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Case Law Details

Case Name : ACIT Vs M/s. Swiftsol (I) Pvt. Ltd. (ITAT Nagpur)
Appeal Number : ITA No.407/Nag/16
Date of Judgement/Order : 02/07/2018
Related Assessment Year : 2010-11
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ACIT Vs M/s. Swiftsol (I) Pvt. Ltd. (ITAT Nagpur)

Conclusion: Addition under section 68 of share application money received by assessee on the reason that summons issued under section 131 to the directors of the investment company for verification returned unserved was unjustified as assessee had substantiated share capital received by it by furnishing relevant details and no onus was cast on the assessee during relevant assessment year  to produce the persons or the books from investment companies.

 Held: Assessee-company had received share application money with share premium from several corporate entities.  AO made addition under section 68 of share application money received by assessee as unexplained credit on the ground that summons issued under section 131 to the directors of the investment company for verification returned unserved. It was held assessee had duly submitted all the necessary details in respect of the share application received which included name, address, company incorporation details, share application details, balance sheets, PAN, bank statements, acknowledgement of income-tax return filed and confirmation from the parties. AO had not found any fault in these submissions, except that he wanted to verify details by asking the assessee to produce the promoter/director of those companies. Assessee had duly discharged its onus and no onus was cast on the assessee to produce the persons or the books from investment companies. The requirements of enquiry and obtaining explanation from the person making the investment had brought into the statute books by amendment to section 68 which was prospective in nature from 01.04.2013. Admittedly, in the present assessment year 2010-11, addition under section 68 was not justified.

FULL TEXT OF THE ITAT JUDGEMENT

These are appeals by the Revenue against the respective orders of the ld. Commissioner of Income Tax (Appeals) for different assessee companies. Since the issues are common and connected and the appeals were heard together these are being consolidated and disposed of together by this order.

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