Pacific Develcon Pvt. Ltd., New Delhi V. DCIT, New Delhi

ITA 1937/DEL/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 4405 (ITAT-DELHI)
• Duration Of Justice: 5 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-09-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: F
• Assessment Year: 2013-2014
• Appeal Filed On: 31-03-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: VED JAIN ADV SHRI ASHISH GOEL
• Section: 68

Judgement Text

I.T.A. 1937/DEL/2017 ASSESSMENT YEAR 2013-14 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: F NEW DELHI BEFORE SHRI G.D. AGRAWAL, HONBLE PRESIDENT AND SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER ITA NO. 1937/DEL /2017 ASSESSMENT YEAR: 2013-14 PACIFIC DEVELCON PVT. LTD., 16/27, TILAK NAGAR, NEW DELHI-110018 (PAN: AABCP9417E) VS DCIT , CIRCLE-19(2), NEW DELHI. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI VED JAIN, ADV. SHRI ASHISH G OEL, CA RESPONDENT BY: SHRI ATIQ AHMAD, SR. DR DATE OF HEARING : 11.09.2017 DATE OF PRONOUNCEMENT: 20.09.2017 ORDER PER SUDHANSHU SRIVASTAVA, J.M. THIS APPEAL HAS BEEN PREFERRED BY THE ASSESSEE AGAINST THE ORDER DATED 1.3.2017 PASSED BY THE LD. CIT(A)-36, NEW DELHI AND PERTAINS TO ASSESSMENT YEA R 2013-14 WHEREIN THE LD. CIT(A) HAS DISMISSED THE ASSESSEES APPEAL CONTESTING THE ADDITION MADE U/S 68 OF THE INCOME TAX ACT, 1961. 2. FOLLOWING GROUNDS HAVE BEEN RAISED IN THE APPEAL :- I.T.A. 1937/DEL/2017 ASSESSMENT YEAR 2013-14 2 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, TH E ORDER PASSED BY THE LEARNED CIT(A) IS BAD BOTH IN THE EYE OF LAW AND ON FACTS. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN PASSING THE ORDER WITHOUT GIVING ASSESSEE PROPER AND ADEQUATE OPPORTUNITY TO REPRESENT HIS CASE IN VIOLATION OF PRINCIPLE OF NATURAL JUSTI CE. 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED BOTH IN FACTS AND LAW IN PASSING T HE ORDER WITHOUT GIVING ANY FINDING ON THE MERITS OF THE CAS E. 4 (I) ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED BOTH IN FACTS AND LAW IN CONFIRMIN G THE ADDITION OF RS.7,92,00,000/- UNDER SECTION 56(2)(VII)(B) OF THE ACT MADE BY THE AO BEING THE SHARE PREMIUM RECEIVED BY THE ASSE SSEE IN RESPECT OF THE SHARE CAPITAL ISSUED DURING THE YEAR . (II) THAT THE ABOVE SAID ADDITION WAS MADE BY THE L EARNED A.O. IGNORING THE FACT THAT THE FAIR MARKETING VALUE (FM V) OF THE SHARE ISSUED IS NOT LESS THAN THE SHARE VALUE OF TH E COMPANY AS ON THE DATE WHEN THESE SHARE WERE ISSUED. 5. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE CIT(A) HAS CONFIRMED THE ADDITION IGNORING THE FACT THAT THE A SSESSEE OWNS A PREMIUM PROPERTY IN VASANT KUNJ MEASURING 430 SQ. MTRS. AND HAVING THE BUILT-UP AREA OF MORE THAN 12880 SQ. FT., WHICH WAS ACQUIRED LONG TIME BACK IN THE YEAR 2002-03 AT THE COST OF RS.7.28 CRORES. 6. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE ADDITION WAS MADE IGNORING THE FACT THAT THE NEW SHAREHOLDER S TO WHOM THE ASSESSEE ISSUED SHARES AT THE PREMIUM OF R S.330/- HAVE BECOME OWNER OF 96% OF THE TOTAL CAPITAL OF TH E COMPANY AND AS SUCH IT CANNOT BE SAID THAT THE CONSIDERATIO N FOR ISSUE OF THE SHARE IS EXCESSIVE SO AS TO INVOKE THE PROVI SION OF SECTION 56(2)(VII)(B). 7. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED I.T.A. 1937/DEL/2017 ASSESSMENT YEAR 2013-14 3 CIT(A) HAS ERRED BOTH IN FACTS AND LAW IN CONFIRMIN G THE DISALLOWANCE OF RS.2,63,295/- ON ACCOUNT OF THE EXP ENSES INCURRED ON ACCOUNT OF THE STAMP DUTY PAID DURING T HE YEAR UNDER CONSIDERATION. 8. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE CIT(A) HAS ERRED BOTH IN FACTS IN CONFIRMING THE DISALLOWANCE OF RS.60,727/- BEING THE EXPENSES INCURRED ON ACCOUNT OF THE INSURANCE PREMIUM. 9. THAT THE APPELLANT CRAVES LEAVE TO ADD, AMEND OR ALTER ANY OF THE GROUNDS OF APPEAL. 3. AT THE OUTSET, LD. AR SUBMITTED THAT THE ASSES SEES APPEAL HAD BEEN DISMISSED EX PARTE QUA THE ASSESSEE. OUR ATTENTION WAS DRAWN TO PARA 4, 5, 6 AND 7 OF THE CIT(A)S ORD ER WHEREIN THE LD. CIT(A) HAS OBSERVED THAT AS THE ASSESSEE WAS NO T INTERESTED IN PURSUING THE APPEAL, THERE WAS NO POINT IN KEEPING THE APPEAL PENDING INDEFINITELY. IT WAS SUBMITTED THAT THE LD . CIT(A) PROCEEDED TO ADJUDICATE BASED ON THE MATERIAL AVAIL ABLE ON RECORD. LD. AR FURTHER SUBMITTED THAT THE ASSESSEE HAD DULY FILED DETAILED SUBMISSIONS BEFORE THE LD. CIT(A) ON 10 TH FEBRUARY, 2017 AND A COPY OF THE SAME WAS PLACED ON RECORD BEFORE US IN SUPPORT OF THE CONTENTION. IT WAS ALSO SUBMITTED THAT THE LD. CIT(A) HAD PASSED THE IMPUGNED ORDER ON 1 ST MARCH, 2017 BUT HAD NOT CONSIDERED SUBMISSIONS/EVIDENCES FILED BY THE ASSES SEE ON 10.2.2017 AND THEREFORE, THE PRINCIPLE OF NATURAL J USTICE HAD BEEN I.T.A. 1937/DEL/2017 ASSESSMENT YEAR 2013-14 4 VIOLATED WHILE DISMISSING THE ASSESSEES APPEAL. L EARNED DEPARTMENTAL REPRESENTATIVE, ON THE OTHER HAND, SUP PORTED THE ORDER OF THE LD. CIT(A) AND OF THE ASSESSING OFFICE R AND SUBMITTED THAT THESE ADDITIONS HAD BEEN MADE AFTER FOLLOWING THE PROPER PROCEDURE AND THE FAULT WAS ENTIRELY OF THE ASSESSE E IN NOT SUBMITTING THE REQUIRED DOCUMENTS. 4. WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFU LLY PERUSED THE RELEVANT MATERIAL PLACED ON RECORD. A PERUSAL O F THE IMPUGNED ORDER SHOWS THAT THE LD. CIT(A) HAS CONFIR MED THE FINDINGS OF THE ASSESSING OFFICER BY SIMPLY RELYING ON THE OBSERVATIONS MADE IN THE ASSESSMENT ORDER BUT HAS N OT CONSIDERED THE ASSESSEES SUBMISSIONS ON MERITS. T HUS, THE ORDER OF THE LD. CIT(A) IS ERRONEOUS IN SO FAR AS T HE ASSESSEES SUBMISSIONS HAVE NOT BEEN DULY CONSIDERED. ON AN O VERALL CONSIDERATION OF THE FACTS SURROUNDING THE CASE, IT IS OUR CONSIDERED OPINION THAT INTEREST OF JUSTICE WOULD B E SERVED IF THE ISSUE IS RESTORED TO THE FILE OF THE ASSESSING OFFI CER FOR EXAMINING AND ADJUDICATING THE ISSUES AFRESH. ACCORDINGLY, W E SET ASIDE THE ORDER OF THE LD. CIT(A) AND RESTORE THE ISSUE TO TH E FILE OF THE LD. ASSESSING OFFICER FOR RE-EXAMINATION OF THE FACTS A ND MAKING THE ASSESSMENT AFRESH AFTER GIVING DUE OPPORTUNITY TO T HE ASSESSEE TO I.T.A. 1937/DEL/2017 ASSESSMENT YEAR 2013-14 5 PRESENT ITS CASE. 5. IN THE RESULT, THE ASSESSEES APPEAL STANDS ALL OWED FOR STATISTICAL PURPOSES. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 20 TH SEPTEMBER, 2017. SD/- SD/- (G.D. AGRAWAL) (SUDHANSHU SRIVASTAVA) PRESIDENT JUDICIAL MEMBER DATED: 20 TH SEPTEMBER, 2017 GS COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT TRUE COPY BY ORDER ASSISTANT REGISTRAR I.T.A. 1937/DEL/2017 ASSESSMENT YEAR 2013-14 6