ITO, WD-6(2), KOLKATA, Kolkata V. M/s Glister Infrastructure Pvt. Ltd., Kolkata

ITA 1202/KOL/2015

• Counselvise Citation: [2018] 122 COUNSELVISE.COM (IT) 2674 (ITAT-KOLKATA)
• Duration Of Justice: 3 year(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-10-2018
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 17-09-2015
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: MD USMAN
• Assessee Lawyers: V K JAIN
• Keywords: Assessment record; Capital receipt
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH B, KOLKATA BEFORE SHRI J. SUDHAKAR REDDY, AM & SHRI S.S. VISWANETHRA RAVI, JM I.T.A. NO. 1202/KOL/2015 ASSESSMENT YEAR 2011-12 INCOME TAX OFFICER................................................................APPELLANT WARD 6(2), KOLKATA, P-7, CHOWRINGHEE SQUARE, KOLKATA 700 069. [PAN: AADCS 6713 N] M/S. GLISTER INFRASTRUCTURE PVT. LTD......................RESPONDENT 9/12, LAL BAZAR STREET, MERCANTILE BUILDING, 2 ND FLOOR, KOLKATA 700 001.. APPEARANCES BY: MD. USMAN, CIT, DR APPEARING ON BEHALF OF THE REVENUE. SHRI V.K. JAIN, AR APPEARING ON BEHALF OF THE ASSESSEE. DATE OF CONCLUDING THE HEARING : JULY 18, 2018 DATE OF PRONOUNCING THE ORDER : OCTOBER 10 TH , 2018 ORDER SHRI S.S. VIEWANETHRA RAVI, JM THIS APPEAL BY THE REVENUE AGAINST THE ORDER DATED 26.06.2015 PASSED BY THE CIT(A) 2, KOLKATA FOR A.Y. 2011-12. 2. THE ONLY ISSUE IS TO BE DECIDED IS AS TO WHETHER THE CIT(A) JUSTIFIED IN DELETING THE ADDITION MADE U/S 68 OF THE ACT IN THE FACTS AND CIRCUMSTANCES OF THE CASE. 3. HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD INCLUDING THE PAPER BOOK FILED BY THE LEARNED AR. THE AO ADDED AN AMOUNT OF RS. 29,11,00,000/- U/S 68 OF THE ACT. THE AO FOUND THE ABOVE AMOUNT AS INVESTMENT VALUE. THE CIT(A) IN HIS ORDER 2 I.T.A. NOS. 2418 & 2389/KOL/2016 SUDHA JEWELLERS (P) LTD. AT PAGE NO 12 DISCUSSED THE ISSUE IN DETAIL BY PLACING RELIANCE IN INSTRUCTION NO 2/2015(F) NO 500/15/2014-APA-I DATED 29.01.2015 AND HELD UNLESS THE TAX RECORDS OF SUBSCRIBERS ARE VERIFIED THE SAME AMOUNT CANNOT BE TAXED IN THE HANDS OF ASSESSEE AS IT IS A CAPITAL RECEIPT. ON PERUSAL OF THE ASSESSMENT RECORD, IT IS FOUND THAT THE AO DID NOT EXAMINE SUBSCRIBER COMPANIES TO VERIFY THEIR IDENTITY, GENUINENESS OF TRANSACTIONS AND CREDITWORTHINESS. BOTH THE PARTIES BEFORE US AGREED TO REMAND MADE TO THE FILE OF THE AO FOR VERIFICATION OF DETAILS OF SUBSCRIBER COMPANIES. THEREFORE, TAKING INTO CONSIDERATION THE FACTS AND CIRCUMSTANCES OF THE CASE AND ISSUE INVOLVED THEREIN, WE DIRECT THE AO TO UNDERTAKE ENQUIRIES AS SET OUT HEREUNDER: I) EXAMINE THE GENUINENESS AND SOURCE OF SHARE CAPITAL, NOT ON A TEST CHECK BASIS, BUT IN RESPECT OF EACH AND EVERY SHAREHOLDER BY CONDUCTING INDEPENDENT ENQUIRY NOT THROUGH THE ASSESSEE. THE BANK ACCOUNT OF THE ENTIRE PERIOD SHOULD BE EXAMINED IN THE COURSE OF VERIFICATION TO FIND OUT THE MONEY TRAIL OF THE SHARE CAPITAL. II) FURTHER THE A.O. SHOULD EXAMINE THE DIRECTIONS AS WELL AS EXAMINE THE CIRCUMSTANCES WHICH NECESSITATED THE CHANGE IN DIRECTORSHIP IF APPLICABLE. HE SHOULD EXAMINE THEM ON OATH TO VERIFY THEIR CREDENTIALS AS DIRECTOR AND REACH A LOGICAL CONCLUSION REGARDING THE CONTROLLING INTEREST. III) THE A.O. IS DIRECTED EXAMINE THE SOURCE OF REALIZATION FROM THE LIQUIDATION OF ASSETS SHOWN IN THE BALANCE SHEET AFTER THE CHANGE OF DIRECTORS, IF ANY. 3 I.T.A. NOS. 2418 & 2389/KOL/2016 SUDHA JEWELLERS (P) LTD. 4. IN THE RESULT, THE APPEAL OF THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 10 TH OCTOBER, 2018. SD/- SD/- J. SUDHAKAR REDDY S.S. VISWANETHRA RAVI ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 10/10/2018 BISWAJIT, SR. P.S. COPY OF ORDER FORWARDED TO: 1. M/S. SUDHA JEWELLERS PVT. LTD., 2/1A, GARIAHAT ROAD, KOLKATA 700 019. 2. ITO, WARD 12(1), KOLKATA. 3. THE CIT(A) 4. THE CIT 5. DR TRUE COPY, BY ORDER, SR. P.S. / H.O.O. ITAT, KOLKATA