ITO, WD-2(4), Gangtok, Sikkim V. M/s Kalson Private Limited, Sikkim

ITA 1135/KOL/2014

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 9369 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 9 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-02-2017
• Appeal Filed By: Department
• Bench Allotted: SMC
• Next Hearing Date: 21-02-2017
• Assessment Year: 2010-2011
• Appeal Filed On: 22-05-2014
• Court: TRIBUNAL
• Department Lawyers: BANIBRATA DUTTA JCIT LD
• Keywords: Unexplained cash credit
• Section: 142(1); 68; 6; 144

Judgement Text

I T A NO. 1135/KOL/14 M/S. KALSON PVT. LIMITED 1 IN THE INCOME TAX APPELLATE TRIBUNAL,DBENCH, KOLKATA BEFORE: SHRI S.S.VISWANETHRA RAVI, JUDICIAL MEMBER AND SHRI DR. ARJUN LAL SAINI, ACCOUNTANT M EMBER ITA NO. 1135/KOL/2014 A.Y: 2010-11 INCOME TAX OFFICER VS. M/S. KALSON PRIVATE LIMI TED WARD 2(4), GANGTOK PAN: AADCK 9486E (APPELLANT) (RESPONDENT) APPEARANCES BY : SHRI BANIBRATA DUTTA, JCIT, LD.DR FOR THE REVEN UE NONE APPEARED FOR THE ASSESSEE DATE OF HEARING : 21-02-2017 DATE OF PRONOUNCEMENT : 24 -02-2017 O R D E R SHRI S.S. VISWANETHRA RAVI, JM :- THIS APPEAL BY THE REVENUE IS AGAINST THE ORDER DT: 26-03- 2014 PASSED BY THE COMMISSIONER OF INCOME TAX (APP EALS), JALPAIGURI FOR THE ASSESSMENT YEAR 2010-11. 2. THE ONLY ISSUE IS TO BE DECIDED AS TO WHETHER T HE CIT-A JUSTIFIED IN DELETING THE ADDITION MADE U/SEC. 68 O F THE ACT IN THE FACTS AND CIRCUMSTANCES OF THE CASE. 3. AT THE TIME OF HEARING, NONE APPEARED REPRESENTI NG ASSESSEE NOR ANY APPLICATION FILED SEEKING ADJOURNM ENT. THE LD.DR SUBMITS REFERRING TO GROUNDS OF APPEAL THAT I T WAS AN ASSESSMENT ORDER U/SEC. 144 OF THE ACT AND THE ASSE SSEE FILED I T A NO. 1135/KOL/14 M/S. KALSON PVT. LIMITED 2 DETAILS OF SHARE CAPITAL AND SUNDRY CREDITORS BEFOR E THE CIT-A. THE CIT-A FORWARDED THE SAME TO THE AO AND NOTICES IN REMAND PROCEEDINGS COULD NOT BE SERVED ON THE ASSESSEE AND THE AUTHORITY BELOW COULD NOT VERIFY THE SAME AND ARGUE D THAT THE AO COULD NOT EXAMINE THE CORRECTNESS OF THE DETAILS IN THE ABSENCE OF ANY EXPLANATION BY THE ASSESSEE AND URG ED TO REMAND THE ISSUE TO THE AO. 4. IN VIEW OF THE SAME, WE PROCEED TO HEAR THE CASE TO DECIDE THE ISSUE BASING ON THE MATRIAL EVIDENCE AVAILABLE ON RECORD. 5. THAT, WE SHALL EXAMINE THE BRIEF FACTS RELATING TO ISSUE ON HAND. THE ASSESSEE IS A COMPANY AND FILED RETURN ON 28-03- 2011 DECLARING INCOME OF RS.6,98,760/-, WHICH WAS D ERIVED FROM OTHER INCOME. UNDER SCRUTINY, NOTICES U/SEC. 1 43(2) AND 142(1) OF THE ACT WERE ISSUED AND FOR WHICH NO COMP LIANCE ON BEHALF OF ASSESSEE WAS MADE. 6. THE CASE WAS RE-FIXED FOR HEARING ON 09-01-2013 AND THE ASSESSEE REMAINED ABSENT. AGAIN THE AO ISSUED A SHO W CAUSE LETTER AS TO WHY THE ASSESSMENT SHOULD NOT BE COMPL ETED EX PARTE AND NO RESPONSE FROM ASSESSEE TO THAT EFFECT. THEREFORE, THE AO CONDUCTED ASSESSMENT PROCEEDINGS IN THE ABSE NCE OF ASSESSEE. DURING SUCH PROCEEDINGS, THE AO FOUND THA T THE ASSESSEE HAS SHOWN PAID UP CAPITAL OF RS.11,00,000/ - AND AN AMOUNT OF RS.24,62,119/- TOWARDS SUNDRY CREDITORS A ND ADDED THE SAID AMOUNT AS UNEXPLAINED CASH CREDIT U/SEC. 6 8 OF THE ACT AND TO THAT EFFECT AN ORDER U/SEC. 144 OF THE ACT W AS PASSED. I T A NO. 1135/KOL/14 M/S. KALSON PVT. LIMITED 3 7. THE ASSESSEE FILED AN APPEAL AND FILED DETAILS O F SHARE CAPITAL AND SUNDRY CREDITORS BEFORE CIT-A AND THE S AID DETAILS WERE SENT TO AO SEEKING REMAND REPORT. BUT, HOWEVER , THE AO DID NOT SECURE THE PRESENCE OF ASSESSEE AS THE NOTI CES ISSUED BY HIM COULD NOT BE SERVED DUE TO POSTAL DEPARTMENT DELAYS. THUS, THE AO FILED REMAND REPORT STATING THAT THE D ETAILS OF SHARE CAPITAL AND SUNDRY CREDITORS COULD NOT BE VER IFIED IN THE ABSENCE OF ASSESSEE. THE CIT-A OBSERVES THAT THE AO FAILED TO EXERCISE THE NECESSARY POWERS TO CARRY OUT VERIFIC ATION AND FOUND FAULT WITH THE COMMENTS OF AO IN THE REMAND REPORT AND DELETED THE SAID ADDITIONS BASING ON THE CONFIRMAT IONS FROM THIRD PARTIES AS FILED BEFORE HIM AND DIRECTED THE AO TO INFORM THE RESPECTIVE AOS REGARDING THE PERSONS, WHO INV ESTED AND SHOWN AS SUNDRY CREDITORS FOR NECESSARY ACTION. WE FIND THAT AS RIGHTLY POINTED BY THE LD.DR THAT THERE WAS NO OCCA SION TO AO TO VERIFY THE DETAILS OF SHARE CAPITAL AND SUNDRY CRED ITORS IN THE ORIGINAL PROCEEDING AS WELL AS IN THE REMAND PROCE EDINGS. IT IS ALSO NOTICED THAT THE CIT-A DELETED THE SAID ADDITI ON BASING ON DETAILS AS FURNISHED BY THE ASSESSEE, BUT, HOWEVER, NO REFERENCE OR WHATSOEVER MADE IN HIS ORDER, EXCEPT, STATING THAT DETAILS OF SHARE CAPITAL AND CONFIRMATION FROM SUN DRY CREDITORS WERE FILED AND DIRECTED THE RESPECTIVE AOS FOR NEC ESSARY ACTION. THEREFORE, THE DETAILS AS SUBMITTED BY THE ASSESSEE WERE NOT EXAMINED BY THE CIT-A AND AO AS THEY REQU IRED TO DO UNDER THE ACT. 8. BE THAT AS IT MAY, COMING TO APPEAL BEFORE US, W E NOTICED THAT THE REGISTRY ISSUED NOTICES DT: 5-7-2016, 21-1 2-2016 AND 1-2-2017 INFORMING THE ASSESSEE THE DATES OF HEARIN G ON 25-8- 2016, 12-01-2016 AND 21-02-2017 RESPECTIVELY. THE T RIBUNAL I T A NO. 1135/KOL/14 M/S. KALSON PVT. LIMITED 4 ALSO ORDERED NOTICES THROUGH APPELLANT REVENUE AND IN PURSUANCE OF WHICH NOTICES WERE ISSUED ON 14-9-2016 AND 18- 11-2016 INFORMING THE DATES OF HEARING 24-10-2016 A ND 22-12- 2016 RESPECTIVELY AND THERE WAS NO REPRESENTATION O N BEHALF OF ASSESSEE BEFORE US. IT IS PERTINENT TO NOTE THAT TH E NOTICE DT. 5- 7-2016 WITH RPAD, WHICH WAS POSTED ON 21-07-2016 WA S RETURNED UNSERVED WITH AN ENDORSEMENT NO SUCH ADDR ESSEE FOUND AND NOT KNOWN . IT IS CLEAR THAT THE ASSESSE E DID NOT AVAIL THE OPPORTUNITIES AS AFFORDED BY THE AUTHORI TIES INCLUDING THIS TRIBUNAL. IN SUCH CIRCUMSTANCES AND IN THE ABS ENCE OF ANY REFERENCE TO THE DETAILS OF SHARE CAPITAL AS SUNDRY CREDITORS IN THE IMPUGNED ORDER, WE DEEM IT FIT AND PROPER TO RE MAND THE ISSUE TO THE AO FOR HIS VERIFICATION AND TO PASS AN ORDER TO THAT EFFECT AS PER LAW. WE SHALL DIRECT THE ASSESSEE TO PRODUCE EVIDENCES, IF ANY, TO SUBSTANTIATE ITS CLAIM. ACCOR DINGLY, THE GROUNDS OF THE REVENUE ARE ALLOWED FOR STATISTICAL PURPOSE AS INDICATED ABOVE. 9. IN THE RESULT, THE APPEAL OF THE REVENUE IS ALLO WED FOR STATISTICAL PURPOSES. DR. ARJUN LAL SAINI S.S. VISWANETHRA RAVI ACCOUNTANT MEMBER JUDICIAL MEMBER DATED 24-02 -2017 ORDER PRONOUNCED IN OPEN COURT ON 24/02/2 017 SD/- SD/- I T A NO. 1135/KOL/14 M/S. KALSON PVT. LIMITED 5 *PP/SPS: COPY OF THE ORDER FORWARDED TO: 1 . THE APPELLANT/DEPARTMENT: THE INCOME TAX OFFICER, WARD 2(4), GANGTOK, AAYKAR BHAWAN, BHANUPATH GANGTO K (SIKKIM) PIN 737101. 2 THE RESPONDENT/ASSESSEE: M/S. KALSON PRIVATE LIMIT ED, BIKASH TAMANG PLAY GROUND ROAD, NAYABAZAR, JORETHAN G, SIKKIM-737121. 3 THE CIT(A) 4. THE CIT 5 . DR, KOLKATA BENCH 6 . GUARD FILE . BY ORDER, ASSTT. REGISTRAR