M/s. Everyday Commercial Pvt. Ltd., Rajasthan V. ITO, Ward - 2(2), Kolkata

ITA 301/KOL/2023

• Counselvise Citation: [2023] 101 COUNSELVISE.COM (IT) 9962 (ITAT-KOLKATA)
• Duration Of Justice: 7 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-11-2023
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: B
• Next Hearing Date: 25-09-2023
• Assessment Year: 2018-2019
• Appeal Filed On: 30-03-2023
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: MIRAJ D. SHAH
• Section: 142(1); 250; 143(2)

Judgement Text

| आयकर अपीलीय अिधकरण ᭠यायपीठ, कोलकाता | IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, KOLKATA BEFORE SHRI SANJAY GARG, HON’BLE JUDICIAL MEMBER & DR. MANISH BORAD, HON’BLE ACCOUNTANT MEMBER I.T.A. No. 301/Kol/2023 Assessment Year: 2018-19 M/s. Everyday Commercial Pvt. Ltd. House No. 3, Chawla Colony Near Toll Tax Behind Power House Sikar Road, Tatiyawas Jaipur - 302019 [PAN : AABCE0994P] Vs Income Tax Officer, Ward – 2(1), Kolkata अपीलाथᱮ/ (Appellant) ᮧ᭜ यथᱮ/ (Respondent) Assessee by : Shri Miraj D. Shah, A/R Revenue by : Shri P.P. Barman, Addl. CIT, Sr. D/R सुनवाई कᳱ तारीख/Date of Hearing : 26/09/2023 घोषणा कᳱ तारीख /Date of Pronouncement: 16/11/2023 आदेश/O R D E R PER DR. MANISH BORAD, ACCOUNTANT MEMBER : The present appeal is directed at the instance of the assessee against the order of the National Faceless Appeal Centre, Delhi (hereinafter the “ld. CIT(A)”) dt. 02/02/2023, passed u/s 250 of the Income Tax Act, 1961 (“the Act”) for the Assessment Year 2018-19. 2. The assessee has raised the following grounds of appeal:- “1. That the Order u/s 250 is bad in law as well as on facts of the case. 2. That the Hon'ble CIT, NFAC erred in law as well as on facts of the by confirming the addition in respect of rental income of Rs 1,80,000/- by treating the same as income from other sources. 3. That the Hon'ble CIT, NFAC erred in law as well as on facts of the case by confirming the disallowance in respect of interest on borrowed capital of Rs 24,99,064/-which was claimed u/s 24(b) under the head of Income from House Property by the Assessee 4. That the appellant craves to leave, add, amend or adduce any of the grounds of appeal during the course of assessment proceedings.” 2 I.T.A. No. 301/Kol/2023 Assessment Year: 2018-19 M/s. Everyday Commercial Pvt. Ltd. 3. At the outset, the ld. Counsel for the assessee submitted that vide the order of the National Company Law Tribunal (NCLT), the assessee company was amalgamated with Monitor Real Estate Pvt. Ltd. (MREPL) vide order dt. 15/03/2019 and a letter was given to the Income tax Officer, Ward – 2(1), Kolkata along with copy of the petition stating that the matter relating to amalgamation of assessee company and other companies with MREPL is listed before the Hon’ble NCLT and the Hon’ble NCLT vide its order directed to serve notice of petition to various authorities, namely, Central Government, Income tax Authorities, registrar of companies within 50 days before the day fixed for hearing. The ld. Counsel for the assessee, however, stated that the said intimation was sent by speed post from Jaipur, Rajasthan and it was delivered with the income tax office, Kolkata on 20/03/2019. Based on these facts, he stated that the assessment order dt. 06/04/2021 passed in the name of Everyday Commercial Private Limited, is non-est as the assessee company was amalgamated and the proceedings if any, could have been only in the name of transferee company, namely, MREPL. He further submitted that, since the assessment order is invalid, all the proceedings thereafter carried out by the ld. CIT(A) have become bad in law. 4. The ld. D/R, on the other hand, submitted that the assessment order has been passed by the National e-assessment centre, Delhi and the impugned order is also passed by National Faceless Appeals Centre and the ld. CIT(A) has rightly dismissed the appeal being 3 I.T.A. No. 301/Kol/2023 Assessment Year: 2018-19 M/s. Everyday Commercial Pvt. Ltd. barred by limitation as there was a delay of 231 days in filing of the appeal and no plausible reason for such delay has been given. 5. We have heard rival contentions and perused the material placed before us. The first ground of appeal is in respect of the order u/s 250 of the Act being bad in law as well as on facts of the case as the assessment order has been framed on a non-existing entity. It has been admitted before us that through the order of the National Company Law Tribunal, various entities including the assessee, namely, Everyday Commercial Pvt. Ltd. amalgamated with MREPL and the scheme of amalgamation came into operation from 01/04/2018 and came into effect before 21/08/2019. The ld. Counsel for the assessee has claimed that the letter was given to the Income Tax Officer, Ward – 2(1), Kolkata on 18/03/2019 which was duly delivered on 20/03/2019 and complete details of the said process of amalgamation was given and this letter was signed by MREPL which is a company based at Jaipur, Rajasthan. 6. We observe that in the said letter claimed to be delivered to the Income Tax Officer, Ward – 2(1) on 20/03/2019, the same is given by a company, namely, MREPL. The PAN No. of this company is mentioned but admittedly, MREPL is not registered in Kolkata and the PAN was not lying with the assessing authority, namely, ITO Ward- 2(1), Kolkata. Thus, it becomes hard to believe that what could have been the course of action at the end of the revenue authorities on receiving this letter dt. 18/03/2019. Moving further we notice that the assessment proceedings were initiated by issuing notice u/s 143(2) of the Act on 28/09/2019 and subsequently notice u/s 142(1) of the Act 4 I.T.A. No. 301/Kol/2023 Assessment Year: 2018-19 M/s. Everyday Commercial Pvt. Ltd. were issued on various dates along with questionnaire through e- mail/e-filing portal and were duly served upon the assessee. It means that almost after six months of the date of letter allegedly given to ITO Ward-2(1), Kolkata, the assessee company was well served with the notice u/s 143(2) and 142(1) of the Act. Further in response to these notices, assessee company had submitted computation of income and copy of ledger account. It is surprising to notice that when the assessee company had submitted these details it could have easily submitted the NCLT order as well as the information about the said amalgamation of the assessee company with MREPL. But no such action has been taken by the assessee. It is also noteworthy that the assessment order has not been framed by the Assessing Officer having PAN jurisdiction but it is assessment made by the National e- Assessment Centre and it is not known that the letter given by a company based at Jaipur and assessed at Jaipur will be taken note by the assessing authorities here at Kolkata, when no such details about the assessee company or its PAN No. was mentioned in the letter and, therefore, whether such information was available with the Assessing Officer, remains in serious doubt. Further the assessee has filed complete details before the ld. CIT(A) but it was delayed by 231 days and before us also no reason has been mentioned for the said delay. 7. We, however considering the facts that amalgamation process has completed and the assessee company has merged with MREPL and, therefore, even if the issues are restored to the lower authorities, the assessments cannot be framed in the name of the merged entity. Therefore, so far as the assessment order in question is concerned, the 5 I.T.A. No. 301/Kol/2023 Assessment Year: 2018-19 M/s. Everyday Commercial Pvt. Ltd. same deserves to be quashed. However, an opportunity is granted to the revenue authorities to pass on the information to the Assessing Officer of the merged entity, namely, MREPL and to carry out the proceedings to assess the income in dispute before us in accordance with law. 8. In the result, appeal of the assessee is allowed for statistical purposes. Order pronounced in the Court on 16 th November, 2023 at Kolkata. Sd/- Sd/- (SANJAY GARG) (DR. MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER Kolkata, Dated 16/11/2023 *SC SrPs आदेश कᳱ ᮧितिलिप अᮕेिषत/Copy of the Order forwarded to : 1. अपीलाथᱮ / The Assessee 2. ᮧ᭜यथᱮ / The Respondent 3. संबंिधत आयकर आयुᲦ / Concerned Pr. CIT 4. आयकर आयुᲦ)अपील (/ The CIT(A)- 5. िवभागीय ᮧितिनिध ,आयकर अपीलीय अिधकरण, कोलकाता/DR,ITAT, Kolkata, 6. गाडᭅ फाई/ Guard file. आदेशानुसार/ BY ORDER, TRUE COPY Assistant Registrar आयकर अपीलीय अिधकरण ITAT, Kolkata