NETSCAPE SOFTWARE LTD, MUMBAI V. ACIT CEN CIR-40, MUMBAI

ITA 1716/MUM/2009

• Counselvise Citation: 171619914 RSA 2009
• Duration Of Justice: 2 year(s) 6 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-10-2011
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: G
• Next Hearing Date: 20-03-2017
• Assessment Year: 2005-2006
• Appeal Filed On: 16-03-2009
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: PRAVIN VARMA
• Keywords: Income from undisclosed sources
• Section: 234B; 250; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH : MUMBAI BEFORE SHRI D. MANMOHAN, VICE PRESIDENT AND SHRI PRAMOD KUMAR, ACCOUNTANT MEMBER ITA. NO. 1716/MUM/2009 ASSESSMENT YEAR 2005-2006 NETSCAPE SOFTWARE LTD. MUMBAI 400 023 PAN AAACN9129J VS. ACIT, C.C. 40 MUMBAI 400 020 (APPELLANT) (RESPONDENT) FOR APPELLANT : -NONE- FOR RESPONDENT : SHRI PRAVIN VARMA DATE OF HEARING : 05-10-2011 DATE OF PRONOUNCEMENT : 05-10-2011 ORDER PER D. MANMOHAN, V.P. 1. THIS APPEAL BY THE ASSESSEE-COMPANY IS DIRECTED AGAINST THE ORDER DATED 18-12-2008 PASSED BY THE CIT(A), CE NTRAL-7, MUMBAI AND IT PERTAINS TO THE ASSESSMENT YEAR 2005-2006. 2. THE CASE WAS ADJOURNED FROM TIME TO TIME FROM T HE YEAR 2009 ONWARDS AT THE REQUEST OF EITHER THE ASSESSEE OR THE DEPARTMENTAL REPRESENTATIVE AND FINALLY POSTED FOR HEARING ON 5/10/11. THOUGH NUMBER OF ADJOURNMENTS WERE TAKEN I T APPEARS THAT THE M/S. R.S.KHANDELWAL & ASSOCIATES, C.AS, WHO ARE AUTHORISED TO APPEAR IN THIS APPEAL, HAD NOT FILED THEIR POWER OF ATTORNEY. TODAY, UNDER THE SIGNATURE OF MS. MANISHA BOLAR ON THE LET TER HEAD OF R.S. KHANDELWAL & ASSOCIATES, C.AS A LETTER WAS FILED SE EKING ADJOURNMENT ON THE FOLLOWING GROUND : IN THIS CONNECTION WE WOULD LIKE TO INFORM YOU THA T THE GROUND OF APPEAL IN THE AFORESAID APPEAL IS ABSOLUT ELY SIMILAR TO GROUND OF APPEAL IN ITA. NO. 3852/M/09 I N THE ITA. NO. 1716/MUM/2009 NETSCAPE SOFTWARE LTD. 2 CASE OF OUR ABOVENAMED CLIENTS WHICH HAS BEEN HEARD BY THE HONBLE TRIBUNAL ON 26 TH SEPTEMBER, 2011 AND THE ORDER IS AWAITED. THIS ORDER WILL HAVE BEARING ON T HE AFORESAID APPEAL UNDER REFERENCE AND HENCE, WE REQU EST YOU TO GRANT A SHORT ADJOURNMENT. 3. ONE PERSON CLAIMED TO BE WORKING IN THE O/O. R.S.KHANDELWAL & ASSOCIATES, C.AS APPEARED BEFORE U S BUT COULD NOT FURNISH DETAILS WITH REGARD TO THE OTHER CONNECTED APPEAL MENTIONED IN THE APPLICATION EXCEPT STATING THAT IT WAS HEARD BY F BENCH. WHEN CALLED UPON TO EXPLAIN AS TO WHAT WERE THE GROUNDS IN THE AFOREMENTIONED CASE, THE REPRESENTATIVE OF THE ASSE SSEE COULD NOT EXPLAIN THE FACTS. HAVING REGARD TO THE FACT THAT T HE CASE WAS ADJOURNED ON NUMBER OF OCCASIONS ON SOME PRETEXT OR THE OTHER WE ARE OF THE VIEW THAT THIS IS NOT A FIT CASE FOR GRA NTING FURTHER ADJOURNMENT AND THEREFORE, THE REQUEST MADE BY THE ASSESSEES COUNSEL IS REJECTED AND WE HEREBY PROCEED TO DISPOS E OF THE APPEAL EX- PARTE QUA THE ASSESSEE. AT THE OUTSET, IT MAY BE ST ATED THAT IN THE LIGHT OF DECISION OF THE HONBLE BOMBAY HIGH COURT IN THE CASE OF CHEMIPOL VS. UNION OF INDIA AND ANOTHER IN CENTRAL EXCISE AP PEAL NO. 52/2009 DATED 17-9-2009 THE TRIBUNAL IS EMPOWERED TO DISMIS S THE APPEAL FOR NON-APPEARANCE SINCE IT IS NOT POSSIBLE TO VERIFY T HE VERACITY OF THE PLEAS RAISED BY THE ASSESSEE IN THE GROUNDS OF APPE AL ANNEXED TO FORM NO.36. 4. AT ANY RATE, EVEN ON MERITS WE FIND THAT THE AS SESSEE DOES NOT HAVE A STRONG CASE. AN AMOUNT OF RS.35.40 CRORE S WAS RECEIVED BY THE ASSESSEE ON ALLOTMENT OF PREFERENCE SHARES CAPI TAL. THE ASSESSING OFFICER WAS OF THE OPINION, FOR THE DETAILED REASON S GIVEN IN THE ASSESSMENT ORDER, THAT THE SHARE APPLICATION MONEY FOR ALLOTMENT OF 70,800 CUMULATIVE REDEEMABLE PREFERENCE SHARES IS A SSESSEES OWN UNACCOUNTED INCOME AND THE SAME IS ASSESSABLE TO TA X AS UNEXPLAINED MONEY, BY INVOKING THE PROVISIONS OF SE CTION 69A OF THE ACT ; ACCORDINGLY, THE IMPUGNED RECEIPT OF RS.35,40 ,00,000/- WAS ITA. NO. 1716/MUM/2009 NETSCAPE SOFTWARE LTD. 3 ADDED TO THE ASSESSEES TOTAL INCOME. THOUGH THE AS SESSEE PREFERRED AN APPEAL BEFORE THE CIT(A), THE PLEA OF THE ASSESS EE WAS REJECTED FOR THE DETAILED REASONS GIVEN BY LEARNED CIT(A) IN PAR A 5 OF HIS ORDER. THOUGH ON BEHALF OF THE ASSESSEE VOLUMINOUS PAPER B OOK WAS FILED, PERSON REPRESENTING ON BEHALF OF THE ASSESSEE COULD NOT HIGHLIGHT AS TO WHICH ARE THE RELEVANT PAPERS WHICH COULD SUCCINCTL Y SHOW THAT THE CONCLUSION DRAWN BY THE ASSESSING OFFICER AS WELL A S THE CIT(A) ARE CONTRARY TO FACTS. AS PER RULE 18 (6) OF THE APPELL ATE TRIBUNAL RULES, 1963 DOCUMENTS THAT ARE REFERRED TO AND RELIED UPON BY THE PARTIES DURING THE COURSE OF ARGUMENTS SHALL ALONE BE TREAT ED AS PART OF THE RECORD OF THE TRIBUNAL. UNDER THE CIRCUMSTANCES, WE ARE OF THE FIRM VIEW THAT THE ASSESSEE-COMPANY HAS NO MATERIAL WHAT SOEVER TO CONTRADICT THE FINDINGS OF THE LEARNED CIT(A). WE, THEREFORE, AFFIRM THE ORDER OF THE LEARNED CIT(A). IT IS NOT OUT OF PLACE TO MENTION THAT THE CIT(A) WHILE UPHOLDING THE ORDER OF THE ASSESSING O FFICER HELD THAT ADDITION IS MAINTAINABLE UNDER SECTION 68 OF THE AC T IF NOT UNDER SECTION 69A OF THE ACT AND EXERCISED THE POWERS VES TED IN HIM UNDER SECTION 250 OF THE ACT, THE POWERS OF THE LEARNED C IT(A) ARE CO- TERMINUS WITH THAT OF THE ASSESSING OFFICER. UNDER THE CIRCUMSTANCES, WE REJECT GROUND NO.1 OF THE ASSESSEE-COMPANY. 5. GROUND NO.2 IS WITH REGARD TO CHARGE OF INTERES T UNDER SECTION 234B OF THE ACT. LEARNED CIT(A) OBSERVED TH AT CHARGING OF INTEREST UNDER SECTION 234B IS MANDATORY SINCE IT I S COMPENSATORY IN NATURE. IN THIS REGARD, LEARNED CIT(A) RELIED UPON THE DECISION OF THE APEX COURT IN THE CASE OF CIT VS. ANJUM M.H.GHASWAL A (2001) 252 ITR 1 (SC). 6. THE CASE LAW RELIED UPON BY THE LEARNED CIT(A) COULD NOT BE CONTRADICTED BY THE ASSESSEE THROUGH THE REPRESE NTATIVE OF ITS COUNSEL. UNDER THESE CIRCUMSTANCES, WE FIND NO INFI RMITY IN THE ORDER OF THE LEARNED CIT(A). ON A CONSPECTUS OF THE MATTE R, WE ARE OF THE VIEW THAT THE APPEAL FILED BY THE ASSESSEE-COMPANY DESERVES TO BE DISMISSED IN LIMINI. WE ORDER ACCORDINGLY. ITA. NO. 1716/MUM/2009 NETSCAPE SOFTWARE LTD. 4 ORDER PRONOUNCED IN THE OPEN COURT ON 05-10-2011 SD/- SD/- (PRAMOD KUMAR) (D.MANMOHAN) ACCOUNTANT MEMBER VICE PRESIDENT MUMBAI, DATE 05 TH OCTOBER, 2011 VBP/- COPY TO 1. NETSCAPE SOFTWARE LTD., BHUPEN CHAMBERS, GROUND FLOOR, 9, DALAL STREET, FORT, MUMBAI 400 023 PAN AAACN9129J 2. ACIT, CENTRAL CIRCLE-40, AAYAKAR BHAVAN, M.K. RO AD, MUMBAI-020. 3. CIT(A), CENTRAL-7, MUMBAI. 4. CIT, CENTRAL-IV, MUMBAI 5. DR B BENCH 6. GUARD FILE TRUE COPY BY ORDER ASST. REGISTRAR, ITAT, MUMBAI BENCHES MUMBAI.