ALCOM INVESTMENT PVT LTD,MUMBAI V. INCOME TAX OFFICER, KOLKATA

ITA 1366/KOL/2024

AI Insights

The case involves Alcom Investment Pvt. Ltd., which appealed against the order of the National Faceless Appeal Centre (CIT(A)) that upheld the addition of Rs. 20,00,000 as deemed dividend under section 2(22)(e) of the Income Tax Act. The assessee contested the jurisdiction of the Assessing Officer and the validity of the reopening of the assessment under section 147, claiming that the case was transferred without proper approval and that no notice under section 143(2) was issued. The Tribunal found that these issues were not adequately addressed by the CIT(A) and thus remanded the case for a fresh examination.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 472655 (ITAT-KOLKATA)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-02-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2017-2018
• Laws Referred To: Income Tax Act
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Set aside; Opportunity of being heard; Deemed dividend; Competent authority
• Section: 147; 144; 250; 2(22)(e)

Judgement Text

" आयकर अपीलȣय अͬधकरण, कोलकाता पीठ, कोलकाता IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH KOLKATA Before Shri Sonjoy Sarma, Judicial Member and Shri Rakesh Mishra, Accountant Member I.T.A. No.1366/Kol/2024 Assessment Year: 2017-18 Alcom Investment Pvt. Ltd..………………………………………..….……….Appellant 10th Floor, Gold Crest, NS Road No.10, JVPD Scheme, Vile Parle (W), Mumbai-400049. [PAN: AACCG1658B] vs. ITO, Ward-12(1), Kolkata………................................……........……...…..…..Respondent Appearances by: Shri Deepak Shaha, AR, appeared on behalf of the assessee. Shri Archana Gupta, Addl. CIT- Sr. DR, appeared on behalf of the Revenue. Date of concluding the hearing : February 12, 2025 Date of pronouncing the order : February 13, 2025 ORDER Per Sonjoy Sarma, Judicial Member: The present appeal has been preferred by the assessee against an order dated 29.05.2024 of the National Faceless Appeal Centre [hereinafter referred to as ‘CIT(A)’] passed u/s 250 of the Income Tax Act (hereinafter referred to as the ‘Act’). 2. Brief facts of the case are that the assessee company is engaged in the business of trading in shares and financing loans. The assessee has filed its return of income for assessment year 2017-18 on 03.11.2017 declaring income of Rs.15,16,410/-. The case of the assessee was selected for scrutiny and during the assessment proceedings, it was observed that the assessee had received an advance of Rs.20,00,000/- from M/s Mars Fincom Pvt. Ltd. in the financial year 2016-17. It was noted by the Assessing Officer that the lender was a sister concern of assessee and held 16.21% shares in it. Several notices were issued to the assessee during the assessment proceedings but there was no proper I.T.A. No.1366/Kol/2024 Assessment Year: 2017-18 Alcom Investment Pvt. Ltd 2 response from the assessee’s side. Based on this, the Assessing Officer treated the transaction as deemed dividend u/s 2(22)(e) of the Act and made an addition of Rs.20,00,000/- in the hands of the assessee by completing assessment u/s 144 r.w.s. 147 of the Act. 3. Dissatisfied with the above order, the assessee preferred an appeal before the ld. CIT(A) against the assessment order. However, the ld. CIT(A) upheld the order of the Assessing Officer by dismissing the appeal of the assessee. 4. Aggrieved by the said order, the assessee filed the present appeal before this Tribunal raising various grounds. However, the primary contention of the ld. AR is that while passing of the impugned order, the ld. CIT(A) did not look into the issue regarding the jurisdiction of the Assessing Officer which was challenged by the assessee before the ld. CIT(A) as the assessee was not informed about the transfer the case of the assessee from Central Circle-1, Aurangabad to ITO, Ward-12(1), Kolkata without necessary approval from the competent authority. He also challenged the reopening of the case u/s 147 of the Act by stating that the initial proceedings u/s 147 were improper as no notice u/s 143(2) of the Act was issued upon the assessee. The ld. AR also stated that on the ground of the dismissal of the appeal by the ld. CIT(A) without addressing the jurisdiction of the Assessing Officer and also on validity of reopening, the impugned order needs to be set aside. 5. On the other hand, the ld. DR supported the orders of the lower authorities. 6. We, after hearing both the parties and perusing the materials available on record, find that the ld. CIT(A) has failed to adjudicate the issues raised by the assessee regarding the jurisdiction of the Assessing Officer to frame the assessment and also the non-issuance of notice u/s 143(2) of the Act to frame assessment which is a necessary as per law I.T.A. No.1366/Kol/2024 Assessment Year: 2017-18 Alcom Investment Pvt. Ltd 3 and the ld. CIT(A) was complete silence about these issues. Therefore, we feel it justified to remand the whole issue back to the file of the ld. CIT(A) to re-examine the grounds raised by the assessee afresh after providing reasonable opportunity of being heard to the assessee. 7. In terms of the above, the appeal of the assessee is allowed for statistical purposes. Kolkata, the 17th February, 2025. Sd/- Sd/- [Rakesh Mishra] [Sonjoy Sarma] लेखा सदèय/Accountant Member ÛयाǓयक सदèय/Judicial Member Dated: 17.02.2025. RS Copy of the order forwarded to: 1. Alcom Investment Pvt. Ltd 2. ITO, Ward-12(1), Kolkata 3. CIT(A)- 4. CIT- , 5. CIT(DR), //True copy// By order Assistant Registrar, Kolkata Benches "