Rissala Decor Pvt Ltd, Gurgaon V. Pr. CIT, Gurgaon

ITA 2895/DEL/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 9856 (ITAT-DELHI)
• Duration Of Justice: 9 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-01-2020
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: F
• Assessment Year: 2014-2015
• Appeal Filed On: 03-04-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Revision of order; Period of limitation; Fair market value; Valuation report; Time period of passing order
• Section: 143(3); 142(1); 56(2); 13; 68; 263; 63

Judgement Text

FIT FOR PUBLICATION SD/- SD/- (JM) (AM) IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH: F: NEW DELHI) BEFORE SHRI AMIT SHUKLA, JUDICIAL MEMBER AND SHRI ANADEE NATH MISSHRA, ACCOUNTANT MEMBER ITA NO:- 2895/DEL/2019 ( ASSESSMENT YEAR: 2014-15) RISSALA DCOR PVT. LTD., GURGAON. VS. PR. CIT, GURGAON. PAN NO: AAECR7761C APPELLANT RESPONDENT ASSESSEE BY : SHRI M.R. SAHU, CA REVENUE BY : SHRI SULEKHA VEMA, CIT(DR) PER ANADEE NATH MISSHRA, AM (A) THIS APPEAL BY ASSESSEE IS FILED AGAINST THE IMPUG NED REVISIONARY ORDER DATED 05.03.2019 OF LEARNED PRINCIPAL COMMISSIONER OF INC OME TAX, GURGAON, [LD. PR. CIT, FOR SHORT], FOR ASSESSMENT YEAR 2014-15. GRO UNDS TAKEN IN THIS APPEAL OF ASSESSEE ARE AS UNDER: 1. THAT THE LEARNED PR.CIT ERRED IN LAW AND ON FACTS I N INVOKING THE PROVISIONS OF SECTION 263 OF THE INCOME TAX ACT 196 1 AND PASSING THE ORDER DATED 05:03.2019. THE ORDER-PASSED AND THE VA RIOUS DIRECTIONS GIVEN ARE BAD IN LAW, ARBITRARY, ERRONEOUS AND UNCA LLED FOR IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE MATERIA L ON RECORD. THE ORDER THERE FORE DESERVES TO BE QUASHED. 2. MAINTAINABILITY / VALIDITY OF REVISIONARY PROCEEDINGS U/S 263 TOWARDS JUSTIFICATION OF SHARE PREMIUM WITH REGARD TO FMV OF EQUITY SHARES COMPUTED UNDER 'DCF' METHOD: 2.1 THAT IN VIEW OF THE WRITTEN REPLIES DATED 21 ST JANUARY ,2019 AND 11 TH FEBRUARY ,2019 TO THE NOTICE U/S 263 WITH ALL THE ENCLOSURES FILED INCLUDING AFFIDAVITS FROM INVESTORS IN THE EQUITY SHARES AND THE ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 2 OF 34 ORAL ARGUMENTS ADVANCED BEFORE HIM DURING THE HEARI NGS THE LEARNED PR.CIT ERRED IN LAW AND IN FACTS IN STILL H OLDING THAT THE ORDER PASSED BY THE AO WAS ERRONEOUS AND PREJUDICIA L TO THE INTEREST OF REVENUE WITHOUT CONTRACTING THE VARIOUS CLAIMS, THROUGH ANY COGENT MATERIAL OR ON ANY PROPER BASIS. THE ORDER U/S. 263 THEREFORE, DESERVES TO-BE-QUASHED. 2.2 THAT ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE PR.CIT HAD ERRED IN INVOKING PROVISIONS OF SECTION 263 WIT HOUT APPRECIATING THE FACT THAT THE FMV OF EQUITY SHARES ISSUED DETERMINED BY THE ASSESSEE UNDER 'DCF' METHOD PREPA RED BY CHARTERED ACCOUNTANT WAS BASED ON THE PROJECTIONS ( ESTIMATIONS) ONLY COULD NOT BE COMPARED WITH THE ACTUALS AND AO HAD NO AUTHORITY TO CHANGE VALUATION METHOD ADOPTED BY THE ASSESSEE. THE AO HAD PASSED THE ASSESSMENT ORDER ACCEPTING TH E FMV OF EQUITY SHARES DETERMINED UNDER 'DCF' METHOD AFTER D ETAILED EXAMINATION OF FACTS IN THE APPELLANTS' CASE AND PO SITION OF LAW HAD FOLLOWED ONE OF THE COURSE PERMISSIBLE IN LAW A ND ACCORDINGLY ORDER DATED 5 TH MARCH 2019 PASSED BY THE PR.CIT UNDER SECTION 263(1) OF THE I.T. ACT, 1961 IS WITHOUT JURISDICTIO N, VOID AN INITIO AND DESERVES TO BE QUASHED. 2.3 THAT WITHOUT PREJUDICE TO THE ABOVE, THE LEARNED PR .CIT ERRED IN LAW AND ON FACTS WITHOUT APPRECIATING THE FACT THAT PROVISIONS OF SEC 56(2)(VIIB) CANNOT BE INVOKED IN THE CASE OF TH E ASSESSES COMPANY -BECAUSE BY VIRTUE OF CASH BEING BROUGHT IN TO THE ASSESSEE COMPANY BY CLOSE RELATIVES FOR ALLOTMENT O F EQUITY SHARES WITH PREMIUM THE BENEFIT HAS ONLY PASSED TO THE CLO SE RELATIVE DIRECTORS AND THERE IS NO SCOPE IN THE ACT TO TAX W HEN CASH OR ASSET IS TRANSFERRED BY A -CLOSE-RELATIVE TO OTHER CLOSE RELATIVES. 2.4 THAT ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE PR.CIT ORDER UNDER SECTION 263 SETTING ASIDE THE ASSESSMEN T BE CANCELLED AND AO'S ORDER -UNDER SECTION 143(3) DATED 12.05.20 16 BE RESTORED. 3. MAINTAINABILITY / VALIDITY OF REVISIONARY PROCEEDING S TOWARDS VERIFICATION OF IDENTITY,GENUINENESS AND CREDITWORTHINESS OF THE PERSONS FROM WHOM SHARE PREMIM WAS RECEIVED: 3.1 THAT IN VIEW OF THE DOCUMENTS SUBMITTED BEFORE THE AO DURING COURSE OF SCRUTINY ASSESSMENT VIDE LETTER DATED 4 TH MAY 2016,9 TH MAY 2016 INCLUDING WRITTEN REPLIES DATED 21 ST JANUARY 2019 TO THE NOTICE DATED 29.11.2018 ISSUED UNDER SECTION 263 WITH AIL ENCLOS URES SUBMITTED BEFORE PR.CIT, HE HAS NOT BROUGHT ON RECORD AND COG ENT AND CONCLUSIVE MATERIAL WHICH WOULD PROVE OR SHOW THAT THE COURSE FOLLOWED BY THE AO WAS UNSUSTAINABLE IN LAW. THE OR DER PASSED BY PR.CIT THEREFORE, DESERVES TO BE QUASHED. 3.2 THAT ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, WHEN THE AO AFTER CONDUCTING NECESSARY ENQUIRIES, WHICH THE CIR CUMSTANCES DEMANDED, HAD ACCEPTED THE DOCUMENTS SUBMITTED BEFO RE HIM AND ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 3 OF 34 HAD FOLLOWED ONE OF THE POSSIBLE COURSE PERMISSIBLE IN LAW, THEN IT WAS NOT OPEN TO THE PR.CIT TO TREAT THE ASSESSMENT ORDER ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE WITHIN M EANING OF SECTION 263 OF THE ACT. THERE FORE THE THE PR.CIT ORDER UND ER-SECTION 263 SETTING ASIDE-THE ASSESSMENT BE CANCELLED AND AO'S ORDER UNDER SECTION 143(3) DATED 12.05.2016 BE RESTORED. 4. THAT THE ASSESSEE CRAVES THE RIGHT TO AMEND, ADD, D ELETE, REPLACE, ALL OR ANY OF THE GROUNDS OF APPEAL EITHER DURING THE COUR SE OF HEARING OR AT ANY TIME BEFORE HEARING OF THIS APPEAL. (B) ASSESSMENT ORDER DATED 12.05.2016 UNDER SECTION 14 3(3) OF INCOME TAX ACT, 1961 (I.T. ACT, FOR SHORT) WAS PASSED BY THE ASSE SSING OFFICER (AO, FOR SHORT), WHEREIN THE RETURNED LOSS OF RS. 1,17,84,680/- WAS ACCEPTED BY THE AO. THE ASSESSMENT ORDER IS REPRODUCED BELOW FOR READY REFE RENCE: ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 4 OF 34 (B.1) VIDE SHOW CAUSED NOTICE DATED 29.11.2018, THE LEAR NED PRINCIPAL COMMISSIONER OF INCOME TAX, GURGAON (LD. PCIT, FO R SHORT), INITIATED REVISION PROCEEDINGS UNDER SECTION 263 OF THE I.T. ACT. THE AFORESAID NOTICE IS REPRODUCED BELOW FOR READY REFERENCE: ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 5 OF 34 (B.3) SUBSEQUENTLY, ORDER UNDER SECTION 263 OF I.T. ACT D ATED 05.03.2019 WAS PASSED BY THE LD. PCIT IS REPRODUCED BELOW FOR READ Y REFERENCE: ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 6 OF 34 ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 7 OF 34 ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 8 OF 34 ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 9 OF 34 (C) THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE AFORESAID ORDER DATED 05.03.2019 PASSED BY LD. PCIT UNDER SECTION 2 63 OF I.T. ACT. IN THE COURSE OF APPELLATE PROCEEDINGS IN INCOME TAX APPELLATE TRIBU NAL (ITAT, FOR SHORT) A PAPER BOOK CONTAINING 138 PAGES WAS FILED FROM THE ASSESS EES SIDE, HAVING THE FOLLOWING PARTICULARS: 1. AUDITORS REPORT REPORT FOR THE FY 2013-14 RELEVANT TO AY 2014-15 2. EQUITY SHARE VALUATION REPORT UNDER RULE 11UA (2)(B ) UNDER DFCF METHOD 3. RETURN FILED ON 05/11/2014 VIDE E FILING ACT. NO: 4 01465931051114 4. NOTICE ISSUED U/S 142(1) DATED 02/05/2016 ISSUED BY AO 5. REPLY DATED 04 TH MAY 2016 IN RESPONSE TO NOTICE ISSUED U/S 142(1) 6. REPLY DATED 04 TH 09 TH MAY 2016 IN RESPONSE A NOTICE ISSUED U/S 142(1) 7. ASSESSMENT ORDER DATED 12/05/2016 PASSED U/S 143(3) 8. SHOW CAUSE NOTICE DATED 29/11/2018 ISSUED U/S 263 B Y PR. CIT, GURGAON 9. WRITTEN SUBMISSION DATED 21/01/2019 WITH PAPER BOOK SUBMITTED BEFORE PR. CIT 10. WRITTEN SUBMISSION DATED 11/02/2019 WITH AFFIDAVITS SUBMITTED BEFORE PR. CIT AFFIDAVITS OF SHARE APPLICANTS. ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 10 OF 34 1. BY SMT. CHITRA KATARIA- ALLOTTED EQUITY SHARES- 35, 000 NOS 2. BY SH. JAGAT SINGH KATARIA- ALLOTTED EQUITY SHARES- 15,999 NOS 3. BY SH. KAMALJEET KATARIA - ALLOTTED EQUITY SHARES- 87,400 NOS 4. BY SMT. SANGEETA AHLAWAT - ALLOTTED EQUITY SHARES- 1,43,450 NOS 5. BY SMT. SULEKHA KATARIA - ALLOTTED EQUITY SHARES- 2 2,200 NOS 6. BY SMT. SUMAN KATARIA - ALLOTTED EQUITY SHARES- 14, 500 NOS 7. BY SH. VIJAY JEET KATARIA - ALLOTTED EQUITY SHARES- 1,05,065 NOS 8. BY SH. AJAY AHLAWAT - ALLOTTED EQUITY SHARES- 85,00 0 NOS 11. ORDER DATED 05/03/2019 PASSED U/S 263 SETTING ASIDE ORDER DATED 12/05/2016 12. GROUNDS OF APPEAL RAISED BEFORE TRIBUNAL IN ITA NO: 2895/DEL/2019 13. ASSESSEE CO. DETERMINED FMV UNDER DFCF METHOD IN ACCORDANCE WITH RULE 11UA(2)(B) READ WITH SECT 56(2)(VIIB) AND VALUATION REPORT WAS PREPARED BY CA AS PER GUIDELINES OF ICAI AND NO FAULT WAS FIND BY AO SAME SHALL BE ACCEPTED AND CANNOT BE REJECTED. RAMESHWAREM STRONG GLASS (P.) LTD VS. ITO (2018) 17 2 ITD 571 (JP. TRIB) 14. BASIS ADOPTED BY ASSESSEE CAN NOT BE CHANGED BY AO VODAFONE M-PESA LTD VS. PR. CIT (2018) 92 TAXMANN.C OM (BOM. HC) 15. PROVISIONS OF SEC 56(2) (VIIB) CAN NOT BE INVOKED W HERE SHARE APPLICANTS ARE CLOSE RELATIVES OF THE DIRECTORS. VANNI ESTATES (P.) LTD. VS. ITO (2018) 172 ITD 629 (CHENNAI TRIB.) 16. SUBMISSIONS OF THE ASSESSEE WAS REJECTED AND MATTER WAS MERELY TO AO FOR FRESH ASSESSMENT NO ENQUIRY WAS DONE BY PR. CIT NO REVISION ORDER U/S 263. AMENDMENT TO SECT 263 W.E.F. 1 ST 2015 APPLIES PROSPECTIVELY. M/S ARUN KUMAR GARG HUF VS. PR. CIT ITA NO.: 3391/D EL/2019, AY 2014-15 ORDER DATED 08/01/2019. (DEL. TRIB) 17. ORDER OF ASSESSMENT PASSED BY AO SHOULD NOT BE INTE RFERED WITH ONLY BECAUSE ANOTHER VIEW IS POSSIBLE. STATE BANK OF INDIA VS. PR. CIT (2019) 111 TAXMANN. COM 252 (MUM. TRIB.) (C.1) IN ADDITION THE FOLLOWING DOCUMENTS WERE ALSO FILE D FROM THE ASSESSEES SIDE: 1. DURING THE FY 2014-15 RELEVANT TO AY 2015-16, E QUITY SHARES 1,35,366 NOS WERE ISSUED TO 7 SHARE HOLDERS EXCEPT TO SH. AJAY A HLAWAT AS PER LIST ENCLOSED. 2. AUDITED FINANCIALS SHOWING ISSUED OF EQUIRTY SHA RES OF RS. 10/- EACH AT PREMIUM RS. 90 PER SHARE IS ENCLOSED, 3. ASSESSMENT ORDER PASSED DATED 30/12/2017- ADDITI ON OF RS. 15,21,900/- RELATING TO 15,219 EQUITY SHARES ISSUED TO SH. VIJA Y KATARIA WAS MADE U/S 68. ASSESSMENT ORDER COPY IS ENCLOSED. 4. CIT(A) IN APPEAL NO. 419/17-18 VIDE ORDER DATED 29/06/2018 DELETED THE ADDITION. APPEAL ORDER COPY IS ENCLOSED. ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 11 OF 34 (C.2) MOREOVER, SYNOPSIS WAS ALSO FILED FROM THE ASSESSEE S SIDE WHICH IS REPRODUCED BELOW FOR READY REFERENCE: ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 12 OF 34 ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 13 OF 34 ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 14 OF 34 ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 15 OF 34 ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 16 OF 34 ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 17 OF 34 (C.3) IN ADDITION A FURTHER WRITE-UP, VIDE LETTER DATED 1 9.12.2019 WAS ALSO SUBMITTED FROM THE ASSESSEES SIDE WHICH IS REPRODUCED BELOW FOR READY REFERENCE: ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 18 OF 34 ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 19 OF 34 ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 20 OF 34 (D) ON THE OTHER HAND, WRITTEN SUBMISSIONS WERE FILED BY THE LEARNED COMMISSIONER OF INCOME TAX (DEPARTMENTAL REPRESENTA TIVE) [LD. CIT(DR), FOR SHORT] WHICH IS REPRODUCED BELOW: ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 21 OF 34 ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 22 OF 34 ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 23 OF 34 ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 24 OF 34 ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 25 OF 34 ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 26 OF 34 ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 27 OF 34 ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 28 OF 34 (E) ALTHOUGH, THE ASSESSEE HAS TAKEN NUMEROUS GROUNDS OF APPEAL, THE CORE ISSUE IN THE PRESENT APPEAL IS WHETHER THE AFORESAID IMPU GNED REVISIONARY ORDER DATED 05.03.2019 PASSED BY LD. PR. CIT UNDER SECTION 263 OF I.T. ACT IS IN ACCORDANCE WITH LAW. AT THE TIME OF HEARING BEFORE US, THE LEARNED AUTHORIZED REPRESENTATIVE (AR, ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 29 OF 34 FOR SHORT) OF THE ASSESSEE TOOK US THROUGH THE VARI OUS MATERIALS FILED FROM THE ASSESSEES SIDE, IN THE COURSE OF APPELLATE PROCEED INGS IN ITAT, ALREADY MENTIONED IN THE FOREGOING PARAGRAPHS (C) (C.1), (C.2) AND (C.3) OF THIS ORDER. HE DREW OUR PARTICULAR ATTENTION TO THE FACT THAT THE AO HAD CO NSIDERED THE DISCOUNTED CASH FLOW METHOD (DCF, FOR SHORT) FOR DETERMINING THE SHARE PREMIUM IN THE RESPECT OF EQUITY SHARE ISSUED BY THE ASSESSEE. HOWEVER, HE FAIRLY A DMITTED THAT NO ENQUIRIES WERE CONDUCTED AT THE END OF THE AO, AND FURTHER THAT NO MATERIALS WERE PLACED FROM ASSESSEES SIDE BEFORE THE AO DURING ASSESSMENT PRO CEEDINGS, TO ESTABLISH THE GENUINENESS OF CASH CREDIT WITHIN THE MEANING OF SE CTION 68 OF I.T. ACT, IN RESPECT OF ISSUE OF EQUITY SHARE AT PREMIUM. (E.1) ON THE OTHER HAND, THE LD. CIT(DR) DREW OUR ATTENT ION TO THE FACTS THAT THE ASSESSEES CASE WAS SELECTED FOR SCRUTINY THROUGH C ASS FOR THE PURPOSE OF VERIFICATION OF LARGE SHARE PREMIUM RECEIVED DURING THE YEAR. S HE FURTHER SUBMITTED THAT THE VERIFICATION OF LARGE SHARE PREMIUM INVOLVED TWO AS PECTS: FIRSTLY, THE AO WAS REQUIRED TO VERIFY THE GENUINENESS WITHIN THE MEANING OF SEC TION 68 OF I.T. ACT IN RESPECT OF THE ENTIRE AMOUNT OF SHARE CAPITAL RECEIVED BY THE ASSESSEE DURING THE YEAR. SECONDLY, THE LD. CIT(DR) CONTENDED THAT THE AO WAS REQUIRED TO VERIFY WHETHER THE AMOUNT OF SHARE PREMIUM PAID FOR EACH EQUITY SHARE WAS NOT EX CESSIVE, HAVING REGARD TO PROVISIONS OF LAW. IN THE PRESENT CASE, THE LD. CI T(DR) SUBMITTED, THE AO HAD COMPLETELY FAILED IN CARRYING OUT THE AFORESAID FIR ST ASPECT OF VERIFICATION; ALTHOUGH, SHE FAIRLY ACCEPTED THAT VERIFICATION IN REGARD TO QUANTUM OF SHARE PREMIUM PAID (AS PER DCF METHOD) WAS CARRIED OUT BY THE AO. THE LD. CIT(DR) CONTENDED THAT HAVING ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 30 OF 34 REGARD TO THE COMPLETE FAILURE ON THE PART OF THE A O TO CARRY OUT THE AFORESAID FIRST ASPECT OF VERIFICATION; IT WAS A FIT CASE FOR EXERC ISE OF REVISIONAL POWERS OF THE LD. PR. CIT UNDER SECTION 263 OF I.T. ACT. SHE FURTHER SUB MITTED THAT THE JUDICIAL PRECEDENTS IN THE CASES OF GEE VEE ENTERPRISES V. ADDL. CIT [1975] 99 ITR 375 ( DELHI), RAMPYARI DEVI SARAOGI V. CIT [1968] 67 ITR 84 (SC) AND SMT. TARA DEVI AGGARWAL V. CIT [1973] 88 ITR 323 (SC), REFERRED TO BY THE LD. PR. CIT IN HIS IMPUGNED REV ISIONARY ORDER DATED 05.03.2019 PASSED UNDER SECTION 263 OF I.T. A CT, WERE SQUARELY APPLICABLE TO THE FACTS OF THE CASE. SHE FURTHER PLACED RELIANCE ON THE WRITTEN SUBMISSIONS FILED DURING APPELLATE PROCEEDINGS IN ITAT, WHICH HAVE AL READY BEEN REPRODUCED BY US IN FOREGOING PARAGRAPH (D) OF THIS ORDER. THE LD. CIT(DR) FURTHER SUBMITTED THAT ALTHOUGH NUMEROUS CASE LAWS AND JUDICIAL PRECEDENTS HAVE BEEN CITED FROM ASSESSEES SIDE IN THE VARIOUS MATERIALS [MENTIONED ALREADY IN FOREGOING PARAGRAPHS (C), (C.1), (C.2) AND (C.3) OF THIS ORDER]; THE FACTS WERE DISTINGUISHABLE AND WERE OF NO HELP TO THE ASSESSEE HAVING REGARD TO THE FACTS AND CIRCUMS TANCES OF THE PRESENT CASE. IN HIS REJOINDER, THE LD. AR OF THE ASSESSEE ONCE AGAIN RE ITERATED THE SUBMISSIONS AND CONTENTIONS RAISED IN VARIOUS MATERIALS [MENTIONED ALREADY IN FOREGOING PARAGRAPHS (C), (C.1), (C.2) AND (C.3) OF THIS ORDER]. HOWEVER, HE FAILED TO EXPLAIN HOW ANY OF THE JUDICIAL PRECEDENTS AND CASE LAWS CITED FROM TH E ASSESSEES SIDE WILL ADVANCE THE CASE OF THE ASSESSEE IN THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE. (F) WE HAVE HEARD BOTH SIDES PATIENTLY. WE HAVE PERUSE D THE MATERIALS AVAILABLE ON RECORD CAREFULLY. WE HAVE ALSO CONSIDERED THE V ARIOUS JUDICIAL PRECEDENTS AND CASE LAWS MENTIONED IN THE RECORDS WHICH WERE BROUGHT TO OUR ATTENTION IN THE COURSE OF ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 31 OF 34 APPELLATE PROCEEDINGS IN ITAT. LIMITATION PERIOD FO R PASSING ASSESSMENT ORDER UNDER SECTION 143(3) OF I.T. ACT IS PRESCRIBED UNDER SECT ION 153(1) OF I.T. ACT. ACCORDING TO THESE PROVISIONS, THE DEADLINE FOR PASSING ASSESSME NT ORDER UNDER SECTION 143(3) OF I.T. ACT, WAS 31.12.2016. HOWEVER, WE FIND THAT TH E AFORESAID ORDER HAS BEEN PASSED ON 12.05.2016; WHICH IS SEVERAL MONTHS AHEAD OF DEA DLINE PRESCRIBED UNDER I.T. ACT FOR PASSING ASSESSMENT ORDER UNDER SECTION 143(3) O F I.T. ACT READ WITH SECTION 153(1) OF I.T. ACT. FURTHER, IT IS NOT IN DISPUTE THAT THE CASE WAS SELECTED FOR SCRUTINY WITH THE MAIN REASON OF VERIFICATION OF LARGE SHARE PREMIUM RECEIVED DURING THE YEAR. MOREOVER, IT IS ALSO NOT IN DISPUTE THAT THE AO HAD COMPLETELY FAILED IN CARRYING OUT ANY VERIFICATION IN RESPECT OF THE SHARE CAPITAL IS SUED DURING THE YEAR FOR THE PURPOSE OF ASCERTAIN THE GENUINENESS OF THESE CASH CREDITS WITHIN THE MEANING OF SECTION 68 OF I.T. ACT. IT IS WELL SETTLED THAT IT IS THE INITIA L BURDEN OF THE ASSESSEE TO PROVE IDENTITY OF THE PERSON, GENUINENESS OF THE TRANSACTION AND F INANCIAL CAPACITY OF THE PERSON; AS FAR AS TRANSACTIONS COVERED BY SECTION 68 OF I.T. A CT ARE CONCERNED. FROM PERUSAL OF VARIOUS MATERIALS FILED FROM THE ASSESSEES SIDE DU RING THE APPELLATE PROCEEDINGS IN ITAT, ALREADY MENTIONED IN THE FOREGOING PARAGRAPHS (C), (C.1), (C.2) AND (C.3) OF THIS ORDER, IT IS EVIDENT THAT ALTHOUGH SOME MATERI ALS WERE PLACED FROM ASSESSEES SIDE BEFORE THE LD. PR. CIT IN THE COURSE OF REVISION PR OCEEDINGS UNDER SECTION 263 OF I.T. ACT IN AN ATTEMPT TO PROVE THE GENUINENESS OF CASH CREDIT WITHIN THE MEANING OF SECTION 68 OF I.T. ACT IN RESPECT OF SHARE CAPITAL ISSUED AT PREMIUM, NO SUCH MATERIALS WERE PLACED FROM THE ASSESSEES SIDE BEFORE THE AO DURING THE ASSESSMENT PROCEEDINGS; AND FURTHER, THAT NO EFFORT WAS MADE B Y THE AO TO ASCERTAIN THE GENUINENESS OF CASH CREDITS WITHIN THE MEANING OF S ECTION 68 OF I.T. ACT. THUS, WE ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 32 OF 34 CONCLUDE THAT THE AFORESAID ASSESSMENT ORDER DATED 12.05.2016 WAS PASSED WITHOUT MAKING INQUIRIES OR VERIFICATIONS WHICH SHOULD HAVE BEEN MADE FOR ASCERTAINING THE GENUINENESS OF THE CASH CREDITS WITHIN THE MEANING OF SECTION 68 OF I.T. ACT. WE ALSO NOTE THAT BY VIRTUE OF EXPLANATION 2 TO SECTIO N 263 OF I.T. ACT, W.E.F 1- 6-2015, AN ORDER PASSED, IN THE OPINION OF THE PRIN CIPAL COMMISSIONER OR COMMISSIONER OF INCOME TAX, WITHOUT MAKING INQUIRIE S OR VERIFICATIONS WHICH SHOULD HAVE BEEN MADE, SHALL BE DEEMED TO BE ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTERESTS OF REVENUE. HAVING REGARD TO AMENDED PROVISIONS OF SECTION 263 OF I.T. ACT W.E.F. 1-6-20 15 AND HAVING REGARD TO UNDISPUTED FACTS, THE AFORESAID JUDICIAL PRECEDENTS AND CASE L AWS RELIED UPON BY THE ASSESSEE, HAVE NO APPLICATION TO PRESENT APPEAL BEFORE US AND FAIL TO ADVANCE THE CASE OF THE ASSESSEE. THE LD. AR OF THE ASSESSEE HAD ALSO FAILE D TO EXPLAIN HOW, IN THE SPECIFIC FACTS AND CIRCUMSTANCES OF THIS CASE, THE JUDICIAL PRECEDENTS CITED FROM THE ASSESSEES SIDE, ADVANCE THE CASE OF THE ASSESSEE. IT CAN BE READILY INFERRED, CONSIDERING THE UNDISPUTED FACTS, THAT THE ASSESSMENT ORDER WAS PAS SED BY THE AO WITHOUT MAKING INQUIRIES AND VERIFICATIONS WHICH SHOULD HAVE BEEN MADE FOR ASCERTAINING THE GENUINENESS OF CASH CREDITS WITHIN THE MEANING OF S ECTION 68 OF I.T. ACT. THIS, BY ITSELF, IS SUFFICIENT FOR US, TO UPHOLD THE IMPUGNE D REVISIONARY ORDER DATED 05.03.2019 OF LEARNED OF PR. CIT, PASSED UNDER SECTION 263 OF I.T. ACT. COUPLED WITH THAT, IS THE FACT, AS WE HAVE ALREADY NOTED EARLIER, THAT THE AS SESSMENT ORDER HAS BEEN PASSED SEVERAL MONTHS AHEAD OF THE DEADLINE PRESCRIBED UND ER I.T. ACT. WHEN AN ASSESSMENT ORDER IS PASSED SEVERAL MONTHS AHEAD OF PRESCRIBED DEADLINE WITHOUT MAKING ENQUIRIES AND VERIFICATIONS WHICH SH OULD HAVE BEEN MADE; ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 33 OF 34 IT CAN BE SAID THAT THE ORDER WAS PASSED WITHOUT DU E APPLICATION OF MIND, AND IN AVOIDABLE HASTE; AND THAT MAKES A STRONGER C ASE FOR EXERCISE OF JURISDICTION UNDER SECTION 263 OF I.T. ACT. FURTHER, THE JUDICIAL PRECEDENTS IN THE CASES OF GEE VEE ENTERPRISES V. ADDL. CIT (SUPRA), RAMPYARI D EVI SARAOGI V. CIT (SUPRA) AND SMT. TARA DEVI AGGARWAL V. CIT (SUPRA); CITED IN THE IMPUGNED REVISIONARY ORDER DATED 05.03.2019 OF THE PR. CIT P ASSED UNDER SECTION 263 OF I.T. ACT ARE SQUARELY APPLICABLE TO THE FACTS OF THE CAS E ESPECIALLY HAVING REGARD TO AMENDED PROVISIONS OF SECTION 263 OF I.T. ACT W.E.F . 1-6-2015. FURTHERMORE, THE JUDICIAL PRECEDENTS AND CASE LAWS MENTIONED BY THE LD. CIT(DR), ALREADY REPRODUCED IN FOREGOING PARAGRAPH (D) OF THIS ORDER, ALSO STRENGTHEN THE CASE OF REVENUE . IN VIEW OF THE FOREGOING, WE ARE OF THE VIEW THAT THE IMPUGNED REVISIONARY ORDER DATED 05.03.2019 PASSED BY LD. PR. CIT UNDER SECTION 263 OF I.T. ACT IS IN ACCORDANCE WITH LAW, HAVING REGARD TO SPECIFIC FACTS AND CIRCUMSTAN CES OF THE PRESENT APPEAL BEFORE US. THEREFORE, WE DECLINE TO INTERFERE WITH THE AF ORESAID IMPUGNED REVISIONARY ORDER DATED 05.03.2019 OF LD. PR. CIT PASSED UNDER SECTIO N 263 OF I.T. ACT. ACCORDINGLY, THE AFORESAID IMPUGNED REVISIONARY ORDER DATED 05.0 3.2019 OF LD. PR. CIT PASSED UNDER SECTION 263 OF I.T. ACT, IS UPHELD AND THE AP PEAL IS DISMISSED. ORDER IS PRONOUNCED IN OPEN COURT ON 03/01/20. SD/- SD/- (AMIT SHUKLA) (ANAD EE NATH MISSHRA) JUDICIAL MEMBER ACCOUNTANT MEMBE R DATED: 03/01/20. POOJA/- ITA NO.- 2895/DEL/2019 M/S RISSALA DCOR PVT. LTD. PAGE 34 OF 34 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI DATE OF DICTATION DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. PS/PS DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/PS DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT DATE ON WHICH THE FILE GOES TO THE BENCH CLERK DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER