ITA 704 of 2009 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH. ITA No.704 of 2009 Date of decision 30 .3.2010 Commissioner of Income Tax II, Ludhiana ... Appellant Versus M/s Shree Dadu Auto (P)Ltd. ... Respondent. CORAM: HON'BLE MR. JUSTICE M.M. KUMAR HON'BLE MR. JUSTICE JITENDRA CHAUHAN Present: Mr. Vivek Sethi,Advocate for the appellant 1.To be referred to the Reporter or not ? 2.Whether the judgement should be reported in the Digest ? M.M.KUMAR, J. The Revenue has approached this Court under Section 260A of the Income Tax Act, 1961 (for brevity 'the Act') challenging order dated 26.2.2009 (P.3) passed by the Income Tax Appellate Tribunal, Chandigarh Bench “B”,Chandigarh (for brevity 'the Tribunal') in ITA No. 558/CHD/2008 in respect of the assessment year 2005-06. The Tribunal on the basis of the judgements of Hon'ble the Supreme Court rendered in the cases of CIT v. Lovely Exports Pvt. Ltd. (2008)216 CTR (SC) 195 and CIT v. M/s Divine Leasing and Finance Ltd. (2008) TIOL -118 SC IT has held that when the identity of the share applicant and share holder is disclosed then no addition can be made under Section 68 of the Act in the hands of the assessee- respondent firm especially when the assessee had received the impugned amount in the form of share application money which was duly confirmed by the share applicant. From the order of the CIT(A) it is clear that both the companies M/s AFSL and M/s ACSL have made investment in ITA 704 of 2009 2 the share application money in the company of the assessee- respondent. Both the companies have been assessed to tax and the investment made by them has been disclosed in their respective balance sheets. It is in the aforesaid facts and circumstances that the Tribunal reached the conclusion that no addition under Section 68 of the Act could have been made and the Assessing Officer could have resorted to reopening the individual assessment of the share applicants /share holders holders applicants as has been held by Hon'ble the Supreme Court in the aforesaid judgements. Having heard learned counsel for the Revenue, we are of the considered view that no exception is provided to admit the appeal especially when the view of Hon'ble the Supreme Court in various judgements is absolutely clear. The proper course for the Assessing Officer could have been to re-open the assessment of the share applicants/ share holders rather than making addition against the assessee- respondent. There is thus no merit in the appeal. Dismissed. (M.M.Kumar) Judge (Jitendra Chauhan) 30.3.2010 Judge okg