Smart Projects (P) Ltd. v. ITO (ITAT Delhi) – Assessee company has duly submitted all requisite documentary evidences before the Authorities below so as to discharge its onus of establishing the identity and credit worthiness of the shareholders and the genuineness of the transactions. That being so, looked at from any angle, the addition has wrongly been made in the hands of the assessee company, though the same ought to have been made, if at all, in the hands of the shareholders, as held in ‘Lovely Exports’.
INCOME TAX APPELLATE TRIBUNAL, DELHI
ITA No. 3045(Del)2010
Assessment year: 2006-07
M/s. Smart Projects (P) Ltd.
Vs.
Income Tax Officer
ORDER
PER A.D. JAIN, J.M.
This is assessee’s appeal for the assessment year 2006-07 against the order dated 30.3.2010 passed by the learned Commissioner of Income Tax(Appeals) XII, New Delhi, taking the following grounds:-
“1. That having regard to the facts and circumstances of the case, ld. CIT(A) has erred in law and on facts in confirming the action of the ld. AO in making addition of Rs. 15,00,000/- being share application money received during the year holding the same as unexplained cash credit u/s 68 of the Act.
2. That having regard to the facts and circumstances of the case, ld. CIT(A) has erred in law and on facts in confirming the action of the ld. AO in making addition of Rs. 15,000/- (i.e. 1% of 15,00,000/-) on account of alleged commission paid.
3. That in any case and in any view of the matter, the action of the ld. CIT(A) in confirming the action of the ld. AO in making the aggregate addition of Rs. 15,15,000/- and in framing the impugned assessment is illegal, void ab initio, contrary to law and facts, beyond jurisdiction and deserves to be quashed.
4. That having regard to the facts and circumstances of the case, the ld. CIT(A) has erred in law and on facts in confirming the action of the ld. AO in framing the assessment in violation of principles of natural justice inasmuch as passing the impugned order without confronting the entire adverse material used against the assessee and by recording the incorrect facts and findings and without providing adequate opportunity of hearing and without providing the opportunity of cross examination of the persons whose statements wee used against the assessee.
5. That in any case and in any view of the matter action of the ld. CIT(A) in confirming the action of the ld. AO in making the impugned addition and framing the impugned assessment order is contrary to law and facts, void ab initio, beyond jurisdiction and the same is not sustainable on various legal and factual grounds.
6. That having regard to the facts and circumstances of the case, ld. CIT(A) has erred in law and on facts in not reversing the action of ld. AO in charging interest u/s 234A, 234B, 234C & 234D.
7. That the appellant craves to leave to add, modify, amend or delete any of the grounds of appeal at the time of hearing and all the above grounds are without prejudice to each other.”
2. Ground No.7 is general.
3. Ground Nos. 1 to 5 are against the action of the learned CIT(A) in confirming the addition of 15,00,000/- being share application money received during the year and that of 15,000/-, being 1% of 15,00,000/-, on account of alleged commission paid.
4. The facts are that the assessee company, engaged in the business of real estate, stated to have received the following as share application money during the year:
