GLACIAL MARKETING PVT. LTD.,KOLKATA vs. I.T.O., WARD - 6(2), KOLKATA

Per Rajesh Kumar, AM:

This is an appeal preferred by the assessee against the order of the National Faceless Appeal Centre, Delhi (hereinafter referred to as the “Ld. CIT(A)”] dated 30.01.2026 for the AY 2012-13.

ITA No.661/KOL/2026 GLACIAL MARKETING PVT. LTD.; A.Y. 2012-13 2.1. The facts in brief are that during the course of assessment proceedings, the ld. AO noted that the assessee company has issued share of ₹1,45,00,000/- including share premium. According to the ld. AO, there was no reasonability for issuing shares at a higher premium and the assessee furnished before the ld. AO all the documents comprising names, address, PAN number, audited balance sheets, bank account and confirmation etc. However, the ld. AO rejected the reply of the assessee and added the entire amount as unexplained cash credit on the ground that assessee has issued share at a very high premium. The ld. CIT (A) confirmed the order of the ld. AO.

2.2. After hearing the rival contentions and perusing the materials available on record, we find that the assessee during the year has raised share capital / share premium of ₹1,45,00,000/- from various investors by issuing equity shares of ₹10 each at a premium of ₹490/-. We note that the ld. AO has also issued summon u/s 131 of the Act and assessee replied the same vide letter dated 28.02.2015, which is available at page no.9. It was submitted before the ld. AO that the shares were issued at a premium of ₹490 raised at a face value of ₹10 each and all the details as called for by the ld. AO were produced. Notice u/s 131 were also issued to the share subscribers, who also responded to the same and furnished all the details and confirmed the transactions. However, the ld. AO made the addition on the ground that shares were issued at a very high premium without any justification. The ld. CIT (A) confirmed the order of the ld. AO on the same lines. We note that the authorities below have not pointed out any defect or Page | 2

ITA No.661/KOL/2026 GLACIAL MARKETING PVT. LTD.; A.Y. 2012-13 deficiency in the evidences filed by the assessee and simply confirmed the addition made by the ld. AO on the ground that the shares were issued at a very high premium which in our opinion is valid ground for making addition. The case of the assessee is squarely covered by the decision of the co-ordinate Bench in case of Samrat Finvestors Private Limited Vs. ITO in ITA Nos. 1035 to 1038/KOL/2025 vide order dated 16.10.2025, wherein the co-ordinate Bench has held as under:-

“013. We have heard the rival contentions and perused the records carefully as placed before us. The Assessee was incorporated on 28/03/1996. The assessee had issued 71,15,670 equity shares, out of these 64,00,000 shares were issued as Right share to the existing shareholders while remaining 7,15,670 were issued by other parties during the year under consideration.

Sl No. Name of the share applicants Amount (Rs) 1. Amarlaxmi Deal Trade pvt. ltd. 3,20,00,000 2. Baghbaan deal trade pvt. Ltd. 3,20,00,000 3. Accurate Shoppers Pvt. Ltd. 2,79,80,000 4. Active Dealmark Pvt. Ltd. 85,00,000 5. Anita Promoters Pvt. ltd. 5000000 6. Axon Mercantile Pvt. ltd. 4490000 7. Billion leasing & finance Pvt. ltd. 3000000 8. Burlington Barter Pvt. ltd. 33033333 9. Deercool Vinimay Pvt. ltd. 6000000 10. Dewdrops Mercantiles Pvt. ltd. 75800000 11. Eastwest Enclave Pvt. ltd. 51750000 12. Flowtop Merchandise Pvt. ltd. 3000000 13. Intimate commotrade Pvt. ltd. 9500000 14. Kinetic Financial Consultants Pvt. ltd. 9200000 15. Linkstar Promoters Pvt. ltd. 3000000 16. Madhu Tradecom Pvt. ltd. 15000000 17. Marshal Conclave pvt. Ltd. 11800000 18. Moontree Tie-up Pvt. ltd. 23533333 19. Original Tradelink Pvt. ltd. 3550000 20. Panchmukhi Tradecomm Pvt. ltd. 13000000 21. Panchratan commotrade Pvt. ltd. 8550000 22. Pragya Commodities Pvt. ltd. 122900000 23. Ritudhara Distributors Pvt. ltd. 3000000 24. Sankatsathi Commerce Pvt. ltd. 9600000 25. Shivmangal Dealcomm Pvt. ltd. 5000000 26. Shivrashi Barter Pvt. ltd. 3000000 27. Siddheshwari Vyapaar Pvt. ltd. 37000000 28. Sliverson Dealcomm Pvt. ltd. 5000000 29. SKP Comtrade Pvt. ltd. 40600000 Page | 3

ITA No.661/KOL/2026 GLACIAL MARKETING PVT. LTD.; A.Y. 2012-13 30. Skytouch Investment Advicors Pvt. ltd. 21350000 31. Sri Narayan Mercantile Pvt. ltd. 129100000 32. Starmark Tie up Pvt. ltd. 7600000 33. Topwell Vinimay Pvt. ltd. 5000000 34. Waterlink Distributors Pvt. ltd. 17900000 Total 786670000 014. We note that during the assessment proceedings the assessee had filed before the all the details as called for comprising the followings: “1. Confirmation of accounts having description of source of investment. 2. Copy of ITR filing acknowledgment. 3. Audited financials of subscribers 4. List of Investment of subscriber companies 5. Extract of bank statement of subscribers. 6. Latest master Data as downloaded from Ministry of Corporate Affairs. 7. Signatory Details of subscriber companies” 015. We also note that the AO issued notices u/s 133(6) of the Act to all the subscribers which were duly replied by all the subscribers along with the evidences as required by the AO. Copies of all these replies and evidences are available in the paper book. Therefore once the assessee had filed all the evidences qua the subscribers and notices issued u/s 133(6) of the Act by the AO were also responded by the subscribers confirming the transactions, then the addition u/s 68 of the Act cannot be made. The case of the assessee finds support from the decision of the Hon’ble Calcutta High Court in the case Pr. CIT-9, Kolkata vs. Sreeleathers [448 ITR P-332] dated 14.07.2022 wherein Hon’ble Court has held : ‘In the absence of any such finding, it is held that the order passed by the Assessing Officer was utterly perverse and rightly interfered by the Commissioner (Appeals). The Tribunal re-appreciated the factual position and agreed with the Commissioner (Appeals). The Tribunal apart from taking into consideration, the legal effect of the statement of AKA also took note of the fact that the notices which were issued by the Assessing Officer under section 133(6) to the lenders where duly acknowledged and all the lenders confirmed the loan transactions by filing the documents which were placed before the tribunal in the form of a paper book. These materials were available on the file of the Assessing Officer and there is no discussion on this aspect. Thus, the tribunal rightly dismissed the appeal filed b y the revenue. [Para 5]’ 016. We also note from perusal of assessment order that, the summons issued u/s 131 of the Act during assessment proceedings were also served upon the share subscribers. Thus, it is evident that the share subscribers were existing at their respective addresses. Thus, notices u/s 133(6) as well as Page | 4

ITA No.661/KOL/2026 GLACIAL MARKETING PVT. LTD.; A.Y. 2012-13 summons u/s 131 of the Act were duly served upon them. In view of this fact identity of share subscribers cannot be doubted. In our opinion upon non- compliance of notices u/s 133(6)/ summons u/s 131 of the Act, no adverse inference can be drawn. Reliance was placed on the decision of Hon'ble Delhi High Court in the case of CIT v. Kamdhenu Steel & Alloys Ltd. [2012] 19 taxmann.com 26/206 Taxman 254/[2019] 361 ITR 22, wherein the Hon'ble Court has held that where the assessee has filed all evidences concerning to the money received and have shown that payments were through account payee cheques then it could be said that the assessee has discharged the initial burden and just because some of the creditors/share applicants could not be found at the address given, it would not give the Revenue the right to invoke section 68 of the Act without bringing any additional and substantive materials to prove that the money raised does not satisfy the requirement of section 68 of the Act. 017. The Assessee relied on the decision of the Hon’ble Supreme Court in the case of Orissa Corporation 159 ITR 360 which was followed by the Hon'ble Gujarat High Court, in the case of Dy. CIT v. Rohini Builders [2002] 256 ITR 360 /[2003] 127 Taxman 523, wherein it was held when the assessee furnishes names and addresses of the alleged creditors and the GIR numbers, the burden shifts to the Department to establish the Revenue's case and in order to sustain the addition the Revenue has to pursue the enquiry and to establish the lack of creditworthiness and mere non-compliance of summons issued by the Assessing Officer under section 131, by the alleged creditors will not be sufficient to draw and adverse inference against the assessee. in the case of six creditors who appeared before the Assessing Officer and whose statements were recorded by the Assessing Officer, they have admitted having advanced loans to the assessee by account payee cheques and in case the Assessing Officer was not satisfied with the cash amount deposited by those creditors in their bank accounts, the proper course would have been to make assessments in the cases of those creditors by treating the cash deposits in their bank accounts as unexplained investments of those creditors under section 69. 018. The Hon’ble High Court, Calcutta in the case of Crystal Networks (P.) Ltd. v. Commissioner of Income-tax 353 ITR 171 has held that when the basic evidences are on record the mere failure of the creditor to appear cannot be basis to make addition. Further reliance was placed in the case of Nemi Chand Kothari 136 Taxman 213, (supra), wherein the Hon'ble Guahati High Court has given a further twist to the issue of onus on assessee under section 68, by holding that the same should be decided by taking into consideration the provision of section 106 of the Evidence Act which says that a person can be required to prove only such facts which are in his knowledge. The Hon'ble Court in the said case held that, once it is found that an assessee has actually taken money from depositor/lender who has been fully identified, the assessee/borrower cannot be called upon to explain, much less prove the affairs of such third party, which he is not even supposed to know or about which he cannot be held to be accredited with any knowledge. In this view, the Hon'ble Court has laid down that section 68 of Income-tax Act, should be read along with section 106 of Evidence Act.

ITA No.661/KOL/2026 GLACIAL MARKETING PVT. LTD.; A.Y. 2012-13 019. Similarly, the Hon'ble Calcutta High Court in the case of Crystal Networks (P.) Ltd. v. CIT [2013] 35 taxmann.com 432/353 ITR 171 has held that where all the evidences were filed by the assessee proving the identity and creditworthiness of the loan transactions, the fact that summon issued were returned un-served or no body complied with them is of little significance to prove the genuineness of the transactions and identity and creditworthiness of the creditors. That Hon’ble Calcutta High Court in the case of Pr. CIT vs. M/s. Naina Distributors Pvt. Ltd. [ITAT /113/2023 & IA No. GA/1/2023] has held ‘that non-appearance of the director cannot be made a ground for addition in the hands of the assessee under Section 68 of the Act when other evidence relating to the raising of share capital qua the share subscriber were available on record as furnished by the assessee and also cross verified by the assessing officer pursuant to the enquiry conducted in response to the notices issued under Section 133(6) of the Act. 020. Further the assessee has duly furnished all the evidences necessary to substantiate creditworthiness and genuineness of transactions, i.e., for discharge of onus cast upon it u/s 68 of the Act as is evident from Page-2 in the assessment order, which is extracted as under:- ‘Shri Mukesh Gupta, FCA and AR appeared from time to time and the relevant aspects of the return and the issue involved were discussed and explained ,. The documents/particulars requisitions by the notice u/s. 142(1) of the I.T. Act and the statement of accounts and explanations requisitioned during the course of proceedings were produced/submitted which were examined and verified with the statement of accounts filed with the details available in the return of income other account statements filed/furnished vis-à-vis the relevant issues of the case.’ 021. It is noteworthy that the Ld. AO in the order passed has not found any deficiency in the submissions made and evidences furnished by the assessee. The details of 78,12,670 equity shares issued of Rs.10/- each at a premium of Rs. 190/- to 34 shareholders , details money invested , documents furnished , their statements recorded u/s 131 of the Act and status of their assessments are tabulated below:- SL. NAME OF THE AMOUNT(Rs) Documents Statement Assessment N0. SHARE filed in recorded made APPLICANTS paper u/s. 131 book in Paper Book 1. AMARLAXMI 3,20,00,000.00 88-277 Face value 143(3) DEALTRADE PVT LTD 2. BAGHBAAN 3,20,00,000.00 278-445 Face Value 143(3) DEALTRADE PVT LTD 3. ACCURATE 2,79,80,000.00 446 to 642 3431 to 3433 143(3) SHOPPERS PVT LTD

ITA No.661/KOL/2026 GLACIAL MARKETING PVT. LTD.; A.Y. 2012-13 4. ACTIVE 85,00,000.00 643 to 710 3406 to 3408 143(3) DEALMARK PVT LTD 5. ANITA 50,00,000.00 711-754 3411 to to 143(1) PROMOTERS PVT 3413 LTD 6. AXON 44,90,000.00 755-825 3411 to to 143(3) MERCANTILE PVT 3413 LTD 7. BILLION LEASING 30,00,000.00 826-863 3411 to to 143(1) & FINANCE PVT 3413 LTD 8. BURLINGTON 3,30,00,000.00 864-1025 3426 to 3428 143(1) BARTER PVT LTD 9. DEERCOOL 60,00,000.00 1026-1070 3416 to 3418 143(3) VINIMAY PVT LTD 10. DEWDROPS 7,58,00,000.00 1071-1258 3416 to 3418 143(3) MERCANTILES PVT LTD 11. EASTWEST 5,17,50,000.00 1259-1405 3431 to 3433 143(3) ENCLAVE PVT LTD 12. FLOWTOP 30,00,000.00 1406-1470 3406 to 3408 143(3) MERCHANDISE PVT LTD 13. INTIMATE 95,00,000.00 1471-1531 3431 to 3433 143(3) COMMOTRADE PVT LTD 14. KINETIC 92,00,000.00 1532-1576 3431 to 3433 143(3) FINANCIAL CONSULATNTS PVT LTD 15. LINKSTAR 30,00,000.00 1577-1640 3421 to 3423 143(3) PROMOTERS PVT LTD 16. MADHU 1,50,00,000.00 1641-1727 3431 to 3433 143(3) TRADECOM PVT LTD 17. MARSHAL 1,18,00,000.00 1728-1791 3445 to 3447 143(3) CONCLAVE PVT LTD 18. MOONTREE TIE- 2,35,00,000.00 1792-1842 3431 to 3433 143(3) UP PVT LTD 19. ORIGINAL 35,50,000.00 1843-1881 3436 to 3438 143(3) TRADELINK PVT LTD 20. PANCHMUKHI 1,30,00,000.00 1882-1961 3445 to 3447 143(3) TRADECOMM PVT LTD 21. PANCHRATAN 85,50,000.00 1962-2038 3445 to 3447 143(3) COMMOTRADE PVT LTD 22. PRAGYA 12,29,00,000.00 2039-2368 3441 to 3442 143(3) COMMODITIES PVT LTD 23. RITUDHARA 30,00,000.00 2369-2443 3436 to 3438 143(3) DISTRIBUTORS PVT LTD

ITA No.661/KOL/2026 GLACIAL MARKETING PVT. LTD.; A.Y. 2012-13 24. SANKATSATHI 96,00,000.00 2444-2518 3436 to 3438 143(3) COMMERCE PVT LTD 25. SHIVMANGAL 50,00,000.00 2519-2555 3421 to 3423 143(3) DEALCOMM PVT LTD 26. SHIVRASHI 30,00,000.00 2556-2613 3421 to 3423 143(3) BARTER PVT LTD 27. SIDDHESHWARI 3,70,00,000.00 2614-2721 3436 to 3438 143(3) VYAPAAR PVT LTD 28. SLIVERSON 50,00,000.00 2722-2772 3426 to 3428 143(1) DEALCOMM PVT LTD 3445 to 3447 143(3) 29. SKP COMTRADE 4,06,00,000.00 2773-2889 PVT LTD 3445 to 3447 30. SKYTOUCH 2,13,50,000.00 2890-2973 143(1) INVESTMENT ADVICORS PVT LTD 3421 to 3423 143(3) 31. SRI NARAYAN 12,91,00,000.00 2974-3207 MERCANTILE PVT LTD 3445 to 3447 143(3) 32. STARMARK TIE- 76,00,000.00 3208-3273 UP PVT LTD 3426 to 3428 33. TOPWELL 50,00,000.00 3274-3320 143(1) VINIMAY PVT LTD 3445 to 3447 143(3) 34. WATERLINK 1,79,00,000.00 3321-3405 DISTRIBUTORS PVT LTD 77,76,70,000 022. We even note that the share subscribers were having substantial creditworthiness which is represented by the free reserves and share capital, therefore there is no substance in the findings of the lower authorities that the subscribers lacked creditworthiness. With respect to creditworthiness not being there in case of subscribers, we are of the opinion that the mere fact that they had meagre recurring income is not relevant and creditworthiness cannot be doubtful when their own funds are several times the investment made in the assessee company. The case of the assessee find support from the decision of Hon'ble Delhi High court in the case of CIT Vs M/s Mayawati 338 ITR 563(Del). 023. Considering the fact of the assessee’s case in the light of ratio laid down in the decisions as discussed above , we are inclined to set aside the order of the ld. CIT()A and direct the Assessing Officer to delete the addition. Ground No.5-7 and 9 & 10 are allowed. 024. The other grounds raised by the assessee is not been adjudicated at this stage. 025. The appeal of the assessee in ITA No. 1035/Kol/2025 for A.Y. 2012-13 is allowed on legal issue. ”

ITA No.661/KOL/2026 GLACIAL MARKETING PVT. LTD.; A.Y. 2012-13 2.3. The assessee has discharged its onus by placing on record the copies of replies u/s 131 of the Act from the share subscribing companies along with their ITR acknowledgements, Audited Final accounts and relevant bank statement. The assessee has duly furnished all the evidences necessary to substantiate the identity of the share subscribers along with the creditworthiness and genuineness of transactions i.e. for discharge of onus cast upon it u/s 68 of the Act. We note that from a perusal of the financials of the share subscribers, it is evident that they have sufficient reserves and capital. Merely due to meagre income creditworthiness cannot be doubted as the own funds of the share subscribing companies are several times thus, investments made in the assessee company.

2.4. Considering the facts and circumstances of the case and also relied on the above decisions, we are inclined to set aside the order of learned CIT (A) and delete the addition. The appeal of the assessee is allowed.

3.1. The undisputed facts are that the assessee did not receive any exempt income during the year. The ld. AO during the course of assessment proceedings noted that the assessee has received share capital / share premium which were invested in the share of other company. The assessee has also not disallowed any expenses u/s 14A read with Rule 8D of the IT Rules in relation to earning of exempt income which does not form part of the total income and accordingly invoked the Page | 9

ITA No.661/KOL/2026 GLACIAL MARKETING PVT. LTD.; A.Y. 2012-13 provisions of Section 14A read with Rule 8D of the Rules. The ld. AO noted that the requirement for invoking such section is only the making of investment in the securities income which is exempt and accordingly he computed the disallowance u/s 8D(2)(3) of the Act by applying 0.5% on the average value of investment and computed the disallowance at ₹1,43,625/-, which were confirmed by the ld. CIT (A).

3.2. After hearing the rival contentions and perusing the materials available on record, we find that it is settled law that no disallowance of expenses is to be made where the assessee has not earned any exempt income during the year. Accordingly, we are inclined to set aside the order of ld. CIT (A) and direct the ld. AO to delete the addition. The ground no.2 is allowed.

Order pronounced on 24.08.2026.

Sd/- Sd/- (PRADIP KUMAR CHOUBEY) (RAJESH KUMAR) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) Kolkata, Dated: 24.08.2026 Sudip Sarkar, Sr.PS

ITA No.661/KOL/2026 GLACIAL MARKETING PVT. LTD.; A.Y. 2012-13

Copy of the Order forwarded to: 1. The Appellant 2. The Respondent 3. CIT DR, ITAT, 4. 5. Guard file. BY ORDER, True Copy//

(Manish Bhoi) Dy. Registrar Income Tax Appellate Tribunal, Kolkata