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01-11-2019, KVF Securities, Section 148, 131, 68, 147, Tribunal Delhi

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1 week 3 days ago - 1 week 3 days ago #11308 by amit
Section - 148, 131, 68, 147
Order Date - 01-11.2019
Favouring - Assessee
Court - Tribunal Delhi
Appellant - ITO
Respondent - KVF Securities (P) Ltd.
Justice - BHAVNESH SAINI, J.M. & B.R.R. KUMAR, A.M.
Citation - 1119Taxpundit51
Appeal No. - ITA.No.5731/Del./2014
Asstt. Year - 2003-2004

Order

PER : BHAVNESH SAINI, J.M.

The Departmental Appeal as well as Cross Objection by Assessee are directed against the Order of the Ld. CIT(A)-VIII, New Delhi, Dated 29.08.2014, for the A.Y. 2003-2004.

2. We have heard the Learned Representative of both the parties and perused the material available on record.

3. Briefly the facts of the case are that the assesseecompany filed its return of income on 02.12.2003 declaring Rs.24,102/- which was processed under section 143(1) on 28.03.2004. The A.O. received information from Investigation Wing. On that basis, A.O. recorded reasons for reopening of the assessment. The assessee in response to the notice under section 148 filed letter stating therein that original return of income filed may be treated as return filed in response to notice under section 148 of the I.T. Act. The assessee filed objections to the same which were disposed of by the A.O. The A.O. noted that assessee company was asked to file the details of loans and advances, increase in share capital during the year and bank statement as required in the questionnaire Dated 13.07.2010. This information was provided by assessee on various dates and vide letter Dated 09.12.2010 has stated that details of accounts has reflected in the statement provided showing transaction in bank account of Rs.10,24,42,961/- as under:

Credit Amounts :
 On account of sales
 On account share application received
 Income (Profit on sale of shares)
 Amounts received back from parties i.e., paid forpurchases.

Debit Amounts :

 On account of purchases
 On account of shares application received, amounts returned on non-allotment.
 Sales advance returned.

3.1. The assessee has further submitted the details of investments/shares, loan advances and paid up capital and share premium. The gist of the same is reproduced in the assessment order. The assessee company has also filed details of paid-up capital and share premium for the year under consideration along with complete address PAN details and amount of share capital allotted to them and also filed confirmation of share holders copies of their Income Tax Ack. receipt and share application forms and copy of the bank statement showing amounts have been given through cheques. It was submitted that all the share applicants are income tax assessees and in all cases amounts have been received through the account payee cheques only. The assessee relied upon Judgment of Hon’ble Supreme Court in the case of CIT vs., M/s Lovely Exports (P) Ltd., [2009] 319 ITR (St.) 5 (SC). The A.O, however, did not accept the contention of assessee and noted that summons under section 131 have been issued to the Investors to attend the O/o. Assessing Officer personally, but, none of the Investor attended, but, documents have been filed through post. The A.O. noted that the verification from the Investors could not be done, therefore, documentary evidences and confirmations filed by assessee were rejected. The A.O. noted that assessee has received credit of Rs.3,24,50,000/- on account of share premium and share capital through transaction where no real transaction was took place. The A.O, therefore, made an addition of this amount under section 68 of the I.T. Act. The A.O. also made addition of 1% of this amount i.e., Rs.3,24,500/- and made total addition of Rs.3,27,74,500/-.

4. The assessee challenged the reopening of the assessment as wel as addition before the Ld. CIT(A). The assessee contended that assumption of jurisdiction under section 147 by the A.O. was without proper appreciation of information received by him from Investigation Wing of the Department. The assessee furnished complete documents to prove identity of the Investors, their creditworthiness and genuineness of the transaction. It was further submitted that out of the total amount, the addition of Rs.29 lakhs do not pertain to the assessment year under appeal as no

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