Happy Homes & Houses Pvt. Ltd. Vs ITO (ITAT Kolkata)
Share Capital Addition Deleted – Non-Appearance of Investors Not Fatal When Identity and Creditworthiness Proved
The Kolkata ITAT allowed the assessee’s appeal and deleted the addition of ₹1.50 crore made under Section 68 in respect of share capital and share premium. The Tribunal noted that the assessee had furnished complete documentary evidence including PAN, ITRs, audited financial statements, bank statements, share application forms, board resolutions and confirmations from all eight subscriber companies. Although the directors of the subscriber companies did not personally appear in response to summons under Section 131, the Tribunal held that mere non-appearance could not justify an addition when all primary evidences establishing identity, creditworthiness and genuineness were already on record and no defect had been pointed out by the Assessing Officer.
Relying on the Supreme Court decision in Orissa Corporation Ltd., the Calcutta High Court ruling in Crystal Networks Pvt. Ltd., and other coordinate bench and High Court precedents including Orchid Industries (Bom HC), the Tribunal held that once the assessee discharges the initial onus, the burden shifts to the Revenue to make further enquiry, which was not done in the present case. Accordingly, the order of the CIT(A) was set aside and the Assessing Officer was directed to delete the entire addition.
FULL TEXT OF THE ORDER OF ITAT KOLKATA
