Ita/386/2010 Of Commissioner Of Income Tax Patiala v. M/S K.c.pipes Pvt. Ltd

IN THE HIGH COURT OF PUNJAB AND HARYANA|AT CHANDIGARH Sr. No.205 ITA No.386 of 2010 (O&M)Date of decision: 02.08.2016 The Commissioner of Income- Tax, Patial ....Appellant VeTSuU M/s K.C. Pipes Pvt. Ltd., Samana (Pb.) ....Respondent CORAM:HON'BLE MR. JUSTICE S.J. VAZIFDAR, ACTING CHIEF JUSTICEHON'BLE MR. JUSTICE DEEPAK SIBAL RRS Present:-Mr. Z.S. Klar, Advocatefor the appellant. Mr. Pankaj Jain, Senior Advocate with| Mr. Sachin Bhardwaj, Advocate andMr. Divya Suri, Advocatefor the respondent. RRS S.J. VAZIFDAR,ACTING CHIEF JUSTICE (ORAL) This appeal is against the order of the Tribunal pertaining to theAssessment Year 2006-07. The Tribunal confirmed the order of the CIT(Appeals). The respondent-assessee filed its return of income. During thecourse of assessment, the Assessing Officer noticed that the paid up sharecapital of the assessee during the year in question had increased by|<80 lacson account of 15 share holders having subscribed to the shares. TheAssessing Officer came to the conclusion that these 15 applicants werefarmers. [t 15 contended before us that the farmers are not aware of thefunctioning of the share market. It was contended that the source of themoney paid by the farmers is doubttul. 2 The share holders had appeared before the Assessing Officer,The only grievance is that they had not appeared again. The matter pertainsto questions of fact and the Tribunal and the CIT (Appeals) have found thatthe money, in fact, was received by the Company. In consideration thereof,Shares were issued and amount has been credited to the appropriate account,If the share holders have acquired the money illegally, the respondent-assessee cannot be held liable. There is nothing to show that the moneybelongs to the Company/assessee itself. The revenue must then proceedagainst the share holders.3The appeal is, therefore, dismissed as no substantial question oflaw arises. We do not make any observation regarding the assessmentproceedings in respect of the 15 parties who had subscribed to the shares. (S.J. VAZIFDAR)ACTING CHIEF JUSTICE August 02, 2016Jyoti I (DEEPAK SIBAL)JUDGE (1)Whether speaking/reasonedYes/No(11)Whether reportableYes/No