Swatipushp Dealers Pvt. Ltd.(Since Merged with snowtemp Commercial Pvt. Ltd.) , Kolkata V. ITO, Ward-11(2), Kolkata

ITA 258/KOL/2024

• Counselvise Citation: [2024] 101 COUNSELVISE.COM (IT) 6569 (ITAT-KOLKATA)
• Duration Of Justice: 4 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-06-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2011-2012
• Appeal Filed On: 08-02-2024
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Income from undisclosed sources; Set aside
• Section: 263; 271(1)(c); 143(3); 43

Judgement Text

ITA No. 258/KOL/2024 (A.Y. 2011-2012) Swatipushp Dealers Pvt. Ltd. (since merged with Snowtemp Commercial Pvt. Ltd.) 1 THE INCOME TAX APPELLATE TRIBUNAL, ‘C’ BENCH, KOLKATA Before Shri Rajpal Yadav, Vice-President (KZ) & Dr. Manish Borad, Accountant Member I.T.A. No. 258/KOL/2024 Assessment Year: 2011-2012 Swatipushp Dealers Pvt. Ltd.,........................Appellant (since merged with Snowtemp Commercial Pvt. Ltd.) 101, 1 st Floor, 18, Prince Anwar Shah Road, Kolkata-700033 [PAN:AAPCS5069P] -Vs.- Income Tax Officer,....................................Respondent Ward-11(2), Kolkata, Aayakar Bhawan, P-7, Chowringhee Square, Kolkata-700069 Appearances by: Shri Abhishak Bansal, A.R., appeared on behalf of the assessee Shri Loviesh Shelley, JCIT, D.R. appeared on behalf of the Revenue Date of concluding the hearing : May 30, 2024 Date of pronouncing the order : June 11, 2024 O R D E R Per Rajpal Yadav, Vice-President (KZ):- The present appeal is directed at the instance of assessee against the order of ld. Commissioner of Income Tax (Appeals), ITA No. 258/KOL/2024 (A.Y. 2011-2012) Swatipushp Dealers Pvt. Ltd. (since merged with Snowtemp Commercial Pvt. Ltd.) 2 National Faceless Appeal Centre (NFAC), Delhi dated 5 th February, 2024 passed for assessment year 2011-12. 2. The assessee has taken five grounds of appeal, out of which Grounds No. 1, 2, 4 & 5 are general in nature, which do not call for recording of any specific finding. 3. In Ground No. 3, the assessee has pleaded that ld. CIT(Appeals) has erred in ignoring the assessment order dated 30.12.2019 passed under section 143(3)/254/263/143(3) in confirming the penalty imposed by the ld. Assessing Officer under section 271(1)(c) of the Income Tax Act. 4. Brief facts of the case are that the assessee has filed its return of income electronically on 18.09.2012 showing a returned loss of Rs.(-)4,615/-. A scrutiny assessment was passed on 30.01.2014 at an assessed loss of Rs.3,666/-. The ld. Pr. CIT took cognizance under section 263 of the Income Tax Act and thereby vide his order dated 25.03.2016, the impugned assessment order passed on 30.01.2014 under section 143(3) was set aside. 5. According to the ld. Assessing Officer, in pursuance of this order, a fresh assessment order was passed on 12.09.2016. It appears that on the basis of this order, a penalty under section 271(1)(c) was imposed by the ld. Assessing Officer vide his order dated 14.06.2018. The ld. Assessing Officer has imposed a penalty of Rs.2,95,95,575/-. ITA No. 258/KOL/2024 (A.Y. 2011-2012) Swatipushp Dealers Pvt. Ltd. (since merged with Snowtemp Commercial Pvt. Ltd.) 3 6. Dissatisfied with this order, an appeal was filed before the ld. CIT(Appeals) on 03.07.2018. This appeal has been decided by the ld. CIT(Appeals) vide impugned order dated 05.02.2024. 7. It emerges out that before finalizing of an assessment order in pursuance to 263 order an appeal was filed before the ITAT bearing ITA No. 1144/KOL/2017. The appeal of the assessee was partly allowed for statistical purposes. The Tribunal has held that since hearing was not provided to the assessee, therefore, 263 order of the ld. Pr. CIT is modified to the extent that instead of finalization of the assessment, it is restored to the ld. Assessing Officer for passing of a de novo assessment. The concluding paragraph of the order passed under section 263 reads as under:- “Further, despite opportunity having been granted as pointed out above the assessee failed to establish genuineness of source of capital. In consideration of the above facts, I hold that the sum of Rs.8,91,00,000/-( Rs.9,90,000/- being share capital and Rs.8,81,10,000/- being share premium) received by the assessee during the period under consideration is the assessee's own income and is assessed as income of the assessee for the instant assessment year. The assessed income as per assessment order dt.30.01.2014 stands enhanced accordingly. The A.O. is directed to pass consequential order giving effect to this order. ITA No. 258/KOL/2024 (A.Y. 2011-2012) Swatipushp Dealers Pvt. Ltd. (since merged with Snowtemp Commercial Pvt. Ltd.) 4 Penalty proceeding u/s. 271(l)(c) initiated separately for concealed unaccounted income of Rs. 8,91,00,000/-. Sd/- (DEVENDRA NATH MISHRA) Pr. Commissioner of Income Tax-4, Kolkata”. This finding has been vacated by the Tribunal holding that proceedings are restored to the ld. Assessing Officer for redetermination of the income. 8. While giving effect to the order of the Tribunal, the ld. Assessing Officer has passed the assessment order on 30.12.2019 and he did not make any addition. The income of the assessee has determined according to the original assessment order dated 30.01.2014 stood as it is. Copy of this assessment order is available on page 43 of the record. For completeness of the facts and circumstances, we deem it appropriate to take note of this order, which reads as under:- ITA No. 258/KOL/2024 (A.Y. 2011-2012) Swatipushp Dealers Pvt. Ltd. (since merged with Snowtemp Commercial Pvt. Ltd.) 5 ITA No. 258/KOL/2024 (A.Y. 2011-2012) Swatipushp Dealers Pvt. Ltd. (since merged with Snowtemp Commercial Pvt. Ltd.) 6 9. Sub-clause (iii) of section 271(1)(c) reads as under:- “Failure to furnish returns, comply with notices, concealment of income, etc. 271:- (1) If the Assessing Officer or the Joint Commissioner or the Commissioner (Appeals) or the Principal Commissioner or Commissioner in the course of any proceedings under this Act, is satisfied that any person- (a).............. (b).............. (c) has concealed the particulars of his income or furnished inaccurate particulars of such income, or (d)................ (i)............ (ii)............ ITA No. 258/KOL/2024 (A.Y. 2011-2012) Swatipushp Dealers Pvt. Ltd. (since merged with Snowtemp Commercial Pvt. Ltd.) 7 (iii) in the cases referred to in clause (c) or clause (d), in addition to tax, if any, payable by him, a sum which has not be less than, but which shall not exceed three times, the amount of tax sought to be evaded by reason of the concealment of particulars of his income or fringe benefits or the furnishing of inaccurate particulars of such income or fringe benefits”. 10. A perusal of sub-clause (iii) of section 271(1)(c) would indicate that penalty would be equivalent or to the extent of three times of taxes, if any, payable by an assessee on the addition made to his income could be charged under this sub-clause. In the present case, no addition has attained finality ultimately. Income of the assessee has been determined equivalent to the amount disclosed by it, which is in a negative figure. Neither any losses have been disallowed nor any addition has been made, therefore, the very foundation to compute the penalty is extinguished. In this situation, no penalty is imposable upon the assessee. It is pertinent to note that ld. CIT(Appeals) failed to take note of all these facts. The assessment order was passed long back in 2019. Unnecessary this appeal was kept pending upto 2024. Accordingly, we allow the appeal of the assessee and delete the penalty. 11. In view of the above, the appeal of the assessee is allowed. Order pronounced in the open Court on 11/06/2024. Sd/- Sd/- (Manish Borad) (Rajpal Yadav) Accountant Member Vice-President (KZ) Kolkata, the 11 th day of June, 2024 ITA No. 258/KOL/2024 (A.Y. 2011-2012) Swatipushp Dealers Pvt. Ltd. (since merged with Snowtemp Commercial Pvt. Ltd.) 8 Copies to :(1 Swatipushp Dealers Pvt. Ltd., (since merged with Snowtemp Commercial Pvt. Ltd.) 101, 1 st Floor, 18, Prince Anwar Shah Road, Kolkata-700033 (2) Income Tax Officer, Ward-11(2), Kolkata, Aayakar Bhawan, P-7, Chowringhee Square, Kolkata-700069 (3) Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi; (4) CIT- , Kolkata (5) The Departmental Representative; (6) Guard File TRUE COPY By order Assistant Registrar, Income Tax Appellate Tribunal, Kolkata Benches, Kolkata Laha/Sr. P.S.