M/s Shiv Naresh Sports Pvt. Ltd., Delhi V. ACIT, New Delhi

ITA 1271/DEL/2016

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 4498 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 11 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-02-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Assessment Year: 2010-2011
• Appeal Filed On: 08-03-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: SB GUPTA
• Keywords: Bogus Share capital; Search and seizure; Opportunity of being heard; Bad and doubtful debts
• Section: 153A; 68; 132; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH F, NEW DELHI BEFORE SH. R.K PANDA, ACCOUNTANT MEMBER AND MS. SUCHITRA KAMBLE, JUDICIAL MEMBER ITA NO.1271/DEL/2016 ASSESSMENT YEAR: 2010-11 SH. SHIV NARESH SPORTS PVT. LTD., E-23, KARAM PURA, DELHI-110015 PAN NO. AAECS7326L VS ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE -5, NEW DELHI (APPELLANT) (RESPONDENT) APPELLANT BY SH. S. B. GUPTA, CA RESPONDENT BY SH. KANWALJIT SINGH, CIT DR DATE OF HEARING: 14/02/2019 DATE OF PRONOUNCEMENT: 14 /0 2 /201 9 ORDER PER R.K. PANDA, AM: 1. THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER DATED 31.03.2015 OF THE CIT(A)-24, NEW DELHI RELATING TO A. Y. 2010-11. 2. THE FACTS OF THE CASE, IN BRIEF, ARE THAT THE AS SESSEE IS A PRIVATE LIMITED COMPANY ENGAGED IN THE BUSINESS OF MANUFACTURING AND TRADING OF SPORTSWEAR AND GARMENT S. A SEARCH AND SEIZURE OPERATION U/S 132 OF THE IT ACT WAS CONDUCTED ON 28.10.2010 IN CASE OF THE ASSESSEE. IN RESPONSE TO NOTICE U/S 153 A IT WAS SUBMITTED THAT THE RETURN ALREADY FILE D U/S 139 ON 25.09.2010 MAY BE TREATED AS RETURN FILED IN RESPON SE TO NOTICE ITA NO.1271/DEL/2016 2 U/S 153A OF THE IT ACT. IT IS PERTINENT TO MENTION HERE THAT THE ASSESSEE HAD FILED THE ORIGINAL RETURN OF INCOME DE CLARING TOTAL INCOME OF RS.69,92,830/-THE ASSESSING OFFICER COMPL ETED THE ASSESSMENT U/S 153 A/ 143 (3) OF THE IT ACT ON A TO TAL INCOME OF RS.1,47,57,171/- WHEREIN HE HAD MADE THE FOLLOWING ADDITIONS :- INCOME AS DECLARED 69,92,830/- ADD : 1. DISALLOWANCE OF EPF PENALTY AND CST 69,92,830/- DEMAND AS DISCUSSED ABOVE. 2. DISALLOWANCE OUT OF CAR R & M, 2,59, 051/- DEP., INSURANCE, INTEREST AND TELEPHONE EXPENSES AS DISCUSSED ABOVE. 1,37,727/- 3. DISALLOWANCE OF BAD DEBTS 15,34,223/- DISCUSSED ABOVE. 4. CASH CREDITS U/S. 68, SHARE APPLICATION MONEY AS DISCUSSED ABOVE. 58,33,340/- TOTAL TAXABLE INCO ME 1,47,57,171/- 3. IN APPEAL THE LD. CIT(A) GAVE RELIEF TO THE ASSE SSEE ON THE GROUNDS RAISED BEFORE HIM. HOWEVER, THE ADDITION O N ACCOUNT OF SHARE APPLICATION MONEY U/S 68 OF THE IT ACT AMOUNT ING TO RS.58,33,340/- WAS NOT CHALLENGED IN THE ORIGINAL G ROUNDS OF APPEAL FOR WHICH THERE WAS NO ADJUDICATION ON THE S AME. 4. AGGRIEVED, WITH SUCH ORDER OF THE CIT(A), THE AS SESSEE IS IN APPEAL BEFORE THE TRIBUNAL BY RAISING VARIOUS GROUN DS CHALLENGING THE ADDITION OF SHARE APPLICATION MONEY OF RS.58,33 ,340/-. ITA NO.1271/DEL/2016 3 5. THE LD. COUNSEL FOR THE ASSESSEE AT THE OUTSET R EFERRING TO PAGE 1 TO 100 OF THE PAPER BOOK SUBMITTED THAT ASSE SSEE HAD MADE AN APPLICATION BEFORE THE LD. CIT(A) FOR ADMIS SION OF ADDITIONAL GROUND WHEREIN ADDITION OF RS.58,33,340/ - WAS CHALLENGED. HOWEVER, THE LD. CIT(A) HAS NOT ADJUDIC ATED THE ADMISSIBILITY OF THE ADDITIONAL GROUND AND HAS NOT DECIDED THE ISSUE. 6. REFERRING TO THE DECISION OF HONBLE ALLAHABAD H IGH COURT IN THE CASE OF AJEET KUMAR SETH VS. CIT REPORTED IN 21 4 CTR 240, HE SUBMITTED THAT THE HONBLE HIGH COURT HAS HELD T HAT THE FIRST APPELLATE AUTHORITY SHOULD HAVE PERMITTED THE ASSES SEE TO RAISE THE ADDITIONAL GROUND WHATEVER ITS WROTH MAY BE ON MERITS AND FIRST APPELLATE AUTHORITY CANNOT REFUSE TO GRANT PE RMISSION TO RAISE ADDITIONAL GROUND. RELYING ON VARIOUS OTHER DECISIO NS, HE SUBMITTED THAT HE HAS NO OBJECTION IF THE MATTER IS RESTORED TO THE FILE OF THE CIT(A) WITH THE DIRECTION TO ADJUDICATE THE ADDITIONAL GROUND RAISED BEFORE HIM. 7. THE LD. DR ON THE OTHER HAND HAS NO OBJECTION FO R RESTORING THE ISSUE TO THE FILE OF THE LD. CIT(A) TO DECIDE T HE ADMISSION OF THE ADDITIONAL GROUND RAISED BEFORE HIM. 8. AFTER HEARING BOTH THE SIDES AND ON PERUSAL OF T HE PAPER BOOK FILED ON BEHALF OF THE ASSSESSEE WE FIND THE A SSESSEE HAS TAKEN THE FOLLOWING ADDITIONAL GROUND BEFORE THE CI T(A). THAT THE ADDITION OF RS.58,33,340/- IN RESPECT OF SHARE CAPITAL IS ILLEGAL AND UNJUSTIFIED AND, THEREFORE, O UGHT TO BE DELETED. ITA NO.1271/DEL/2016 4 9. HOWEVER, A PERUSAL OF THE ORDER OF THE LD. CIT(A ) SHOWS THAT THERE IS NO DISCUSSION REGARDING THE ADDITIONAL GROUND RA ISED BEFORE HIM BY THE ASSESSEE. CONSIDERING THE TOTALITY OF THE FACT S OF THE CASE AND IN THE INTEREST OF JUSTICE WE DEEM IT PROPER TO RESTOR E THE MATTER BACK TO THE FILE OF THE LD. CIT(A) WITH A DIRECTION TO ADJU DICATE THE ADMISSIBILITY OF THE ADDITIONAL GROUND RAISED BEFOR E HIM AND DECIDE THE SAME. NEEDLESS TO SAY THAT THE LD. CIT(A) SHAL L DECIDE THE ISSUE AS PER FACT AND LAW AFTER GIVING DUE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. WE HOLD AND DIRECT ACCORDINGLY. 10. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF H EARING ITSELF ON 14.02.2019. SD/- SD/- (SUCHITRA KAMBLE) (R. K PANDA) JUDICIAL MEMBER ACCOUNTA NT MEMBER *NEHA* DATE:- .02.2019 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI ITA NO.1271/DEL/2016 5 DATE OF DICTATION 14.02.2019 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.PS/PS DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/ PS DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT 15.02.2019 DATE ON WHICH THE FILE GOES TO THE BENCH CLERK DATE ON WHICH FILE GOES TO THE HEAD CLERK. THE DATE ON WHICH FILE GOES TO THE ASSISTANT REGIST RAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER