Super Plastronics Pvt. Ltd., New Delhi V. ITO, New Delhi

ITA 3885/DEL/2014

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 8806 (ITAT-DELHI)
• Duration Of Justice: 5 year(s) 2 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-09-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 04-05-2017
• Assessment Year: 2004-2005
• Appeal Filed On: 07-07-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Additional evidence; Reassessment proceedings
• Section: 147; 68; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH G, NEW DELHI BEFORE SH. R. K. PANDA, ACCOUNTANT MEMBER AND SH. KULDIP SINGH, JUDICIAL MEMBER ITA NO.3885/DEL/2014 ASSESSMENT YEAR: 2004-05 SUPER PLASTRONICS PVT. LTD E-118, GREATER KAILASH PART-I NEW DELHI-110048 PAN NO.AACFS9943C VS ITO WARD- 9 (4) NEW DELHI (APPELLANT) (RESPONDENT) APPELLANT BY SH. VED JAIN, CA RESPONDENT BY SH. N. K. BANSAL, SR. DR DATE OF HEARING: 05/09/2019 DATE OF PRONOUNCEMENT: 13/09/2019 ORDER PER R.K. PANDA, AM: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER DATED 07.04.2014 OF THE CIT(A)-11, NEW DELHI RELATING TO A. Y. 2004-05. 2. FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSES SEE IS A COMPANY AND HAD FILED ITS RETURN OF INCOME ON 01.11 .2014 DECLARING TOTAL INCOME OF RS.4,42,670/-. THE RETURN WAS PROCESSED U/S. 143 (1). SUBSEQUENTLY THE CASE OF T HE ASSESSEE WAS REOPENED U/S. 147 OF THE ACT AFTER RECORDING RE ASONS AND THEREAFTER NOTICE U/S. 148 WAS ISSUED. THE ASSESSE E IN RESPONSE PAGE | 2 TO THE SAID NOTICE FILED LETTER DATED 11.04.2011 ST ATING THAT THE RETURN ALREADY FILED ON 01.11.2014 MAY BE TREATED A S RETURN FILED IN RESPONSE TO NOTICE U/S. 148. THE ASSESSIN G OFFICER ALSO SUPPLIED THE REASONS TO THE ASSESSEE FOR WHICH THE CASE WAS REOPENED. SUBSEQUENTLY THE ASSESSING OFFICER ISSUE D NOTICE U/S. 143 (2) AND 142 (1) OF THE IT ACT FIXING THE H EARING ON 28.07.2011. ON THE BASIS OF REQUEST OF THE ASSESSE E THE CASE WAS ADJOURNED TO 03.08.2011 AND AGAIN ADJOURNED TO 10.08.2011. HOWEVER, ON THAT DATE NO ONE APPEARED BEFORE THE ASSESSING OFFICER FOR WHICH HE ISSUED ANOTHER NOTIC E ON 13.09.2011 FIXING THE DATE OF HEARING ON 28.09.2011 . AGAIN NONE APPEARED ON THAT DATE AND SUBSEQUENTLY ON 14.1 0.2011 PART COMPLIANCE WAS MADE AND THE PROCEEDINGS WERE A DJOURNED TO 21.10.2011. HOWEVER, AGAIN NONE APPEARED ON THA T DATE OR EVEN ON SUBSEQUENT DATES. 3. THE ASSESSING OFFICER NOTED THAT THE ASSESSEE HA S RECEIVED AN AMOUNT OF RS.25,00,000/- FROM M/S. MAHA NIVESH I NDIA LIMITED (RS.10,00,000/-) AND M/S. GEEFCEE FINANCE L IMITED (RS.15,00,000/-) TOWARDS SHARE APPLICATION MONEY. S INCE THE ASSESSEE COULD NOT EXPLAIN THE NATURE OF SUCH CREDI T ENTRIES, THE ASSESSING OFFICER INVOKING THE PROVISIONS OF SECTIO N 68 OF THE IT ACT, 1961, MADE ADDITION OF RS.25 LACS TO THE TOTAL INCOME OF THE ASSESSEE. 4. BEFORE CIT(A) THE ASSESSEE FILED AN APPLICATION UNDER RULE 46 A FOR ADMISSION OF CERTAIN ADDITIONAL EVIDENCES WHICH WERE FORWARDED BY THE CIT(A) TO THE ASSESSING OFFICER FO R HIS COMMENTS. THE ASSESSING OFFICER FORWARDED HIS REMA ND REPORT PAGE | 3 WHICH WERE CONFRONTED TO THE ASSESSEE BY THE CIT(A) . BASED ON THE COMMENTS OF THE ASSESSING OFFICER IN THE REMAND REPORT AND REJOINDER OF THE ASSESSEE TO SUCH REMAND REPORT THE LD. CIT(A) ISSUED AN ENHANCEMENT NOTICE TO THE ASSESSEE. AFTER CONSIDERING THE SUBMISSION OF THE ASSESSEE THE LD. CIT(A) ENHAN CED THE TOTAL INCOME BY RS.2,96,00,000/- OVER AND ABOVE THE ADDITION OF RS.25 LACS MADE BY THE ASSESSING OFFICER. 5. AGGRIEVED WITH SUCH ORDER OF THE CIT(A), THE ASS ESSEE IS IN APPEAL BEFORE THE TRIBUNAL BY RAISING THE FOLLOWING GROUNDS :- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE ORDER PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (A PPEALS) [CIT(A)] IS BAD BOTH IN THE EYE OF LAW AND ON FACTS . 2(I) ON THE FACTS AND CIRCUMSTANCES OF THE CASE, TH E REOPENING THE ASSESSMENT UNDER SECTION 147 OF THE ACT IS BAD IN LAW AS THE SAME HAS BEEN DONE WITHOUT COMPLYING WITH THE S TATUTORY CONDITIONS AND THE PROCEDURE PRESCRIBED UNDER THE L AW IS BAD AND LIABLE TO BE QUASHED. (II) ON THE FACTS AND CIRCUMSTANCES OF THE CASE, TH E REASON RECORDED FOR REOPENING OF THE ASSESSMENT IN THE ABSENCE OF ANY L IVE NEXUS, ARE BAD IN LAW AND AS SUCH THE REOPENING OF THE ASS ESSMENT IS ILLEGAL AND LIABLE TO BE QUASHED SO. 3(I) ON THE FACTS AND CIRCUMSTANCES OF THE CASE, LE ARNED CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN CONFIRMING TH E ADDITION OF RS.25,00,000/- MADE BY THE AO ON ACCOUNT OF THE SHA RE APPLICATION MONEY RECEIVED BY THE APPELLANT COMPANY . (II) THAT THE ADDITION HAS BEEN CONFIRMED DESPITE THE ASSESSEE BINGING ON RECORD ALL THE EXPLANATION AND EVIDENCES IN RESPECT OF THE SAME. PAGE | 4 (III) THAT THE LEARNED CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN CONFIRMING THE SAID ADDITION WITHOUT THERE BEING ANY ADVERSE MATERIAL AGAINST THE ASSESSEE AND WITHOUT MAKING AN Y REFERENCE TO ANY SPECIFIC INFORMATION OR EVIDENCE A GAINST THE ASSESSEE. 4. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, LEAR NED CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN ENHANCING THE INCOME OF THE ASSESSEE BY RS.2,96,00,000/- WITHOUT GIVING IT A NOTICE FOR SUCH ENHANCEMENT TO THE APPELLANT COMPANY. 5(I) ON THE FACTS AND CIRCUMSTANCES OF THE CASE, LE ARNED CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN MAKING AN ADD ITION OF RS.2,56,00,000/- ON ACCOUNT OF SHARE APPLICATION MO NEY RECEIVED BY THE ASSESSEE. (II) THAT THE ADDITION HAS BEEN MADE DESPITE THE ASSESSE E BRINGING ON RECORD ALL THE EXPLANATION AND EVIDENCE S IN RESPECT OF THE SAME. THAT THE LEARNED CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN MAKING THE SAID ADDITION WITHOUT THERE BEING ANY AD VERSE MATERIAL AGAINST THE ASSESSEE AND WITHOUT MAKING AN Y REFERENCE TO ANY SPECIFIC INFORMATION OR EVIDENCE AGAINST THE ASSESSEE. THAT THE ABOVE SAID ADDITIONS HAVE BEEN CONFIRMED/ MADE BY INDULGING INTO SURMISES AND CONJECTURES. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, LEARNED CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN APPLYING THE JUDGMENT OF N.R. PORTFOLIO LTD. IGNORING THE FACT THAT IN THE S AID CASE THERE WAS AN ALLEGATION OF ACCOMMODATION ENTRY ADMITTED B Y THE ENTRY PROVIDER. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, LEARNED CIT(A; HAS ERRED BOTH ON FACTS AND IN LAW IN IGNORING THE JUDGMENT OF THE SUPREME COURT IN THE CASE OF CIT VS. LOVELY EXP ORTS LTD. WHICH IS SQUARELY APPLICABLE TO THE FACTS OF THIS C ASE. PAGE | 5 THAT THE ADDITION MADE/ CONFIRMED BY THE CIT(A) UND ER SECTION 68 WITHOUT GIVING FINDING IN RESPECT OF EAC H OF THE SHAREHOLDER INDIVIDUALLY IS OTHERWISE UNTENABLE IN THE EYE OF LAW. THE APPELLANT CRAVES LEAVE TO ADD, AMEND OR ALTER A NY OF THE GROUNDS OF APPEAL. 6. WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY B OTH THE SIDES, PERUSED THE ORDERS OF THE ASSESSING OFFICER AND CIT(A) AND THE PAPER BOOK FILED ON BEHALF OF THE ASSESSEE. WE HAVE ALSO CONSIDERED THE VARIOUS DECISIONS CITED BEFORE US. IT IS THE SUBMISSION OF THE LD. COUNSEL FOR THE ASSESSEE THAT THE TRIBUNAL IN THE CASE OF ITO VS. VIVSUN PROPERTIES P RIVATE LIMITED IN ITA NO.4786/DEL/2011 ORDER DATED 01.03.2016 HAS HELD M/S. MAHANIVESH INDIA LIMITED AND M/S. GEEFCEE FINA NCE LIMITED AS IDENTIFIED AND GENUINE. FURTHER THE ASS ESSEE HAS FILED ALL NECESSARY DOCUMENTS SUCH AS THE COPY OF T HE INCOME TAX RETURNS, COPY OF BANK STATEMENTS, FINANCIAL STA TEMENTS OF ALL THE PARTIES, AFFIDAVIT OF THE DIRECTORS ETC TO PROV E THE IDENTITY AND CAPACITY OF THE SHARE APPLICANTS AND GENUINENESS OF THE TRANSACTIONS. IT IS ALSO HIS SUBMISSION THAT THE A SSESSING OFFICER HAS REOPENED THE ASSESSMENT WITHOUT INDEPEN DENT APPLICATION OF MIND BUT ON THE BASIS OF REPORT OF T HE INVESTIGATION WING WHICH AMOUNTS TO REOPENING ON BO RROWED SATISFACTION. REFERRING TO VARIOUS DECISION OF HON BLE DELHI HIGH COURT IT IS HIS SUBMISSION THAT SUCH REOPENING IS B AD IN LAW. 7. IT IS THE SUBMISSION OF THE LD. DR THAT IN VIEW OF THE DECISION OF HONBLE DELHI HIGH COURT IN THE CASE OF NDR PAGE | 6 PROMOTERS VIDE ITA NO.49/2018 ORDER DATED 17.01.201 9 AND THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF NR A ISPAT VIDE ITA NO.1731/DEL/2016 ORDER DATED 30.04.2019, THE AD DITION MADE BY THE ASSESSING OFFICER IN THE EXPARTE ORDER WHICH HAS BEEN ENHANCED BY THE CIT(A) SHOULD BE UPHELD. SO FA R AS THE ISSUE OF REOPENING IS CONCERNED IT IS THE SUBMISSIO N OF THE LD. DR THAT NO SUCH GROUND WAS TAKEN BY THE ASSESSEE BE FORE THE CIT(A) FOR WHICH HE HAS NOT ADJUDICATED ON THIS ISS UE. THEREFORE, THE ISSUE OF REOPENING CANNOT BE AGITATED AT THIS P OINT. IT IS AN ADMITTED FACT THAT NEITHER THE ASSESSEE NOR THE REV ENUE HAD THE BENEFIT OF THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF NRA ISPAT (SUPRA) AND THE DECISION OF HONBLE DELHI HIGH COURT IN THE CASE OF NDR PROMOTERS (SUPRA) WHEN THE ASSES SMENT WAS MADE OR THE CIT(A) PASSED THE ORDER. IT IS AN ADMI TTED FACT THAT THE ASSESSEE HAS NOT TAKEN ANY GROUND BEFORE THE CI T(A) CHALLENGING THE VALIDITY OF REASSESSMENT PROCEEDING S FOR WHICH HE HAS NOT ADJUDICATED THE VALIDITY OF REASSESSMENT PROCEEDINGS. CONSIDERING THE TOTALITY OF THE FACTS OF THE CASE A ND IN THE INTEREST OF JUSTICE WE DEEM IT PROPER TO RESTORE TH E ISSUE TO THE FILE OF THE ASSESSING OFFICER WITH A DIRECTION TO D ECIDE THE ISSUE AFRESH AND IN ACCORDANCE WITH LAW AFTER GIVING DUE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THE ASSESSING OFFI CER SHALL KEEP IN MIND THE ABOVE DECISIONS RELIED ON BY LD. DR WHI LE DECIDING THE ISSUE. THE GROUNDS RAISED BY THE ASSESSEE ARE ACCORDINGLY ALLOWED FOR STATISTICAL PURPOSE. PAGE | 7 8. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON 13.09.2019. SD/- SD/- (KULDIP SINGH) (R.K PANDA) JUDICIAL MEMBER ACCOUNTANT MEMBER *NEHA* DATE:-13.09.2019 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 APPROVED DRAFT COMES TO THE SR.PS /PS DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING 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 WE BSITE OF ITAT 16.09.2019 DATE ON WHICH THE FILE GOES TO THE BENCH CLERK DATE ON WHICH FILE GOES TO THE HEAD CLERK. THE DATE ON WHICH FILE GOES TO THE ASSISTANT REGIST RAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER