JUDGMENT P.P. Naolekar, C.J. 1. We have heard Mr. K.N. Choudhury, learned Counsel for the Appellant and Mr. K.P. Sharma. learned standing Counsel for the Revenue. 2. The brief facts of the case is that during the relevant assessment year the Assessee has shown receipt of share application money of Rs. 19 lacs in cash from M/s. Kabis Iron and Steel Company Pvt. Ltd. on different dates, which are as sunder: Date of receipt Amount 26.7.89 50,000.00 16.11.89 2,50,000.00 26.2.90 4,00,000.00 21.3.90 2,00,000.00 26.3.90 5,00,000.00 29.3.90 5,00,000.00 ------------------------ Rs. 19,00,000.00 3. As the share application money of Rs. 19 lacs was received in cash, the Assessing Officer asked the Assessee Company to explain the Immediate source from which the concerned company had advanced the sum of Rs. 19 lacs in cash and the manner in which the cash was transferred from Hissar to Guwahati, with supporting evidence. The Assessee stated that the said money was remitted by the concerned Company out of the available cash in hands. The explanation submitted by the Assessee was not accepted by the Assessing Officer observing that M/s. Kabis Iron and Steel Company Pvt. Ltd. had not filed any return of income after the Assessment Year 1985-86 on the ground that it had no manufacturing and commercial activities. In the Balance Sheet as on 31.3.90, the only source of the said Company's fund was shown as the share application money, amounting to Rs. 24 lacs, shown as received during the previous year ended 31.3.90. In the absence of supporting details and evidence, the capacity of M/s. Kabis Iron and Steel Company Pvt. Ltd. to advance the sum of Rs. 19 lacs has not been established, particularly when the said company did not have any manufacturing and commercial activities and in that view of the matter, the Assessing Officer treated the said sum of Rs. 19 lacs as Assessee's income under the Section 68 of Income Tax Act, 1961, i.e. the income from undisclosed sources. The Assessing Officer was also not satisfied with the creditworthiness of M/s. Kabis Iron and Steel Company Pvt. Ltd. and thus the transaction, purchase of share and depositing of the amount thereof has not been accepted and that the amount shown in the book of account was taken to be its own money. 4. The Assessing Officer was also not satisfied with the creditworthiness of M/s. Kabis Iron and Steel Company Pvt. Ltd. and thus the transaction, purchase of share and depositing of the amount thereof has not been accepted and that the amount shown in the book of account was taken to be its own money. 4. Aggrieved by the said order of assessment, the Assessee filed appeal before the Commissioner of Income Tax (Appeals), being appeal No. Guwa-123/93-94. The Appellate Authority on appreciation of the facts of the case has found that the share application money was received from M/s. Kabis Iron and Steel Company Pvt. Ltd., Hissar and thus the amount cannot be taken to be the amount of Assessee from undisclosed source and thus the appeal was allowed. Feeling aggrieved, the Revenue went in appeal before the Income Tax Appellate Tribunal, Guwahati (ITA No. 174/Gau/1994). The Tribunal considered the ratio laid down in CIT v. Sofia Finance Limited, reported in 205 ITR 99, by the Delhi High Court and has held that in the facts and circumstances of the case, the ratio laid therein has no application. The Tribunal was of the view that the shareholder was not carrying on manufacturing and commercial activities since 1985-86 and had also not filed any return of income thereafter, and therefore, source of money as share application money paid by the alleged shareholder during the previous year ending 31.3.90 was doubtful. There was also no bank account. According to the Tribunal, these facts, prima facie, establish that the Assessee Company had failed to established that the alleged share capital of Rs. 19 lacs was invested in the purchase of shares by the shareholder, namely, M/s. Kabis Iron and Steel Company Pvt. Ltd. Thus, the Tribunal proceeded on the finding of creditworthiness of M/s. Kabis Iron and Steel Company Pvt. Ltd. to purchase the share from the Assessee Company. 5. 19 lacs was invested in the purchase of shares by the shareholder, namely, M/s. Kabis Iron and Steel Company Pvt. Ltd. Thus, the Tribunal proceeded on the finding of creditworthiness of M/s. Kabis Iron and Steel Company Pvt. Ltd. to purchase the share from the Assessee Company. 5. A Division Bench of this Court in a recent judgment in the matter of Nemichand Kothari v. CIT reported in (2004) 1 GLR 504 : 2004 (Supp.) GLT 208, has held that in the nature of the transaction involved in the case, the Assessee has to, prima facie, satisfy the Assessing Officer, the identity of the person, who has alleged to have invested-and deposited the money with the Assessee; Secondly, the transaction must be genuine; and thirdly, the creditworthiness of the creditors, who deposit the money, vis-a-vis, the transaction itself. If the Assessee, prima facie, establishes these facts, then the burden shall be on the Revenue to prove that the money shown to have been deposited by the Assessee under transaction is, in fact, the money of the Assessee, which has been routed through third party, to hold that it is the money of the Assessee from undisclosed source. In the case in hand, admittedly, the identity of the shareholder, who has shown to have purchased the share from the Assessee has been established to be that of M/s. Kabis Iron and Steel Company Pvt. Ltd. It is also established before the Assessing Authority that in pursuance of the share application the shares have been issued in the name of the Company, viz. M/s. Kabis Iron and Steel Company Pvt. Ltd. It is not the case of the Department that the share money received by the Assessee Company had not been reflected in the accounts book of the Assessee company. The Assessee has produced the balance sheet of M/s. Kabis Iron and Steel Company Pvt. Ltd. indicating that they have purchased the share from the Assessee Company worth Rs. 19 lacs and the amount of the share money has been sent by cash on different dates. The Assessing Officer has also found that M/s. Kabis Iron and Steel Company Pvt. Ltd. have said to have received the money of Rs. 19 lacs and the amount of the share money has been sent by cash on different dates. The Assessing Officer has also found that M/s. Kabis Iron and Steel Company Pvt. Ltd. have said to have received the money of Rs. 24 lacs as share money and that amount has been reflected in the balance sheet as on 31.3.90 of M/s. Kabis Iron and Steel Company Pvt. Ltd. and out of the said amount, the share amount has been paid to the Assessee Company. On these facts, prima facie, all the ingredient required to be proved by the Assessee have been established, however, no material was placed on record by the Department, on the basis of which it can be said that it is, in fact, the money of the Assessee, which was placed with M/s. Kabis Iron and Steel Company Pvt. Ltd. and M/s. Kabis Iron and Steel Company Pvt. Ltd. has invested that money for purchase of the share of the Company. Much thrust have been put by the Assessing Officer and the Tribunal on the fact that the company M/s. Kabis Iron and Steel Company Pvt. Ltd., is not a manufacturing unit on the date the shares have been purchased, ignoring the fact that there is no proof on record that they were not possessing the requisite money, which was required for purchase of the shares worth Rs. 19 lacs. In the nature of the transactions involved in the case, neither the Assessing Officer nor the Tribunal is required to assess the income of either the creditor or the company, or the purchaser of the share in the assessment proceedings of the Assessee. The balance sheet of the Company, which has invested the money, is to be examined only for the purpose of finding out whether the Company is in a position to enter into transactions involved. The Income Tax Officer is not concerned in the assessment proceeding against the Assessee of the assessment of the concerned company. In the facts and circumstances, we are satisfied that the Assessee has discharged its burden to prove the fact that the amount of Rs. The Income Tax Officer is not concerned in the assessment proceeding against the Assessee of the assessment of the concerned company. In the facts and circumstances, we are satisfied that the Assessee has discharged its burden to prove the fact that the amount of Rs. 19 lacs have been deposited with the Assessee company for the shares, which have been purchased from the money received from M/s. Kabis Iron and Steel Company Pvt. Ltd. and is the amount of the Assessee company received as share money and not received from undisclosed source. 6. For the aforesaid reasons, we set aside the order of the Tribunal and restore the order of the Commissioner of Income Tax (Appeals), Guwahati. The appeal stands disposed of. No order as costs.