M/s Mullick Enterprises Pvt. Ltd., Kolkata V. CIT, KOLKATA-1, KOLKATA, Kolkata

ITA 1298/KOL/2015

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 4557 (ITAT-KOLKATA)
• Duration Of Justice: 8 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-07-2016
• Appeal Filed By: Assessee
• Bench Allotted: C
• Assessment Year: 2006-2007
• Appeal Filed On: 14-10-2015
• Court: TRIBUNAL
• Department Lawyers: S NIRAJ KUMAR
• Section: 147; 68; 148; 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH : KOLKATA [BEFORE HONBLE SHRI P.M.JAGTAP, AM & SRI N.V.VA SUDEVAN, JM ] I.T.A NO. 1298/KOL/20 15 ASSESSMENT YEAR : 2006-0 7 M/S. MULLICK ENTERPRISES (P)LTD. -VS.- C.I .T.- I, KOLKATA KOLKATA KOLKATA [PAN : AACCM 2831 L] (APPELLANT) (RESPONDENT) FOR THE APPELLANT : SHRI SUJOY SEN, ADVOCATE FOR THE RESPONDENT : SHRI S.NIRAJ KUMAR, CI T (DR) DATE OF HEARING : 10.06.2016. DATE OF PRONOUNCEMENT : 08.07.2016. ORDER PER N.V.VASUDEVAN, JM THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDER DATED 24.03.2014 OF CIT-I, KOLKATA PASSED U/S 263 OF THE INCOME TAX ACT, 1961 (ACT). 2. THE ASSESSEE IS A PRIVATE LIMITED COMPANY. FO R A.Y.2006-07 IT FILED RETURN OF INCOME ON 05.11.2006 DECLARING LOSS. IT IS NOT CLE AR AS TO WHETHER ANY INTIMATION ON THIS RETURN FILED BY THE ASSESSEE WAS ISSUED. SUBSEQUEN TLY A NOTICE U/S 148 OF THE ACT WAS ISSUED ON 31.03.2011. THEREAFTER ORDER OF ASSESSMEN T DATED 30.12.2011 WAS PASSED BY AO AND U/S 147 R.W.S.143(3) OF THE ACT. IN THIS OR DER AO FOUND THAT THERE WAS NO BUSINESS ACTIVITY OF THE ASSESSEE DURING THE PREVIO US YEAR AND THEREFORE EXPENSES DEBITED IN THE PROFIT AND LOSS ACCOUNT BASED ON WHI CH THE ASSESSEE ARRIVED AT LOSS DURING THE PREVIOUS YEAR WAS LIABLE TO BE DISREGARDED. ACC ORDINGLY THE TOTAL INCOME OF THE ASSESSEE WAS COMPUTED BY THE AO AT RS. NIL. 2 ITA NO.1298/KOL/2015 M/S. MULLICK ENTERPRISES PVT. LTD. A.YR.2006-07 2 3. CIT IN EXERCISE OF HIS POWER U/S 263 OF THE A CT WAS OF THE VIEW THAT THE AFORESAID ORDER OF THE AO WAS ERRONEOUS AND PREJUDICIAL TO TH E INTEREST OF THE REVENUE. THE CIT IN THE AFORESAID ORDER ULTIMATELY CAME TO THE CONCLUSI ON THAT THE AO WHILE COMPLETING THE ASSESSMENT ON 30.12.2011 DID NOT MAKE ANY INQUIRIES WITH REGARD TO THE GENUINENESS OF THE SHARE CAPITAL RECEIVED BY THE ASSESSEE DURING T HE PREVIOUS YEAR. THE ORDER OF AO WAS SET ASIDE BY CIT IN THE IMPUGNED ORDER AND THE AO W AS DIRECTED TO PASS A SPEAKING ORDER AFTER VERIFYING THE SOURCE OF SHARE CAPITAL I NCLUDING THE SHARE PREMIUM. 4. AGGRIEVED BY THE AFORESAID ORDER OF THE CIT THE ASSESSEE HAS PREFERRED THE PRESENT APPEAL BEFORE THE TRIBUNAL. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS. IT APPE ARS THAT THE SHOW CAUSE NOTICE U/S 263 OF THE ACT ISSUED ON 20.01.2014 COULD NOT BE SERVED AS THE ASSESSEE COMPANY WAS FOUND NOT EXISTING AT THE GIVEN ADDRESS. THE CIT HAS PASS ED THE IMPUGNED ORDER EXPARTE.. IT WAS THE SUBMISSION OF THE LD. COUNSEL FOR THE ASSES SEE BEFORE US THAT NO SHARE APPLICATION MONEY NOR ANY MONEY TOWARDS SHARE CAPIT AL OR SHARE PREMIUM WAS RECEIVED BY THE ASSESSEE DURING THE PREVIOUS YEAR. THEREFORE THE FUNDAMENTAL ASSUMPTION OF THE CIT THAT THE ASSESSEE RECEIVED SHARE CAPITAL AND SH ARE PREMIUM DURING THE PREVIOUS YEAR WAS INCORRECT. IT WAS SUBMITTED THAT BECAUSE OF NON -SERVICE OF THE NOTICE, THE ABOVE FACTS COULD NOT BE BROUGHT TO THE NOTICE OF CIT. TH E LIMITED PRAYER OF THE LD. COUNSEL FOR THE ASSESSEE WAS TO SET ASIDE THE ORDER OF CIT AND REMAND THE ISSUE FOR CONSIDERATION AFRESH BY CIT SO THAT THE ASSESSEE CAN EXPLAIN BEFO RE CIT THAT THERE WAS NO OCCASION FOR THE AO TO EXAMINE THE RECEIPT OF SHARE CAPITAL AND SHARE PREMIUM DURING THE PREVIOUS YEAR BY THE ASSESSEE AND THEREFORE NO INVESTIGATION COULD BE MADE U/S 68 OF THE ACT. 6. THE LD. DR SUBMITTED THAT CONSIDERING THE FA CTS AND CIRCUMSTANCES OF THE CASE APPROPRIATE DIRECTIONS MAY BE GIVEN TO THE CIT IN T HIS REGARD. 3 ITA NO.1298/KOL/2015 M/S. MULLICK ENTERPRISES PVT. LTD. A.YR.2006-07 3 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND ARE OF THE VIEW THAT IN THE GIVEN FACTS AND CIRCUMSTANCES OF THE CASE THE IMPUGNED OR DER OF CIT SHOULD BE SET ASIDE AND THE ISSUE RAISED BY CIT IN THE IMPUGNED ORDER SHOUL D BE DECIDED AFRESH AFTER AFFORDING OPPORTUNITY TO THE ASSESSEE OF BEING HEARD. THE ASE SSEE WILL ESTABLISH HIS CLAIM THAT THERE IS NO RECEIPT OF SHARE CAPITAL OR SHARE PREMI UM DURING THE PREVIOUS YEAR RELATING TO A.Y.2006-07. THE CIT WILL EXAMINE THE CLAIM OF ASSE SSEE AND PASS AN ORDER IN ACCORDANCE WITH LAW. FOR STATISTICAL PURPOSES THE A PPEAL OF ASSESSEE IS TREATED AS ALLOWED. 8. IN THE RESULT THE APPEAL OF ASSESSEE IS TREA TED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 08.07.2016. SD/- SD/- [P.M.JAGTAP] [ N.V.VASUDEVAN ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 08.07.2016. [RG PS] COPY OF THE ORDER FORWARDED TO: 1.M/S. MULLICK ENTERPRISES PVT. LTD., C/O SALARPURI A JAJODIA & CO., 7, C.R.AVENUE, KOLKATA-700072. 2. C.I.T.-I, KOLKATA KOLKATA. 3. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY BY ORDER ASSTT.REGISTRAR, ITAT, KOLKATA BENCHES 4 ITA NO.1298/KOL/2015 M/S. MULLICK ENTERPRISES PVT. LTD. A.YR.2006-07 4