Case Law Details
A.G. Ferro Cast P Ltd Vs ITO (ITAT Kolkata)
A perusal of the assessment order reveals that the order of the Assessing Officer is short and cryptic wherein no reasoning has been given as to why the Assessing Officer has treated the share application/share premium received from one party M/s Lagan Vincom Pvt. Ltd. as unexplained cash credit, whereas, the share subscription from other parties including from the another corporate entity M/s Mayfair Commotrade Pvt. Ltd. which was also subscribed to 50000 shares of the assessee company at a face value of Rs.10/- each and along with share premium of Rs.90/- each were accepted. The only reason given by the Assessing Officer in not accepting the share subscription from M/s Lagan Vincom Pvt. Ltd. has been mentioned as that ‘the said subscriber has made investment in all unquoted shares which are not under the scanner of SEBI’.
6. The above reasoning, in our view, is no way, justify the action of the Assessing Officer in treating the aforesaid share subscription by one party as unexplained cash credit in the hands of the assessee. The assessee, in this case, has furnished all the details and evidences proving the identity and creditworthiness of the share subscriber as well as financials of the share subscriber and other documents to prove the genuineness of the transaction. The ld. counsel has also invited our attention to the assessment order passed in the case of M/s Lagan Vincom Pvt. Ltd. for assessment year 2012-13 to submit that the said share subscriber was duly assessed to tax. In this case, the assessee has discharged the initial burden upon him to furnish the evidences to prove the identity and creditworthiness of the share subscribers and genuineness of the transaction and further the share subscribers having appeared and got recorded their statements in response to summons issued u/s 131 of the Act and the Assessing Officer without pointing out any defect or infirmity in the evidences or details furnished by the assessee or any contradiction in the statement recorded u/s 131 of the Act has made the impugned addition only in the case of one party and having accepted the share subscription/share premium in the case of other parties. As observed above, the Assessing Officer even has not given any reasoning in the impugned assessment order for making the impugned addition.
7. Even the Ld. CIT(A) though has relied upon various case laws but has not pointed out as to how those case laws were applicable to the facts and circumstances of the case of the assessee. In view of this, the impugned addition made by the Assessing Officer and further confirmed by the CIT(A) is not sustainable in the eyes of law and the same is accordingly hereby ordered to be deleted.
FULL TEXT OF THE ORDER OF ITAT KOLKATA
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