M/s. S.R. Batliboi & Associates LLP, Kolkata V. DCIT, Circle - 54, Kolkata (Currently Circle - 22), Kolkata

ITA 121/KOL/2018

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 7996 (ITAT-KOLKATA)
• Duration Of Justice: 11 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-01-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2010-2011
• Appeal Filed On: 25-01-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RADHESHYAM
• Section: 143(1); 68; 148; 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA D BENCH, KOLKATA (BEFORE SRI S.S. GODARA, JUDICIAL MEMBER & SRI M. BALAGANESH, ACCOUNTANT MEMBER) ITA NO. 121/KOL/2018 ASSESSMENT YEAR: 2008-09 M/S. SNOWFALL COMMERCIAL PVT. LTD.............................................APPELLANT 27, CHRISTOPHER ROAD EKTA FLORAL FLAT NO.E BLOCK 3 6 TH FLOOR KOLKATA 700 046 [PAN : AAKCS 7764 C] VS. INCOME TAX OFFICER, WARD-4(1), KOLKATA.................................................RESPONDENT APPEARANCES BY: SHRI SUBASH AGARWAL, ADVOCATE, APPEARED ON BEHALF OF THE ASSESSEE . SHRI RADHE SHYAM, CIT D/R. APPEARING ON BEHALF OF THE REVENUE. DATE OF CONCLUDING THE HEARING : DECEMBER 27 TH , 2018 DATE OF PRONOUNCING THE ORDER : JANUARY 1 ST , 2019 ORDER PER BENCH :- THIS IS AN APPEAL OF THE ASSESSEE DIRECTED AGAINST THE ORDER PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) 2, KOLKATA (IN SHORT THE LD CITA) IN APPEAL NO. 1329/CIT(A)-2/2014-15 DATED 23.2.2016 AGAINST THE ORDER OF ASSESSMENT FRAMED BY THE LEARNED INCOME TAX OFFICER, WARD -4(1), KOLKATA (IN SHORT THE LD AO) U/S 143(3)/263/143(3)/147 OF THE ACT DATED 28.3.2014 FOR THE ASST YEAR 2008-09. 2. THE ONLY ISSUE TO BE DECIDED IN THIS APPEAL IS AS TO WHETHER THE LD CITA WAS JUSTIFIED IN UPHOLDING THE ADDITION MADE U/S 68 OF THE ACT TOWARDS SHARE APPLICATION MONEY IN THE SUM OF RS 18,36,75,000/-, IN THE FACTS AND CIRCUMSTANCES OF THE CASE. 3. THE BRIEF FACTS OF THIS ISSUE IS THAT THE ASSESSEE FILED ITS RETURN OF INCOME FOR THE ASST YEAR 2008-09 ON 10.9.2008 DECLARING TOTAL INCOME OF RS 12,656/-, WHICH WAS DULY PROCESSED U/S 143(1) OF THE ACT. LATER THE ASSESSMENT WAS REOPENED BY ISSUANCE OF NOTICE U/S 148 OF THE ACT AND RE-ASSESSMENT WAS COMPLETED U/S 147/143(3) OF THE ACT ON 29.4.2010 DETERMINING TOTAL INCOME AT RS 18,480/-. THIS RE-ASSESSMENT WAS SUBJECTED TO REVISION PROCEEDINGS U/S 263 OF THE ACT BY THE LD CIT ON THE GROUND THAT THE 2 ITA NO. 202/KOL/2018 ASSESSMENT YEAR: 2012-13 IMMENSE DEALMARK PVT. LTD LD. AO HAD NOT PROPERLY ENQUIRED AND VERIFIED THE GENUINENESS AND SOURCE OF SHARE APPLICATION MONEY / SHARE CAPITAL AS WELL AS THE IDENTITY AND CREDITWORTHINESS OF THE SHAREHOLDERS WHO HAD APPLIED FOR SHARES OF THE COMPANY. HENCE THE LD CIT PASSED THE REVISION ORDER U/S 263 OF THE ACT ON 26.3.2013 BY SETTING ASIDE THE ORDER PASSED BY THE LD AO U/S 147/143(3) OF THE ACT DATED 29.4.2010 WITH CERTAIN SPECIFIC GUIDELINES REGARDING INVESTIGATION TO BE CARRIED OUT WHILE ASSESSING THE ASSESSEE DE NOVO. THE LD AO IN THE CONSEQUENTIAL PROCEEDINGS HAD OBSERVED THAT THE SUMMONS ISSUED TO THE DIRECTORS OF THE ASSESSEE COMPANY REMAIN UNSERVED AND THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE WAS DIRECTED TO PRODUCE THE DIRECTORS AT THE FAG END OF THE ASSESSMENT PROCEEDINGS, ON WHICH DATES, THE PRESENT DIRECTORS WERE NOT IN STATION. ACCORDINGLY, THE LD AO PROCEEDED TO CONCLUDE THAT THE DIRECTIONS OF THE LD CIT IN HIS SECTION 263 ORDER CANNOT BE COMPLIED AND PROCEEDED TO MAKE THE ADDITION TOWARDS SHARE APPLICATION MONEY IN THE SUM OF RS 18,36,75,000/- IN THE ASSESSMENT. THIS ACTION OF THE LD AO WAS UPHELD BY THE LD CITA. AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE US. 4. WE HAVE HEARD THE RIVAL SUBMISSIONS. AT THE OUTSET, WE FIND THAT THE LD AO HAD TRIED TO COMPLY WITH THE VARIOUS DIRECTIONS ISSUED BY THE LD CIT IN THE SECTION 263 ORDER WHILE SETTING ASIDE THE RE-ASSESSMENT FRAMED ON 29.4.2010. BUT FROM THE PERUSAL OF THE ASSESSMENT ORDER, WE FIND THAT THE LD AO HAD STARTED THE VERIFICATION PROCESS ONLY AT THE FAG END OF THE TIME LIMIT FOR COMPLETION OF ASSESSMENT PROCEEDINGS, WHICH HAD LEAD TO ASSESSEE NOT ABLE TO PRODUCE THE PRESENT DIRECTORS OF THE ASSESSEE COMPANY. WE FIND THAT THE DIRECTIONS OF THE LD CIT ARE CATEGORICAL IN AS MUCH AS THE ENTIRE VERIFICATION PROCESS IS TO BE MADE DIRECTLY BY THE LD AO THROUGH HIMSELF AND NOT THROUGH THE ASSESSEE. HENCE THE CO-OPERATION OR NON-COOPERATION OF THE ASSESSEE IS OF NO RELEVANCE IN THE INSTANT CASE. WE FIND THAT THE DIRECTIONS ISSUED BY THE LD CIT IN HIS SECTION 263 ORDER HAD BEEN UPHELD BY THIS TRIBUNAL AND LATER BY HONBLE JURISDICTIONAL HIGH COURT AND SLP OF THE ASSESSEE HAD ALSO BEEN DISMISSED BY THE HONBLE APEX COURT. NOW THERE IS NO OTHER CHOICE LEFT TO THE LD AO TO STRICTLY COMPLY WITH THE SAID DIRECTIONS OF LD CIT BEFORE COMPLETING THE ASSESSMENT. HENCE IN THE INTEREST OF JUSTICE AND FAIRPLAY, WE DEEM IT FIT AND APPROPRIATE, TO REMAND THIS APPEAL TO THE FILE OF LD AO FOR DENOVO ADJUDICATION IN ACCORDANCE WITH LAW ACCORDINGLY, THE GROUNDS RAISED BY THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. 3 ITA NO. 202/KOL/2018 ASSESSMENT YEAR: 2012-13 IMMENSE DEALMARK PVT. LTD 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. KOLKATA, THE 1 ST DAY OF JANUARY, 2019. SD/- SD/- [S.S. GODARA] [ M. BALAGANESH ] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 01.01.2019 {SC SPS} COPY OF THE ORDER FORWARDED TO: 1 . M/S. SNOWFALL COMMERCIAL PVT. LTD 27, CHRISTOPHER ROAD EKTA FLORAL FLAT NO.E BLOCK 3 6 TH FLOOR KOLKATA 700 046 2. INCOME TAX OFFICER, WARD-4(1), KOLKATA 3. CIT(A)- 4. CIT- , 5. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY BY ORDER ASSISTANT REGISTRAR ITAT, KOLKATA BENCHES