ITAT : Equity from directors' daughter not transaction between strangers, deletes 'unexplained credit'

Ahmedabad ITAT deletes unexplained cash credit addition with respect to share application money received by assessee (a private limited company) during AY 2010-11 from one of the shareholder (who is daughter of one of the assessee’s directors); Rejects Revenue’s stand that source of funds in the hands of shareholder and creditworthiness was not proved; ITAT takes note of earning statements, bank account details of the shareholder and her husband, which “show prima facie evidence of the means of the shareholder.”; Further, ITAT observes that the relationship between the assessee-company and the shareholder was well established in the sense that the shareholder is the daughter of one of the directors, remarks that “It is, therefore, not a transaction between two strangers.”; Also, ITAT observes that amounts were received through the banking channels.:ITAT