Case Law Details
Inter Publicity Pvt. Ltd. Vs DCIT (ITAT Mumbai)
Introduction: The recent order from ITAT Mumbai, dated 17/10/2023, in the case of Inter Publicity Pvt. Ltd. vs. DCIT sheds light on the assessment year 2014-15. The appeal addresses concerns about additions under section 68 of the Income Tax Act related to share application money.
Detailed Analysis: The order discusses the background, search operations, and assessments conducted on the assessee. It outlines the details of share capital received during the relevant year and the subsequent investigations initiated by the AO. The AO raised concerns about the creditworthiness of the subscriber companies, leading to the addition under section 68.
The assessee, in response, submitted various documents such as certificates of incorporation, PAN numbers, balance sheets, bank statements, and more, demonstrating the identity, genuineness, and creditworthiness of the subscribers. The AO, however, rejected these contentions, relying on statements made during the search operation.
The ITAT’s detailed analysis highlights the importance of the assessee’s initial burden to establish the three key factors – identity, genuineness, and creditworthiness. The order emphasizes the admissibility of documents furnished by the assessee, including certificates of incorporation, PAN, and bank statements, as evidence to prove the legitimacy of transactions.
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