Autozilla Solutions Private Limited, Hyderabad V. Income Tax Officer, Ward-1(2) , Hyderabad

ITA 1568/Hyd/2019

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 0231 (ITAT-HYDERABAD)
• Duration Of Justice: 2 year(s) 2 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-01-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-B
• Assessment Year: 2016-2017
• Appeal Filed On: 23-10-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 68; 143(3); 115JB; 143(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES “B”: HYDERABAD (THROUGH VIRTUAL CONFERENCE) B EFORE SH RI SA TBEER SING H GODA RA, JU DI CIA L MEM BER AND SHR I L AXMI PR AS A D SAHU , AC COUNT ANT MEMBE R ITA No. 1568/Hyd/2019 Assessment Years: 2016-17 Autozilla Solutions Pvt. Ltd., Hyderabad. PAN – AANCA 4025H Vs. Income-tax Officer, Ward – 1(2), Hyderabad. (Appellant) (Respondent) Assessee by: Shri A. Srinivas Revenue by: Shri Rohit Mujumdar Date of hearing: 10/01/2022 Date of pronouncement: 12/01/2022 O R D E R PER L.P. SAHU, A,M.: This appeal filed by the assessee is directed against CIT(A) – 1, Hyderabad’s order dated 28/06/2019 for AY 2016-17 involving proceedings u/s 143(3) of the Income Tax Act, 1961 ; in short “the Act” on the following grounds of appeal: ITA No. 1568/Hyd/2019 M/s Autozilla Solutions Pvt. Ltd., Hyd. :- 2 -: 2. We notice at the outset that assessee’s instant appeal suffers from 31 days delay in filing before the ITAT. In this connection, the assessee has filed a petition for condonation along with an affidavit, wherein, inter-alia, it was submitted that since there was an ambiguity in the order of the CIT(A) in adjudicating the grounds of appeal, caused the impugned delay in filing the appeal belatedly. We rely on Case law Collector Land Acquisition Vs. Mst. Katiji & Ors, 1987 AIR 1353 (SC) and University of Delhi Vs. Union of India, Civil Appeal No. 9488 & 9489/2019 dated 17 December, 2019, hold that such a delay; supported by cogent reasons, deserves to be condoned so as to make way for the cause of substantial justice. We ITA No. 1568/Hyd/2019 M/s Autozilla Solutions Pvt. Ltd., Hyd. :- 3 -: accordingly hold that revenue’s impugned delay in filing this appeal is neither intentional nor deliberate but due to the circumstances beyond its control. The same stands condoned. Case is now taken up for adjudication on merits. 3. Briefly the facts of the case are that the assessee company engaged in the business of automobiles and auto parts, filed its return of income for the AY 2016-17 on 17/10/2016 declaring total loss of Rs. 21,22,104/- under normal provisions and deemed total loss u/s 115JB at Rs. 19,49,531/-. Subsequently, the case was selected for limited scrutiny under CASS and notice u/s 143(2) was issued to the assessee on 18/07/2017 and other statutory notices were also issued to the assessee. 3.1 During the course of scrutiny proceedings, the AO noticed that the assessee company had collected an amount of Rs. 79,66,180/- towards share premium from the following parties: Space left intentionally ITA No. 1568/Hyd/2019 M/s Autozilla Solutions Pvt. Ltd., Hyd. :- 4 -: 3.2 When the AO asked the assessee to justify the amounts received from the share applicants, the assessee was unable to prove the three ingredients/conditions laid down u/s 68 of the Act that identity, genuineness and creditworthiness of the transactions. The AO, therefore, added the entire amount of Rs. 79,91,550/- including the face value of the shares. 3.3 Alternatively, applying section 56(2)(viib), the AO calculated further addition of Rs. 79,72,460/-. 4. Aggrieved by the order of the AO, the assessee preferred an appeal before the CIT(A) by raising the following grounds of appeal: 1. The order of the AO is contrary to the law, facts and circumstances of the case. ITA No. 1568/Hyd/2019 M/s Autozilla Solutions Pvt. Ltd., Hyd. :- 5 -: 2. The AO erred in addition an amount of 79,91,550/- as addition u/s 68 of the Act. 3. The AO erred in adding an amount of Rs. 79,72,460/- as excess share premium u/s. 56(2)(viib) ignoring the value of share premium as calculated by the assessee. 4. The assessment order needs to be quashed as the AO was not sure as to which addition to be made under the income tax act, which tantamount to non application of mind. 5. The assessment. also needs to be quashed as the demand notice served on the assessee is not correct computation of taxes. 6. Any other grounds which the assessee may urge either before t or at the time during the hearing.” 5. The CIT(A) adjudicated the appeal of the assessee in respect of ground No. 3 and allowed the appeal of the assessee, but, did not discuss ground No. 2 raised before him. 6. Aggrieved by the order of the CIT(A), the assessee is in appeal before the ITAT by way of raising a ground that Ground No. 2 raised before the CIT(A) has not been adjudicated by him. 7. Before us, the ld. AR submitted that ground No. 2 raised before the CIT(A), has not been adjudicated by him and vehemently argued the case. ITA No. 1568/Hyd/2019 M/s Autozilla Solutions Pvt. Ltd., Hyd. :- 6 -: 8. The ld. DR, on the other hand, relied on the order of the AO. 9. After hearing both the parties and perusing the material on record as well as the orders of revenue authorities, it is observed that the AO disallowed the share premium raised by the assessee u/s 56(2)(viib), while, the same was also added to the income of the assessee u/s 68 of the Act. We are of the view that once the addition made under one section of the IT Act, the same addition cannot be made under another section, which lead to double addition, which cannot be permissible in the IT Act. The CIT(A) has deleted the addition of Rs. 79,72,460/- u/s 56(2)(viib) by holding that the DCF method followed the assessee is correct. Therefore, it will be presumed that the addition deleted by the CIT(A) under one section out of two sections is accepted. When the Bench asked the ld. DR that whether any appeal filed against the order of CIT(A) and the ld. DR replied that the revenue has not filed any appeal against the order of CIT(A). The total amount received by the assessee was towards share capital including share premium and once the revenue has allowed/accepted the valuation method adopted by the assessee, then, the total amount received by the assessee is acceptable. Therefore, allowing part amount out of total amount is not correct. For this proposition, we rely on the decision of the ITAT, ITA No. 1568/Hyd/2019 M/s Autozilla Solutions Pvt. Ltd., Hyd. :- 7 -: Cuttack Bench in the case of DCIT Vs. M/s Auroglobal Comtrade Pvt. Ltd. in ITA No. 426/CTK/2018, order dated 14/12/2020 and direct the AO to allow the difference between the addition of Rs. 19,090/- (Rs. 79,91,550 – Rs. 79,72,460). Following the above decision, we allow the appeal of the assessee. 10. In the result, appeal of the assessee is allowed in above terms. Pronounced in the open court on 12 th January, 2022. Sd/- Sd/- (S.S. GODARA) (L. P. SAHU) JUDICIAL MEMBER ACCOUNTANT MEMBER Hyderabad, Dated: 12 th January, 2022. kv Copy to : 1 M/s Autozilla Solutions Pvt. Ltd., No. 604-1-98/9D/48, Dwelling Jaihind Enclave, Jaihind Gandhi Road, Madhapur, Hyderabad – 500 081 2 ITO, Ward – 1(2), IT Towers, AC Guards, Masab Tank, Hyderabad. 3 CIT(A) - 1, Hyderabad. 4 PR. CIT - 1, Hyderabad. 5 ITAT, DR, Hyderabad. 6 Guard File. ITA No. 1568/Hyd/2019 M/s Autozilla Solutions Pvt. Ltd., Hyd. :- 8 -: S . N o . D e t a i l s D a t e 1 D r a f t d i c t a t e d o n 2 D r a f t p l a c e d b e f o r e a u t h o r 3 D r a f t p r o p o s e d & p l a c e d b e f o r e t h e S e c o n d M e m b e r 4 D r a f t d i s c u s s e d / a p p r o v e d b y S e c o n d M e m b e r 5 A p p r o v e d D r a f t c o m e s t o t h e S r . P S / P S 6 K e p t f o r p r o n o u n c e m e n t 7 F i l e s e n t t o B e n c h C l e r k 8 D a t e o n w h i c h t h e f i l e g o e s t o H e a d C l e r k 9 D a t e o n w h i c h f i l e g o e s t o A . R . 10 D a t e o f D i s p a t c h o f o r d e r