M/s. Hirak Vyapaar Private Limited , Kolkata V. ITO, Ward - 6(1) , Kolkata

ITA 26/KOL/2019

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 1359 (ITAT-KOLKATA)
• Duration Of Justice: 3 year(s) 9 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-10-2022
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 20-09-2022
• Assessment Year: 2008-2009
• Appeal Filed On: 06-01-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Revision of order; Set aside
• Section: 131; 68; 148; 263; 142(1); 143(2)

Judgement Text

1. ITA No. 26/Kol/2019 AY 2008-09 M/s. Hirak Vyapaar Pvt. Ltd. आयकर अपीलीय अिधकरण कोलकाता 'ए' पीठ, कोलकाता म ¤ IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA ‘A’ BENCH, KOLKATA डॉ मनीष बोरड, ल े खा सदÖय एवं ®ी संजय शमा ª , Æयाियक सदÖय क े सम± Before DR. MANISH BORAD, ACCOUNTANT MEMBER & SONJOY SARMA, JUDICIAL MEMBER आयकर अपील सं ́या: 26 /कोल/ 2019 िनधा ª रण वष ª ः 2008-09 I.T.A. No.: 26/Kol/2019 Assessment Year: 2008-09 M/s. Hirak Vyapaar Pvt. Ltd....................................Appellant [PAN: AABCH 9133 M] Vs. ITO, Ward-6(1), Kolkata........................................Respondent Appearances by: None appeared on behalf of the Assessee. Md. Ghayasuddin, CIT, DR appeared on behalf of the Revenue. Date of concluding the hearing : September 21 st , 2022 Date of pronouncing the order : October 10, 2022 आदेश /O R D E R PER SONJOY SARMA, JUDICIAL MEMBER: This appeal of the assessee for the assessment year 2008-09 is directed against the order dated 20.03.2017 passed by the ld. Commissioner of Income-tax, Appeals [in short, hereinafter referred to as ‘the ‘ld. CIT(A)-7, Kolkata]. 2. ITA No. 26/Kol/2019 AY 2008-09 M/s. Hirak Vyapaar Pvt. Ltd. 2. When the case was called for, none appeared on behalf of assessee. A perusal of file shows that number of notices of hearing were sent including few through RP/AD, which have been returned unserved by the postal department. Asessee has not filed any paper book or written submissions. It seems that assessee is not interested to pursue this appeal. We, therefore, deem it proper to adjudicate the appeal on merits ex parte qua the assessee on the basis of material available on record and the assistance of the ld. DR. 3. The assessee has raised the following grounds of appeal for the AY 2008-09:- “i. That in the facts and under the circumstances of the case, the CIT(A) is unjustified and unlawful in confirming the order of the ld. Assessing Officer vide ex-parties order. ii. That the ld. Assessing Officer was not justified in considering the share capital and share premium received from various parties of Rs. 10,60,50,000/- as unexplained cash credit. iii. That the entire addition by the AO is based on mere suspicious and without any material evidence on record and hence liable to be deleted. iv. That the addition made by the AO is based on a pre-determined and biased mind-set and based on pure guess, surmises and conjecture which does not hold good in law. v. That the assessment has been made without appreciating the documents and explanation produced before the AO and without affording reasonable opportunity to the assessee. vi. That the ld. Assessing Officer was not justified in making addition on account of share capital as same was verified & certified by him in earlier years in detailed assessment. vii. That the addition made by ld. Assessing Officer and upheld by the ld. CIT(A) are liable to be set aside. viii. That the appellant may add, alter, delete, withdraw or modify any of the ground at the time of hearing of the matter with the leave of the Hon’ble ITAT.” 4. Brief facts of the case are that the assessee is a private limited company. The source of income is stated to be from investment in shares. Income at Rs. 630/- declared in e-return of income filed on 3. ITA No. 26/Kol/2019 AY 2008-09 M/s. Hirak Vyapaar Pvt. Ltd. 21.10.2008 for the AY 2008-09. Case selected for scrutiny through CASS (Computer Assisted Scrutiny Selection) followed by serving of statutory notices u/s. 143(2) and 142(1) upon the assessee. Subsequently, the ld. AO passed an assessment order u/s 147/143(3) on 17.06.2010 determining the total income at Rs. 34,430/-. Immediately after it, ld. CIT u/s 263 of the Act set aside the order passed u/s 148 by the AO. In the light of order passed u/s 263 of the Act, the case of the assessee was fixed and formal notice u/s 142(1) of the Act was issued to the assessee. The ld. A/R of the assessee appeared and submitted the power of attorney. The ld. AO observed that the assessee company has received an amount of Rs. 10,60,50,000/- as share subscription being share capital/share premium from the share-holders. Thereafter, the ld. AO issued notices u/s. 131 of the Act to appear personally along with relevant details/documents for examination/verification of (i) identity (ii) existence/identity/sources of funds and creditworthiness (iii) genuineness of the transaction. But the alleged creditors who have subscribed the amounts in the assessee company did not appear before the ld.AO for the same and remained non-compliance. Therefore, the ld. AO proceeded to frame the assessment u/s. 143(3)/147/263 of the Act on the basis of as material available before him. The ld. AO was not satisfied with the identity, creditworthiness and genuineness of said transaction of share capital/ share premium of Rs. 10,60,50,000/- received by the assessee company from the alleged subscribers/creditors. He accordingly completed/passed the assessment u/s. 143(3)/147/263 of the Act making addition u/s. 68 of the Act for unexplained cash credit of Rs. 10,60,50,000/- and assessed assessee’s income at Rs. 6,20,06,615/-. 4. ITA No. 26/Kol/2019 AY 2008-09 M/s. Hirak Vyapaar Pvt. Ltd. 5. Aggrieved, the assessee preferred appeal before the ld. CIT(A) challenging the impugned addition made u/s. 68 of the Act at Rs. 10,60,50,000/-. Apart from filing appeal, the assessee made no further efforts before the ld. CIT(A) did not file any other documentary evidence in support of its claim. As the assessee failed to do so, ld. CIT(A) confirmed the addition. 6. Aggrieved, now the assessee is in appeal before this Tribunal. Again the assessee failed to appear before us on any of the dates of hearing. Except filing this appeal before us. It clearly indicates that the assessee is only trying to delay the proceeding and has nothing to place on record. On the other hand, the ld. DR vehemently argued supporting the orders of lower authorities and prayed for confirming the order of ld. CIT(A). 7. We have heard the ld. DR and perused the material placed on record before us. The assessee has challenged the finding of the ld. CIT(A) confirming the addition made u/s. 68 of the Act at Rs. 10,60,50,000/- by the ld. AO for unexplained cash credits of share capital and security premium received during the year. We notice that the assessee company had offered meagre income of Rs. 630/- for the AY 2008-09. The assessee company has been able to procure share capital/share premium at Rs. 10,60,50,000/-. Statutory notice u/s. 131 of the Act duly served upon the alleged directors but none complied. Assessee failed to produce the alleged shareholders before the ld. AO for identity, creditworthiness and genuineness of the transaction. Even after providing sufficient opportunity no submission was made either before the ld. AO and ld. CIT(A) nor before us in this regard. The assessee was asked to explain the cash credits received by it during the 5. ITA No. 26/Kol/2019 AY 2008-09 M/s. Hirak Vyapaar Pvt. Ltd. year. The assessee failed to file necessary details to explain the source of alleged cash credit and also unable to prove identity, creditworthiness of the cash creditors as well as genuineness of the transaction as per section 68 of the Act. The assessee company has miserably failed to explain the source of alleged cash credit. If the assessee had sufficient details to explain the alleged sum, it could have certainly filed those details. Consistently escaping from appearing before the ld. AO and the appellate authority (ld. CIT-A) indicates that the assessee has no plausible explanation to explain the source of alleged sum of share capital and security premium. If the assessee is unable to explain the alleged cash credit and consistent escaped, the provisions of section 68 of the Act are attracted. Thus, it is held that the assessee has routed its unaccounted income in the books of account in the form of share capital and security premium by arranging bogus share capital and share premium through accommodation entry provider. 8. Therefore, under these facts and circumstances, we find no infirmity in the finding of the ld. CIT(A) confirming the addition of Rs. 10,60,50,000/- made u/s. 68 of the Act and the same is confirmed. Thus, grounds of appeal raised by the assessee are dismissed. 9. In the result, the appeal of the assessee is dismissed. Order pronounced in the open Court on 10.10.2022 Sd/- Sd/- (MANISH BORAD) (SONJOY SARMA) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated : 10.10.2022 Biswajit, Sr. P.S. 6. ITA No. 26/Kol/2019 AY 2008-09 M/s. Hirak Vyapaar Pvt. Ltd. आदेशकȧĤǓतͧलͪपअĒेͪषत / Copy of Order Forwarded to:- 1.अपीलाथȸ/Appellant/: M/s. Hirak Vyapaar Pvt. Ltd., C/o. Taraknath Jaiswal, Advocate, Siddha Weston, Unit No. 115, 1 st Floor, 9 Weston Street, Kolkata-700012. 2. Ĥ×यथȸ/Respondent/: Income Tax Officer, Ward 6(1), Kolkata. 3. संबंͬधतआयकरआय ु Èत/ Concerned CIT 4.आयकरआय ु Èत- अपील / CIT (A) 5. ͪवभागीयĤǓतǓनͬध,आयकरअपीलȣयअͬधकरणकोलकाता / DR, ITAT, Kolkata 6.गाड[फाइल/ Guard file. True Copy/ By order Assistant Registrar ITAT, Kolkata Benches, Kolkata