THE DCIT, CIRCLE3(1), VISAKHAPATNAM., Visakhapatnam V. M/s Godavari Toll Bridge Pvt. Ltd., Visakhapatnam

ITA 336/VIZ/2012

• Counselvise Citation: [2016] 130 COUNSELVISE.COM (IT) 9894 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 3 year(s) 11 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-09-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 15-12-2015
• Assessment Year: 2006-2007
• Appeal Filed On: 20-09-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: T S N MURTHY
• Assessee Lawyers: V RAGHAVENDRA RAO
• Keywords: Unexplained investment; Audit objection; Wholly owned subsidiary; Reason to believe
• Section: 142(1); 68; 69; 148

Judgement Text

ITA NO.336/VIZAG/2012 GODAVARI TOLL BRIDGE PVT. LTD., VISAKHAPATNAM 1 , , IN THE INCOME TAX APPELLATE TRIBUNAL, VISAKHAPATNAM BENCH, VISAKHAPATNAM . , . , $ BEFORE SHRI V. DURGA RAO, JUDICIAL MEMBER & SHRI G. MANJUNATHA, ACCOUNTANT MEMBER ./I.T.A.NO.336/VIZAG/2012 ( / ASSESSMENT YEAR: 2006-07) DCIT, CIRCLE - 3(1), VISAKHAPATNAM VS. GODAVARI TOLL BRIDGE PVT. LTD., VISAKHAPATNAM [PAN: AACCG7208D ] ( % / APPELLANT) ( &'% / RESPONDENT) / APPELLANT BY : SHRI T.S.N. MURTHY, DR / RESPONDENT BY : SHRI V. RAGHA VENDRA RAO, AR / DATE OF HEARING : 22.06.2016 / DATE OF PRONOUNCEMENT : 16.09.2016 / O R D E R PER G. MANJUNATHA, ACCOUNTANT MEMBER: THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAIN ST THE ORDER OF THE CIT(A), VISAKHAPATNAM DATED 28.6.2012 AND IT PE RTAINS TO THE ASSESSMENT YEAR 2006-07. ITA NO.336/VIZAG/2012 GODAVARI TOLL BRIDGE PVT. LTD., VISAKHAPATNAM 2 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E COMPANY, M/S. GODAVARI TOLL BRIDGE PVT. LTD. WAS INCORPORATED ON 23.3.2006 AS WHOLLY OWNED SUBSIDIARY OF M/S. NAVAYUGA ENGINEERING COMPA NY LIMITED (NECL) FILED ITS RETURN OF INCOME FOR THE ASSESSMEN T YEAR 2006-07 ON 30.3.2008 ADMITTING TOTAL INCOME OF ` NIL. SUBSEQUENTLY, IT HAS COME TO THE NOTICE OF THE ASSESSING OFFICER, THAT THE ASSES SEE COMPANY MADE HUGE INVESTMENTS FOR ACQUIRING A TOLL BRIDGE AT A V ERY HIGHLY APPRECIATED PREMIUM COST OF ` ` 125 CRORES WITHOUT AID OF ANY EXTERNAL FUNDS, HENCE , THE ASSESSING OFFICER HAS REASON TO BELIEVE THAT IN COME CHARGEABLE TO TAX ESCAPED ASSESSMENT IN THE FORM OF UNEXPLAINED INVES TMENTS. ACCORDINGLY, THE ASSESSING OFFICER RE-OPENED THE AS SESSMENT BY ISSUING NOTICE U/S 148 OF THE ACT. THE CASE HAS BEEN SELEC TED FOR SCRUTINY AND ACCORDINGLY, NOTICE U/S 143(2) & 142(1) OF THE ACT WERE ISSUED FROM TIME TO TIME. IN RESPONSE TO NOTICES, THE AUTHORIZED RE PRESENTATIVE OF THE ASSESSEE APPEARED FROM TIME TO TIME AND FURNISHED B OOKS OF ACCOUNTS AND RELEVANT INFORMATION. 3. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE A.O. NOTICED THAT THE ASSESSEE HAS ACQUIRED A TOLL BRIDGE FROM I TS HOLDING COMPANY M/S. NECL FOR A CONSIDERATION OF ` 125 CRORES. THE A.O. FURTHER OBSERVED THAT M/S. NECL HAS BUILT A TOLL BRIDGE ACR OSS THE GOUTAMI ITA NO.336/VIZAG/2012 GODAVARI TOLL BRIDGE PVT. LTD., VISAKHAPATNAM 3 BRANCH OF GODAVARI RIVER UNDER BOT SCHEME, WITH THE ASSISTANCE OF A.P. STATE GOVERNMENT, WITH A COST OF ` 86 CRORES ON WHICH THE STATE GOVERNMENT HAS SUBSIDIZED 80% OF THE COST OF THE BR IDGE AND THE REMAINING 20% OF THE COST OF THE BRIDGE HAS BEEN IN CURRED BY M/S. NECL. DURING THE YEAR UNDER CONSIDERATION, M/S. N ECL HAS TRANSFERRED RIGHT OVER THE BOT ASSET TO THE ASSESSEE COMPANY TO OPERATE, MAINTAIN AND COLLECT TOLL VIDE A RESOLUTION PASSED IN THE ME ETING OF ITS BOARD OF DIRECTORS HELD ON 31.3.2006 WHICH WAS ACCEPTED BY T HE ASSESSEE COMPANY BY ITS BOARD OF DIRECTORS RESOLUTION PASSE D ON THE SAME DAY. THE CONSIDERATION FOR THE TRANSFER OF BOT ASSET IS MUTUALLY AGREED AT ` 125 CRORES, WHICH IS PAYABLE BY M/S. GODAVARI TOLL BRIDGE PVT. LTD. TO M/S. NECL. THE CONSIDERATION FOR TRANSFER OF BOT A SSET HAS BEEN PAID BY WAY OF ALLOTMENT OF FULLY PAID EQUITY SHARES OF FACE VALUE OF ` 10/- EACH WITH A PREMIUM OF ` 990/- PER SHARE. 4. TO ASCERTAIN THE GENUINENESS OF THE TRANSACTION, THE A.O. ISSUED A SHOW CAUSE NOTICE AND ASKED TO EXPLAIN HOW THE VALU E OF THE BRIDGE IS FIXED AT ` 125 CRORES AND ALSO WHY THE AMOUNT OF ` 125 CRORES SHOULD NOT BE ASSESSED AS UNEXPLAINED INVESTMENT, AS THE A SSESSEE COMPANY IS INCORPORATED JUST THEN AND NO SOURCE OF INCOME TO I NVEST SUCH A HUGE SUM TO ACQUIRE THE BRIDGE. IN RESPONSE TO SHOW CAU SE NOTICE, THE ITA NO.336/VIZAG/2012 GODAVARI TOLL BRIDGE PVT. LTD., VISAKHAPATNAM 4 ASSESSEE COMPANY VIDE ITS SUBMISSION DATED 17.11.20 11 FURNISHED THE COPY OF PPP AGREEMENT, REASONS FOR TRANSFER OF ASSE T FROM M/S. NECL, ALLOTMENT OF SHARES, DETAILS OF TAKING OVER OF THE LOAN AND THE FBT RECONCILIATION STATEMENT ETC. IN ITS SUBMISSIONS, IT IS STATED BY THE COMPANY THAT THE VALUE OF THE BRIDGE HAS BEEN FIXED ON THE BASIS OF FUTURE EARNINGS IN THE FORM OF TOLL COLLECTIONS FOR THE REMAINING LEASE PERIOD. THE ASSESSEE FURTHER SUBMITTED THAT IT HAS PAID THE SAID CONSIDERATION IN THE FORM OF ASSUMPTION OF OUTSTAND ING LOAN AMOUNT OF ` 10.30 CRORES OWNED BY M/S. NECL AND THE BALANCE OF ` 114.70 CRORES HAS BEEN SETTLED BY WAY OF ALLOTMENT OF FULLY PAID UP EQUITY SHARES OF ` 10/- EACH AT A PREMIUM OF ` 990/- PER SHARE. THE ASSESSEE COMPANY FURTHER SUBMITTED THAT THE TRANSACTION HAS BEEN DUL Y RECORDED IN THE BOOKS OF ACCOUNTS AND THE CONSIDERATION HAS BEEN PA ID WITHOUT ANY CASH OR KIND BY ALLOTMENT OF EQUITY SHARES, THEREFORE, B Y NO STRETCH OF IMAGINATION IT CAN BE TREATED AS UNEXPLAINED INVEST MENT WITHIN THE MEANING OF THE PROVISIONS OF SECTION 69 OF THE ACT. 5. HE A.O. AFTER CONSIDERING THE EXPLANATIONS OF TH E ASSESSEE, HELD THAT THE ASSESSEE HAS FAILED TO CONVINCINGLY EXHIBI T ITS SOURCE FOR SUCH HUGE INVESTMENT OF ` 125 CRORES INTO A PUBLIC ASSET AT A HIGHLY APPRECIATED COST OF WHICH OWNERSHIP OF THE ASSET RE STED WITH ITA NO.336/VIZAG/2012 GODAVARI TOLL BRIDGE PVT. LTD., VISAKHAPATNAM 5 GOVERNMENT OF ANDHRA PRADESH, BY MERELY ALLOTTING S HARES OF A COMPANY WHICH IS FEW DAYS OLD. THE A.O. FURTHER HELD THAT THE ASSESSEE HAS ACQUIRED THE TOLL BRIDGE WITH A HIGHLY APPRECIATED COST OF ` 125 CRORES, WHEREAS THE WDV OF THE ASSET AS PER THE IT ACT IN T HE BOOKS OF ACCOUNTS OF THE HOLDING COMPANY WAS AT ` 13.46 CRORES. THE CONSIDERATION IS DISCHARGED SUBSTANTIALLY BY ALLOTM ENT OF SHARES WITH A PREMIUM AND PARTLY BY TAKING OVER BANK LOAN FROM M/ S. NECL. THOUGH THE ASSESSEE COMPANY SAYS THAT THERE IS NO CASH INV OLVED, IT DID NOT CONVINCINGLY EXPLAINS ITS SOURCE OF SUCH HUGE INVES TMENT WHEN THE COMPANY IS JUST IN THE FORMATION STAGE AND WITHOUT STARTING ANY BUSINESS ACTIVITY, HOW THE SHARES OF ` 10/- IS ISSUED FOR A PREMIUM OF ` 990/- PER SHARE IS NOT KNOWN. THE ASSESSEES CLAIM THAT IT H AD SECURITIES PREMIUM RESERVES TO MATCH ITS INVESTMENTS ON PPP MODE LEASE D ASSETS OF GOVERNMENT OF ANDHRA PRADESH IN THE VERY FORMATION YEAR WAS UNREALISTIC, THEREFORE, HELD THAT THE ENTIRE COST O F ` 125 CRORES HAS TO BE TREATED AS UNEXPLAINED SOURCE OF INVESTMENTS, WITH THESE OBSERVATIONS, MADE ADDITIONS OF ` 125 CRORES AS UNEXPLAINED INVESTMENT UNDER THE PROVISIONS OF SECTION 69 OF THE ACT AND BROUGHT TO TAX. 6. AGGRIEVED BY THE ASSESSMENT ORDER, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(A). BEFORE THE CIT(A), THE A SSESSEE REITERATED ITA NO.336/VIZAG/2012 GODAVARI TOLL BRIDGE PVT. LTD., VISAKHAPATNAM 6 THE SUBMISSIONS MADE BEFORE THE A.O. IN ADDITION T O MERITS OF THE ISSUE, THE ASSESSEE CHALLENGED THE RE-OPENING OF ASSESSMEN T. AS REGARDS RE- OPENING OF ASSESSMENT, THE ASSESSEE SUBMITTED THAT THE A.O. RE-OPENED THE ASSESSMENT BASED ON THE AUDIT OBJECTION WITHOUT ANY FRESH MATERIAL IN HIS POSSESSION TO FORM AN OPINION THAT THE INCOM E CHARGEABLE TO TAX ESCAPED ASSESSMENTS. AS REGARDS THE ADDITIONS TOWA RDS UNEXPLAINED INVESTMENT OF ` 125 CRORES, THE ASSESSEE SUBMITTED THAT IT HAS ACQ UIRED RIGHT OVER BOT ASSET FOR A CONSIDERATION OF ` 125 CRORES FROM ITS HOLDING COMPANY M/S. NECL AND THE CONSIDERATION FOR TRANSFE R OF ASSET HAS BEEN PAID PARTLY BY TAKING OVER LOAN OUTSTANDING OF ` 10.30 CRORES AND THE BALANCE AMOUNT OF ` 114.70 CRORES HAS BEEN PAID BY WAY OF ALLOTMENT OF FULLY PAID UP EQUITY SHARES OF ` 10/- EACH WITH A PREMIUM OF ` 990/- PER SHARE. IT HAS NOT INCURRED ANY AMOUNT EITHER IN CA SH OR KIND TO ACQUIRE THE ASSET. THE ASSESSEE FURTHER EXPLAINED THAT THE RE IS NOTHING UNEXPLAINED IN THIS TRANSACTION AND HENCE THE PROVI SIONS OF SECTION 68 OR 69 OF THE ACT WOULD HAVE NO APPLICATION. THE ASSES SEE FURTHER SUBMITTED THAT RELYING ON THE PROVISIONS OF SECTION 69 OF THE ACT, ADDITIONS CAN BE MADE UNDER THIS SECTION, WHERE ASS ESSEE HAS MADE INVESTMENTS WHICH ARE NOT REFLECTED IN THE BOOKS OF ACCOUNTS AND THE ASSESSEE OFFERS NO EXPLANATIONS ABOUT THE NATURE AN D SOURCE OF INVESTMENTS. THE ASSESSEE FURTHER SUBMITTED THAT TO INVOKE THE ITA NO.336/VIZAG/2012 GODAVARI TOLL BRIDGE PVT. LTD., VISAKHAPATNAM 7 PROVISIONS OF SECTION 69 OF THE ACT, AN INVESTMENT IS EITHER NOT RECORDED IN THE BOOKS OF ACCOUNTS OR THE SOURCES OF SUCH INV ESTMENTS ARE NOT EXPLAINED TO THE SATISFACTION OF THE A.O. HOWEVER, IN THE PRESENT CASE ON HAND, THE INVESTMENTS ARE RECORDED IN THE BOOKS OF ACCOUNTS AND THE SOURCE FOR THE SAME HAS BEEN EXPLAINED BY BOOK ENTR IES. THE CONSIDERATION FOR TRANSFER OF ASSET HAS BEEN SETTLE D BY WAY OF ALLOTMENT OF EQUITY SHARES OF SUBSIDIARY COMPANY WITHOUT ANY MONETARY CONSIDERATION IN THE FORM OF CASH OR KIND, THEREFOR E, THE A.O. WAS NOT CORRECT IN HOLDING THAT THE INVESTMENTS MADE IN ACQ UIRING TOLL BRIDGE IS UNEXPLAINED. IT WAS FURTHER SUBMITTED THAT THE BOT ASSET HAS BEEN VALUED BASED ON THE FUTURE EARNING CAPACITY OF THE ASSET FOR THE REMAINING LEASE PERIOD AND THE VALUATION HAS BEEN D ONE FOR THE PURPOSE OF GETTING BANK LOAN, THEREFORE, THERE IS NO ELEMEN T OF UNEXPLAINED INVESTMENT IN THIS TRANSACTION AND HENCE, THE A.O. WAS COMPLETELY ERRED IN INVOKING THE PROVISIONS OF SECTION 69 OF THE ACT . 7. THE CIT(A) AFTER CONSIDERING THE EXPLANATIONS OF THE ASSESSEE, HELD THAT THE A.O. HAS RECORDED THE REASONS FOR RE- OPENING THE ASSESSMENT AND ISSUED NOTICE BY FOLLOWING THE DUE P ROCEDURE OF LAW. THE ASSESSMENT HAS BEEN RE-OPENED WITHIN 4 YEARS FR OM THE END OF THE ASSESSMENT YEAR AND THE CASE WAS NOT SUBJECT TO EAR LIER SCRUTINY ITA NO.336/VIZAG/2012 GODAVARI TOLL BRIDGE PVT. LTD., VISAKHAPATNAM 8 ASSESSMENT. THE CIT(A) FURTHER HELD THAT IT IS ALS O HELD BY VARIOUS JUDICIAL FORUMS THAT AUDIT OBJECTION CAN ALSO BE TR EATED AS INFORMATION BASED ON WHICH A.O. CAN RECORD HIS SATISFACTION FOR RE-OPENING. WITH THESE OBSERVATIONS, UPHELD THE RE-OPENING OF ASSESS MENT AND REJECTED THE GROUND RAISED BY THE ASSESSEE. AS REGARDS THE ADDITIONS TOWARDS UNEXPLAINED INVESTMENT, THE CIT(A) HELD THAT THE AS SESSEE COMPANY DULY RECORDED THE INVESTMENT IN ITS BOOKS OF ACCOUN TS AND ALSO EXPLAINED THE SOURCES OF MAKING INVESTMENTS WHICH IS BY ALLOT MENT OF EQUITY SHARES. THE FACT OF SHARE ALLOTMENT IS REFLECTED I N THE BOOKS OF ACCOUNTS AND THE ANNUAL RETURN FILED WITH THE REGISTRAR OF C OMPANIES. THE ENTIRE TRANSACTION IS COMPLETED BY WAY OF BOOK ADJUSTMENT BETWEEN THE HOLDING COMPANY AND THE SUBSIDIARY COMPANY. THE QU ESTION OF VALUATION OF THE BRIDGE AND THE VALUATION OF THE SH ARES DO NOT SEEM TO HAVE ANY INCOME TAX ANGLE ATTACHED TO THEM. AS FAR AS THE QUESTION OF INVESTMENT IS CONCERNED, THE ENTIRE INVESTMENT IS R EFLECTED IN THE BOOKS OF ACCOUNTS AND IS CLEARLY EXPLAINED THROUGH BOOK E NTRIES AND HENCE THERE IS NO ELEMENT OF EITHER UNEXPLAINED INVESTMEN T OR UNACCOUNTED MONEY TRANSFER IN THE TRANSACTION. AS RIGHTLY POIN TED OUT BY THE ASSESSEE, THE PRE-REQUISITES FOR INVOKING SECTION 6 9 OF THE ACT ARE NOT FULFILLED AS THERE IS NO UNACCOUNTED OR UNEXPLAINED INVESTMENT IN THE TRANSACTIONS. WITH THESE OBSERVATIONS, DELETED ADDI TIONS MADE BY THE ITA NO.336/VIZAG/2012 GODAVARI TOLL BRIDGE PVT. LTD., VISAKHAPATNAM 9 A.O. TOWARDS UNEXPLAINED INVESTMENT. AGGRIEVED BY THE CIT(A) ORDER, THE REVENUE IS IN APPEAL BEFORE US. 8. THE LD. D.R. SUBMITTED THAT THE CIT(A) OUGHT TO HAVE APPRECIATED THE FACT REGARDING TREATMENT OF THE UNEXPLAINED INV ESTMENT. THE D.R. FURTHER SUBMITTED THAT THE CIT(A) OUGHT TO HAVE APP RECIATED THE FINDINGS OF THE A.O. I.E. THOUGH THERE IS NO CASH INVOLVEMEN T, THE ASSESSEE COMPANY DID NOT CONVINCINGLY EXHIBIT ITS SOURCE OF SUCH HUGE INVESTMENT OF ` 125 CRORES INTO A PUBLIC ASSET AT A HIGHLY APPRECI ATED COST OF WHICH OWNERSHIP RESTED WITH GOVERNMENT OF ANDHRA PRADESH BY MERELY ALLOTTING THE SHARES OF THE COMPANY WHICH IS FEW DA YS OLD. THE D.R. FURTHER SUBMITTED THAT THE ASSESSEE HAS FAILED TO E XPLAIN HOW THE COMPANY, WHICH IS FEW DAYS OLD WITHOUT ANY BUSINESS CAN VALUE ITS SHARES OF ` 10/- EACH WITH A PREMIUM OF ` 990/- PER SHARE. THE ASSESSEE HAS FAILED TO EXPLAIN THE VALUATION OF ASS ET AS WELL AS VALUATION OF SHARES, THEREFORE, THE A.O. IS RIGHT IN INVOKING THE PROVISIONS OF SECTION 69 OF THE ACT AND HIS ORDER SHOULD BE UPHEL D. ON THE OTHER HAND, THE LD. A.R. FOR THE ASSESSEE STRONGLY SUPPOR TED THE ORDER OF CIT(A). ITA NO.336/VIZAG/2012 GODAVARI TOLL BRIDGE PVT. LTD., VISAKHAPATNAM 10 9. WE HAVE HEARD BOTH THE PARTIES, PERUSED THE MATER IALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHOR ITIES BELOW. THE A.O. MADE ADDITIONS OF ` 125 CRORES UNDER THE PROVISIONS OF SECTION 69 OF THE ACT, AS UNEXPLAINED INVESTMENT TOWARDS INVES TMENT IN ACQUISITION OF TOLL BRIDGE. THE A.O. WAS OF THE OPINION THAT T HE ASSESSEE HAS FAILED TO CONVINCINGLY EXHIBIT ITS SOURCE OF INCOME OF SUC H A HUGE INVESTMENT OF ` 125 CRORES IN A BOT ASSET, THE OWNERSHIP OF WHICH IS RESTED WITH THE GOVERNMENT OF ANDHRA PRADESH. THE A.O. FURTHER WAS OF THE OPINION THAT THOUGH THERE IS NO ELEMENT OF CASH INVOLVEMENT , THE ACQUISITION OF BOT ASSET AT A HIGHLY APPRECIATED COST OF ` 125 CRORES AND SUBSTITUTION OF CONSIDERATION IN THE FORM OF ALLOTMENT OF EQUITY SHARES WITH A PREMIUM OF ` 990/- PER SHARE HAS NOT BEEN EXPLAINED. IT IS THE CONTENTION OF THE ASSESSEE THAT IT HAS ACQUIRED RIG HT OVER BOT ASSETS FROM ITS HOLDING COMPANY AND THE CONSIDERATION FOR TRANSFER OF ASSET HAS BEEN PAID BY WAY OF ALLOTMENT OF EQUITY SHARES WITH OUT ANY MONETARY CONSIDERATION IN THE FORM OF CASH. THE ASSESSEE FU RTHER CONTENDED IT HAS EXPLAINED THE PURPOSE OF VALUATION OF BOT ASSET AND ALSO METHOD OF VALUATION OF ASSET. ACCORDING TO THE ASSESSEE, IT HAS VALUED THE ASSET ON THE BASIS OF FUTURE EARNING CAPACITY OF ASSET AND T HE PURPOSE OF VALUATION OF ASSET IS TO GET BANK FINANCE FOR ITS B USINESS. ITA NO.336/VIZAG/2012 GODAVARI TOLL BRIDGE PVT. LTD., VISAKHAPATNAM 11 10. WE FIND FORCE IN THE ARGUMENTS OF THE ASSESSEE F OR THE REASON THAT THE ENTIRE TRANSACTION HAS BEEN COMPLETED BY WAY OF TRANSFER OF AN ASSET FROM THE HOLDING COMPANY M/S. NECL, TO A 100% SUBSI DIARY COMPANY M/S. GODAVARI TOLL BRIDGE PVT. LTD. THE TRANSFER O F BOT ASSET HAS BEEN AFFECTED BY WAY OF BOOK ADJUSTMENT BY ALLOTMENT OF FULLY PAID UP EQUITY SHARES. THE ASSESSEE HAS EXPLAINED THE REASONS FOR TRANSFER OF ASSET TO ITS SUBSIDIARY COMPANY. THE ASSESSEE ALSO EXPLAINE D HOW THE VALUE OF ASSET HAS BEEN FIXED AT A HIGHLY APPRECIATED COST O F ` 125 CRORES. THE ASSESSEE ALSO EXPLAINED THE SOURCE OF INVESTMENT BY WAY OF ALLOTMENT OF EQUITY SHARES AND PARTLY BY TAKING OVER LOAN OUTSTA NDING IN THE NAME OF HOLDING COMPANY. THEREFORE, WE ARE OF THE VIEW THA T THE A.O. WAS NOT CORRECT IN MAKING ADDITIONS U/S 69 OF THE ACT, WHEN THE ENTIRE TRANSACTION HAS BEEN DULY RECORDED IN THE BOOKS OF ACCOUNTS OF HOLDING COMPANY AND SUBSIDIARY COMPANY AND THE CONSIDERATIO N FOR TRANSFER OF ASSET HAS BEEN EXPLAINED. TO INVOKE THE PROVISIONS OF SECTION 69 OF THE ACT EITHER THE INVESTMENT IS NOT RECORDED IN THE BO OKS OF ACCOUNTS OR THE SOURCES FOR INVESTMENT HAS NOT BEEN EXPLAINED TO TH E SATISFACTION OF THE A.O. IN THE PRESENT CASE ON HAND, ON PERUSAL OF TH E FACTS AVAILABLE ON RECORD, WE FIND THAT THE INVESTMENT IN THE BOT ASSE T HAS BEEN DULY RECORDED IN THE BOOKS OF ACCOUNTS AND THE SOURCES F OR THE INVESTMENT HAS BEEN EXPLAINED. THE CIT(A) AFTER CONSIDERING T HE RELEVANT DETAILS ITA NO.336/VIZAG/2012 GODAVARI TOLL BRIDGE PVT. LTD., VISAKHAPATNAM 12 RIGHTLY DELETED THE ADDITIONS MADE BY THE A.O. WE DO NOT SEE ANY REASONS TO INTERFERE WITH THE ORDER PASSED BY THE C IT(A). HENCE, WE INCLINED TO UPHOLD THE CIT(A)S ORDER AND REJECT TH E APPEAL FILED BY THE REVENUE. 11. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. THE ABOVE ORDER WAS PRONOUNCED IN THE OPEN COURT ON 16 TH SEPT16. SD/- SD/- ( . ) ( . ) (V. DURGA RAO) (G. MANJUNATHA) /JUDICIAL MEMBER /ACCOUNTANT MEMBER # /VISAKHAPATNAM: ' /DATED : 16.09.2016 VG/SPS )# *# /COPY OF THE ORDER FORWARDED TO:- 1. / THE APPELLANT THE ACIT, CIRCLE-3(1), VISAKHAPA TNAM 2. / THE RESPONDENT GODAVARI TOLL BRIDGE PVT. LTD., 48-9-17, DWARAKA NAGAR, VISAKHAPATNAM 3. + / THE CIT, VISAKHAPATNAM 4. + ( ) / THE CIT (A), VISAKHAPATNAM 5. # . , . , # / DR, ITAT, VISAKHAPATNAM 6 . / GUARD FILE / BY ORDER // TRUE COPY // 12 . (SR.PRIVATE SECRETARY) . , # / ITAT, VISAKHAPATNAM