M/s Diana Tradecom Pvt. Ltd., Kolkata V. ITO, Ward-7(3), Kolkata, Kolkata

ITA 1980/KOL/2016

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 4511 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 10 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-08-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2008-2009
• Appeal Filed On: 07-10-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S DASGUPTA
• Assessee Lawyers: S M SURANA
• Keywords: Principle of natural justice

Judgement Text

PAGE | 1 IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH B, KOLKATA BEFORE SH. J.S UDHAKAR REDDY, ACCOUNTANT MEMBER AND SH. S.S.VISWANETHRA RAVI, JUDICIAL MEMBER ITA NO.1980/KOL/2016 [ASSESSMENT YEAR: 2008 - 09] APPELLANT BY SH. S.M.SURANA, ADVOCATE RESPONDENT BY SH. S.DASGUPTA, ADDL. CIT DR DATE OF HEARING 10.07.2018 DATE OF PRONOUNCEMENT 0 8 .0 8 .2018 ORDER PER S.S . VISWANETHRA RAVI , JUDICIAL MEMBER THIS APPEAL BY THE ASSESSEE AGAINST THE ORDER DATED 29.08.2016 PASSED BY CIT(A) - 16, KOLKATA FOR AY 2008 - 09. 2. THE LD. AR SUBMITS THE ISSUE INVOLVED IN THIS APPEAL IS INTRODUCTION OF SHARE CAPITAL . T HE AO TREATED THE SAME AS BOGUS U NDER 144 PROCEEDINGS. THE AO WITHOUT ISSUING NOTICE AND BY VIOLATING THE PRINCIPLES OF NATURAL JUSTICE ADDED AN AMOUNT OF RS. 3,18,00 ,000/ - TO THE TOTAL INCOME OF THE ASSESSEE. I N THE FIRST APPELLATE PROCEEDINGS, THE CIT(A) BY PLACING RELIANCE IN THE CASE OF RAJMANDIR ESTATES LTD. VS PCIT - II, KOLKATA DATED 13.05.2016 , CONFIRMED THE VIEW OF THE AO . THERE WAS NO OPPORTUNITY FOR THE ASSESSEE TO PROVE ITS ONUS BY FURNISHING ALL THE RELEVANT DOCUMENTS IN CONNECTION WITH THE SHARE CAPITAL RAISED AND URGED TO REMAND THE MATTER TO THE FILE OF THE AO FOR CONDUCTING INQUIRIES INDEPENDENTLY IN RESPECT OF SHARE CAPITAL SUBSCRIBING COMPANIES. THE LD.DR DID NOT CONTROVERT THE S AME . M/S. DIANA TRADECOM PVT.LTD., C / O - RAJESH MOHAN & ASSOCIATES, 34, GANESH CHANDRA AVENUE, KOLKATA - 700013. PAN - AACCD7356B VS ITO, WARD - 7(3), AAYAKAR B HAWAN, P - 7, CHOWRINGHEE SQAURE, KOLKATA - 700069. (APPELLANT) (RESPONDENT) ITA NO.1 916 /KOL/201 6 [ASSESSMENT YEAR: 20 08 - 09 ] PAGE | 2 3. HEARD BOTH AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THERE WAS NO OPPORTUNITY FOR THE ASSESSEE IN THE ASSESSMENT PROCEED INGS AND THE CIT(A) BY PLACING RELIANCE ON THE DECISION OF THIS TRIBUNAL IN THE CASE OF RAJMANDIR ESTATES LTD. VS PCIT - II, KOLKATA ( SUPRA ) CONFIRMED THE VIEW TAKEN BY THE AO. TAKING INTO CONSIDERATION, THE SUBMISSIONS OF LD.AR & LD.DR AND IN THE FACTS AND CIRCUMSTANCES OF THE CASE, WE DEEM IT PROPER TO REMAND THE MATTER TO THE FI LE OF THE AO TO CONDUCT INQUIRIES AS SET OUT HEREUNDER: - I) EXAMINE THE GENUINENESS AND SOURCE OF SHARE CAPITAL, NOT ON A TEST CHECK BASIS, BUT IN RESPECT OF EACH AND EVERY SHAREHOLDER BY CONDUCTING INDEPENDENT ENQUIRY NOT THROUGH THE ASSESSEE. THE BANK ACCO UNT OF THE ENTIRE PERIOD SHOULD BE EXAMINED IN THE COURSE OF VERIFICATION TO FIND OUT THE MONEY TRAIL OF THE SHARE CAPITAL. II) FURTHER THE A.O. SHOULD EXAMINE THE DIRECTIONS AS WELL AS EXAMINE THE CIRCUMSTANCES WHICH NECESSITATED THE CHANGE IN DIRECTORSHIP IF APPLICABLE. HE SHOULD EXAMINE THEM ON OATH TO VERIFY THEIR CREDENTIALS AS DIRECTOR AND REACH A LOGICAL CONCLUSION REGARDING THE CONTROLLING INTEREST. III) THE A.O. IS DIRECTED EXAMINE THE SOURCE OF REALIZATION FROM THE LIQUIDATION OF ASSETS SHOWN IN THE BALANCE SHEET AFTER THE CHANGE OF DIRECTORS, IF ANY. 4. IN VIEW OF THE ABOVE, G ROUNDS RAISED BY THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE O PEN COURT ON 0 8 .0 8 .2018. S D / - S D / - (J.S UDHAKAR REDDY) (S.S. VISWANETHRA RAVI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATE: - 0 8 .0 8 .2018 *AMIT KUMAR* ITA NO.1 916 /KOL/201 6 [ASSESSMENT YEAR: 20 08 - 09 ] PAGE | 3 COPY FORWARDED TO: 1. APPELLANT - M/S. DIANA TRADECOM PVT. LTD., C / O - RAJESH MOHAN & ASSOCIATES, 34, GANESH CHANDRA AVENUE, KOLKATA - 700013. 2. RESPONDENT - ITO, WARD - 7(3), AAYAKAR B HAWAN, P - 7, CHOWRINGHEE SQAURE, KOLKATA - 700069. 3. CIT - KOLKATA 4. CIT(APPEALS) - KOLKATA 5. DR: ITAT - KOLKATA BENCHES SR.P.S./H.O.O ITAT, KOLKATA