IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH “A”, LUCKNOW BEFORE SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER AND SHRI ANADEE NATH MISSHRA, ACCOUNTANT MEMBER Assessment Year: 2007-08 ACIT, Central Circle-1 v. M/s Anubhav Vyapaar

27/2, P.K. Complex Raja Ram Pvt Ltd Mohan Rai Marg, Lucknow- 34-A, Ratu Sarkar Lane, Kolkata-

226001. 700073.

PAN:AAFCA4742D (Appellant) (Respondent)

Appellant by: Shri Samrat Chandra, C.A.

Respondent by: Smt Namita S. Pandey, CIT(DR)

O R D E R

PER ANADEE NATH MISSHRA, A.M.:

The present appeal has been filed by the Revenue against the impugned appellate order dated 31.12.2014 passed by the Ld. Commissioner of Income Tax (Appeals)-III, Lucknow for the assessment year 2007-08. The grounds of appeal of the Revenue are as under: -

“1. On the facts and in the circumstances of the case that the ld. CIT(A) has erred in deleting the addition of Rs. 4,75,00,000/- made by the assessing officer on account of unexplained share capital. The ld. CIT(A) has deleted this addition on the basis of Observations which are factually incorrect and without appreciating the findings made by the A.O. as indicated in the statement of facts enclosed.

2. That the order of the ld. CIT(A) deserves to be vacated and the assessment order passed by the A.O. be restored.

3. That the appellant craves to add or amend any one or more of the grounds of the appeal as stated above as and when need for doing so may arise.”

2. In this case, the assessment order dated 031.03.2013 was passed by the Assessing Officer, under section 143(3)/153C of the Income Tax Act, 1961 (“Act”, for short) whereby assessee’s total income was determined at Rs.4,75,00,000/-. In the aforesaid assessment order, addition of was made by the Assessing Officer by treating the share capital and share premium unexplained. The relevant portion of the assessment order is reproduced as under: -

“........Vide questionnaire dated 26.02.2013 and 04.03.2013 the assessee was required to furnish incidence regarding source of such share capital and share premium in view of the fact at the share capital and share premium were received in this year. In explanation some copies of confirmation of accounts purportedly in support of source of the said share capital and share premium. However, the documents furnished neither prove the identity and capacity of the persons claimed to have invested in the assessee company, nor the genuineness of such transactions, In these set of facts it is taken that the said sources of share capital and premium are not found as explained. Accordingly, the amount of share capital and share premium totaling Rs. 4,75,00,000/- is added to the assessee’s total income as unexplained credits.”

2.1 Aggrieved, the assessee filed appeal in the office of the Ld. CIT(A). Vide aforesaid impugned appellate order dated 31.12.2014, the Ld. CIT(A) deleted the aforesaid addition entirely. The relevant portion of the impugned order dated 31.12.2014 of the Ld. CIT(A) is reproduced as under: -

“By way of share application money from the above mentioned subscribers and subsequently shares were allotted to’ the above companies against the amounts so received. The subscribers to the shares are income Tax Assessee and have been regularly filing return of Income for last so many years.

Before the Assessing Officer the Appellant company has submitted the details that the shareholders are having PAN and are regularly filing their return of income for last so many years. The copies of returns, bank statement, identity of the share holders were filed before the Assessing Officer during the asstt. proceedings and same were also filed before me during the course of appeal Regarding the identity, the appellant has also submitted that all the shareholder are Companies registered under the Companies Act 1956. having PAN and regularly filing their return of Income in their respective ward.

For the genuineness and creditworthiness of transaction it was stated that share capital had been properly recorde