Airoplast Private Limited Vs. Income Tax Officer, Ward 2(1)(1), Mumbai

Parties Involved

Facts Summary

The assessee, Airoplast Private Limited, filed its return of income for Assessment Year 2015-16 on 30 September 2015 declaring nil income after claiming a loss of ₹5,54,253. The original assessment was completed under section 143(3) on 16 October 2017 accepting the loss returned. Subsequently, the Assessing Officer noted that the assessee had shown non-current investments aggregating to ₹4,60,00,000 on account of purchase and subscription of shares, comprising ₹2,15,00,000 in the shares of M/s Wavell Industries Pvt Ltd and ₹2,45,00,000 in the shares of M/s JKM Holdings Pvt Ltd, reflected under Note 7 as non-current investments. The Assessing Officer formed a prima facie view that the source and nature of the investment remained unexplained within the meaning of section 69. Notice under section 148 was issued on 30 March 2021, and in the reassessment order, the Assessing Officer held that the investment of ₹2,45,00,000 was unexplained and added the same to the total income of the assessee.…

Legal Issues

• 1. Whether the sum of ₹2,45,00,000 invested by the assessee in shares of M/s JKM Holdings Pvt Ltd can be treated as unexplained investment within the meaning of section 69.

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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