Case Law Details
ITO Vs Direct Trading Co. P. Ld. (ITAT Delhi)
The Income Tax Appellate Tribunal (ITAT) Delhi heard an appeal filed by the revenue against the order of the CIT(A)-3, Delhi, dated 05.05.2017, concerning the assessment year 2012-13. The primary contention of the revenue was related to the deletion of additions made by the Assessing Officer (AO) on account of unexplained share capital, share premium, and unexplained investment.
AO’s Findings
The AO observed that the assessee had received a share premium of Rs. 2,03,40,000 from various entities. The AO sought justification for the share premium, and upon receiving what was deemed an unsatisfactory response, proceeded to analyze each applicant company. The AO concluded that the assessee failed to explain the source of credit entries in its books, resulting in the addition of Rs. 2,30,22,000 under Section 68 of the Income Tax Act.
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