M/s Terminal Vinimay Pvt Ltd, Kolkata V. I.T.O.,Ward-9(1), Kolkata

ITA 1339/KOL/2019

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 8251 (ITAT-KOLKATA)
• Duration Of Justice: 1 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-07-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 30-05-2019
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ROBIN CHOWDHURY
• Assessee Lawyers: S JHAJHARIA
• Keywords: Opportunity of being heard; Source of fund; Set aside
• Section: 133(6); 143(1); 147; 263

Judgement Text

, B , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH: KOL KATA ( ) . . , . . ! , ' #$ ) [BEFORE SHRI P.M. JAGTAP, VICE PRESIDENT (KZ) & SHR I A. T. VARKEY, JM] I.T.A. NO. 1339/KOL/2019 ASSESSMENT YEARS: 2009-10 M/S. TERMINAL VINIMAY PVT. LTD. PAN: AADCT 1157 B VS. ITO, WARD 9(1), KOLKATA APPELLANT RESPONDENT DATE OF HEARING 09.07.2019 DATE OF PRONOUNCEMENT 17.07.2019 FOR THE APPELLANT SHRI S. JHAJHARIA, AR FOR THE RESPONDENT SHRI ROBIN CHOWDHURY, ADDL. CIT, SR. DR ORDER PER SHRI A.T.VARKEY, JM THIS IS AN APPEAL PREFERRED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A) 2, KOLKATA DATED 02.09.2016 FOR A.Y. 2009-10. 2. THE MAIN GRIEVANCE OF THE ASSESSEE IS AGAINST TH E ACTION OF THE LD. CIT(A) IN PASSING AN EX-PARTE ORDER AGAINST THE ASSESSEE. AT THE OUTS ET ITSELF THE LD. AR BROUGHT OUR NOTICE THAT THE NAME OF THE ASSESSEE HAS BEEN WRONGLY MENTIONED IN THE FORM 36 AND, THEREFORE, REVISED FORM 36 HAS BEEN FILED WHEREIN THE NAME O F THE ASSESSEE HAS BEEN SHOWN AS M/S. TERMINAL VINIMAY PVT. LTD. IT WAS ALSO BROUGHT TO O UR NOTICE THAT THE AO HAD PASSED A CRYPTIC ASSESSMENT ORDER ON 29.03.2014 WITHOUT GIVI NG PROPER OPPORTUNITY TO THE ASSESSEE AT THE ASSESSMENT STAGE. ACCORDING TO THE LEARNED COUN SEL, THE ASSESSEE HAD RAISED SHARE CAPITAL TO THE TUNE OF RS. 13,29,00,000/- IN THIS ASSESSMEN T YEAR. LATER ON THE ASSESSMENT WAS REOPENED U/S 147 OF THE INCOME TAX ACT, (HEREIN AFT ER REFERRED TO AS THE ACT) AND IN THE ASSESSMENT ORDER, THE AO DETERMINED THE TOTAL INCOM E AT RS. 55,630/-. THEREAFTER, CIT, KOLKATA III EXERCISED HIS REVISIONAL JURISDICTION AL U/S 263 OF THE ACT AND WAS PLEASED TO SET ASIDE THE ORDER OF THE AO AND DIRECTED HIM TO ENQUI RE ABOUT THE INTRODUCTION OF SHARE CAPITAL AND GAVE DETAILED GUIDELINES FOR CONDUCTING EFFECTI VE INVESTIGATION / ENQUIRY TO UNEARTH THE BENEFICIARY IF ANY WHO HAD LAUNDERED THEIR BLACK MO NEY BY THE MODUS-OPERANDI AS REVEALED BY INVESTIGATION. HOWEVER, ACCORDING TO LD. AR, THE AO WHILE GIVING EFFECT TO THE ORDER OF 2 ITA NO.1339/KOL/2019 M/S. TERMINAL VINIMAY PVT. LTD. AY 2009-10 THE CIT, KOLKATA III PASSED U/S 263 OF THE ACT HA DISSUED NOTICE TO THE ASSESSEE U/S 143(1) DATED 24.07.2013 AND THEREAFTER, RE-FIXATION LETTER WAS ISSUED ON 07.08.2013 WHEREIN THE AO ACKNOWLEDGES THAT THE AR OF THE ASSESSEE FILED DETA ILS ON 20.01.2014. THE AO NOTES FROM THE DETAILS FILED THAT THERE WAS A LIST OF SHAREHOL DERS TO WHOM ALLOTMENT OF 6,64,500 SHARES AMOUNTING TO RS. 13,29,00,000/- WERE MADE. THEREAFT ER, THE AO ISSUED NOTICE U/S 133(6) ON 14.02.2014 FROM THE INVESTORS CALLING FOR THE SOURC E OF FUND FOR INVESTMENT IN THE ASSESSEE- COMPANY. ACCORDING TO THE AO 10 (TEN) NOTICES RETUR NED BACK UN-SERVED AND NONE APPEARED BEFORE HIM. THEREFORE, SUMMONS U/S 131(1) WERE ISSU ED TO THE DIRECTORS OF THE COMPANY ON 26.02.2014 FIXING THE CASE ON 11.03.2014 AND SINCE NONE APPEARED, THE AO DREW ADVERSE INFERENCE AGAINST THE ASSESSEE AND MADE THE ADDITIO N OF RS. 13,29,00,000/-. AGGRIEVED THE ASSESSEE PREFERRED AN APPEAL BEFORE THE LD. CIT(A) WHO HAS PASSED AN EX-PARTE ORDER CONFIRMING THE ADDITION. AGGRIEVED THE ASSESSEE IS BEFORE US. 3. AT THE OUTSET ITSELF, THE LEARNED COUNSEL DREW O UR ATTENTION TO THE CHART WHICH SHOWS THE NAME OF 32 SHARE SUBSCRIBERS, OUT OF WHICH 30 S HAREHOLDERS ARE CORPORATE ENTITIES. ACCORDING TO THE LEARNED COUNSEL ALL THE 30 SHARE S UBSCRIBER COMPANIES HAVE BEEN ASSESSED BY THEIR RESPECTIVE AOS FOR THE ASSESSMENT YEAR UN DER CONSIDERATION AND THE ORDERS HAVE BEEN KEPT IN THE PAPER BOOK FROM PAGE 1 TO 68. THE CHART GIVING THE DETAILS AS UNDER: SL. NO. NAME OF THE SHARE SUBSCRIBER ORDER DATE PAGE NOS. 1 ACHINTA TIE-UP PRIVATE LIMITED 14.10.2011 1-2 2 ANJANIPUTRA MERCANTILE PRIVATE LIMITED 29.12.2010 3-4 3 BRAJESHWAR DEALERS PRIVATE LIMITED 29.12.2010 5-6 4 DAYANIDHI DISTRIBUTORS PRIVATE LIMITED 17.06.2011 7-9 5 GODHULI MARKETING PRIVATE LIMITED 18.05.2011 10-1 1 6 HEMLET DEALCOM PRIVATE LMIMITED 03.10.2010 12-12 7 HIRAMOTI VINIMAY PRIVATE LIMITED 04.03.2011 13-14 8 INTLOW LEASING & FINANCE PRIVATE LIMITED 23.12.20 11 15-17 9 JYOTI VINCOM PRIVATE LIMITED 30.08.2011 18-20 10 JAGADGURU GOODS PRIVATE LIMITED 15.12.2011 21-22 11 JANKI COMMOTRADE PRIVATE LIMITED 25.03.2011 23-2 4 3 ITA NO.1339/KOL/2019 M/S. TERMINAL VINIMAY PVT. LTD. AY 2009-10 12 KAMYA VANIFYA PRIVATE LIMITED 30.12.2009 25-26 13 LINSEY VINIMAY PRIVATE LIMITED 06.04.2010 27-29 14 MAHABALI MERCHANTS PRIVATE LIMITED 25.03.2011 30 -31 15 MAYUR TRADECOM PRIVATE LIMITED 04.05.2011 32-34 16 NANDA VINCOM PRIVATE LIMITED 06.05.2011 35-37 17 NEPTUNE VINCOM PRIVATE LIMITED 17.06.2011 38-40 18 NARMODA TRADELINK PRIVATE LIMITED 41-42 19 OASIS COMMOTRADE PRIVATE LIMITED 11.05.2011 43-4 4 20 ORBITAL CONTRACTORS & FINANCIERS PVT. LTD. 28.02.2011 45-46 21 PURSHOTTAM GOODS PRIVATE LIMITED 05.05.2011 47-4 9 22 RAGHUNATH DEALERS PRIVATE LIMITED 01.07.2011 50- 51 23 SEVAK TRADELINK PRIVATE LIMITED 30.03.2011 52-53 24 SUTANUTI VYAPAAR PRIVATE LIMITED 14.07.2011 54-5 5 25 SKIPPER VINIMAY PRIVATE LIMITED 07.07.2011 56-57 26 SHALIMAR TIE-UP PRIVATE LIMITED 07.07.2011 58-59 27 SUNDARAM TRADELINK PRIVATE LIMITED 28.12.2010 60 -61 28 SWARNREKHA COMMODEAL PRIVATE LIMITED 28.12.2010 62-63 29 UNITY COMMOSALES PRIVATE LIMITED 04.07.2011 64-6 5 30 SAKEHI SALES PRIVATE LIMITED 04.05.2011 66-68 4. FROM THE AFORESAID CHART AND THE PAPER BOOK, IT WAS BROUGHT TO OUR NOTICE THAT OUT OF 32 SHARE SUBSCRIBERS, 30 ARE PRIVATE LIMITED COMPAN IES AND OUT OF WHICH 30 COMPANIES HAVE BEEN ASSESSED U/S 147/143(3) OF THE ACT BY THEIR RE SPECTIVE AOS AND THE ASSESSMENT ORDERS HAVE BEEN PLACED FROM PAGE 1 TO 68. THEREFORE, IT W AS CONTENTED BY THE LD. AR THAT THE IDENTITY OF THE SHARE SUBSCRIBERS CANNOT BE DOUBTED AT ALL. ACCORDING TO THE LEARNED COUNSEL, THE ASSESSEE HAD FILED THE DETAILS OF MONEY TRANSFE R THROUGH BANKING CHANNELS THUS ESTABLISHING THE GENUINENESS OF THE TRANSACTIONS AN D FURTHER ACCORDING TO THE LD. AR, THE ASSESSEE HAD ALSO FILED THE SOURCE OF FUND FOR INVE STMENT OF THE ASSESSEE-COMPANY AND IT WAS 4 ITA NO.1339/KOL/2019 M/S. TERMINAL VINIMAY PVT. LTD. AY 2009-10 STRENUOUSLY URGED BEFORE US BY THE LD. AR THAT ON A PERUSAL OF THE BALANCE SHEET OF EACH INVESTING COMPANY IT WOULD REVEAL THAT THE INVESTOR S HAVE GOT SUFFICIENT CREDITWORTHINESS OF INVESTMENT IN THE ASSESSEE-COMPANY. FOR BUTTRESSING THESE FACTS THE LD. AR DREW OUR ATTENTION TO THE PAPER BOOK WHICH THE ASSESSEE HAD FILED BEFORE THE AO AND CIT(A) WHICH WE NOTE IS A BULKY PAPER BOOK RUNNING TO 517 PAGES. IT WAS ALSO BROUGHT TO OUR NOTICE THAT THE LD. CIT(A) HAS TAKEN EX-PARTE VIEW ON THE SOLE REASON THAT THE ASSESSEE HAD NOT FILED ANY WRITTEN SUBMISSIONS BEFORE THE CIT(A). HOWEVER THE LD. AR PRODUCED THE LETTER DATED 17.06.2016 FILED BY THE ASSESSEE-COMPANY BEFORE THE LD. CIT(A) 2, KOLKATA FROM WHICH WE NOTE THAT WRITTEN SUBMISSION AND DOCUMENTS WERE IN FACT FILED BY THE ASSESSEE, THEREFORE, THE ACTION OF THE LD. CIT(A) CANNOT BE COUNTENANCED . TAKING INTO CONSIDERATION THE AFORESAID FACTS AND THE PAPER BOOK FILED BEFORE THE AUTHORITI ES BELOW, WE ARE OF THE CONSIDERED OPINION THAT THE ASSESSEE DID NOT GET PROPER OPPORT UNITY BEFORE THE AO AT THE ASSESSMENT STAGE. THEREFORE, RELYING ON THE DECISION OF THE HO NBLE SUPREME COURT IN TIN BOX COMPANY VS. CIT (2001) 249 ITR 216 (SC) HAS HELD AS UNDER: IT IS UNNECESSARY TO GO INTO GREAT DETAIL IN THESE MATTERS FOR THERE IS A STATEMENT IN THE ORDER OF THE TRIBUNAL, THE FACT-FINDING AUTHORITY, THAT R EADS THUS : WE WILL STRAIGHTAWAY AGREE WITH THE ASSESSEES SUB MISSION THAT THE INCOME-TAX OFFICER HAD NOT GIVEN TO THE ASSESSEE PROPER OPPORTUNITY OF BEI NG HEARD. THAT THE ASSESSEE COULD HAVE PLACED EVIDENCE BEFORE THE FIRST APPELLATE AUTHORITY OR BEFORE THE TRIBUNAL IS REALLY OF NO CONSEQUENCE FOR IT IS THE ASSESSMENT ORDER THAT COUNTS. THAT ORDER MUST BE MADE AFTER THE ASSESSEE HAS BEEN GIVEN A RE ASONABLE OPPORTUNITY OF SETTING OUT HIS CASE. WE, THEREFORE, DO NOT AGREE WITH THE TRIBUNAL AND THE HIGH COURT THAT IT WAS NOT NECESSARY TO SET ASIDE THE ORDER OF ASSESSMENT AND REMAND THE MATTER TO THE ASSESSING AUTHORITY FOR FRESH ASSESSMENT AFTER GIVING TO THE ASSESSEE A PROPER OPPORTUNITY OF BEING HEARD. TWO QUESTIONS WERE PLACED BEFORE THE HIGH COURT, OF WHICH THE SECOND QUESTION IS NOT PRESSED. THE FIRST QUESTION READS THUS : 1. WHETHER, ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE TRIBUNAL WAS JUSTIFIED IN NOT SETTING ASIDE THE ASSESSMENT ORDER IN SPITE OF A FINDING ARRIVED AT BY IT THAT THE INCOME- TAX OFFICER HAD NOT GIVEN A PROPER OPPORTUNITY OF H EARING TO THE ASSESSEE ? IN OUR OPINION, THERE CAN ONLY BE ONE ANSWER TO THI S QUESTION WHICH IS INHERENT IN THE QUESTION ITSELF : IN THE NEGATIVE AND IN FAVOUR OF THE ASSESSEE. THE APPEALS ARE ALLOWED. THE ORDER UNDER CHALLENGE IS SET ASIDE. THE ASSESSMENT ORDER, THAT OF THE COMMISSIONER (APPEALS) AND OF THE TRIBUNAL A RE ALSO SET ASIDE. THE MATTER SHALL NOW BE REMANDED TO THE ASSESSING AUTHORITY FOR FRESH CO NSIDERATION, AS AFORESTATED. 5 ITA NO.1339/KOL/2019 M/S. TERMINAL VINIMAY PVT. LTD. AY 2009-10 5. TAKING INTO ALL THE FACTS STATED (SUPRA), WE ARE INCLINED TO SET ASIDE THE ORDER OF THE LD. CIT(A) AND REMAND THE ISSUE BACK TO THE FILE OF THE AO AND THE AO IS DIRECTED TO CONSIDER ALL THE DOCUMENTS BEFORE PASSING THE DE-NO VO ASSESSMENT. THE LD. AR HAS UNDERTAKEN TO PRODUCE THE DIRECTORS OF THE ASSESSEE COMPANY / SHARE SUBSCRIBER COMPANIES BEFORE THE AO. THEREAFTER, THE AO IS DIRECTED TO FR AME THE FRESH ASSESSMENT ORDER IN ACCORDANCE TO LAW AFTER GIVING OPPORTUNITY TO THE A SSESSEE. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED FOR STATISTICAL PURPOSES. ORDER IS PRONOUNCED IN THE OPEN COURT ON 17.07.201 9 SD/- SD/- (P.M. JAGTAP) (ABY. T. VARKEY) VICE-PRESIDENT JUDICIAL MEMBER DATED : 17TH JULY, 2019 BISWAJIT (SR. P.S.) COPY OF THE ORDER FORWARDED TO: 1. APPELLANT M/S. TERMINAL VINIMAY PVT. LTD., SAL ARPURIA JAJODIA & CO., 3 RD FLOOR, 7, CHITTARANJAN AVENUE, KOLKATA 700 072. 2 RESPONDENT ITO, WARD 9(1), P-7, CHOWRINGHEE S QUARE, 7 TH FLOOR, KOLKATA 700 069. 3. THE CIT(A) -2, KOLKATA. (THROUGH E-MAIL) 4. 5. CIT KOLKATA DR, ITAT, KOLKATA. (THROUGH E-MAIL) / TRUE COPY, BY ORDER, ASSISTANT REGISTRAR/H.O.O. ITAT, KOLKATA