Gajgamini Trexim Pvt. Ltd., , Kolkata V. ITO, Ward - 9(2), , Kolkata

ITA 2144/KOL/2018

AI Insights

Gajgamini Trexim Pvt. Limited appealed against the order of the Commissioner of Income Tax (Appeals)-3, Kolkata, which confirmed the addition of Rs.39,01,00,000 to the assessee's income for the assessment year 2012-2013. The addition was initially made by the Assessing Officer due to the assessee's failure to provide details supporting the receipt of share capital money. The CIT(Appeals) upheld this addition after noting that the share subscribers were entities of no means, and the assessee was not engaged in any substantial business that could justify such a huge share premium. The Tribunal dismissed the appeal due to a delay of 88 days in filing, finding the explanation for the delay insufficient and noting the assessee's lack of engagement in the litigation process.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 129048 (ITAT-KOLKATA)
• Duration Of Justice: 4 year(s) 7 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-05-2023
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 26-04-2023
• Assessment Year: 2012-2013
• Appeal Filed On: 10-10-2018
• Other Referred Cases: Collector Land Acquisition Vs. Mst. Katiji & Others, N. Balakrisknan Vs. M. Krishnamurtky
• Laws Referred To: Income Tax Act
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Section: 131; 68

Judgement Text

ITA No. 2144/KOL/2018 Assessment Year : 2012-2013 Gajgamini Trexim Pvt. Limited 1 IN THE INCOME TAX APPELLATE TRIBUNAL, ‘B’ BENCH, KOLKATA Before Shri Rajpal Yadav, Vice-President & Shri Rajesh Kumar, Accountant Member I.T.A. No. 2144/KOL/2018 Assessment Year: 2012-2013 Gajgamini Trexim Pvt. Limited,................Appellant 63/2B, Begachia Ultadanga, North 24-Parganas, Kolkata-700037 [PAN: AAECG5510A] -Vs.- Income Tax Officer,................................Respondent Ward-9(2), Kolkata, Aayakar Bhawan, P-7, Chowringhee Square, Kolkata-700069 Appearances by: N o n e, appeared on behalf of the assesseee Shri Subhrajyoti Bhattacharjee, CIT, D.R., appeared on behalf of the Revenue Date of concluding the hearing : April 27, 2023 Date of pronouncing the order : May 23, 2023 O R D E R Per Shri Rajpal Yadav, Vice-President (KZ):- The assessee is in appeal before the Tribunal against the order of ld. Commissioner of Income Tax ITA No. 2144/KOL/2018 Assessment Year : 2012-2013 Gajgamini Trexim Pvt. Limited 2 (Appeals)-3, Kolkata dated 23 rd April, 2018 passed for assessment year 2012-13. 2. The assessee has taken three grounds of appeal, out of which Grounds No. 1 and 3 are general in nature, which do not call for recording of any specific finding. 3. In Ground No. 2, the assessee has pleaded that ld. CIT(Appeals) has erred in confirming the addition of Rs.39,01,00,000/-. 4. Brief facts of the case are that the assessee has filed its return of income electronically on 25.09.2012 disclosing total income of Rs.2,022/-. The ld. Assessing Officer noticed that the assessee had raised share capital of Rs.39,01,00,000/-, which includes premium received by it. The ld. Assessing Officer has issued summons under section 131 of the Income Tax Act served upon its Directors and directed them to appear before him, but they did not appear nor assessee has submitted any details in support of its transaction regarding receipt of share capital money. Hence ld. Assessing Officer has made an addition of Rs.39,01,00,000/-. ITA No. 2144/KOL/2018 Assessment Year : 2012-2013 Gajgamini Trexim Pvt. Limited 3 5. Dissatisfied with the addition, assessee went in appeal before the ld. CIT(Appeals). The assessee did not submit anything before the ld. CIT(Appeals). The ld. 1 st Appellate Authority has noticed that ten applicants have subscribed the shares of the assessee and all these applicants are entities of no means. Their returned income is within the range of Rs.13,000/- to Rs.25,000/- . According to the ld. CIT(Appeals), none of the share applicants has resources to pay such a huge premium to the assessee. The assessee was also not doing any substantial business on which can it commands a huge share premium? Accordingly, ld. CIT(Appeals) has confirmed the assessment order and upheld the addition. The ld. CIT(Appeals) has discussed the antecedent of each share applicant on pages no. 2 to 5 of the impugned order. 6. The Registry has pointed out that appeal is time- barred by 88 days. In order to explain the delay, the assessee has filed the application, which reads as under:- ITA No. 2144/KOL/2018 Assessment Year : 2012-2013 Gajgamini Trexim Pvt. Limited 4 7. In response to the notice of hearing, no one has come present on behalf of the assessee. As per the report of Postal Authority, no one was available on the given address. 8. With the assistance of ld. D.R., we have gone through the record carefully. Sub-section 5 of Section 253 contemplates that the Tribunal may admit an appeal or permit filing of memorandum of cross- objections after ITA No. 2144/KOL/2018 Assessment Year : 2012-2013 Gajgamini Trexim Pvt. Limited 5 expiry of relevant period, if it is satisfied that there was a sufficient cause for not presenting it within that period. This expression sufficient cause employed in the section has also been used identically in sub-section 3 of section 249 of Income Tax Act, which provides powers to the ld. Commissioner to condone the delay in filing the appeal before the Commissioner. Similarly, it has been used in section 5 of Indian Limitation Act, 1963. Whenever interpretation and construction of this expression has fallen for consideration before Honble High Court as well as before the Honble Supreme Court, then, Honble Court were unanimous in their conclusion that this expression is to be used liberally. We may make reference to the following observations of the Hon’ble Supreme court from the decision in the case of Collector Land Acquisition Vs. Mst. Katiji & Others, 1987 AIR 1353: 1. Ordinarily a litigant does not stand to benefit by lodging an appeal late. 2. Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this when delay is condoned the highest that can happen is that a cause would be decided on merits after hearing the parties. ITA No. 2144/KOL/2018 Assessment Year : 2012-2013 Gajgamini Trexim Pvt. Limited 6 3. "Every day’s delay must be explained" does not mean that a pedantic approach should be made. Why not every hour's delay, every second's delay? The doctrine must be applied in a rational common sense pragmatic manner. 4. When substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred for the other side cannot claim to have vested right in injustice being done because of a non-deliberate delay. 5. There is no presumption that delay is occasioned deliberately, or on account of culpable negligence, or on account of mala fides. A litigant does not stand to benefit by resorting to delay. In fact he runs a serious risk. 6. It must be grasped that judiciary is respected not on account of its power to legalize injustice on technical grounds but because it is capable of removing injustice and is expected to do so. ITA No. 2144/KOL/2018 Assessment Year : 2012-2013 Gajgamini Trexim Pvt. Limited 7 9. Similarly, we would like to make reference to authoritative pronouncement of Honble Supreme Court in the case of N. Balakrisknan Vs. M. Krishnamurtky (supra). It reads as under: “Rule of limitation are not meant to destroy the right of parties. They are meant to see that parties do not resort to dilatory tactics, but seek their remedy promptly. The object of providing a legal remedy is to repair the damage caused by reason of legal injury. Law of limitation fixes a life-span for such legal remedy for the redress of the legal injury so suffered. Time is precious and the wasted time would never revisit. During efflux of time newer causes would sprout up necessitating newer persons to seek legal remedy by approaching the courts. So a life span must be fixed for each remedy. Unending period for launching the remedy may lead to unending uncertainty and consequential anarchy. Law of limitation is thus founded on public policy. It is enshrined in the maxim Interest reipublicae up sit finis litium (it is for the general welfare that a period be putt to litigation). Rules of limitation are not meant to destroy the right of the parties. They are meant to see that parties do not resort to dilatory tactics but seek their remedy promptly. The idea is that every legal remedy must be kept alive for a legislatively fixed period of time. A court knows that refusal to condone delay would result foreclosing a suitor from putting forth his cause. There is no presumption that delay in approaching the court is always deliberate. This Court has held that the words "sufficient cause" under Section 5 of the Limitation Act should receive a liberal construction so as to advance substantial justice vide Shakuntala Devi lain Vs. Kuntal Kumari [AIR 1969 SC 575] and State of West Bengal Vs. The Administrator, Howrah Municipality [AIR 1972 SC 749]. It must be remembered that in every case of delay there can be some lapse on the part of the litigant concerned. That alone is not enough to turn down his plea and to shut the door against him. If the explanation does not smack of mala fides or it ITA No. 2144/KOL/2018 Assessment Year : 2012-2013 Gajgamini Trexim Pvt. Limited 8 is not put forth as part of a dilatory strategy the court must show utmost consideration to the suitor. But when there is reasonable ground to think that the delay was occasioned by the party deliberately to gain time then the court should lean against acceptance of the explanation. While condoning delay the Could should not forget the opposite party altogether. It must be borne in mind that he is a looser and he too would have incurred quiet a large litigation expenses. It would be a salutary guideline that when courts condone the delay due to laches on the part of the applicant the court shall compensate the opposite party for his loss”. 10. We do not deem it necessary to re-cite or recapitulate the proposition laid down in other decisions. It is suffice to say that the Honble Courts are unanimous in their approach to propound that whenever the reasons assigned by an applicant for explaining the condonation of delay, then such reasons are to be construed with a justice oriented approach. 11. In the light of above, let us examine the application for condonation of delay. The Hon’ble Supreme Court has observed that length of delay does not matter. It is the explanation given by an applicant demonstrating the reasons for such a delay matter for consideration. We have discussed the past history of the assessee before the ld. Assessing Officer as well as with the ld. CIT(Appeals). The assessee has not prosecuted its litigation either before the ld. Assessing Officer or before the ld. 1 st Appellate Authority. Thus it is not very serious in contesting the issues. A ‘vague application’ (extracted ITA No. 2144/KOL/2018 Assessment Year : 2012-2013 Gajgamini Trexim Pvt. Limited 9 supra) suggest its conduct. It does not contain any reason to show, why this appeal has been delayed by the assessee. It is also pertinent to observe that this conduct of the assessee gives up a feeling that it is just filing the appeal for the sake of filing without submitting any details discharging its onus cast upon by section 68 of the Income Tax Act. In such situation, we do not consider the reasons assigned by the assessee as sufficient reason for filing the appeal beyond the prescribed limit. Accordingly, this appeal is dismissed being time barred. 12. In the result, the appeal of the assessee is dismissed. Order pronounced in the open Court on May 23 rd , 2023. Sd/- Sd/- (Rajesh Kumar) (Rajpal Yadav) Accountant Member Vice-President(KZ) Kolkata, the 23 rd day of May, 2023 Copies to : (1) Gajgamini Trexim Pvt. Limited, 63/2B, Begachia Ultadanga, North 24-Parganas, Kolkata-700037 (2) Income Tax Officer, Ward-9(2), Kolkata, Aayakar Bhawan, P-7, Chowringhee Square, Kolkata-700069 ITA No. 2144/KOL/2018 Assessment Year : 2012-2013 Gajgamini Trexim Pvt. Limited 10 (3) Commissioner of Income Tax (Appeals), Income Tax Department, National Faceless Appeal Centre (NFAC), Delhi (4) Commissioner of Income Tax , (5) The Departmental Representative (6) Guard File TRUE COPY By order Assistant Registrar Income Tax Appellate Tribunal, Kolkata Benches, Kolkata Laha/Sr. P.S.