ITA No.339/Kol/2020

Parties Involved

Facts Summary

This case pertains to the assessment year 2012-13, where the Assessing Officer (AO) enhanced the income of the assessee, M/s KA Vanijya Pvt. Ltd., by adding Rs. 2,04,75,000/- as unexplained cash credit under section 68 of the Income Tax Act, 1961. The AO found that the company had meagre income and turnover, yet it attracted a high premium for its shares without a solvent track record. The Commissioner of Income Tax (Appeals) (CIT(A)) deleted this addition, stating that sufficient documents were produced to discharge the onus on the assessee. The Revenue has appealed this decision, arguing that the CIT(A) failed to properly verify the identity, genuineness, and creditworthiness of the investor company.…

Legal Issues

• 1. Whether the CIT(A) was justified in deleting the addition of Rs. 2,10,00,000/- made under section 68.
• 2. Whether the CIT(A) was justified in deleting the addition without making any enquiry regarding the identity, genuineness, and creditworthiness of the investor company.
• 3. Whether the CIT(A) was correct in granting relief to the assessee.

Judgment Outcome

Decided in favour of Revenue.

Precedents Relied Upon

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