD TO DRAW ADVERS E INFERENCE AGAINST THE ASSESSEE. THE ASSESSEE HAD SUPPLIED NEW ADDRESSES OF ALL SHARE APPLICANTS DURING ASSESSMENT PROCEEDIN GS, HOWEVER, NO FURTHER ACTION WAS TAKEN BY LD.AO TO OBTAIN CONFIRM ATION OF THE SHARE APPLICANTS. THE DETAILS FURNISHED BY THE ASSE SSEE WERE CONVENIENTLY IGNORED. THE ASSESSEE HAD ALREADY PLAC ED ON RECORD THE CONFIRMATION OF ALL THE INVESTOR ENTITIES. NOT ONLY THE SOURCE OF FUNDS WAS PROVED BUT EVEN THE DETAILS OF SOURCE OF SOURCE OF INVESTMENT SO MADE IN THE ASSESSEE COMPANY WERE FUR NISHED. IT IS TRITE LAW THAT NO ADDITIONS COULD BE MADE MERELY ON THE BASIS OF CONJECTURES, SURMISES OR MERE DOUBTS. THEREFORE, LD . CIT(A) WAS QUITE RIGHT IN DELETING THE ADDITION MADE U/S 68 BY LD. AO. FINDING NO INFIRMITY IN THE SAME, WE DISMISS THIS GROUND OF APPEAL. 6. SO FAR THE ADHOC ESTIMATION OF EXPENDITURE IS CO NCERNED, WE FIND NO INFIRMITY IN THE ACTION OF LD. CIT(A) IN RE STRICTING THE SAME TO HALF SINCE THE ESTIMATION MADE BY LD. AO APPEARED T O BE ON THE HIGHER SIDE AND IT WAS WITHOUT ANY SOUND BASIS. THE ISSUE OF DISALLOWANCE U/S 43B HAS RIGHTLY BEEN ADJUDICATED I N THE LIGHT OF BINDING JUDICIAL PRECEDENT IN THE SHAPE OF DECISION OF HONBLE JURISDICTIONAL HIGH COURT AND THEREFORE, THE SAME W OULD NOT REQUIRE 10 ITA NO.279/JODH/2018 M/S. SAI LEELA SYNTHETICS PRIVATE LIMITED ASSESSMENT YEAR: 2015-16 ANY INTERFERENCE ON OUR PART. SIMILARLY, THE ADDITI ON OF UNSECURED LOAN WAS ALSO RIGHTLY DELETED SINCE THE LOAN WAS WE LL AS INTEREST THEREON HAD ALREADY BEEN REPAID BY THE ASSESSEE ON 03/05/2016 WHICH IS COUPLED BY THE FACT THAT THE ADDITION OF S HARE APPLICATION MONEY AS RECEIVED FROM THIS ENTITY HAD ALREADY BEEN DELETED, WHICH WE HAVE ALSO CONFIRMED. THEREFORE, THE IMPUGNED ORD ER WOULD NOT REQUIRE ANY INTERFERENCE ON OUR PART, IN ANY MANNER . 7. RESULTANTLY, THE APPEAL STANDS DISMISSED. ORDER PRONOUNCED U/R 34(4) OF INCOME TAX (APPELLATE TRIBUNAL) RULES, 1963. SD/- SD/- (SANDEEP GOSAIN) (MAN OJ KUMAR AGGARWAL) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI; DATED : 21/12/2020 SR.PS:-JAISY VARGHESE ! / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. !' / THE RESPONDENT 3. # ( ) / THE CIT(A) 4. # / CIT CONCERNED 5. $%!& ' , ' , / DR, ITAT, JODHPUR 6. %)*+ / GUARD FILE / BY ORDER, / (DY./ASSTT.REGISTRAR) , / ITAT, JODHPUR.