M/s Celebration Vintrade Pvt. Ltd., Kolkata V. I.T.O.,Ward-3(2), Kolkata

ITA 1685/KOL/2019

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 7537 (ITAT-KOLKATA)
• Duration Of Justice: 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-07-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2014-2015
• Appeal Filed On: 16-07-2019
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ROBIN CHOUDHUR Y
• Keywords: Unexplained cash credit; Opportunity of being heard; Source of fund; Set aside
• Section: 131; 143(3); 133(6)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A, BENC H KOLKATA BEFORE SHRI A.T. VARKEY, JM &DR. A.L.SAINI, AM ./ITA NO.1685/KOL/2019 ( / ASSESSMENT YEAR:2014-15) M/S CELEBRATION VINTRADE PVT. LTD. 159, RABINDRA SARANI, 4 TH FLOOR, ROOM NO. 301, KOLKATA-700069 VS. ITO, WARD-3(2), KOLKATA ./ ./PAN/GIR NO.: AADCC 5744 R (ASSESSEE) .. (REVENUE) ASSESSEE BY :SHRI SOUMITRA CHOUDHURY, ADVOCATE RESPONDENT BY : SHRI ROBIN CHOUDHURY, ADDL. CIT SR. D.R. / DATE OF HEARING : 19/07/2019 /DATE OF PRONOUNCEMENT : 26/07/2019 / O R DE R PER DR. A. L. SAINI: THIS APPEAL IS LISTED FOR HEARING TODAY I.E.19.7 .2019 FOR CONSIDERATION OF GRANT OF EARLY HEARING. HOWEVER, WITH THE CONSENT O F BOTH THE PARTIES, THE RELATED APPEAL ITSELF HAS BEEN HEARD TODAY AND AS SUCH THE REQUEST FOR EARLY HEARING IS DISMISSED AS INFRUCTUOUS. 2. THE CAPTIONED APPEAL FILED BY THE ASSESSEE, PERT AINING TO ASSESSMENT YEAR 2014-15, IS DIRECTED AGAINST THE ORDER PASSED B Y THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-10, KOLKATA, WHICH IN TURN ARISES OUT OF AN ASSESSMENT ORDER PASSED BY THE ASSESSING OFFICER U/S 143(3) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) DATED 21/11/2016. M/S CELEBRATION VINTRADE PVT. LTD. ITA NO.1685/KOL/2019 ASSESSMENT YEAR:2014-15 P PP PA AA AG GG GE EE E | || | 2 22 2 3. AT THE OUTSET ITSELF, THE LD. D.R. FOR THE REVEN UE AS WELL AS THE LD. COUNSEL FOR THE ASSESSEE BOTH HAVE AGREED THAT AT THE ASSESSMENT ST AGE THE ASSESSEE COMPANY DID NOT MAKE ANY COMPLIANCE OF NOTICES U/S 133(6) OF TH E ACT. EVEN DURING THE APPELLATE PROCEEDINGS, THE LD. CIT(A) DID NOT ISSUE SUMMONS TO THE DIRECTORS OF THE ASSESSEE COMPANY U/S 131 OF THE ACT TO APPEAR BEFORE HIM PERSONALLY TO EXPLAIN THE BONA FIDE OF THE TRANSACTION. THE RELEV ANT PARA OF THE ASSESSMENT ORDER IS REPRODUCED BELOW: IT WAS SEEN FROM THE DETAILS THAT THE ASSESSEE HA S RECEIVED SHARE APPLICATION MONEY OF RS. 20,00,000/- FROM SHRI SHAKAMBHARI. NOT ICE U/S 133(6) WAS ISSUED TO M/S SHRI SHAKAMBHARI, ONE OF THE CREDITOR OF SHARE APPLICATION MONEY TO THE ASSESSEE. IN THE NOTICE U/S 133(6) IT WAS REQUESTE D TO FURNISH THE DETAILS OF SOURCE OF FUND FOR SHARE APPLICATION MONEY TO THE ASSESSEE COMPANY. THE REPLY FROM SHRI SAIKAT ROY CHOWDHURY PROPRIETOR OF M/S SHRI SH AKAMBHARI WAS RECEIVED ON 04/10/2016 BUT WITHOUT EXPLANATION OF SOURCE WITH S UPPORTING DOCUMENTS. ON 18/10/2016 LD. A/R OF THE ASSESSEE APPEARED, HE WAS REQUESTED TO SUBMIT THE COPY OF BANK STATEMENT WITH EXPLANATION OF SOURCE OF SHA RE APPLICATION MONEY GIVEN TO THE ASSESSEE COMPANY BY M/S SHRI SHAKAMBHARI DURING THE YEAR UNDER CONSIDERATION, I.E. DURING THE F.Y. 2013-14. THE CA SE WAS ADJOURNED TO 25/10/2016 ON HIS REQUEST. ON 28.10.2016, LD. A/R O F THE ASSESSEE APPEARED AND SOUGHT ADJOURNMENT. THE CASE WAS ADJOURNED TO 02/11 /2016 AT 11 A.M. ON 02/11/2016, LD. A/R OF THE ASSESSEE APPEARED BUT CO ULD NOT FILE ANY EXPLANATION OF SOURCE OF SHARE APPLICATION MONEY GIVEN BY M/S SHRI SHAKAMBHARI TO THE ASSESSEE COMPANY DURING THE YEAR UNDER CONSIDERATION I.E. DU RING F.Y. 2013-14. HE COULD NOT PRODUCE ANY DOCUMENTS SUCH AS BANK STATEMENT ET C. TO EXPLAIN THE SOURCE OF SHARE APPLICATION MONEY RECEIVED BY THE ASSESSEE FR OM M/S SHRI SHAKAMBHARI. THE SHARES OF THE PRIVATE LIMITED COMPANY CAN BE AL LOTTED TO CLOSE PERSON ACCORDINGLY SHARE APPLICATION MONEY CAN BE RECEIVED FROM THE CLOSE PERSON ONLY. DESPITE SEVERAL OPPORTUNITIES GIVEN TO THE ASSESSEE , HE COULD NOT PRODUCE THE EXPLANATION OF SOURCE OF SHARE APPLICATION MONEY GI VEN BY M/S SHRI SHAKAMBHARI TO THE ASSESSEE COMPANY DURING THE YEAR UNDER CONSI DERATION I.E. F.Y. 2013-14. 4. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL AVAILABLE ON RECORD. WE NOTE THAT THE CO-ORDINATE BENCH OF ITAT KOLKATA ON SIMILAR IDENTICAL GACTS AND CIRCUMSTANCES IN THE CASE OF MEGHANA COMMODITIE S PVT. LTD. IN I.T.A. NO. 1167/KOL/2018 FOR A.Y. 2012-13 HAS REMITTED BACK TH E ISSUE TO THE FILE OF LD. ASSESSING OFFICER WHICH IS REPRODUCED BELOW: 2. THE ASSESSEE IN THE PRESENT CASE IS A COMPANY, WHICH IS ENGAGED IN THE BUSINESS OF INVESTMENT IN SHARES. TH E RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION WAS FILED B Y IT ON 28.09.2012 DECLARING TOTAL INCOME OF RS.4,532/-. DU RING THE COURSE OF ASSESSMENT PROCEEDINGS, THE CLAIM OF THE ASSESSE E OF HAVING RAISED THE SHARE CAPITAL AMOUNTING TO RS.4.02 CRORE S WAS EXAMINED BY THE ASSESSING OFFICER. DURING THE COURSE OF THE SAID EXAMINATION, HE ISSUED SUMMONS UNDER SECTION 131 TO THE THREE DI RECTORS OF THE M/S CELEBRATION VINTRADE PVT. LTD. ITA NO.1685/KOL/2019 ASSESSMENT YEAR:2014-15 P PP PA AA AG GG GE EE E | || | 3 33 3 SHARE SUBSCRIBER COMPANIES AS WELL AS TO THE DIRECT OR OF THE ASSESSEE-COMPANY. TWO OF THE SAID FOUR SUMMONS WERE RETURNED BY THE POSTAL AUTHORITIES UN-SERVED WHILE THERE WAS NO RESPONSE TO THE REMAINING TWO SUMMONS. THE ASSESSEE ALSO FAILED TO ESTABLISH THE IDENTITY AND CREDITWORTHINESS OF THE CONCERNED SHAR E SUBSCRIBER COMPANIES AND THE GENUINENESS OF THE RELEVANT TRANS ACTIONS. THE ASSESSING OFFICER, THEREFORE, TREATED THE ENTIRE SH ARE CAPITAL OF RS.4.02 CRORES RECEIVED BY THE ASSESSEE DURING THE YEAR UNDER CONSIDERATION AS UNEXPLAINED CASH CREDIT AND AN ADD ITION TO THAT EXTENT WAS MADE BY HIM TO THE TOTAL INCOME OF THE A SSESSEE IN THE ASSESSMENT COMPLETED UNDER SECTION 143(3) VIDE AN O RDER DATED 17.03.2015. 3. AGAINST THE ORDER PASSED BY THE ASSESSING OFFICE R UNDER SECTION 143(3), AN APPEAL WAS PREFERRED BY THE ASSE SSEE BEFORE THE LD. CIT(APPEALS) AND SINCE THERE WAS NO COMPLIANCE ON THE PART OF THE ASSESSEE TO THE NOTICES ISSUED BY HIM FIXING TH E SAID APPEAL FOR HEARING FROM TIME TO TIME, THE LD. CIT(APPEALS) DIS MISSED THE APPEAL OF THE ASSESSEE VIDE HIS APPELLATE ORDER DAT ED 14.03.2018 PASSED EX-PARTE. AGGRIEVED BY THE ORDER OF THE LD. CIT(APPEALS), THE ASSESSEE HAS PREFERRED THIS APPEAL BEFORE THE TRIBU NAL. 4. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AN D ALSO PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT THE NOTICES ISS UED BY THE LD. CIT(APPEALS) FIXING THE APPEAL OF THE ASSESSEE FOR HEARING WERE NEVER RECEIVED BY THE ASSESSEE AND THE SAME, THEREF ORE, COULD NOT BE COMPLIED WITH. HE HAS ALSO SUBMITTED THAT PROPER AN D SUFFICIENT OPPORTUNITY WAS NOT AFFORDED BY THE ASSESSING OFFIC ER DURING THE COURSE OF ASSESSMENT PROCEEDINGS TO EXPLAIN THE REL EVANT CASH CREDITS REPRESENTING SHARE CAPITAL AMOUNTING TO RS. 4.02 CRORES IN TERMS OF SECTION 68. HE HAS CONTENDED THAT THE MATT ER MAY, THEREFORE, BE SENT BACK TO THE ASSESSING OFFICER FO R GIVING THE ASSESSEE A PROPER AND SUFFICIENT OPPORTUNITY TO EST ABLISH THE IDENTITY AND CREDITWORTHINESS OF THE CONCERNED SHAR E SUBSCRIBERS AS WELL AS THE GENUINENESS OF THE RELEVANT TRANSACTION S BY PRODUCING THE RELEVANT DOCUMENTARY EVIDENCE. THE LD. D.R. HAS ALSO NOT RAISED ANY OBJECTION FOR SENDING THE MATTER BACK TO THE AS SESSING OFFICER. WE, THEREFORE, SET ASIDE THE IMPUGNED ORDER PASSED BY THE LD. CIT(APPEALS) EX-PARTE AND RESTORE THE MATTER TO THE FILE OF THE ASSESSING OFFICER FOR DECIDING THE SAME AFRESH AFTE R GIVING PROPER AND SUFFICIENT OPPORTUNITY OF BEING HEARD TO THE AS SESSEE. AS UNDERTAKEN BY THE LD. COUNSEL FOR THE ASSESSEE, THE ASSESSEE SHALL MAKE DUE COMPLIANCE BEFORE THE ASSESSING OFFICER AN D SHALL EXTEND ALL THE POSSIBLE COOPERATION IN ORDER TO ENABLE THE ASSESSING OFFICER TO COMPLETE THE ASSESSMENT EXPEDITIOUSLY. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS TREATE D AS ALLOWED FOR STATISTICAL PURPOSES. M/S CELEBRATION VINTRADE PVT. LTD. ITA NO.1685/KOL/2019 ASSESSMENT YEAR:2014-15 P PP PA AA AG GG GE EE E | || | 4 44 4 WE NOTE THAT IN ASSESSEES CASE, THERE IS NO COMPLI ANCE OF NOTICES U/S 133(6) / 131 OF THE ACT, THEREFORE, RESPECTFULLY FOLLOWING THE J UDGMENT OF CO-ORDINATE BENCH ON IDENTICAL FACTS AND CIRCUMSTANCES, WE ARE OF THE V IEW THAT THE PRESENT APPEAL OF THE ASSESSEE SHOULD ALSO BE REMITTED BACK TO THE FILE O F ASSESSING OFFICER FOR DE NOVO ASSESSMENT. WE, THEREFORE, SET ASIDE THE IMPUGNED O RDER PASSED BY THE LD. CIT(A), AND RESTORE THE MATTER TO THE FIE OF THE ASSESSING OFFICER FOR PASSING THE FRESH ASSESSMENT ORDER AFTER GIVING PROPER AND SUFFICIENT OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. AS UNDERTAKEN BY THE LD. COUNSEL FOR THE ASSESSEE, THE ASSESSEE SHALL MAKE DUE COMPLIANCE BEFORE THE ASSESSING OFFICER AN D SHALL EXTEND ALL THE POSSIBLE COOPERATION IN ORDER TO ENABLE THE ASSESSI NG OFFICER TO COMPLETE THE ASSESSMENT EXPEDITIOUSLY. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 26.07.2019 SD/- ( A.T. VARKEY ) SD/- (A.L.SAINI) / JUDICIAL MEMBER / ACCOUNTANT MEMBER / DATE: 26/07/2019 ( SB, SR.PS ) COPY OF THE ORDER FORWARDED TO: 1. M/S CELEBRATION VINTRADE PVT. LTD. 2. ITO, WARD-3(2), KOLKATA 3. C.I.T(A)- 4. C.I.T.- KOLKATA. 5. CIT(DR), KOLKATA BENCHES, KOLKATA. 6. GUARD FILE. TRUE COPY BY ORDER ASSIST ANT REGISTRAR ITAT, KOLKA TA BENCHES