ITO 8(3)(2), MUMBAI V. SRINGERI TECHNOLOGIES P.LTD, MUMBAI

ITA 3924/MUM/2014

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 7860 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 6 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-12-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Assessment Year: 2010-2011
• Appeal Filed On: 30-05-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANJUNATH SWAMI
• Keywords: Unexplained cash credit; Income from undisclosed sources; Share purchase agreement; Question of law; Corroborative evidences
• Section: 143(3); 133(6); 131; 68; 263

Judgement Text

1 SRINGERI TECHNOLOGIES PVT LTD IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH E, MUMBAI BEFORE SHRI MAHAVIR SINGH (JUDICIAL MEMBER) AND SHRI G MANJUNATHA (ACCOUNTANT MEMBER) I.T.A NO.3924/MUM/2014) (ASSESSMENT YEAR: 2010-11) ITO, 8(3)(2), MUMBAI VS M/S SRINGERI TECHNOLOGIES P VT LTD FLAT NO.21, BLDG NO18, OFF MAHAKALI CAVES ROAD, ANDHERI (E), MUMBAI-93 PAN : AANCS9470J APPELLANT RESPONDEDNT APPELLANT BY SHRI MANJUNATH SWAMI RESPONDENT BY SHRI PRAKASH JHUNJHUNWALA DATE OF HEARING 10-11 -2017 DATE OF PRONOUNCEMENT 29-12-2017 O R D E R PER G MANJUNATHA, AM : THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAIN ST ORDER OF THE CIT(A)-18, MUMBAI DATED 21-03-2014 AND IT PERTAINS TO AY 2010- 11. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL:- 'I. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD. CIT(A) ERRED IN DELETING THE ADDITION OF RS.12, 00,00,000/- MADE ON ACCOUNT OF SHARE APPLICATION MONEY RECEIVED TREA TING IT AS UNEXPLAINED INCOME OF THE ASSESSEE U/S.68 OF THE I. T.ACT, 1961.' II. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE CIT(A) ERRED IN NOT APPRECIATING THE FACT THAT THE ASESSEE HAD FAILED TO DISCHARGE THE ONUS OF SUBSTANTIATING THE GENUINENES S OF THESE TRANSACTIONS AND CREDITWORTHINESS OF THE SAID INVES TORS.' III. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE 2 SRINGERI TECHNOLOGIES PVT LTD CIT(A) ERRED IN NOT APPRECIATING THE FACT THAT NEIT HER THE FINANCIAL POSITION OF THE SAID INVESTORS IS STRONG ENOUGH TO SUBSTANTIATE THE INVESTMENT OF SUCH HUGE AMOUNTS IN THE ASSESSEE-COM PANY NOR THE FINANCIAL POSITION OF THE ASSESSEE-COMPANY JUSTIFIES CHARGING OF PREMIUM OF RS.90/- PER SHARE HAVING FAC E VALUE OF RS.10/- IV. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE CIT(A) ERRED IN PLACING RELIANCE ON THE JUDGEMENT O F SUPREME COURT IN THE CASE OF LOVELY EXPORTS PVT. LTD. (216 CTP. 1 95) (SC) SINCE FACTS INVOLVED IN THAT CASE ARE DISTINGUISHABLE FRO M THE FACTS OF THE ASSESSEE'S CASE.' V. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE CIT(A) ERRED IN IGNORING THE RATIO LAID DOWN BY THE JURISDICTIONAL BOMBAY HIGH COURT DATED FEBRUARY 22, 2012 IN THE CA SE OF MAJOR METALS LTD. VS.UOI (WRIT PETITION NO. 397 FO 2011), WHEREIN JUDGEMENTS IN CASES OF M/S. LOVELY EXPORT PVT. LTD. (216 CTR 195) (SC), CIT V/S. CREATIVE WORLD TELEFILMS LTD (2011) (333 ITP. 100) (BORN) ETC. RELIED UPON BY THE ASSESSEE HAVE BEEN D ISCUSSED AND DISTINGUISHED WHILE HOLDING THAT THAT AMOUNTS S HOWN TO HAVE BEEN RECEIVED AS SHARE APPLICATION MONEY HAS BE TO BE TAXED AS INCOME OF INCOME OF THE ASESSEE COMPANY FROM UNDISC LOSED SOURCES IN ACCORDANCE WITH THE PROVISIONS OF SECTIO N 68 OF THE TMNCOME-TAX ACT, 1961.' VI.'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE CIT(A) ERRED IN IGNORING THE RATIO LAID DOWN BY THE HON'BLE DELHI HIGH COURT IN THE CASE OF (I) CIT VS. NOVA PROMOTER S & FINLEASE (PVT.) LTD. (2012) (342 ITP. 169) AND (II) CIT VS. NR PORTIFOLIO (PVT.) LTD. (2014) (42TAXMANN.COM 339), WHEREIN AFTER DISCUSSING THE JUDGEMENT IN THE CASE OF LOVELY EXPORTS IT WAS HELD THAT AMOUNTS SHOWN TO HAVE BEEN RECEIVED AS SHARE APPLICATION MONEY HAS TO BE TAXED AS UNDISCLOSED INCOME OF THE ASSESSSEE WITHIN THE MEANING OF SECTION 68 IF THE ASSESSEE FAILS TO ESTABLISH THE GENUINENESS OF THE TRANSACTIONS AND FINANCIAL CAPACITY OF THE SAID INVESTORS. 3 SRINGERI TECHNOLOGIES PVT LTD 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE C OMPANY WAS INCORPORATED ON 05-03-2010, FILED ITS RETURN OF INCOME FOR THE A SSESSMENT YEAR 2010-11 ON 06-10-2010 DECLARING TOTAL INCOME AT NIL. THE ASSE SSEE HAS SUBSCRIBED SHARE CAPITAL OF RS.3,86,540,500 AND SHARE PREMIUM OF RS. 12,60,00,000. DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE COMPANY HAS ISSUED SHARES WITH A FACE VALUE OF RS.10 AT A PREMIUM OF RS.90 PER SHARE FOR ALL OUTSIDE PARTIES, HOWEVER, ISSUED SHARES TO ITS DIRECTORS AT A FACE VALUE F RS .10/-. OUT OF THE TOTAL SHARE CAPITAL RECEIVED OF RS.16,46,50,500 THE ASSESSEE CO MPANY HAS RECEIVED SHARE CAPITAL OF RS.12 CRORES FROM 9 COMPANIES, OUT OF WH ICH 3 COMPANIES ARE REGISTERED WITH REGISTRAR OF COMPANIES (ROC), MUMBA I HAVING ADDRESS AT MUMBAI AND REMAINING 6 COMPANIES ARE REGISTERED IN REGISTRAR OF COMPANIES, KOLKATTA. DURING THE COURSE OF ASSESSMENT PROCEEDI NGS, THE AO ISSUED SHOW CAUSE NOTICE AND ASKED THE ASSESSEE TO PROVE THE ID ENTITY, GENUINENESS OF TRANSACTIONS AND CREDITWORTHINESS OF THE PARTIES, W HO SUBSCRIBED TO THE SHARE CAPITAL. THE AO ALSO ASKED THE ASSESSEE TO JUSTIFY ISSUE OF SHARES AT A PREMIUM OF RS.90 PER SHARE. IN RESPONSE TO SHOW CAUSE NOTI CE THE ASSESSEE HAS FURNISHED VARIOUS DETAILS INCLUDING SHARE APPLICATION FORMS, SHARE CERTIFICATES, RETURN OF ALLOTMENT FILED WITH ROC, CONFIRMATION OF ACCOUNT F ROM PARTIES, BOARD RESOLUTION FOR ISSUE OF SHARES AT PREMIUM, PAN OF S UBSCRIBERS, CIN MASTER DATA (ROC), I.T. ACKNOWLEDGEMENT RECEIPT OF COMPANIES AL ONGWITH THEIR FINANCIAL STATEMENTS AND BANK STATEMENTS. THE AO, AFTER CON SIDERING RELEVANT SUBMISSIONS OF THE ASSESSEE AND ALSO ON PERUSING VA RIOUS DETAILS FILED BY THE 4 SRINGERI TECHNOLOGIES PVT LTD SUBSCRIBER, ISSUED NOTICES TO ALL SUBSCRIBERS U/S 1 33(6) TO THE ADDRESSES GIVEN. OUT OF THOSE 10 COMPANIES, NOTICES ISSUED TO 3 PART IES, VIZ. M/S V.D.R. CONSULTANTS P LTD, M/S HEENA TEXTILES LTD AND M/S K ATRINA TRADING PVT LTD WERE NOT SERVED. REMAINING PARTIES HAD FILED THEIR REPLIES TO NOTICE U/S 133(6) AND SUBMITTED VARIOUS DETAILS CALLED FOR BY THE AO. LATER, THE 3 COMPANIES, ON WHOM NOTICES U/S 133(6) COULD NOT BE SERVED HAVE FI LED THEIR REPLIES TO THE AO ALONGWITH VARIOUS DETAILS. THE AO ALSO ISSUED SUMM ONS U/S 131 TO DIRECTORS OF THE COMPANY. IN RESPONSE TO SUMMONS, THE DIRECTORS OF CERTAIN COMPANIES HAVE APPEARED BEFORE THE AO AND GIVEN THEIR DEPOSITION W HEREIN THEY HAVE ADMITTED SUBSCRIPTION OF SHARE CAPITAL OF ASSESSEE COMPANY. THE AO ALSO RECORDED STATEMENT OF SHR RITESH BURHAD, CA U/S 131 OF THE A CT. BASED ON THE EVIDENCES FILED BY THE ASSESSEE, INFORMATION RECEIVED FROM SU BSCRIBERS, NOTICES ISSUED U/S 133(6) AND STATEMENTS RECORDED FROM DIRECTORS OF CE RTAIN COMPANIES, THE AO CAME TO THE CONCLUSION THAT ALTHOUGH THE ASSESSEE H AS PROVED IDENTITY OF SUBSCRIBERS, BUT FAILED TO PROVE GENUINENESS OF TRA NSACTIONS AND CREDITWORTHINESS OF THE PARTIES AS ALL THE COMPANIES ARE PAPER COMPA NIES AND DO NOT HAVE ANY CAPACITY TO PROVE SUBSCRIPTION OF HUGE SHARE CAPITA L TO THE ASSESSEE COMPANY. THE AO ALSO HAS TAKEN INTO ACCOUNT REPORT RECEIVED FROM DDIT(INV), KOLKATA, IN RESPONSE TO A COMMISSION ISSUED TO VERIFY GENUIN ENESS OF CLAIM IN RESPECT OF KOLKATA PARTIES WHEREIN THE INSPECTOR ATTACHED TO T HE DDIT(INV), KOLKATA SUBMITTED THE REPORT THAT THE PARTIES WERE NOT AVAI LABLE AT THE GIVEN ADDRESS. THE AO HAS GIVEN HIS OWN REASONS TO COME TO THE CON CLUSION THAT THE ALLEGED 5 SRINGERI TECHNOLOGIES PVT LTD SHARE CAPITAL RECEIVED FROM 9 COMPANIES IS NOT GENU INE AND SUCH FINDINGS HAS BEEN GIVEN IN HAS ASSESSMENT ORDER ON PAGE 3 TO 27. THE AO HAS RELIED UPON VARIOUS DECISIONS AND ALSO DISTINGUISHED CASE LAWS RELIED UPON BY THE ASSESSEE TO COME TO THE CONCLUSION THAT THE ASSESSEE HAS FAILED TO ESTABLISH GENUINENESS OF TRANSACTION AND CREDITWORTHINESS OF THE PARTIES AND ACCORDINGLY MADE ADDITION OF RS.12 CRORES U/S 68 AS UNEXPLAINED CREDIT. 3. AGGRIEVED BY THE ASSESSMENT ORDER, THE ASSESSEE PRE FERRED APPEAL BEFORE THE CIT(A) . BEFORE THE CIT(A), THE ASSESSEE HAS F ILED ELABORATE WRITTEN SUBMISSIONS WHICH ARE REPRODUCED IN CIT(A)S ORDER ON PAGES 14-18. THE ASSESSEE ALSO RELIED UPON PLETHORA OF JUDGEMENTS IN CLUDING DECISION OF HONBLE SUPREME COURT IN THE CASE OF CIT VS LOVELY EXPORTS PVT LTD & HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS GOA SPONGE & POWER LTD. THE SUM AND SUBSTANCE OF THE ASSESSEES SUBMISSION IS THAT IT HAS FILED VARIOUS DETAILS TO PROVE IDENTITY OF SUBSCRIBERS AND ALSO FILED ENORMO US DOCUMENTS TO PROVE GENUINENESS OF TRANSACTIONS AND CREDITWORTHINESS OF PARTIES. THE ASSESSEE FURTHER SUBMITTED THAT THE AO HAS IGNORED ALL EVIDE NCES FILED BY THE ASSESSEE MERELY ON SUSPICION AND SURMISES ONLY ON THE GROUND THAT THE NOTICES ISSUED TO THOSE COMPANIES WERE RETURNED UNSERVED DESPITE FURN ISHING OF DOCUMENT ALONGWITH AFFIDAVIT BEFORE COMPLETION OF ASSESSMENT . THE ASSESSEE FURTHER SUBMITTED THAT SUBSCRIBERS TO THE SHARE CAPITAL HAV E FILED THEIR AFFIDAVITS AND CONFIRMED TRANSACTION OF SHARE APPLICATION MONEY WI TH THE ASSESSEE COMPANY ALONG WITH ALL DOCUMENTS. THE AO HAS IGNORED ALL E VIDENCES FILED BY THE 6 SRINGERI TECHNOLOGIES PVT LTD ASSESSEE TO MAKE ADDITION TOWARDS SHARE APPLICATION MONEY U/S 68 OF THE ACT. 4. THE CIT(A), AFTER CONSIDERING SUBMISSIONS OF THE AS SESSEE AND ALSO RELYING UPON VARIOUS CASE LAWS RELIED BY THE ASSESSSEE OBSE RVED THAT THE ASSESSEE HAS FILED COMPLETE DOCUMENTARY EVIDENCES TO PROVE IDENT ITY OF SUBSCRIBERS AND ALSO FILED ENORMOUS DOCUMENTS TO PROVE GENUINENESS OF TR ANSACTION AND CREDITWORTHINESS OF THE PARTIES. THE CIT(A) FURTHE R OBSERVED THAT THE AO HAS IGNORED ALL EVIDENCES FILED BY THE ASSESSEE ON FLIM SY GROUNDS IGNORING THE FACT THAT THE SUBSCRIBER TO THE SHARE CAPITAL HAS CAPACI TY TO PROVE SUBSCRIPTION OF SHARE CAPITAL TO ASSESSEE COMPANY. THE AO ALSO IGN ORED AFFIDAVIT FILED BY THE SUBSCRIBERS WHEREIN THEY HAVE DEPOSED BEFORE THE MA GISTRATE ALONGWITH ALL EVIDENCES. THE CIT(A) FURTHER REFERRING TO THE DEC ISION OF HONBLE SUPREME COURT IN THE CASE OF CIT VS LOVELY EXPORTS (2008) 2 16 CTR 195(SC) OBSERVED THAT WHEN THE ASSESSEE HAS FURNISHED DETAILS OF SUB SCRIPTION INCLUDING THEIR PAN, IT IS INCUMBENT UPON THE AO TO PROCEED FURTHER IN ACCORDANCE WITH LAW TO REOPEN ASSESSMENT OF SUBSCRIBERS, IF AT ALL HE IS H AVING DOUBT ABOUT THE GENUINENESS OF TRANSACTION AND CREDITWORTHINESS OF THE PARTIES, BUT CANNOT MAKE ADDITION U/S 68 OF THE ACT TO SHARE CAPITAL IN THE HANDS OF THE ASSESSEE. THE CIT(A) ALSO DISCUSSED THE PROVISO PROVIDED TO SECTI ON 68 BY THE FINANCE ACT, 2012 WEF 01-04-2013 AND OBSERVED THAT THERE IS NO R EASON FOR THE AO TO MAKE ADDITION TOWARDS SHARE CAPITAL AND SHARE APPLICATIO N MONEY IN THE HANDS OF THE ASSESSEE AS THE SAID PROVISO INSERTED BY THE FINANC E ACT, 2012 IS APPLICABLE FROM AY 2013-14 ONWARDS. WITH THESE OBSERVATION, THE CI T(A) DELETED THE ADDITION 7 SRINGERI TECHNOLOGIES PVT LTD MADE BY THE AO TOWARDS SHARE CAPITAL U/S 68 OF THE INCOME-TAX AC6, 1961. AGGRIEVED BY THE ORDER OF CIT(A), THE REVENUE IS IN APPEAL BEFORE US. 5. THE LD.DR SUBMITTED THAT THE LD.CIT(A) ERRED IN DEL ETING THE ADDITION OF RS.12 CRORES MADE ON ACCOUNT OF SHARE APPLICATION M ONEY RECEIVED TREATING IT AS UNEXPLAINED INCOME OF THE ASSESSEE U/S 68 OF THE AC T. THE LD.DR FURTHER SUBMITTED THAT THE LD.CIT(A) ERRED IN NOT APPRECIAT ING THE FACT THAT NEITHER THE FINANCIAL POSITION OF THE SAID INVESTORS IS STRONG ENOUGH TO SUBSTANTIATE THE INVESTMENT OF ENORMOUS SUMS, NOR THE FINANCIAL POSI TION OF THE ASSESSEE COMPANY JUSTIFIES CHARGING OF PREMIUM OF RS.90 PER SHARE HAVING FACE VALUE OF RS.10 PER SHARE. THE LD.DR FURTHER SUBMITTED THAT THE ASSESSEE WAS INCORPORATED IN THE FINANCIAL YEAR RELEVANT TO AY 2 009-10 AND WITHOUT THERE BEING ANY BUSINESS ACTIVITY CHARGING HUGE PREMIUM O F RS.90 PER SHARE AND SUBSCRIPTION OF SHARE CAPITAL WITH A HUGE PREMIUM O F RS.90 PER SHARE OF UNKNOWN COMPANIES APPEARS TO BE SHAM TRANSACTION. THOUGH THE ASSESSEE HAS FILED VARIOUS DETAILS TO PROVE IDENTITY OF THE SUBS CRIBERS, THE SHELL COMPANIES FORMED BY HAWALA OPERATORS ALWAYS KEEP DOCUMENTS TO PROVE IDENTITY. BUT THE FACT IS THAT MERE FILING EVIDENCES FOR PROVING IDEN TITY WILL NOT DISCHARGE THE ONUS CAST UPON THE ASSESSEE TO PROVE THE REQUIREMENTS OF SECTION 68, I.E. GENUINENESSS OF TRANSACTION AND CREDITWORTHINESS OF THE PARTIES. THE AO HAS BROUGHT OUT VARIOUS REASONS TO COME TO THE CONCLUSION THAT THE TRANSACTION THE ASSESSEE COMPANY HAD WITH THOSE 9 COMPANIES IS NOT GENUINE T RANSACTIONS AND HENCE THE CIT(A) WAS ERRED IN DELETING ADDITION MADE BY THE A O TOWARDS SHARE 8 SRINGERI TECHNOLOGIES PVT LTD APPLICATION MONEY U/S 68 OF THE ACT. IN SUPPORT OF HIS ARGUMENT, HE RELIED UPON THE DECISION OF HONBLE BOMBAY HIGH COURT IN THE CA SE OF MAJOR METALS LTD VS UOI WRIT PETITION NO.397 OF 2011 AND HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS NOVA PROMOTERS & FINLEASE PVT LTD (2012 342 ITR 169 & HONBLE CALCUTTA HIGH COURT IN THE CASE OF SUBBALAXMI VANIJ YA PVT LTD VS CIT 155 ITD 171 (CAL) AND RAJ MANDIR ESTATE PVT LTD VS PR.CIT 3 86 ITR 162. 6. ON THE OTHER HAND, THE LD.AR FOR THE ASSESSEE STRON GLY SUPPORTING THE ORDER OF THE CIT(A) SUBMITTED THAT THE ASSESSEE HAS PROVED IDENTITY, GENUINENESS OF TRANSACTION AND CREDITWORTHINESS OF THE PARTIES BY FILING VARIOUS DOCUMENTS INCLUDING, PAN, CIN MASTER DATA, SHARE APPLICATION FORM, BOARD RESOLUTION, SHARE CERTIFICATE, CONFIRMATION OF ACCOUNT, I.T. AC KNOWLEDGEMENT RECEIPT OF SUBSCRIBERS, BALANCESHEETS, BANK STATEMENTS, REPLY TO THE NOTICE ISSUED U/S 133(6) OF SHAREHOLDERS, AFFIDAVIT FILED BY THE DIRE CTORS OF SHAREHOLDER COMPANIES, SALES-TAX RETURNS AND SHARE CAPITAL AND RESERVES OF SHAREHOLDERS. THE AO HAS IGNORED ALL EVIDENCES TO COME TO THE CONCLUS ION THAT ALL THOSE COMPANIES ARE PAPER COMPANIES WITHOUT ANY BUSINESS ACTIVITY. THE LD.AR FURTHER SUBMITTED THAT THE ASSESSEE HAS FILED ALL DETAILS T O PROVE THE EXISTENCE OF COMPANIES AND THEIR BUSINESS ACTIVITIES WHICH IS EV IDENT FROM THE FACT THAT ALL THESE COMPANIES ARE HAVING HUGE TURNOVER AND NET PR OFIT AND ALSO RESERVES AND SURPLUS TO JUSTIFY SUBSCRIPTION OF SHARE CAPITAL TO THE ASSESSEE COMPANY. THE ASSESSEE ALSO FURNISHED OTHER DETAILS INCLUDING BAN K STATEMENTS OF SUBSCRIBERS TO PROVE THAT THERE IS NO INSTANCE OF ANY CASH DEPOSIT BEFORE THE DATE OF ISSUE OF 9 SRINGERI TECHNOLOGIES PVT LTD CHEQUES AND ALSO SALES-TAX RETURNS TO PROVE THE BUS INESS ACTIVITY OF THE ASSESSEE. THE LD.AR FURTHER SUBMITTED THAT OUT OF THE 9 COMPA NIES, 3 COMPANIES WERE ASSESSED IN MUMBAI, IN WHICH THE SCRUTINY ASSESSMEN T ORDERS HAVE BEEN PASSED FOR THE ASSESSMENT YEARS 2011-12 AND 2012-13, WHERE THIS ISSUE WAS NOT FOUND PLACE IN ASSESSMENT ORDER. THE LD.AR FURTHER SUBMI TTED THAT MERELY BECAUSE NOTICES ISSUED U/S 133(6) WERE RETURNED UNSERVED, A DDITION CANNOT BE MADE TOWARDS GENUINE TRANSACTIONS DESPITE FURNISHING OF ALL EVIDENCES BEFORE THE AO AT THE TIME OF COMPLETION OF ASSESSMENT. THE LD.AR FURTHER SUBMITTED THAT IT IS INCORRECT ON THE PART OF THE AO TO COME TO THE CONC LUSION THAT THE ASSESSEE HAS ROUTED ITS OWN FUNDS IN THE FORM OF SHARE CAPITAL F ROM THOSE COMPANIES WITHOUT APPRECIATING THE FACT THAT THE ASSESSEE COMPANY WAS INCORPORATED ON 05-03-2010 AND NOT EVEN CARRIED OUT BUSINESS ACTIVITY FOR ONE MONTH DURING THE RELEVANT FINANCIAL YEAR. ON THE OTHER HAND, THE ASSESSEE HA S FURNISHED ENORMOUS DOCUMENTS TO PROVE THE TRANSACTION AS GENUINE SUBSC RIPTION OF SHARE CAPITAL BUT THE AO HAS IGNORED ALL EVIDENCES ONLY ON FLIMSY GR OUNDS BY CONSIDERING THE FACTS WHICH WERE FAVOURABLE TO THE REVENUE IGNORING THE FACT THAT THE TRANSACTIONS WITH ASSESSEE COMPANY ARE GENUINE TRAN SACTIONS. THE LD.AR FURTHER REFERRING TO THE CERTIFICATE ISSUED BY THE CHARTERED ACCOUNTANT, M/S POOJAN MEHTA & CO DATED 10-11-2017 SUBMITTED THAT A LL THESE COMPANIES ARE ACTIVE IN THE WEBSITE OF MCA AND NONE OF THE COMPAN IES HAS BEEN DELISTED IN THE LIST PREPARED BY THE MCA AS SHELL COMPANIES. T HE LD.AR ALSO FURNISHED THE MASTER DATA GENERATED FROM THE WEBSITE OF MCA AS PE R WHICH ALL THE COMPANIES 10 SRINGERI TECHNOLOGIES PVT LTD WERE ACTIVE AND FILED THEIR BALANCE-SHEET UPTO 31-0 3-2016 AND IN SOME CASES, UPTO 2017. 7. THE LD.AR REFERRING TO THE OBSERVATION OF THE AO WI TH REGARD TO THE AFFIDAVITS FILED BY THE DIRECTORS OF SUBSCRIBERS, S UBMITTED THAT THERE IS NO REASON FOR THE AO TO IGNORE AFFIDAVITS WHICH ARE SUPPORTED BY VALID DOCUMENTS AND ALSO DEPOSED BEFORE A MAGISTRATE COURT. THE AO, DURING THE COURSE OF REMAND PROCEEDINGS ALSO REITERATED HIS STAND TAKEN IN THE ASSESSMENT PROCEEDINGS DESPITE THE ASSESSEE HAS FURNISHED FURTHER EVIDENCE TO PROVE THE GENUINENESS OF TRANSACTION. THE MERE FACT THAT THE ASSESSEE HAS I SSUED SHARE CAPITAL WITH A PREMIUM IS NOT A REASON FOR DOUBTING THE GENUINENES S OF THE TRANSACTION. THE ISSUE OF SHARES AT A PREMIUM AND SUBSCRIPTION OF SU CH SHARES BY THE SUBSCRIBERS IS WITHIN THE KNOWLEDGE OF THE ASSESSEE COMPANY AND SUBSCRIBERS AND THE AO CANNOT DOUBT THE GENUINE TRANSACTIONS MERELY ON SUS PICION AND SURMISES WITHOUT THERE BEING ANY ADVERSE EVIDENCE IN HIS POSSESSION. IN THIS CASE, THE AO HAS TREATED GENUINE SHARE TRANSACTION WITH ASSESSEE COM PANY AS UNEXPLAINED CASH CREDIT ON FLIMSY GROUNDS IGNORING EVIDENCE FILED BY THE ASSESSEE. THE LD.AR REFERRING TO THE PAPER BOOK FILED WHICH CONTAINS 16 PAGES WHEREIN HE HAS FURNISHED ASSESSMENT ORDER COPIES OF 4 COMPANIES PA SSED FOR THE AYS 2008-09 TO 2012-13. THE LD.AR FURTHER SUBMITTED THAT THE A O HAS PASSED SCRUTINY ASSESSMENT ORDER IN RESPECT OF THESE 4 COMPANIES WH EREIN HE HAS EXAMINED THE ISSUE OF INVESTMENT IN ASSESSEE COMPANY WITHOUT THE RE BEING ANY ADVERSE COMMENTS. THEREFORE, THERE IS NO REASON FOR THE AO TO DOUBT THE GENUINENESS OF 11 SRINGERI TECHNOLOGIES PVT LTD TRANSACTIONS. AS REGARDS CREDITWORTHINESS OF THE P ARTIES, THESE COMPANIES ARE HAVING REGULAR BUSINESS ACTIVITIES WHICH IS EVIDENT FROM THE FACT THAT THEY HAVE FILED REGULAR INCOME-TAX RETURNS WHEREIN THEY HAVE DECLARED HUGE SHARE CAPITAL AND RESERVES AND SURPLUS OF RS.336.67 CRORES, IN AG GREGATE WHEREAS INVESTMENT IN ASSESSEE COMPANY IS ONLY RS.12 CRORES. IN SUPPO RT OF HIS ARGUMENTS, HE RELIED UPON THE FOLLOWING JUDGEMENTS:- 1 CIT VS. ORCHID INDUSTRIES PVT LTD (2017) 397 IT R 136 (BOMBAY HIGH COURT) 2 CIT VS GAGANDEEP INFRASTRUCTURE PVT LTD ITA NO. 1 613 OF 2014 (BOMBAY HIGH COURT) DATED 20/03/2017 3 CIT VS CREATIVE WORLD TELEFLIMS LTD 333 ITR 100 ( BOM-HIGH COURT) 4 CIT VS GOA SPONGE AND POWER LTD ITA NO.16 OF 2012 (BOMBAY HIGH COURT) 5 CIT VS GREEN INFRA LTD ITA NO. 1162 OF 2014 6 CIT VS LOVELY EXPORTS (P) LTD 216 CTR 195 (SC) 7 CIT VS STELLER INVESTMENT LTD 251 ITR 263 (SC) 8 JAYA SECURITIES LTD VS CIT (2008) 166 TAXMAN 7 (A LL) (SLP OF DEPT DISMISSED) 9 CIT VS JAY DEE SECURITIES & FINANCE LTD 27-28 32 TAXMANNCOM 91(ALL-HIGH_COURT) 10 CIT VS EXPO GLOBE INDIA LTD 361 LTR 0147 (DEL-H IGH COURT) 11 CIT VS GANGESHWARI METAL PVT LTD (2014) 361 ITR 10 (DEL-HIGH COURT) 12 CIT VS DWARKADHISH INVESTMENT (P) LTD 6 (2011) 3 30 ITR298 (DEL HIGH COURT) 13 CIT VS VRINDAVAN FARMS (P) LTD ITA 71/2015 (HC-D EL) 14 CIT VS NA Y BHARAT DUPLEX LTD (2013) 35 TAXMANN.COM 289 (ALL H IGH COURT) 15 MOD CREATIONS PVT LTD VS ITO (2011) 62 DTR 25 (DEL-HIGH COURT) 8. WE HAVE HEARD BOTH THE PARTIES, PERUSED MATERIALS AVAILABLE ON RECORD 12 SRINGERI TECHNOLOGIES PVT LTD AND GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. THE ONLY ISSUE THAT NEEDS TO BE RESOLVED IS WHETHER, ON THE FACTS AND IN THE CI RCUMSTANCES OF THE CASE, SHARE CAPITAL RECEIVED FROM 9 COMPANIES IS UNEXPLAI NED CASH CREDIT U/S 68 OF THE INCOME-TAX ACT, 1961. THE AO HAS MADE ADDITION OF RS.12 CRORES TOWARDS SHARE CAPITAL FROM 9 COMPANIES AS UNEXPLAIN ED CASH CREDIT U/S 68 OF THE ACT, ON THE GROUND THAT THE ASSESSEE HAS ESTABL ISHED IDENTITY OF SUBSCRIBER TO THE SHARE CAPITAL BUT FAILED TO PROVE GENUINENES S OF TRANSACTION AND CREDITWORTHINESS OF THE PARTIES. THE AO HAS BROUGH T OUT VARIOUS REASONS TO COME TO THE CONCLUSION THAT THE ALLEGED SUBSCRIBER TO THE SHARE CAPITAL ARE PAPER COMPANIES AND THEY DID NOT HAVE ANY BUSINESS ACTIVITY TO SUBSTANTIATE SUBSCRIPTION OF HUGE SHARE CAPITAL TO THE ASSESSEE COMPANY. ACCORDING TO THE AO, ALL THESE COMPANIES ARE PAPER COMPANIES, DID NO T HAVE ANY ACTUAL BUSINESS ACTIVITY. THE AO FURTHER OBSERVED THAT TH ESE COMPANIES DID NOT HAVE ANY CAPACITY TO ESTABLISH CREDITWORTHINESS TO PROVE SUBSCRIPTION OF SHARE CAPITAL. THE AO FURTHER OBSERVED THAT THE ASSESSEE IS ALSO NOT JUSTIFIED IN ISSUING SHARE CAPITAL AT A PREMIUM OF RS.90 PER SHA RE FOR SHARES HAVING FACE VALUE OF RS.10 IN THE FIRST YEAR OF ITS INCORPORATI ON. ACCORDING TO THE AO, ALL THESE SEQUENCE OF EVENTS PROVES AN UNDOUBTED FACT T HAT THESE COMPANIES ARE PAPER COMPANIES AND THE ASSESSEE IS NOT ABLE TO PRO VE THE GENUINENESS OF TRANSACTION AND CREDITWORTHINESS OF THE PARTIES AND HENCE, HE OPINED THAT THE ALLEDGED SHARE CAPITAL RECEIVED FROM 9 COMPANIES IS UNEXPLAINED CASH CREDIT. 9. THE AO MADE ADDITION TOWARDS SHARE CAPITAL U/S 68 O F THE ACT, ON THE 13 SRINGERI TECHNOLOGIES PVT LTD GROUND THAT THE ASSESSEE HAS FAILED TO OFFER ANY EX PLANATION WITH REGARD TO THE CREDITS FOUND IN THE NATURE OF SHARE CAPITAL AND SH ARE PREMIUM. THE PROVISIONS OF SECTION 68, DEALS WITH A CASE, WHERE ANY SUM FOUND CREDITED IN THE BOOKS OF ACCOUNT OF THE ASSESSEE IN THE FINANCI AL YEAR IN WHICH THE ASSESSEE, OFFERS NO EXPLANATION OR EXPLANATION OFFE RED BY THE ASSESSEE, IN THE OPINION OF THE AO IS NOT SATISFACTORY, THEN SUM FOU ND CREDITED MAY BE TREATED AS INCOME OF THE ASSESSEE OF THAT PREVIOUS YEAR. A PLAIN READING OF SECTION 68, MAKES IT VERY CLEAR THAT TO FIX ANY CREDIT WITHIN T HE AMBIT OF SECTION 68 OF THE ACT, THE AO HAS TO EXAMINE 3 INGREDIENTS, I.E. IDEN TITY, GENUINENESS OF TRANSACTION AND CREDITWORTHINESS OF THE PARTIES. I F THE ASSESSEE PROVES ALL 3 INGREDIENTS, THEN THE ONUS SHIFTS TO THE AO TO PROV E OTHERWISE. SIMILARLY, THE PROVISO INSERTED BY THE FINANCE ACT, 2012 WEF 01-04 -2013 DEALS WITH THE CASE WHERE THE SUM SO CREDITED CONSISTS OF SHARE APPLICA TION MONEY, SHARE CAPITAL, SHARE PREMIUM, BY WHATEVER NAME CALLED AND EXPLANAT ION OFFERED BY SUCH ASSESSEE SHALL BE DEEMED TO BE NOT SATISFACTORY UNL ESS SUCH PERSON BEING A RECIPIENT IN WHOSE NAME SUCH CREDIT IS RECORDED IN THE BOOKS OF SUCH COMPANY ALSO OFFERS AN EXPLANATION ABOUT THE NATURE AND SOU RCE OF SUCH SUM SO CREDITED. AS PER THE PROVISO, IF THE ASSESSEE FAIL S TO EXPLAIN THE SOURCE OF SOURCE OF SHARE CAPITAL OR SHARE APPLICATION MONEY, THEN THE ADDITION CAN BE MADE TOWARDS SHARE CAPITAL, AND SHARE APPLICATION M ONEY IN THE HANDS OF THE ASSESSEE U/S 68 OF THE INCOME-TAX ACT, 1961. WHETH ER PROVISO INSERTED BY THE FINANCE ACT W.E.F. 01-04-2013 IS APPLICABLE PROSPEC TIVELY OR RETROSPECTIVELY, 14 SRINGERI TECHNOLOGIES PVT LTD HAS BEEN DECIDED BY VARIOUS COURTS. ACCORDING TO T HE RATIO LAID DOWN BY THE HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS GAG ANDEEP INFRASTRUCTURE LTD (2017) 394 ITR 680 (BOM) THE HONBLE COURT OBSE RVED THAT PROVISO INSERTED TO SECTION 68 W.E.F. 01-04-2013 IS CONSIDE RED TO BE PROSPECTIVE IN NATURE AND APPLICABLE FROM A.Y.2013-14 ONWARDS. TH EREFORE, WE ARE OF THE VIEW THAT NO ADDITION CAN BE MADE U/S 68 OF THE INC OME-TAX ACT, 1961 IN RESPECT OF SHARE CAPITAL AND SHARE APPLICATION MONE Y OR SHARE PREMIUM BEFORE INSERTION OF PROVISO TO SECTION 68 IF THE SOURCE OF SOURCE IS NOT EXPLAINED BY THE ASSESSEE. 10. HAVING SAID SO, LET US EXAMINE WHETHER THE ASSESSE E HAS DISCHARGED THE BURDEN CAST UPON IT UNDER SECTION 68 OF THE INCOME- TAX ACT, 1961 IN RESPECT OF SHARE CAPITAL RECEIVED FROM SUBSCRIBERS. THE AO HA S NOT DISPUTED THE FACT THAT THE ASSESSEE HAS FURNISHED VARIOUS EVIDENCES TO PRO VE IDENTITY OF THE SUBSCRIBERS. THE AO CATEGORICALLY ADMITTED IN HIS ASSESSMENT ORDER THAT THE ASSESSEE HAS FILED VARIOUS DETAILS INCLUDING PAN, C IN MASTER DATA, AFFIDAVITS OF SHAREHOLDERS AND IT ACKNOWLEDGEMENT RECEIPT OF S UBSCRIBERS TO PROVE THE IDENTITY. THE AO HAS DISPUTED GENUINENESS OF TRANS ACTIONS AND CREDITWORTHINESS OF THE PARTIES. ACCORDING TO THE AO, THE SUBSCRIBERS TO THE SHARE CAPITAL ARE NOT HAVING CAPACITY TO PROVE CRED ITWORTHINESS AND ALSO THE TRANSACTION WITH THE ASSESSEE COMPANY ARE NOT GENUI NE. THE AO HAS VARIOUS REASONS TO COME TO THE CONCLUSION THAT THE ASSESSEE HAS FAILED TO DISCHARGE GENUINENESS OF TRANSACTION AND CREDITWORTHINESS OF THE PARTIES. ACCORDING TO 15 SRINGERI TECHNOLOGIES PVT LTD THE AO, MERE FURNISHING OF INCOME-TAX RETURNS AND B ALANCE-SHEETS OF SUBSCRIBERS WOULD NOT BE SUFFICIENT COMPLIANCE OF D ISCHARGING GENUINENESS OF TRANSACTIONS, THAT TOO, IN A CASE WHERE NOTICE ISSU ED U/S 133(6) TO THE SUBSCRIBERS TO THEIR GIVEN ADDRESSES WERE REMAIN UN SERVED. THE AO ALSO BROUGHT OUT SOME OTHER REASONS INCLUDING STATEMENTS GIVEN BY DIRECTORS OF CERTAIN COMPANIES AND CHARTERED ACCOUNTANT, WHO HAS ISSUED AUDIT REPORT IN RESPECT OF THESE COMPANIES. THE AO ALSO DOUBTED CO NFIRMATION FILED BY THE ASSESSEE AND ALSO SHARE APPLICATION FORMS. THE AO HAS DOUBTED APPLICATION FORM FOR ISSUE OF SHARE AND AUDIT REPORTS TO COME T O THE CONCLUSION THAT THE SHARE APPLICATION FORM ISSUED BY THE ASSESSEE ARE S TEREOTYPED. THE AO ALSO IGNORED STATEMENT GIVEN BY THE DIRECTORS WHEREIN TH EY HAVE CATEGORICALLY ACCEPTED THAT THEY HAVE SUBSCRIBED TO THE SHARE CAP ITAL OF THE ASSESSEE COMPANY. THE AO ALSO IGNORED AFFIDAVIT FILED BY TH E SUBSCRIBERS ON THE GROUND THAT THE REPORT RECEIVED FROM DDIT(INV), KOL KATA PROVES A FACT THAT THESE COMPANIES ARE NOT IDENTIFIED AT THEIR ADDRESS ES. 11. HAVING CONSIDERED ARGUMENTS OF BOTH THE SIDES AND M ATERIALS AVAILABLE ON RECORD, WE DO NOT FIND ANY MERIT IN THE REASONS GIVEN BY THE AO TO COME TO THE CONCLUSION THAT THE ASSESSEE HAS FAILED TO PROV E THE GENUINENESS OF TRANSACTION AND CREDITWORTHINESS OF THE PARTIES ON THE GROUND THAT THE ASSESSEE HAS FILED ENORMOUS DETAILS IN RESPECT OF 9 COMPANIE S INCLUDING THEIR PAN DETAILS, CIN MASTER DATA, AFFIDAVITS SWORN BEFORE E XECUTIVE MAGISTRATE, REPLY TO THE NOTICES ISSUED U/S 133(6). THE ASSESSEE ALS O FILED COPIES OF ASSESSMENT 16 SRINGERI TECHNOLOGIES PVT LTD ORDER PASSED U/S 143(3) BY THE DEPARTMENT IN RESPEC T OF 4 COMPANIES. THE ASSESSEE ALSO FILED A CERTIFICATE FROM A CHARTERED ACCOUNTANT CERTIFYING THE ACTIVE STATUS OF THE COMPANY IN THE WEBSITE OF MINI STRY OF CORPORATE AFFAIRS. ON GOING THROUGH VARIOUS DETAILED FILED BY THE ASSE SSEE, WE FIND THAT THERE IS NO REASON FOR THE AO TO DOUBT THE GENUINENESS OF TR ANSACTIONS OF CREDITWORTHINESS OF THE PARTIES. WE FURTHER NOTICE THAT ALL 9 COMPANIES ARE ACTIVE IN THE WEBSITE OF ROC AND ALSO THEY HAVE FIL ED THEIR BALANCE-SHEET UPTO 31-03-2016 AND IN SOME CASES UPTO 31-03-2017. WE F URTHER NOTICE THAT THE AO HAS FURNISHED A REPORT ACCEPTING THE FACT THAT A LL THESE COMPANIES ARE ACTIVE IN THE WEBSITE OF MCA AND NONE OF THE COMPAN IES NAME IS STRUCK OFF FROM THE LIST PUBLISHED BY THE MCA AS SHELL COMPANY . WE FURTHER NOTICE THAT THE ASSESSEE HAS FILED BALANCE-SHEET OF ALL 9 SUBSC RIBERS WHEREIN THEY HAVE HUGE SHARE CAPITAL AND RESERVES AND SURPLUS TO ESTA BLISH CREDITWORTHINESS OF THE PARTIES. ON PERUSAL OF THE BALANCE-SHEET FILED BY THE ASSESSEE, WE FIND THAT THE AGGREGATE OF SHARE CAPITAL AND RESERVES OF 9 COMPAN IES IS AT RS.333.67 CRORES, WHEREAS INVESTMENT IN ASSESSEE COMPANY IS ONLY RS.1 2 CRORES. WE FURTHER NOTICE THAT ALL COMPANIES ARE HAVING REGULAR BUSINE SS RANGING FROM 2 TO 3 CRORES. THE ASSESSEE ALSO FURNISHED COPIES OF SALE S-TAX RETURNS FILED WITH COMMERCIAL TAX DEPARTMENT TO PROVE THE BUSINESS ACT IVITY OF THE ASSESSEE. ALL THESE EVIDENCES GO TO PROVE AN UNDOUBTED FACT T HAT THESE COMPANIES ARE NOT PAPER COMPANIES AND RECOGNIZED WITH BUSINESS AC TIVITY. WE FURTHER OBSERVE THAT THE ASSESSEE ALSO FILED AFFIDAVIT FOR M THE DIRECTORS OF SUBSCRIBER 17 SRINGERI TECHNOLOGIES PVT LTD COMPANIES, WHEREIN THY HAVE EXPLAINED THE REASONS F OR NOT RECEIVING COMMUNICATION SENT BY THE AO U/S 133(6) OF THE ACT. THEY FURTHER STATED IN THE AFFIDAVIT THAT THEY HAVE SUBSCRIBED TO THE SHAR E CAPITAL OF THE COMPANY AND ALSO FURNISHED SUPPORTING EVIDENCES TO JUSTIFY INVE STMENT IN SHARE CAPITAL OF THE COMPANY. WE FURTHER NOTICE THAT THE ASSESSEE H AS FURNISHED BANK STATEMENT OF SUBSCRIBERS WHEREIN WE DO NOT FIND ANY INSTANCE OF CASH DEPOSITS OR TRANSFER FROM OTHER COMPANIES PRIOR TO THE DATE OF TRANSFER TO THE ASSESSEE COMPANY. THEREFORE, WE ARE OF THE VIEW THAT THE AO WAS INCORRECT IN TREATING SHARE CAPITAL ALONGWITH SHARE APPLICATION MONEY AS UNEXPLAINED CASH CREDIT U/S 68 OF THE INCOME-TAX ACT, 1961. 12. COMING TO THE OBSERVATION OF THE AO WITH REGARD TO THE ISSUE OF SHARES AT A PREMIUM. THE AO HAS QUESTIONED THE ISSUE OF SHAR ES AT A PREMIUM OF RS.90 PER SHARE WITH A FACE VALUE OF RS.10 PER SHARE ON THE GROUND THAT THE ASSESSEE IS NEW COMPANY WITHOUT ANY BUSINESS, NOT ABLE TO JU STIFY ISSUE OF SHARES AT A PREMIUM OF RS.90 PER SHARE. WE DO NOT FIND ANY MER IT IN THE FINDINGS OF THE AO FOR THE REASON THAT THE ISSUE OF SHARES AT A PRE MIUM AND SUBSCRIPTION TO SUCH SHARES IS WITHIN THE KNOWLEDGE OF THE COMPANY AND THE SUBSCRIBERS TO THE SHARE CAPITAL AND THE AO CANNOT HAVE ANY ROLE TO PL AY AS LONG AS THE ASSESSEE HAS PROVE THE GENUINENESS OF TRANSACTIONS. WE FURT HER NOTICE THAT THE AO CANNOT QUESTION THE ISSUE OF SHARES AT A PREMIUM AN D ALSO CANNOT BRING TO TAX SUCH SHARE PREMIUM WITHIN THE PROVISIONS OF SECTION 68 OF THE ACT, BEFORE INSERTION OF PROVISO TO SECTION 68 BY THE FINANCE A CT, 2012 WEF 01-04-2013 18 SRINGERI TECHNOLOGIES PVT LTD WHICH EVIDENT FROM THE FACT THAT THE HONBLE BOMBAY HIGH COURT HAS HELD THAT PROVISO INSERTED TO SECTION 68 IS RETROSPECTIV E IN NATURE. THEREFORE, WE ARE OF THE CONSIDERED VIEW THAT THE AO HAS TREATED SHARE CAPITAL AND SHARE PREMIUM AS UNEXPLAINED CREDIT U/S 68 OF THE ACT, ON FLIMSY GROUNDS IGNORING ALL EVIDENCES FILED BY THE ASSESSEE. 13. COMING TO THE CASE LAWS RELIED UPON BY THE ASSESSEE . THE ASSESSEE HAS RELIED UPON PLETHORA OF JUDGEMENTS INCLUDING THE DE CISION OF HONBLE SUPREME COURT IN THE CASE OF CIT VS LOVELY EXPORTS PVT LTD (2008) 216 CTR 195 (SC). IN THE CASE LAWS RELIED UPON BY THE ASSE SSEE, THE ISSUE HAS BEEN DEALT AS UNDER:- CIT VS. GOA SPONGE AND POWER LTD (13/02/2012) TAX APPEAL NO. 16 OF 2012 (HIGH COURT- BOMBAY) 'ONCE THE AUTHORITIES HAVE GOT ALL THE DETAILS, INC LUDING THE NAME AND ADDRESSES OF THE SHAREHOLDERS, THEIR PAN/G IR NUMBER, SO ALSO THE NAME OF THE BANK FROM WHICH THE ALLEGED INVESTORS RECEIVED MONEY AS SHARE APPLICATION, THEN, IT CANNO T BE TERMED AS 'BOGUS'. THE CONTROVERSY IS COVERED BY TH E JUDGEMENTS RENDERED B Y THE HON'BLE SUPREME COURT I N THE CASE OF LOVELY EXPORTS PVT LTD, VS. CIT, (2008) 216 CTR (SC ) 195, AS ALSO BY THIS COURT IN CIT VS. CREATIVE WORLD TELE FILMS LTD, (2011) 333 ITR 100 (BOM). IN SUCH CIRCUMSTANCES, WE ARE OF THE VIEW THAT THE TRIBUNAL'S FINDING THAT THERE IS NO JUSTIFICATION I N THE ADDITION MADE UNDER SECTION 68 OF THE INCOME TAX ACT , , 1961 NEITHER SUFFERS FROM ANY PERVERSITY NOR GIVES RISE TO ANY S UBSTANTIAL QUESTION OF LAW.' CIT VS. CREATIVE WORLD TELE FILMS LTD (2011) 333 ITR 100 (BORN-HIGH COURT) 'THE QUESTION SOUGHT TO BE RAISED IN THE APPEAL WAS ALSO RAISED BEFORE THE TRIBUNAL AND THE TRIBUNAL WAS PLEASED TO FOLLOW THE 19 SRINGERI TECHNOLOGIES PVT LTD JUDGMENT OF THE APEX COURT IN THE CASE OF CIT VS. L OVELY EXPORTS (P) LTD. (2008) 216 CTR (SC) 195. WHEREIN THE APEX COURT OBSERVED THAT IF THE SHARE APPLICATION MONEY IS REC EIVED BY THE ASSESSEE-COMPANY FROM ALLEGED BOGUS SHAREHOLDERS, W HOSE NAMES ARE GIVEN TO THE AO, THEN THE DEPARTMENT CAN ALWAYS PROCEED AGAINST THEM AND IF NECESSARY REOPEN THEIR INDIVIDUAL ASSESSMENTS. IN THE CASE IN HAND, IT IS NOT DISPUTE D THAT THE ASSESSEE HAD GIVEN THE DETAILS OF NAME AND ADDRESS OF THE SHAREHOLDER, THEIR PAN/GIR NUMBER AND HAD ALSO GIVE N THE CHEQUE NUMBER, NAME OF THE BANK. IT WAS EXPECTED ON THE PART OF THE AO TO MAKE PROPER INVESTIGATION AND REACH THE S HAREHOLDERS. THE AO DID NOTHING EXCEPT ISSUING SUMMONS WHICH WER E ULTIMATELY RETURNED BACK WITH AN ENDORSEMENT 'NOT TRACEABLE IN OUR CONSIDERED VIEW, THE AO OUGHT TO HAVE FOUND OUT THE IR DETAILS THROUGH PAN CARDS, BANK ACCOUNT DETAILS OR FROM THE IR BANKERS SO AS TO REACH THE SHAREHOLDERS SINCE ALL THE RELEV ANT MATERIAL DETAILS AND PARTICULARS WERE GIVEN BY THE ASSESSEE TO THE AO. IN THE ABOVE CIRCUMSTANCES, THE VIEW TAKEN BY THE TRIBUNAL CANNOT BE FAULTED.' CIT VS. LOVELY EXPORTS (P) LTD (2008) 216 CTR 195 (SC) 'IF THE SHARE APPLICATION MONEY IS RECEIVED BY THE ASSESSEE COMPANY FROM ALLEGED BOGUS SHAREHOLDERS, WHOSE NAMES ARE GI VEN TO THE AO, THEN THE DEPARTMENT IS FREE TO PROCEED TO REOPEN TH EIR INDIVIDUAL ASSESSMENTS IN ACCORDANCE WITH LAW, BUT IT CANNOT B E REGARDED AS UNDISCLOSED INCOME OF ASSESSEE COMPANY.' CIT VS. STELLER INVESTMENT LTD (2001) 251 ITR 263 (SC) (CIVIL APPEAL) 'THAT THE INCREASE IN SUBSCRIBED CAPITAL OF THE RES PONDENT- COMPANY COULD NOT BE A DEVICE OF CONVERTING BLACK M ONEY INTO WHITE WITH THE HELP OF FORMATION OF AN INVESTMENT C OMPANY, ON THE ROUND THAT, EVEN IF IT BE ASSUMED THAT THE S UBSCRIBERS TO THE INCREASED CAPITAL WERE NOT GENUINE, TINDER NO C IRCUMSTANCES COULD THE AMOUNT OF SHARE CAPITAL BE REGARDED AS UN DISCLOSED 20 SRINGERI TECHNOLOGIES PVT LTD INCOME, AN APPEAL WAS TAKEN BY THE DEPARTMENT TO TH E SUPREME COURT. THE SUPREME COURT DISMISSED THE APPE AL HOLDING THAT THE TRIBUNAL HAD COME TO A CONCLUSION ON FACTS AND NO INTERFERENCE WAS CALLED FOR.' CIT VS. NAV BHARAT DUOLEX LTD (2013) 35 TAXMANN.COM 289 (ALL-HIGH COURT) 'WE HAVE CONSIDERED THE ARGUMENTS OF THE COUNSEL FO R THE PARTIES. CIT(A) FOUND THAT FIVE COMPANIES SUBSCRIBING THE EQ UITY SHARES AMOUNTING TO RS. 25,00.000/- WERE IDENTIFIED AND TH EY HAD SUBMITTED THEIR BANK STATEMENTS, CASH EXTRACTS AND RETURNS FILING RECEIPTS. AS SUCH IDENTITY OF THE SHARE APPLICANT C OMPANIES AND PURCHASE OF SHARE HAD BEEN PROVED BY THE ASSESS EE. SUPREME COURT IN THE CASES OF CIT V. STELLER INVEST MENTS LTD. [2001] 251 ITR 263 AND LOVELY EXPORTS CASE (SUPRA), HAS HELD THAT THE IDENTITY OF THE SHAREHOLDER ALONE IS REQUI RED TO BE PROVED, IN CASE OF THE CAPITAL CONTRIBUTED BY THE S HAREHOLDERS. ACCORDINGLY CIT(A) AND THE TRIBUNAL HAS NOT COMMITT ED ANY ILLEGALITY IN ALLOWING THE APPEAL OF THE ASSESSEE. WE DO NOT FIND ANY ILLEGALITY IN THE JUDGMENT OF THE CIT(A) AND THE TR IBUNAL.' CIT VS. JA Y DEE SECURITIES & FINANCE LTD (2013) 32 TAXMANN.COM 91 (ALL-HIGH COURT) 'THE TRIBUNAL RECORDED FINDINGS THAT THE ASSESSEE H AD PRODUCED THE RETURN OF INCOME FILED BY THE RELEVANT SHAREHOL DERS WHO HAD PAID SHARE APPLICATION MONEY. THE ASSESSEE HAD ALSO PROD UCED THE CONFIRMATION OF SHARE HOLDERS INDICATING THE DETAIL S OF ADDRESSES, PAN AND PARTICULARS OF CHEQUES THROUGH WHICH THE AM OUNT WAS PAID TOWARDS THE SHARE APPLICATION MONEY. THE TRIBU NAL THEREAFTER RELIED UPON THE JUDGMENT OF THE SUPREME COURT IN CIT V. LOVELY EXPORTS (P.) LTD WHEREIN IT WAS HELD THAT IF THE ASSESSEE PRODUCES THE NAMES, ADDRESSES, PAN DETAILS OF THE S HARE HOLDERS THEN THE ONUS ON THE ASSESSEE TO PROVE THE SOURCE O F SHARE APPLICATION MONEY STANDS DISCHARGED. IF THE ASSESSI NG AUTHORITY WAS NOT SATISFIED WITH THE CREDITWORTHINE SS OF THE SHAREHOLDERS, IT WAS OPEN TO THE ASSESSING AUTHORIT Y TO VERIFY THE SAME IN THE HANDS OF THE SHAREHOLDERS CONCERNED, TH E TRIBUNAL HAS RELIED UPON AN ORDER OF THE SUPREME COURT IN CASE O F CIT V. 21 SRINGERI TECHNOLOGIES PVT LTD DIVINE LEASING & FINANCE LTD. IN VIEW OF THE DECISI ON 'OF THE SUPREME COURT, WE DISMISS THE APPEALS WITH OBSERVAT IONS THAT THE DEPARTMENT IS FREE TO PROCEED TO REOPEN THEIR INDIV IDUAL ASSESSMENTS OF THE SHAREHOLDERS WHOSE NAMES AND DET AILS WERE GIVEN TO THE ASSESSING OFFICER.' ACIT VS. VENKATESHWARLSPAT PVT LTD (2009) 319 ITR 393 (CHHATISGARH-HIGH COURT) 'IF THE SHARE APPLICATIONS ARE RECEIVED BY THE ASSE SSEE FROM ALLEGED BOGUS SHAREHOLDERS, WHOSE NAMES ARE GIVEN TO THE AS SESSING OFFICER, THEN THE DEPARTMENT IS FREE TO PROCEED TO REOPEN TH EIR INDIVIDUAL ASSESSMENTS IN ACCORDANCE WITH LAW, BUT IT CANNOT B E REGARDED AS THE UNDISCLOSED INCOME OF THE ASSESSEE.' MOD CREATIONS PVT LTD VS. /TO (2013) 354 ITR 282 (DEL-HIGH COURT) 'HELD, ALLOWING THE APPEAL, (I) THAT THE ASSESSEE H AD DISCHARGED THE INITIAL ONUS PLACED ON IT. IN THE EVENT THE REV ENUE STILL HAD A DOUBT WITH REGARD TO THE GENUINENESS OF THE TRANSAC TIONS IN ISSUE OR AS REGARDS THE CREDITWORTHINESS OF THE CRE DITORS, IT WOULD HAVE HAD TO DISCHARGE THE ONUS WHICH HAD SHIF TED ON TO IT. A BALD ASSERTION BY THE ASSESSING OFFICER THAT THE CR EDITS WERE A CIRCULAR ROUTE ADOPTED BY THE ASSESSEE TO PLOUGH BA CK ITS OWN UNDISCLOSED INCOME INTO ITS ACCOUNTS, COULD BE OF N O AVAIL. THE REVENUE WAS REQUIRED TO PROVE THIS ALLEGATION. AN ALLEGATION BY ITSELF WHICH IS BASED ON ASSUMPTION WILL NOT PAS S MUSTER IN LAW. THE REVENUE WOULD BE REQUIRED TO BRIDGE THE GAP BET WEEN THE SUSPICIONS AND PROOF IN ORDER TO BRING HOME THIS AL LEGATION. THE TRIBUNAL WITHOUT ADVERTING TO THE PRINCIPLE LAID ST RESS ON THE FACT THAT DESPITE OPPORTUNITIES, THE ASSESSEE AND/OR THE CREDITORS HAD NOT PROVED THE GENUINENESS OF THE TRANSACTION. BASE D ON THIS IT CONSTRUED THE INTENTIONS OF THE ASSESSEE AS BEING M ALA FIDE. THE TRIBUNAL OUGHT TO HAVE ANALYSED THE MATERIAL RATHER THAN BE BURDENED BY THE FACT THAT SOME OF THE CREDITORS HAD CHOSEN NOT TO MAKE A PERSONAL APPEARANCE BEFORE THE ASSESSING OFF ICER. IF THE ASSESSING OFFICER HAD ANY DOUBT ABOUT THE MATERIAL PLACED ON RECORD, WHICH WAS LARGELY BANK STATEMENTS OF THE CR EDITORS AND 22 SRINGERI TECHNOLOGIES PVT LTD THEIR INCOME-TAX RETURNS, IT COULD GATHER THE NECES SARY INFORMATION FROM THE SOURCES TO WHICH THE INFORMATI ON WAS ATTRIBUTABLE......IF IT HAD ANY DOUBTS WITH REGARD TO THEIR CREDITWORTHINESS, THE REVENUE COULD ALWAYS BRING TH E SUM IN QUESTION TO TAX IN THE HANDS OF THE CREDITORS OR SU B- CREDITORS.' CIT VS. AL ANAM AGRO FOODS (P.) LTD (2013) 38 TAXMA NN.CORN 375 (ALL-HIGH COURT) TRIBUNAL, HOWEVER, HELD THAT SINCE IDENTITY OF SHAREHOLDERS STOOD PROVED ON RECORD, AMOUNT OF SHAR E APPLICATION MONEY COULD NOT BE ADDED TO INCOME OF A SSESSEE. ACCORDING TO TRIBUNAL, IN SUCH A CASE AMOUNT COULD BE TAXED IN HANDS OF PERSONS WHO HAD INVESTED' CIT VS. DWARKADHISH INVESTMENT (P) LTD (2011) 330 ITR 298 (DEL-HIGH COURT) 'JUST BECAUSE THE CREDITORS/SHARE APPLICANTS COULD NOT BE FOUND AT THE ADDRESS GIVEN, IT WOULD NOT GIVE THE R EVENUE THE RIGHT TO INVOKE S. 68 REVENUE HAS ALL THE POWE R AND WHEREWITHAL TO TRACE ANY PERSONMOREOVER, IT IS SET TLED LAW THAT THE ASSESSEE NEED NOT TO PROVE THE 'SOURCE OF SOURCE' IN THE INSTANT CASE, THE TRIBUNAL HAS CONFIRMED THE OR DER OF THE CIT(A) DELETING THE IMPUGNED ADDITION HOLDING T HAT THE ASSESSEE HAS BEEN ABLE TO PROVE THE IDENTITY OF THE SHARE APPLICANTS AND THE SHARE APPLICATION MONEY HAS BEEN RECEIVED BY WAY OF ACCOUNT PAYEE CHEQUES.' CIT VS. NAMASTEY CHEMICALS PVT LTD (2013) 33 TAXMANN.COM 271 (GUJ-HIGH COURT) 'IN THE PRESENT CASE ALSO, THE RESPONDENT ASSESSEE HAS RECEIVED SHARE APPLICATION MONEY FROM DIFFERENT SUB SCRIBERS. IT WAS FOUND THAT LARGE NUMBER OF SUBSCRIBERS HAD R ESPONDED TO THE LETTERS ISSUED BY THE ASSESSING OFFICER OR S UMMONS ISSUED BY HIM AND SUBMITTED THEIR AFFIDAVITS. IN SO ME CASES SUCH REPLIES WERE NOT RECEIVED THROUGH POSTS. RS. 9 LACS REPRESENTED THOSE ASSESSEES WHO DENIED HAVING MADE ANY INVESTMENT ALTOGETHER. THE ISSUE THUS WOULD FALL SQ UARELY WITHIN THE AMBIT OF THE JUDGMENT OF THE SUPREME COU RT IN THE CASE NF LOVELY EXPORTS (SUPRA). NO ERROR OF LAW CAN BE STATED 23 SRINGERI TECHNOLOGIES PVT LTD TO HAVE BEEN COMMITTED BY THE TRIBUNAL. TAX APPEAL IS THEREFORE DISMISSED.' CIT VS. PEOPLES GENERAL HOSPITAL LTD (2013) 356 ITR 65 (MP-HIGH COURT) 'HELD, DISMISSING THE APPEALS, THAT IT THE ASSESSEE HAD RECEIVED SUBSCRIPTIONS TO THE PUBLIC OR RIGHTS ISSU E THROUGH BANKING CHANNELS AND FURNISHED COMPLETE DET AILS OF THE SHAREHOLDERS, NO ADDITION COULD BE MADE TINDER SECTION 68 OF THE INCOME-TAX ACT, 1961, IN THE ABSENCE OF ANY POSITIVE MATERIAL OR EVIDENCE TO INDICATE THAT THE SHAREHOLD ERS WERE BENAMIDARS OR FICTITIOUS PERSONS OR THAT ANY PART O F THE SHARE CAPITAL REPRESENTED THE COMPANY'S OWN INCOME FROM UNDISCLOSED SOURCES. IT WAS NOBODY'S CASE THAT THE NON- RESIDENT INDIAN COMPANY WAS A BOGUS OR NON-EXISTENT COMPANY OR THAT THE AMOUNT SUBSCRIBED BY THE COMPAN Y BY WAY OF SHARE SUBSCRIPTION WAS IN FACT THE MONEY OF THE ASSESSEE. THE ASSESSEE HAD ESTABLISHED THE IDENTITY OF THE INVESTOR WHO HAD PROVIDED THE SHARE SUBSCRIPTION AN D THAT THE TRANSACTION WAS GENUINE. THOUGH THE ASSESSEE'S CONT ENTION WAS THAT THE CREDITWORTHINESS OF THE CREDITOR WAS A LSO ESTABLISHED, IN THIS CASE, THE ESTABLISHMENT OF THE IDENTITY OF THE INVESTOR ALONE WAS TO BE SEEN. THUS, THE ADDITI ON WAS RIGHTLY DELETED.' CIT VS. SHREE RAMA MULTI TECH LTD (2013) 34 TAXMANN.COM 177 (GUJ-HC) 'IT IS NOTED THAT COMMISSIONER (APPEALS) AS WELL AS THE TRIBUNAL HAVE DULY CONSIDERED ISSUE AND HAVING FOUN D COMPLETE DETAILS OF THE RECEIPTS OF SHARE APPLICATION MONEY, A/ON GWITH THE FORM NAMES AND AD DRESSES, PAN AND OTHER REQUISITE DETAILS, THEY FOUND COMPLET E ABSENCE OF THE GROUNDS NOTED FOR INVOKING THE PROVISION OF SEC TION 68. MOREOVER, BOTH RIGHTLY HAD APPLIED THE DECISION OF CIT VS. LOVELY EXPORTS (P) LTD TO THE CASE OF THE ASSESSEE. THEREF ORE, NO REASON WAS FOUND IN ABSENCE OF ANY ILLEGALITY MUCH LESS ANY PE RVERSITY TOO TO INTERFERE WITH THE ORDER OF THE BOTH THESE AUTHORIT IES, WHO HAD CONCURRENTLY HELD THE DUE DETAILS HAVING BEEN PROVE D. THE ASSESSEE COMPANY HAD PRESENTED THE NECESSARY WORTH PROOF BEF ORE BOTH THE AUTHORITIES AND IT WAS NOT EXPECTED BY THE ASSESSEE- COMPANY TO FURTHER PROVE THE SOURCE OF THE DECEASED .' 24 SRINGERI TECHNOLOGIES PVT LTD CIT VS. NIKUNJ EXIMP ENTERPRISES (P.) LTD (2013) 35 TAXRNANN.COM 384 (BOM) 'WHETHER MERELY BECAUSE SUPPLIERS HAD NOT APPEARED BEFORE ASSESSING OFFICER OR COMMISSIONER (APPEALS), IT COU LD NOT BE CONCLUDED THAT PURCHASES WERE NOT MADE BY ASSESS EE - HELD, YES.... FURTHER, THERE WERE CONFIRMATION LETTERS FI LED BY THE SUPPLIERS, COPIES OF INVOICES FOR PURCHASES AS WELL AS COPIES OF BANK STATEMENT ALL OF WHICH WOULD INDICATE THAT THE PURCHASES WERE IN FACT MADE. IN OUR VIEW, MERELY BECAUSE THE SUPPLIERS HAVE NOT APPEARED BEFORE THE ASSESSING OFFICER OR T HE CIT(A), ONE CANNOT CONCLUDE THAT THE PURCHASES WERE NOT MADE BY THE RESPON DENT- ASS ESSEE' CIT VS. SAMIR BIO- TECH PVT LTD (2010) 325 ITR 294 (DEL-HIGH COURT) 'IDENTITIES OF THE SUBSCRIBERS ARE NOT IN DOUBT. TH E TRANSACTIONS HAVE ALSO BEEN UNDERTAKEN THROUGH BANKING CHANNELS INASMUCH AS THE APPLICATION MONEY FOR THE SHARES WAS GIVEN T HROUGH ACCOUNT PAYEE CHEQUES. THE CREDITWORTHINESS HAS ALSO BEEN E STABLISHED, AS INDICATED BY THE TRIBUNAL. THE SUBSCRIBERS HAVE GIV EN THEIR COMPLETE DETAILS WITH REGARD TO THEIR TAX RETURNS A ND ASSESSMENTS. IN THESE CIRCUMSTANCES, THE DEPARTMENT COULD NOT DR AW AN ADVERSE INFERENCE AGAINST THE ASSESSEE ONLY BECAUSE THE SUB SCRIBERS DID NOT INITIALLY RESPOND TO THE SUMMONS. THE SUBSC RIBERS, HOWEVER, SUBSEQUENTLY GAVE THEIR CONFIRMATION LETTE RS AS WOULD BE APPARENT FROM THE IMPUGNED ORDER. THE IDENTITY OF T HE SUBSCRIBERS STANDS ESTABLISHED AND IT IS ALSO A FACT THAT THEY HAVE SHOWN THE SAID AMOUNTS IN THEIR AUDITED BALANCE SHEETS AND HAVE AL SO FILED RETURNS BEFORE THE IT AUTHORITIES. THE DECISION OF THE TRIBUNAL DELETING THE ADDITION CANNOT BE FAULTED. 14. COMING TO THE CASE LAWS RELIED UPON BY THE LD.DR. THE LD.DR RELIED UPON THE DECISION OF HONBLE CALCUTTA HIGH COURT I N THE CASE OF RAJ MANDIR ESTATE PVT LTD VS PR.CIT (2016) 386 ITR 162 (CAL). WE HAVE GONE THROUGH THE CASE LAW RELIED UPON BY THE LD.DR IN THE LIGHT OF F ACTS OF THE PRESENT CASE AND 25 SRINGERI TECHNOLOGIES PVT LTD FIND THAT THE CASE LAW RELIED UPON BY THE LD.DR IS NOT APPLICABLE AS IN THIS CASE, THE SUBSCRIBERS TO THE SHARE CAPITAL DID NOT ESTAB LISH THEIR FINANCIAL CAPACITY TO SUBSCRIBE SHARE CAPITAL IN THE ASSESSEE COMPANY. T HE BANK ACCOUNT OF ALL THE APPLICANTS HAVE BEEN FOUND CREDITED FROM OTHER SOUR CES IMMEDIATELY BEFORE TRANSFER OF FUNDS TO THE ASSESSEE COMPANY. THE COMPANIES DID NOT HAVE ANY BUSINESS ACTIVITY TO ESTABLISH THEIR FINANCIAL CAPA CITY. UNDER THOSE FACTS AND CIRCUMSTANCES , THE HONBLE CALCUTTA HIGH COURT CAME TO THE CONCLUSION THAT THE ASSESSEE HAS FAILED TO ESTABLISH GENUINENESS OF TRANSACTIONS AND CREDITWORTHINESS OF THE PARTIES AND HENCE CONFIRMED ADDITION MADE BY THE AO U/S 68 OF THE INCOME-TAX ACT, 1961. INSOFAR AS TH E HONBLE BOMBAY HIGH COURT IN THE CASE O M/S MAJOR METALS VS CIT (SUPRA ), THE FACTS OF THE CASE ARE ENTIRELY DIFFERENT WHEREIN THE ISSUE BEFORE THE HON BLE HIGH COURT WAS WHETHER THE ASSESSEE WAS ABLE TO ESTABLISH GENUINENESS OF T RANSACTION IN THE LIGHT OF THE CLEAR FINDING RECORDED BY SETTLEMENT COMMISSION WHE REIN IT WAS OBSERVED THAT ALL THE SUBSCRIBERS OF SHARE CAPITAL WERE NOT EVEN ASSESSED TO INCOME-TAX AND THEY DID NOT HAVE ANY SOURCE OF INCOME TO EXPLAIN F INANCIAL CAPACITY. UNDER THESE CIRCUMSTANCES, THE HONBLE COURT CAME TO THE CONCLUSION THAT THE ASSESSEE WAS UNABLE TO EXPLAIN THE ISSUE OF SHARE AT A HUGE PREMIUM AND HENCE CONFIRMED ADDITION MADE BY THE AO U/S 68 OF THE ACT . 15. IN THIS CASE, ON PERUSAL OF THE FACTS AVAILABLE ON RECORD WE FIND THAT THE ASSESSEE HAS FILED ENORMOUS DETAILS IN RESPECT OF A LL 9 SUBSCRIBERS TO THE SHARE 26 SRINGERI TECHNOLOGIES PVT LTD CAPITAL AND THE EVIDENCES FILED BY THE ASSESSEE CAT EGORICALLY PROVES THAT SUBSCRIBERS TO THE SHARE CAPITAL ARE COMPANIES HAVI NG FINANCIAL POSITION TO ESTABLISH CREDITWORTHINESS. THEREFORE, CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE AND ALSO RELYING UPON THE CASE LAWS DIS CUSSED ABOVE, WE ARE OF THE VIEW THAT THE AO WAS ERRED IN MAKING ADDITION TOWAR DS SHARE CAPITAL AND SHARE PREMIUM U/S 68 OF THE ACT. THE CIT(A), AFTER CONSI DERING RELEVANT SUBMISSIONS HAS RIGHTLY DELETED THE ADDITION MADE BY THE AO TOW ARDS SHARE CAPITAL AND SHARE PREMIUM. WE DO NOT FIND ANY ERROR OR INFIRMITY IN THE ORDER OF THE CIT(A); HENCE, WE ARE INCLINED TO UPHOLD THE FINDINGS OF TH E CIT(A) AND DISMISS THE APPEAL FILED BY THE REVENUE. 16. IN THE RESULT, APPEAL FILED BY THE REVENUE IS DISMI SSED. ORDER PRONOUNCED IN THE OPEN COURT ON 29 TH DECEMBER, 2017. SD/- SD/- (MAHAVIR SINGH) (G MANJUNATHA) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DT : 29 TH DECEMBER, 2017 PK/- COPY TO : 1. APPELLANT 2. RESPONDENT 3. CIT(A) 4. CIT 5. DR /TRUE COPY/ BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI