VIJAYA MOTELS PVT. LTD.,KOLKATA vs. I.T.O., WARD - 5(4),, KOLKATA

The only issue raised by the assessee is against the confirmation of addition ofRs.3,42,00,000/- as made by the ld. AO u/s 68 of the Income-tax Act, 1961 (the Act) in respect of share application money received from M/s Lovely Properties Pvt. ltd.

After hearing the rival contentions and perusing the materials available on record, we find that during the course of assessment

In the appellate proceedings, the ld. CIT (A) confirmed the order of the ld. AO.

We note that in the case of the subscriber i.e. M/s Lovely properties Pvt. Ltd. the assessment was framed u/s 147/143(3) of the Act vide order dated 26.10.2019, wherein the addition was made u/s 68 of the Act of ₹3,32,37,000/- out of which the investment was made in the assessee company. The copy of the order is available from page no.35 to 37 of the Paper Book. We also note that the said subscriber has gone into VSVS Scheme and paid the due taxes on the said amount and the fact was also brought to the notice of ld. CIT (A) during appellate proceedings and the ld. CIT (A) in para no.4.3 recorded the finding to this effect but finally, dismissed the appeal of the assessee. In our opinion, once the amount of investment made in the assessee company by the subscriber has been settled in the VSVS scheme and due taxes were paid, then there is no question of adding back the amount of share capital share/premium in the hands of the assessee. consequently, we set aside the order of ld. CIT (A) and direct the ld. AO to delete the addition.