ITO WARD -19(4), NEW DELHI vs. PIONEER FACTORS IT INFRA DEVELOPERS PVT LTD, NEW DELHI

Brief facts of case are that assessee M/s. Pioneer Factor IT Infradevelopers Pvt. Ltd. e-filed its return on 25.09.2015 for the assessment year 2015-16 declaring NIL income, The case was selected for scrutiny under CASS. Order under section 143(3) was passed on 8.12.2017 assessing income as Rs. 4,13,50,000/- under section 68 on account of unapproved share capital i.e. unexplained cash credit. Assessee preferred appeal before Learned CIT(A) which was partly allowed deleting addition of Rs. 4,13,50,000/-.

Being aggrieved appellant Department preferred appeal. 4. Learned Departmental Representative submitted that Learned CIT(A) erred in law and fact in deleting addition of Rs. 4,13,50,000/- made by Learned Assessing Officer on account of unexplained share capital received from Snt. Kalawati Devi Jain, Smt. Sunaina Devi, Shri Ram Sewak Gupta and M/s. Pioneer Procon Pvt. Ltd. despite the fact that the assessee was not able to prove the genuineness of transactions and their creditworthiness of creditors as required under section 68 of the Income Tax Act. 5. Learned Representative for assessee submitted that in pursuance to notice under section 133(6) Smt. Kalawati Devi Jain, Smt. Sunaina Devi, Shri Ram Sewak Gupta submitted replies confirming subscription in preference share capital of assessee company, independently and had furnished their respective bank statements duly reflecting the source of their investments and ITR etc. The assessee company had duly furnished complete details and corroborating evidences in the shape of confirmations, PAN, income tax particulars, addresses, share certificates, ROC records. Learned Assessing Officer had made addition on the sole basis of low amount of returned income of the 4 investor entities and doubted their creditworthiness. So appeal may be rejected.

From examination of record in light of aforesaid rival contentions it is crystal clear that Learned Assessing Officer noticed that Smt, Kalawati Devi Jain, Smt. Sunaina Gupta, Shri Ram Sewak Gupta, M/s. Pioneer Procon (P) Ltd. having very low income and as such having no creditworthiness to provide share capital to assessee company mad made addition of Rs. 4,13,50,000/-. Learned CIT(A) on basis of submissions tabulated in detail in relation to nature and source of funds made by Smt. Kalawati Devi Jain, Smt. Sunaina Gupta, Shri Ram Sewak Gupta and M/s. Pioneer Procon (P) Ltd. as under:-

The above factual position was corroborated by bank statement investors. None of the four investor entities were having any blemished track record of entry operators. All four were regular income tax assessees filing ITRs. The four investors had provided statutory records like audited financial statements, ITR, Confirmation, Bank Statements, Share Certificates, ROC Records and the independent confirmation so the onus had shifted back to the Learned Assessing Officer resultantly the addition of Rs. 4,13,50,000/- was found to be unsustainable. In view of above material facts and circumstances the findings of Learned CIT(A) are just, fair, reasonable and deserve to be upheld. The arguments of Departmental Representative being devoid on merit are unsustainable.

No other point was argued. 9. In the result appeal is dismissed.