Assessee raised share capital of by issuing equity shares of face value of Rs. 10 at a premium of 90 per share. AO treated amount received by assessee as unexplained credit under section 68 on the ground that summons issued to investors under section 131 were returned unserved.

ITAT held that the assessee has filed names, address and PAN of the investors, copies of share allotment advice, share application forms, bank statements, statement giving complete details of share application money received during the year, Form No. 2 evidencing return of allotment and Form 5 for increase in authorized capital. Also, AO issued notices under section 133(6) to all the investors for carrying out independent verification of these transactions which were duly responded by these investors by filing all the requisite details comprising shares subscribed, ledger accounts, bank statements, explanation for source of funds, ITRs and audited financial statements and also assessment order framed under section 143(3) in all the cases. AO had not pointed out any defect or deficiency in the evidences filed by assessee as well as by investors. Accordingly, no addition could be made under section 68 for the mere reason that summons issued to investors were returned unserved. [ITA No.588/Kol/2020, dated 16/01/2023] [AY .2012-13].