ACIT, Circle-4(1), Kolkata, Kolkata V. M/s Karan Polymers(P) Ltd., Kolkata

ITA 1847/KOL/2016

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 1363 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 11 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-09-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 21-09-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M K BISWAS
• Assessee Lawyers: P K AGARWAL
• Section: 68; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH D, KOLKATA BEFORE SH. J.SUDHAKAR REDDY, ACCOUNTANT MEMBER AND SH. S.S.VISWANETHRA RAVI, JUDICIAL MEMBER ITA NO.1847/KOL/2016 [ASSESSMENT YEAR: 2006-07] APPELLANT BY SH. M.K.BISWAS, ADDL. CIT RESPONDENT BY SH. P.K.AGARWAL, FCA DATE OF HEARING 04.09.2018 DATE OF PRONOUNCEMENT 07.09.2018 ORDER PER S.S. VISWANETHRA RAVI, JUDICIAL MEMBER THIS APPEAL FILED BY THE REVENUE AGAINST THE ORDER DATED 12.07.2016 PASSED BY CIT(A)-4, KOLKATA FOR AY 2006-07. 2. THE ONLY ISSUE ARISES FROM GROUND NOS. 1 & 2 RAISED BY THE REVENUE AS TO WHETHER THE LD.CIT(A) JUSTIFIED DELETING THE ADDITION MADE BY THE AO UNDER THE HEAD UNDISCLOSED INCOME IN THE FACTS AND CIRCUMSTANCES OF THE CASE. IT IS NOTED FROM THE ORDER OF LD.CIT(A) THAT HE FOUND SATISFIED BY EXAMINING THE DETAILS AVAILABLE ON RECORD THAT THE ASSESSEE HAD NOT RAISED ANY SHARE CAPITAL DURING THE YEAR UNDER CONSIDERATION AND THE OPENING AND CLOSING SHARE CAPITAL OF THE ASSESSEE AS PER THE AUDITED BOOKS OF ACCOUNTS WAS RS.2,29,32,000/-. THEREFORE, IN OUR ACIT, CIRCLE-4(1), P-7, CHOWRINGHEE SQUARE, KOLKATA-700069. VS M/S. KARAN POLYMERS (P.) LTD., 56E, HEMANTA BASU SARANI, DALHOUSIE, STEPHEN HOUSE, 4 TH FLOOR, R.NO.57ABC, KOLKATA-700001. PAN-AABCK3114F (APPELLANT) (RESPONDENT) ITA NO.1847/KOL/2016 [ASSESSMENT YEAR: 2006-07] PAGE | 2 OPINION, NO ADDITION U/S 68 OF THE INCOME TAX ACT, 1961 (IN SHORT ACT) IS NOT MAINTAINABLE. THE RELEVANT PORTION OF WHICH IS REPRODUCED HEREIN BELOW:- 4.2. I HAVE CONSIDERED THE SUBMISSION OF THE AR OF THE APPELLANT IN THE BACKDROP OF THE ASSESSMENT ORDER. I FIND THAT PRIMARILY, THE AO HAS MADE THE IMPUGNED ADDITION OF RS.80,00,000/- ON ACCOUNT OF SHARE CAPITAL OF THE APPELLANT ON THE PREMISE THAT THERE WAS NO EXPLANATION COMING FORTH FROM THE APPELLANT ON THIS COUNT. FROM THE SUBMISSIONS MADE BY THE ASSESSEE AND THE DETAILS AVAILABLE ON RECORD, I FIND THAT THE ASSESSEE HAD NOT RAISED ANY SHARE CAPITAL DURING THE YEAR. THE OPENING & CLOSING SHARE CAPITAL OF THE ASSESSEE AS PER THE AUDITED BOOKS OF ACCOUNTS WAS RS.2,29,32,000/-. IT IS THEREFORE CLEARLY DISCERNIBLE FROM THE JURISDICTIONAL RECORDS THAT NO SHARE CAPITAL WAS RAISED BY THE ASSESSEE DURING THE RELEVANT FY 2005-06 AND THEREFORE THE QUESTION OF INVOCATION OF SECTION 68 AND ADDITION OF RS.80,00,000/- ON ACCOUNT OF SHARE CAPITAL DOES NOT ARISE AT ALL. IN THE CIRCUMSTANCES I FIND THAT THE INITIATION OF PROCEEDINGS U/S 148 WAS WITHOUT APPLICATION OF MIND AND EVEN THE IMPUGNED ADDITION MADE IN THE REASSESSMENT ORDER WAS PRIMA FACIE ERRONEOUS AND UNJUSTIFIED. FOR THE REASONS & FACTS SET OUT IN THE FOREGOING THEREFORE, I HEREBY SET ASIDE THE IMPUGNED ORDER PASSED U/S 148 AND ALSO CANCEL THE ADDITION OF RS.80,00,000/- MADE U/S 68 THEREIN. GROUND NOS. 1 & 2 OF THE APPEAL ARE THEREFORE ALLOWED. 3. IN VIEW OF THE FINDING OF LD.CIT(A) AND DISCUSSION MADE HEREIN ABOVE, WE FIND NO INFIRMITY IN THE ORDER OF LD.CIT(A) AND IT IS JUSTIFIED. ACCORDINGLY, GROUND NOS. 1 & 2 RAISED BY THE REVENUE ARE DISMISSED. 4. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 07.09.2018. SD/- SD/- (J.SUDHAKAR REDDY) (S.S.VISWANETHRA RAVI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATE:-07.09.2018 *AMIT KUMAR* ITA NO.1847/KOL/2016 [ASSESSMENT YEAR: 2006-07] PAGE | 3 COPY FORWARDED TO: 1. APPELLANT- ACIT, CIRCLE-4(1), P-7, CHOWRINGHEE SQUARE, KOLKATA- 700069. 2. RESPONDENT- M/S. KARAN POLYMERS (P) LTD., 56E, HEMANTA BASU SARANI, DALHOUSIE, STEPHEN HOUSE, 4 TH FLOOR, R.NO.57ABC, KOLKATA- 700001. 3. CIT-KOLKATA 4. CIT(APPEALS)-KOLKATA 5. DR: ITAT -KOLKATA BENCHES SR.P.S./H.O.O ITAT, KOLKATA