ITO 9(1)(1), MUMBAI V. ANG TRADING P.LTD, MUMBAI

ITA 5556/MUM/2010

• Counselvise Citation: [2012] 119 COUNSELVISE.COM (IT) 8799 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 2 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-09-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 27-03-2012
• Assessment Year: 2000-2001
• Appeal Filed On: 08-07-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained investment; Additional evidence
• Section: 131; 68; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH A BENCH BEFORE SHRI B.R.MITTAL(JUDICIAL MEMBER) AND SHRI B.RAMAKOTAIAH (ACCOUNTANT MEMBER) ITA NO.5556/MUM/2010 ASSESSMENT YEAR: 2000 -01 I.T.O. 9(1)(1), AAYAKAR BHAVAN, M.K. ROAD, MUMBAI. M/S. ANG TRADING PVT LTD., 211, ANANT BHAVAN, WATER FIELD ROAD, BANDRA (W), MUMBAI-400 050 PA NO.AACCA 9284 B (APPELLANT) VS. (RESPONDENT) APPELLANT BY : MS NEERAJA PRADHAN RESPONDENT BY: SHRI RAJIV KHANDELWAL DATE OF HEARING: 29.8.2012 DATE OF PRONOUNCEMENT: 26 .9.2012 ORDER PER B.R.MITTAL, JM: THE DEPARTMENT HAS FILED THIS APPEAL FOR ASSESSMEN T YEAR 2000-2001 AGAINST ORDER DATED 23.4.2010 OF LD CIT(A)-19, MUMBAI ON F OLLOWING GROUNDS: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE AND IN LAW, THE LD. CIT(A) ERRED IN DELETING THE ADDITION OF RS.75,00,0 00/- BY THE ASSESSING OFFICER U/S.68 OF THE L.T.ACT IGNORING THE FACT THA T THE IDENTITY AND CREDITWORTHINESS OF THE LENDERS AND THE GENUINENESS OF THE TRANSACTIONS WERE NOT ESTABLISHED BY THE ASSESSEE. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LD.CIT(A) ERRED IN DELETING THE ADDITION OF RS.80,1 0,000/ MADE BY THE ASSESSING OFFICER AS UNEXPLAINED INVESTMENT IGNORIN G THE FACT THAT THE GENUINENESS OF THE TRANSACTIONS HAD NOT BEEN PROVED . 2. THE RELEVANT FACTS GIVING RISE TO THIS APPEAL AR E THAT THE AO ORIGINALLY MADE THE ASSESSMENT ORDER ON 3.3.2006 UNDER SECTION 144 R.W. S 147 OF THE ACT. LD CIT(A) VIDE HIS ORDER DATED 18.9.2006 CONFIRMED THE ASSESSMENT ORDER. THE ASSESSEE FILED APPEAL BEFORE THE TRIBUNAL BEING I.T.A. NO.6280/MUM/2006, THE TRIBUNAL VIDE ITS ORDER DATED 25.10.2007 ALONGWITH APPEALS FOR ASSESSMENT YEARS 2 001-02 AND 2002-03 SET ASIDE THE ITA NO.5556/MUM/2010 ASSESSMENT YEAR: 2000 -01 2 ORDERS OF AUTHORITIES BELOW AND RESTORED THE MATTER BACK TO THE FILE OF AO WITH THE DIRECTION TO DECIDE ISSUES AFRESH AFTER PROVIDING O PPORTUNITY OF HEARING TO THE ASSESSEE. 3. PURSUANT THERETO, AO MADE ASSESSMENT ORDER U/S.1 43(3) R.W.S 254 OF THE ACT ON 24.12.2008. LD CIT(A) VIDE HIS ORDER DATED 23.4.20 10 ALLOWED THE APPEAL OF ASSESSEE IN PART. HENCE, THIS APPEAL BY THE DEPARTMENT. 4. IN RESPECT OF GROUND NO.1 OF APPEAL, RELEVANT FA CTS ARE THAT ASSESSEE DURING THE PREVIOUS YEAR RELEVANT TO ASSESSMENT YEAR UNDER CON SIDERATION HAD SHOWN ADVANCE FROM CORPORATES TO RS.75,00,000/- AS UNDER: SR.NO. NAME OF THE PARTY AMOUNT RECEIVED 1. AANGAN RESORTS AND HOTELS PVT LTD. 10,00,000 2. KRISHNA PLASTO CHEM LTD., 15,00,000 3. CHEDDAR CONSTRUCTION PVT LTD., 5,00,000 4. STANELEY INDUSTRIES INDIA LTD. 10,00,000 5. COGENT VENTURES INDIA LTD. 10,00,000 6. HETU INVESTMENT & TRADING PVT LTD 5,00,000 7. FAME INVESTMENT & TRADING PVT LTD., 5,00,000 8. INNOVATIVE PRINT-FORMS LTD., 10,00,000 9. SRI SUBHLABH INFOLINE CO. LTD. 5,00,000 TOTAL: 75,00,000 5. ASSESSEE STATED THAT THE SAID AMOUNT WAS RECEIVE D TOWARDS SHARE APPLICATION MONEY AND SUBSEQUENTLY IN ASSESSMENT YEAR 2001-02, IT WAS SHOWN AS SHARE CAPITAL. AO ISSUED SUMMONS UNDER SECTION 131 OF THE ACT ON 4 .12.2008 TO ALL THE ABOVE 9 PARTIES FROM WHOM ADVANCES STATED TO HAVE BEEN RECEIVED BY THE ASSESSEE. AO HAS STATED THAT OUT OF ABOVE, SUMMONS WHICH WERE ISSUED, HAVE BEEN RETURNED UNSERVED IN RESPECT OF PARTIES AT SERIAL NO.3,4,5,7,8 AND 9. HOWEVER, NO REPLY WAS RECEIVED FROM THE REMAINING THREE PARTIES I.E. AT SL. NO.1,2 & 6. AO HAS STATE D THAT ASSESSEE WAS GIVEN LAST AND FINAL OPPORTUNITY TO PRODUCE THE PARTIES FOR EXAMINATION BUT ASSESSEE COULD NOT COMPLY WITH AND FAILED TO PROVE IDENTITY, CAPACITY OF THE PARTI ES AND ALSO GENUINENESS OF THE TRANSACTION. THUS, AO TREATED THE SAID AMOUNT OF R S.75 LAKHS AS UNEXPLAINED CASH ITA NO.5556/MUM/2010 ASSESSMENT YEAR: 2000 -01 3 CREDIT UNDER SECTION 68 OF THE ACT. BEING AGGRIEVE D, ASSESSEE FILED APPEAL BEFORE THE FIRST APPELLATE AUTHORITY. 6. ON BEHALF OF ASSESSEE, IT WAS CONTENDED THAT ASS ESSEE FILED DETAILS IN RESPECT OF ABOVE NINE PARTIES, SUCH AS ADDRESS OF THE PARTIES, PAN NUMBER, DESIGNATION OF THE JURISDICTIONAL ASSESSING OFFICER, DATE OF RECEIPT OF THE AMOUNT, CHEQUE NUMBER AND ALSO COPIES OF THE SHARE APPLICATION FORMS AND COPI ES OF THE BOARD RESOLUTION. IT WAS CONTENDED THAT ASSESSEE FILED CONFIRMATION FROM THE SAID NINE PARTIES AND ALSO CERTAIN OTHER RELATED DOCUMENTS IN ORDER TO EVIDENCES THE T RANSACTIONS. LD CIT(A) CALLED FOR REMAND REPORT AND DURING THE REMAND PROCEEDINGS, AO ISSUED FURTHER SUMMONS IN THE ADDRESSES AS MENTIONED IN THE LETTERS OF CONFIR MATION. LD CIT(A) HAS STATED THAT IN THE REMAND REPORT DATED 09.11.2009, AO HAS CONFIRM ED THAT TRANSACTIONS IN RESPECT OF AMOUNT RECEIVED FROM AANGAN RESORTS & HOTELS PVT. L TD.RS.L0,00,000/-),M/S.HETU INVESTMENT AND TRADING PVT.LTD.(RS.5,00,00/-), ARE VERIFIED AND CONFIRMED. THEREFORE, AO IN THE REMAND REPORT ACCEPTED THE GENUINENESS O F RS.15 LAKHS. LD CIT(A) HAS STATED THAT AS REGARDS BALANCE SEVEN PARTIES, AO HA S STATED THAT THE ADVANCES REMAINED UNEXPLAINED ON ACCOUNT OF THE FOLLOWING REASONS: SR.NO. NAME OF THE PARTY AMOUNT REASONS 1. M/S KRISHNA PLASTO CHEM LTD. RS.15,00,000/- CONFIRMATION NOT FILED. COPY OF ACKNOWLEDGEMENT OF LATEST RETURN AND BANK STATEMENT NOT FILED 2. M/S. CHEDDAR CONSTRUCTION PVT. LTD. RS.5,00,000 COPY OF ACKNOWLEDGEMENT OF LATEST RETURN AND BANK STATEMENT NOT FILED. 3. M/S.STANLEY INDUSTRIES (I) LTD. RS.10,00,000 COP Y OF ACKNOWLEDGEMENT OF LATEST RETURN AND BANK STATEMENT NOT FILED 4. M/S.COGENT VENTURE INDIA LTD RS.10,00,000 COPY O F ACKNOWLEDGEMENT OF LATEST RETURN AND BANK STATEMENT NOT FILED 5. M/S. FAME INVESTMENT AND TRADING CO RS.5,00,000 COPY OF ACKNOWLEDGEMENT OF LATEST RETURN AND BANK STATEMENT NOT FILED 6. M/S. INNOVATIVE PRINT FORMS LTD. RS.10,00,000 BA LANCE SHEET NOT FILED, COPY OF BANK STATEMENT NOT FILED. 7. M/S. SHREE SHUBHLABH INFOLINE CO. LTD. RS.10,00,000 SCHEDULE D OF BALANCE SHEET IN RESPECT OF INVESTMENT NOT FILED. ITA NO.5556/MUM/2010 ASSESSMENT YEAR: 2000 -01 4 7. LD CIT(A) HAS STATED THAT AO HAS CONFIRMED BALAN CE ADDITIONS FOR THE REASONS THAT ASSESSEE HAD NOT FURNISHED COPY OF ACKNOWLEDG EMENT OF THE LATEST RETURN FILED BY THE ABOVE PARTIES AND THAT ALSO FAILED TO FURNISH C OPIES OF THEIR BANK STATEMENTS, AND HENCE, AS PER AOS SECOND REMAND REPORT DATED 11.3. 2010, STATED THAT ASSESSEE FAILED TO PROVE GENUINENESS OF THE ADVANCES TAKEN FROM THE BALANCE PARTIES. 8. FURTHER, IN RESPECT OF ABOVE SEVEN PARTIES, IT W AS SUBMITTED AS UNDER: (I) M/S. KRISHNA PLASTO CHEM LTD. RS.15,00,000 DURING THE COURSE OF ASSESSMENT PROCEEDINGS, ASSESS EE HAD FILED BEFORE THE AO COPY OF SHARE APPLICATION SHOWING CHEQUE NUMBER, AM OUNT, BANK NAME, ADDRESS AND PAN NUMBER OF THE PARTY. ASSESSEE ALSO FILED BE FORE THE AO CERTIFIED COPY OF RESOLUTION PASSED BY THE BOARD OF DIRECTORS OF THE APPLICANT, COPY OF CERTIFICATE OF INCORPORATION AND MEMORANDUM AND ARTICLES OF ASS OCIATION OF THE APPLICANT. DURING APPELLATE PROCEEDINGS, ASSESSEE FILED CONFIR MATION LETTER FROM THE PARTY SHOWING NAME, ADDRESS, PAN NUMBER ETC. DURING THE C OURSE OF REMAND PROCEEDINGS, ASSESSEE FILED CONFIRMATION LETTER DAT ED 14.12.2009 BEFORE THE AO AND THE SAID PARTY ALSO FILED COPY OF ACKNOWLEDGEME NT OF THE RETURN OF INCOME AND BALANCE-SHEET AS AT 31.03.2000. THEREFORE, ASS ESSEE FILED THE REQUISITE DETAILS/EVIDENCE TO ESTABLISH THE IDENTITY OF THE S HAREHOLDERS AS WELL AS GENUINENESS OF THE TRANSACTION. (II) M/S. CHEDDAR CONSTRUCTION PVT. LTD.- RS.5,00,000 DURING THE COURSE OF ASSESSMENT PROCEEDINGS BEFOR E THE AO, ASSESSEE FILED COPY OF SHARE APPLICATION RECEIVED FROM THE PARTY S HOWING DETAILS OF CHEQUE NUMBER, AMOUNT, BANK NAME, ADDRESS AND PAN NUMBER O F THE PARTY WHO HAD APPLIED FOR ALLOTMENT OF SHARES. ASSESSEE ALSO FILE D BEFORE THE AO CERTIFIED COPY OF RESOLUTION PASSED BY THE BOARD OF DIRECTORS OF T HE ASSESSEE, COPY OF CERTIFICATE OF INCORPORATION AND COPY OF MEMORANDUM AND ARTICLE S OF ASSOCIATION OF ASSESSEE COMPANY. DURING THE COURSE OF APPELLATE PR OCEEDINGS, ASSESSEE FILED BEFORE THE CIT (A), LETTER OF CONFIRMATION SHOWING NAME, ADDRESS AND PAN ITA NO.5556/MUM/2010 ASSESSMENT YEAR: 2000 -01 5 NUMBER OF THE PARTY. DURING THE COURSE OF REMAND, I N RESPONSE TO THE SUMMONS ISSUED, THE SHAREHOLDERS FILED LETTER DATED 10.12.2 009 CONFIRMING THAT THEY HAD PAID SHARE APPLICATION MONEY TO THE ASSESSEE AND TH AT ASSESSEE HAD ALLOTTED SHARES TO THEM. THE SHAREHOLDER ALSO FILED BEFORE T HE AO COPY OF ACKNOWLEDGEMENT OF RETURN OF INCOME AND BALANCE-SHE ET AS ON 31.03.2000. HENCE, ASSESSEE FILED REQUISITE DETAILS TO ESTABLIS H THE IDENTITY AND GENUIENENSS OF THE TRANSACTIONS. (III) M/S.STANLEY INDUSTRIES (I) LTD RS.10,00,000 DURING THE COURSE OF ASSESSMENT PROCEEDINGS, ASSESS EE FILED COPY OF SHARE APPLICATION RECEIVED FROM THE PARTY SHOWING DETAILS OF CHEQUE NUMBER, AMOUNT,, BANK, NAME AND ADDRESS AND PAN OF THE APPLICANT. ASSESSEE ALSO FILED BEFORE THE AO CERTIFIED COPY OF RESOLUTION PASSED BY THE B OARD OF DIRECTORS OF THE APPLICANT, COPY OF CERTIFICATE OF INCORPORATION, ME MORANDUM AND ARTICLES OF ASSOCIATION OF THE APPLICANT. ASSESSEE FILED BEFORE THE CIT(A), DURING THE COURSE OF APPELLATE PROCEEDINGS, CONFIRMATION FROM THE PAR TY SHOWING NAME, ADDRESS, PAN OF THE PARTY. DURING THE COURSE OF REMAND, IN R ESPONSE TO SUMMON U/S 131, THE SHAREHOLDERS FILED BEFORE THE AO LETTER DATED 1 0.12.2009 CONFIRMING THAT THEY HAD PAID SHARE APPLICATION MONEY TO THE ASSESSEE AN D THAT ASSESSEE HAD ALLOTTED SHARES TO THEM. THE SHAREHOLDERS ALSO FILED BEFORE THE AO COPY OF ACKNOWLEDGEMENT OF THEIR RETURN AND BALANCE-SHEET A S ON 31.03. 2000. HENCE, ASSESSEE FILED REQUISITE DETAILS TO ESTABLISH THE I DENTITY AND GENUINENESS OF THE TRANSACTIONS. (IV) M/S. COGENT VENTURE INDIA LTD. RS.1O,00,000/- ASSESSEE FILED DURING THE COURSE OF ASSESSMENT PROC EEDINGS, COPY OF SHARE APPLICATION RECEIVED FROM THE PARTY SHOWING DETAILS OF CHEQUE NUMBER, AMOUNT, BANK, ADDRESS AND PAN NUMBER OF THE APPLICANT WHO H AD APPLIED FOR ALLOTMENT OF SHARES. ASSESSEE ALSO FILED BEFORE THE AO CERTIFIED COPY OF RESOLUTION PASSED BY THE BOARD OF DIRECTORS OF THE APPELLANT, COPY OF CE RTIFICATE OF INCORPORATION AND ITA NO.5556/MUM/2010 ASSESSMENT YEAR: 2000 -01 6 COPY OF MEMORANDUM AND ARTICLES OF ASSOCIATION. DUR ING THE COURSE APPELLATE PROCEEDINGS BEFORE THE CIT(A), ASSESSEE FILED LETT ER OF CONFIRMATION FROM THE PARTY SHOWING NAME, ADDRESS AND PAN OF THE PARTY. D URING REMAND PROCEEDINGS, IN RESPONSE TO SUMMONS U/S. 131, THE SHAREHOLDERS F ILED BEFORE THE AO LETTER DATED 10.12.2009 CONFIRMING THAT THEY HAD PAID SHAR E APPLICATION MONEY TO THE APPELLANT AND THAT THE APPELLANT HAD ALLOTTED SHARE S TO THEM. THE SHAREHOLDERS ALSO FILED BEFORE THE AO COPY OF ACKNOWLEDGEMENT OF THEIR RETURN AND BALANCE- SHEET AT ON 31.03.2001. HENCE, ASSESSEE FILED REQU ISITE DETAILS TO ESTABLISH THE IDENTITY AND GENUINENESS OF THE TRANSACTIONS. (V) M/S.FAME INVESTMENT & TRADING PVT. LTD. - RS.5,00, 000/. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, ASSESS EE FILED COPY OF SHARE APPLICATION RECEIVED FROM THE PARTY, SHOWING DETAIL S OF CHEQUE NUMBER, AMOUNT, BANK, NAME, ADDRESS AND PAN NUMBER OF THE APPLICANT WHO HAD APPLIED FOR ALLOTMENT OF. ASSESSEE ALSO PLACED BEFORE THE AO C ERTIFIED COPY OF RESOLUTION PASSED BY THE BOARD OF DIRECTORS, COPY OF CERTIFICA TE OF INCORPORATION, AND MEMORANDUM AND ARTICLES OF ASSOCIATION. ASSESSEE D URING THE COURSE OF APPELLATE PROCEEDINGS FILED LETTER OF CONFIRMATION SHOWING NAME, ADDRESS AND PAN NUMBER OF THE PARTY. DURING THE COURSE OF REMAN D, IN RESPONSE TO SUMMONS U/S. 131 THE APPLICANT FILED BEFORE THE AO LETTER D ATED 10.12.2009 CONFIRMING THAT THEY HAD PAID SHARE APPLICATION MONEY TO THE A SSESSEE AND THAT ASSESSEE HAD ALLOTTED SHARES TO THEM. THE SHAREHOLDERS ALSO FILED BEFORE THE AO COPY OF ACKNOWLEDGEMENT OF THEIR RETURN OF INCOME AND BALAN CE-SHEET AS AT 31.03.2001. HENCE, ASSESSEE FILED REQUISITE DETAILS TO ESTABLIS H THE IDENTITY AND GENUINENESS OF THE TRANSACTIONS (VI) INNOVATE PRINT FORMS LTD RS.10,00,000 ASSESSEE FILED DURING THE COURSE OF ASSESSMENT PROC EEDINGS COPY APPLICATION RECEIVED FROM THE PARTY SHOWING DETAILS OF CHEQUE A MOUNT, BANK, NAME AND ADDRESS AND PAN NUMBER OF THE APPLICANT WHO HAD APP LIED FOR ALLOTMENT OF SHARES. ASSESSEE ALSO FILED BEFORE THE AO CERTIFI ED COPY OF RESOLUTION PASSED ITA NO.5556/MUM/2010 ASSESSMENT YEAR: 2000 -01 7 BY THE BOARD OF DIRECTORS OF THE APPLICANT, COPY OF CERTIFICATE OF INCORPORATION, AND COPY OF MEMORANDUM AND ARTICLES OF ASSOCIATION OF THE APPLICANT. DURING THE COURSE OF HEARING OF THE APPEAL, ASSESSEE FILED LETTER OF CONFIRMATION FROM THE PARTY SHOWING NAME, ADDRESS, PAN OF THE APPLICANT. DURING THE COURSE OF REMAND, IN RESPONSE TO SUMMONS ISSUED, THE SHAREHOL DERS TILED BEFORE THE AO LETTER DATED 07.03.2010 CONFIRMING THAT THEY HAD PA ID SHARE APPLICATION MONEY TO THE ASSESSEE AND THAT THE ASSESSEE HAD ALLOTTED SHARES TO THEM. HENCE, ASSESSEE FILED REQUISITE DETAILS TO ESTABLISH THE I DENTITY AND GENUINENESS OF THE TRANSACTIONS (VII) M/S.SHREE SUBHLABH INFOLINE COM. LTD. - RS.5, 00,00 0/- DURING THE COURSE OF ASSESSMENT PROCEEDINGS, ASSESS EE FILED COPY OF SHARE APPLICATION RECEIVED FROM THE PARTY SHOWING DETAILS OF CHEQUE NUMBER, AMOUNT, BANK, NAME, ADDRESS AND PAN OF THE APPLICANT WHO HA D APPLIED FOR ALLOTMENT OF SHARES . ASSESSEE ALSO FILED BEFORE THE AO CERTIFI ED COPY OF RESOLUTION PASSED BY THE BOARD OF DIRECTORS OF THE APPLICANT, COPY OF CE RTIFICATE OF INCORPORATION AND MEMORANDUM AND ARTICLES OF ASSOCIATION OF THE APPLI CANT. ASSESSEE ALSO FILED BEFORE THE CIT (A) LETTER OF CONFIRMATION FROM THE PARTY SHOWING NAME, ADDRESS AND PAN OF THE PARTY. DURING REMAND PROCEEDINGS, TH E SHAREHOLDER FILED BEFORE THE AO LETTER DATED 14.12.2009 CONFIRMING THAT THEY HAD PAID SHARE APPLICATION MONEY TO THE APPELLANT AND THAT THE APPELLANT HAD A LLOTTED SHARES TO THEM. . HENCE, ASSESSEE FILED REQUISITE DETAILS TO ESTABLIS H THE IDENTITY AND GENUINENESS OF THE TRANSACTIONS. 9. LD CIT(A) AFTER CONSIDERING SUBMISSIONS OF ASSES SEE AND ALSO CONSIDERING REMAND REPORT OF THE AO DATED 11.3.2010, VIDE PARA 11 OF T HE IMPUGNED ORDER HAS DELETED THE SAID ADDITION OF RS.75,00,000, WHICH READS AS UNDER : 11. I HAVE CONSIDERED THE ABOVE SUBMISSIONS AS MAD E. I HAVE ALSO TAKEN INTO ACCOUNT THE REMAND REPORT OF THE AO IN LETTER NO. ITO.9(L)(1) REM./ REP./2009-2010 DATED 11.03.2010. AS REGARDS M/S.KRI SHNA PLASTO CHEM LTD., M/S.CHEDDAR CONSTRUCTION PVT. LTD., M/S.STANL EY INDUSTRIES (1) LTD., M/S.COGENT VENTURE INDIA LTD. AND M/S.FAME INVESTME NT & TRADING PVT. LTD., THE ONLY OBJECTION OF THE AO IS THAT THE COPI ES OF ACKNOWLEDGEMENT ITA NO.5556/MUM/2010 ASSESSMENT YEAR: 2000 -01 8 OF LATEST RETURN OF INCOME AND BANK STATEMENTS WERE NOT FILED. THOUGH THE AO HAS STATED THAT WITH RESPECT TO KRISHNA PLAS TO CHEM LTD., CONFIRMATION LETTER FOR A.YR.2000-01 WAS NOT FILED, IT IS SEEN FACTUALLY FROM THE RECORDS THAT CONFIRMATION HAS INDEED BEEN FILED WHICH FORMS PART OF COMPILATION OF ADDITIONAL EVIDENCE AT PAGE NO.16. T HE FURNISHINGS OF ALL OTHER EVIDENCE IN RESPECT OF THE ABOVE PARTIES HAVE NOT BEEN DISPUTED. AS REGARDS THE SAID PARTIES, IT HAS TO BE STATED, ON A N APPRECIATION OF THE WEALTH OF EVIDENCE FURNISHED BY THE APPELLANT IT HA S TO BE HELD THAT IT HAS DISCHARGED THE BURDEN CAST UPON IT U/S.68 OF THE AC T. THE DETAILS AS FURNISHED BY THE APPELLANT IN FACT CONSTITUTE ACCEP TABLE PROOF THAT INDEED THE MONEY HAS FLOWN FROM THE SHAREHOLDERS. THE DETA ILS AS FURNISHED HAVE NOT BEEN REJECTED OR FOUND TO BE FALSE. IT HAS BEEN ESTABLISHED WITH RESPECT TO THESE PARTIES THAT THE APPELLANT HAD RAI SED SHARE CAPITAL FROM THE SAID PARTIES AS PROOF OF WHICH SHARE APPLICATIO N FORMS AND OTHER RELEVANT DETAILS HAVE BEEN FURNISHED; IN FACT IT HA S ALSO BEEN BROUGHT ON RECORD THAT SHARES WERE ALLOTTED TO THE SHAREHOLDER S IN RESPECT OF THE MONIES RECEIVED. THE APPELLANT HAS IN FACT PROVED T HE IDENTITY OF THE SUBSCRIBERS, THEIR CREDITWORTHINESS AND GENUINENESS OF THE TRANSACTIONS. THESE DETAILS HAVE NOT BEEN REPUDIATED. THE ONLY OB JECTION OF THE AO IS THAT COPIES OF LATEST RETURNS OF INCOME WERE NOT FI LED. IT HAS TO BE STATED THAT THEY ARE CONCERNED WITH THE A.YR.2000-01 AND W ITH REGARD TO THE SAID ASSESSMENT YEAR, MATERIAL HAS BEEN FURNISHED. THE CREDIT HAS APPEARED DURING THIS YEAR. HENCE MERELY FOR THE RE ASON THAT COPIES OF THE LATEST RETURN WORE NOT FILED, ARE IN FACT NOT M ATERIAL TO DECIDE THE ISSUE AT HAND, IT CANNOT BE STATED THAT THE BURDEN ON THE APPELLANT CAST BY SECTION 68 OF THE ACT HAS NOT BOON DISCHARGED. T HEREFORE, IT IS HELD THAT THE CREDITS AS APPEARING IN THE BOOK OF THE AP PELLANT AS REGARDS M/E,.KRISHNA PLASTO LTD., M/S.CHEDDAR CONSTRUCTIONS PVT. LTD., M/S. STANLEY INDUSTRIES (I) LTD., M/S.COGENT VENTURE IND IA LTD., AND M/S.FAME INVESTMENT & TRADING PVT. LTD., STAND FULLY EXPLAIN ED. WITH REGARD TO M/S. INNOVATIVE PRINT FORMS LTD AND M/S. SHREE SHUBHLABH COMMUNICATIONS LTD., IT IS THE CONTENTION OF THE AO THAT THE RELEVANT BALANCE-SHEETS WERE NOT FILED. IT IS HELD THAT EVEN THOUGH THE RELEVANT BALANCE-SHEETS WERE NOT FILED, THERE HAS BEEN OTHER CORROBORATIVE EVIDENCE IN THE FORM OF SHARE APPLICATION FORMS, LE TTERS OF CONFIRMATION, AND OTHER RELEVANT DETAILS SUCH AS NAME, ADDRESS AN D PAN NUMBERS FURNISHED WHICH ARE IN ITSELF RELEVANT. IN ORDER TO ESTABLISH THE IDENTITY OF THE SUBSCRIBERS, THEIR CREDITWORTHINESS AND GENUINE NESS OF THE TRANSACTIONS. THE APPELLANT HAS IN FACT MADE AVAILA BLE TO THE AO ALL THE INFORMATION AS AVAILABLE TO PROVE THE LEGITIMACY OF THE TRANSACTION. MATERIAL HAS BEEN PRODUCED TO EVIDENCE THAT THE SAI D PARTIES HAD INDEED APPLIED FOR SHARES AND THAT IN RESPONSE TO MONIES R ECEIVED, THE APPELLANT HAD ALLOTTED SHARES TO THEM. DETAILS OF CHEQUE NUMB ER, AMOUNT, BANK, NAME AND PAN NUMBERS OF THE APPLICANT HAD ALSO BEEN FURNISHED. TAKING INTO ACCOUNT THE SAID DETAILS AS FURNISHED, WHICH H AVE NOT BEEN REPUDIATED, SOLELY FOR THE REASON THAT APPELLANT CO ULD NOT MAKE AVAILABLE THE BALANCE-SHEETS OF THE APPLICANTS, IT IS HELD TH AT THE AC WAS NOT ITA NO.5556/MUM/2010 ASSESSMENT YEAR: 2000 -01 9 JUSTIFIED IN DISBELIEVING THE CREDITS. TAKING INTO ACCOUNT THE RELEVANT DETAILS AS FURNISHED, WHICH HAVE NOT BOON DISPUTED OR FOUND TO BE SHAM, IT IS HELD THAT THE APPELLANT HAS DISCHARGED THE ON US CAST UPON IT U/S.68 OF THE ACT. ON THE BASIS OF THE ABOVE FINDINGS, THE ADDITION AS MADE U/S.68 IN A SUM OF RS.78,00,000/- IS HEREBY DELETED. HENCE, DEPARTMENT IS IN APPEAL BEFORE THE TRIBUNAL . 10. DURING THE COURSE OF HEARING, LD D.R. RELIED ON ORDER OF ASSESSING OFFICER. 11. ON THE OTHER HAND, LD A.R. MADE HIS SUBMISSIONS ON THE LINES OF SUBMISSIONS MADE BEFORE LD CIT(A) AND SUBMITTED THAT ASSESSEE F ILED REQUISITE DETAILS NOT ONLY TO PROVE THE IDENTITY OF THE SHAREHOLDERS BUT ALSO EST ABLISHED THE GENUINENESS AND CREDITWORTHINESS OF THE SHARE APPLICANTS. HE SUBMI TTED THAT ALL THE SHARE MONEIES RECEIVED BY ASSESSEE BY A/C PAYEE CHEQUES, DETAILS WERE PLACED BEFORE THE AUTHORITIES BELOW. HE SUBMITTED THAT ORDER OF LD CIT(A) IS JUS TIFIED TO DELETE THE ADDITION MADE BY THE AO. 12. WE HAVE CONSIDERED SUBMISSIONS OF LD REPRESENTA TIVES OF PARTIES AND ORDERS OF AUTHORITIES BELOW. ON PERUSAL OF DETAILS PLACED IN THE PAPER BOOK AND THE CONTENTS OF DOCUMENTS WHICH ARE MENTIONED BY LD CIT(A), PARTICU LARLY AT PAGES 4 TO 9 OF THE IMPUGNED ORDERS, WE OBSERVE THAT ASSESSEE HAS NOT O NLY PROVED THE IDENTITY OF THE SHARE APPLICANTS BUT ALSO FILED REQUISITE DETAILS E STABLISHING THE GENUINENESS OF THE TRANSACTIONS AS WELL AS CREDITWORTHINESS OF THE SHA RE APPLICANTS. DURING THE COURSE OF HEARING, LD D.R. COULD NOT CONTROVERT THE SUBMISSIO NS AND THE REQUISITE DETAILS AND DOCUMENTS MENTIONED IN THE ORDER OF LD CIT(A) AS WE LL AS PLACED BEFORE US IN THE PAPER BOOK COMPRISING OF 948 PAGES (TWO VOLUMES). ON PER USAL OF THE SAID DETAILS, WE HOLD THAT LD CIT(A) IS JUSTIFIED TO HOLD THAT ASSESSEE H AS MADE AVAILABLE SUFFICIENT MATERIAL ON RECORD THAT THE SHARE APPLICANTS APPLIED FOR THE SH ARES IN RESPONSE TO MONIES RECEIVED FROM THEM AND ASSESSEE HAS ALLOWED SHARES TO THEM. THE ONLY REASON ON WHICH AO DOUBTED THE GENUINENESS OF THE SHARE APPLICANTS MON EY WAS THAT ASSESSEE COULD NOT MAKE AVAILABLE BALANCE SHEET OF THE APPLICANTS BUT ON THE OTHER HAND, IT IS AN ADMITTED FACTS THAT ASSESSEE FILED RELEVANT DETAILS AS WELL AS CONFIRMATION FROM THE SHARE APPLICANTS THAT THEY APPLIED FOR THE SHARES ALLOTME NT OF THE ASSESSEE COMPANY AND ITA NO.5556/MUM/2010 ASSESSMENT YEAR: 2000 -01 10 ASSESSEE ALSO ALLOTTED THE SHARES TO THEM FOR THE M ONIES RECEIVED. HENCE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF LD CIT(A) TO INT ERFERE. ACCORDINGLY, WE UPHOLD HIS ORDER AND REJECT GROUND NO.1 TAKEN BY DEPARTMENT. 13. IN RESPECT OF GROUND NO.2 OF APPEAL, IT IS OBSE RVED THAT ASSESSEE HAS ADVANCED RS.80,10,000 TO THREE PARTIES I.E. (1) CHAND BHOJWA NI RS.70,00,000, (2) RAJINDER KAUR- RS.8,60,000 AND (3) C. NARAYAN & COMPANY RS.1,50, 000. AO STATED HAS STATED THAT ASSESSEE WAS ASKED TO FILE EVIDENCES OF THESE ADVAN CES, THROUGH NAME, ADDRESS AND PAN NUMBERS. HOWEVER, ASSESSEE FAILED TO FILE THE EVIDENCES AS REQUIRED BY THE AO, SUCH AS NAME, ADDRESS, PAN NO. HENCE, AO TREATED THE SAID LOANS AGGREGATING TO RS.80,10,000 AS UNEXPLAINED INVESTMENT. BEING AGGR IEVED, ASSESSEE FILED APPEAL BEFORE THE FIRST APPELLATE AUTHORITY. 14. IN THE FIRST APPEAL, LD CIT(A) CALLED FOR REMAN D REPORT FROM THE AO. LD CIT(A) HAS STATED THAT IN THE REMAND REPORT, AO HAS STATED THAT ADDITION HAS TO BE SUSTAINED BECAUSE WITH RESPECT TO CHAND BHOJWANI AND C.NARAYA N & COMPANY, DETAILS WERE NOT FILED AND WITH RESPECT TO ADVANCE TO RAJINDER KAUR, COPY OF ACKNOWLEDGEMENT OF THE LATEST RETURN OF INCOME AND BANK STATEMENT WEE NOT FILED. HOWEVER, ASSESSEE COUNTERED THE SAID AVERMENTS STATING THAT ASSESSEE FILED DETA ILS IN THE COMPILATION OF ADDITIONAL EVIDENCE AND SAME WERE FORWARDED TO THE AO. IT WAS ALSO CONTENDED THAT ASSESSEE HAD RECEIVED AN AGGREGATE AMOUNT OF RS.80,10,000 DURING THE RELEVANT PREVIOUS YEAR ON ACCOUNT OF SHARE APPLICATION MONEY AND THAT OUT OF THE SAID FUND, AN AMOUNT OF RS.80,10,000 WAS ADVANCED TO ABOVE NAMED THREE PART IES AS IS EVIDENT BY THE BALANCE SHEET. LD CIT(A) CONSIDERED ABOVE FACTS AND HELD T HAT ADVANCE OF RS.80,10,000 CANNOT BE TREATED AS UNEXPLAINED INVESTMENT. THE BALANCE SHEET AS ON 31.3.2000 EXPLAINS THE SOURCE WHICH FACILITATED THE ASSESSEE TO MAKE SUCH AN INVESTMENT AND, THEREFORE, IT HAS TO BE TREATED AS EXPLAINED DUE TO THE DISCLOSURES A S REVEALED IN THE BALANCE SHEET AND ACCORDINGLY, DELETED THE ADDITION MADE BY THE AO. HENCE, THIS APPEAL BY THE DEPARTMENT. 15. DURING THE COURSE OF HEARING, LD D.R. RELIED ON ORDER OF AO. ON THE OTHER HAND, LD A.R. SUBMITTED THAT SAID ADVANCE WAS GIVEN OUT OF SHARE APPLICATION MONEY RECEIVED ITA NO.5556/MUM/2010 ASSESSMENT YEAR: 2000 -01 11 BY THE ASSESSEE. IT WAS FURTHER SUBMITTED THAT LOA NS ARE GIVEN TO GROUP CONCERNS. IT WAS FURTHER SUBMITTED THAT THE AMOUNT WAS ADVANCED BY A/C PAYEE CHEQUE AND IT WAS REFLECTED IN THE BOOKS OF ACCOUNT OF THE ASSESSEE. LD A.R. ALSO REFERRED PAGES 675 TO 677 OF PB, WHICH ARE COPIES OF CONFIRMATION FROM TH E CONCERNED THREE DEBTORS OF ASSESSEE COMPANY. 16. CONSIDERING ABOVE SUBMISSIONS OF LD REPRESENTAT IVES OF PARTIES AND ORDERS OF AUTHORITIES BELOW AND ALSO THE FACT THAT SAID AMOU NT IS REFLECTED IN THE BALANCES SHEET OF THE ASSESSEE COMPANY AND WAS PAID OUT OF SHARE A PPLICATION MONEY RECEIVED BY THE ASSESSEE IN THE ASSESSMENT YEAR UNDER CONSIDERATION , WE HOLD THAT LD CIT(A) HAS RIGHTLY DELETED THE SAID ADDITION BY HOLDING THAT AO IS NOT JUSTIFIED TO TREAT THE SAID AMOUNT AS UNEXPLAINED INVESTMENT. HENCE, GROUND NO.2 OF APPE AL TAKEN BY DEPARTMENT IS REJECTED. 17. IN THE RESULT, APPEAL FIELD BY DEPARTMENT IS DI SMISSED. PRONOUNCED IN THE OPEN COURT ON 26 TH SEPTEMBER, 2012 SD/- (B.RAMAKOTAIAH ) ACCOUNTANT MEMBER SD/- (B.R. MITTAL) JUDICIAL MEMBER MUMBAI, DATED 26 TH SEPT, 2012 PARIDA COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. COMMISSIONER OF INCOME TAX (APPEALS),19, MUMBAI 4. COMMISSIONER OF INCOME TAX, 9 , MUMBAI 5. DEPARTMENTAL REPRESENTATIVE, BENCH A MUMBAI //TRUE COPY// BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI