M/s Kalyani Barter Pvt. Ltd., Kolkata V. DCIT, CIR-2(1), Kolkata

ITA 414/KOL/2019

• Counselvise Citation: [2024] 101 COUNSELVISE.COM (IT) 8521 (ITAT-KOLKATA)
• Duration Of Justice: 4 year(s) 11 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-02-2024
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: A
• Next Hearing Date: 20-09-2023
• Assessment Year: 2012-2013
• Appeal Filed On: 04-03-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Bogus Share capital; Reasonable cause
• Section: 68; 142(1); 14A; 250; 143(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, KOLKATA Before Shri Sanjay Garg, Judicial Member & Dr. Manish Borad, Accountant Member I.T.A. No.414/KOL/2019 Assessment Years: 2012-13 Kalyani Barter Pvt. Ltd. 2, Ganesh Chandra Avenue, 2 nd floor, Room No. 5, Kolkata-700013. (PAN: AACCK7579D) Vs. DCIT, Circle-2(1), Kolkata (Appellant) (Respondent) Appearances by: Shri Miraj D. Shah, AR appeared for Appellant. Shri S. Dutta, CIT, DR appeared for Respondent. Date of concluding the hearing : 20.02.2024 Date of pronouncing the order : 26.02.2024 ORDER Per Manish Borad, Accountant Member: This appeal filed by the assessee pertaining to the Assessment Year (in short “AY”) 2012-13 is directed against the order passed u/s 250 of the Income Tax Act, 1961 in short the “Act”) by ld. Commissioner of Income-tax (Appeals)-1, Kolkata [in short ld. “CIT(A)”] dated 22.01.2019 arising out of the assessment order passed u/s 143(3) of the Act by Ld. DCIT, Circle-2(1), Kolkata. 2. Assessee has effectively raised four grounds of which two relate to addition u/s. 68 of the Act on account of unexplained share capital and unsecured loan, one relates to disallowance u/s. 14A of the Act and through ground no. 4 it has claimed that the order passed by Ld. CIT(A) u/s. 250 of the Act is not correct confirming the arbitrary disallowances/additions. I.T.A. No. 414/Kol/2019 A Y: 2012-13, Kalyani Barter P. Ltd. Page 2 of 4 3. At the outset, Ld. Counsel for the assessee submitted that the documents referred in paper book containing 239 pages filed on 15.06.2023 were not placed before the lower authorities for necessary examination. These documents are vital for the purpose of examination of the nature and source of the alleged sum. The prayer was further made that one more opportunity may be granted by restoring the issue raised on merits to the Ld. CIT(A) for fresh adjudication after considering the documents filed in the paper book. On the other hand, ld. DR submitted that the major addition is regarding unexplained cash credit in the form of share capital/share premium and unsecured loan which the assessee has taken from paper company/ shell company/ accommodation entry provider and Jama Kharchi Companies and assessee failed to explain the nature and source of the same as mandated u/s. 68 of the Act. 4. We have heard the rival submissions and carefully gone through the records placed before us. We note that the assessee is a Private Limited Company engaged in the business of shares and securities. It declared loss of Rs.2,13,39,135/- in the return of income for AY 2012- 13 furnished on 16.09.2012. After the case being selected for scrutiny through CASS and validly serving notices u/s. 143(2) and 142(1) of the Act, the assessee was asked to explain the source of share capital and share premium amounting to Rs.6.55 Cr. as well as nature and source of unsecured loan of Rs.1.27 Cr. Though submissions were made by the assessee but complete details were not filed which resulted in the addition of the alleged sum along with other minor additions and income assessed at Rs.5,69,77,411/-. 5. When the matter travelled before the Ld. CIT(A), though the assessee filed statement of facts but did not file the evidence which were necessary for pleading the grounds of appeal. Ld. CIT(A) at page I.T.A. No. 414/Kol/2019 A Y: 2012-13, Kalyani Barter P. Ltd. Page 3 of 4 4 of the impugned order has observed that “in case assessee deliberately and intentionally failed to produce evidence before the AO with a desire to prevent enquiry or investigation an adverse view should be taken.” Further, at para 19 of the impugned order, ld. CIT(A) observed that “in the case in hand no details were filed before the Ld. AO. He had been stopped from making any further investigations. It is evident that the assessee had failed to prove the identity, genuineness and creditworthiness of the people having given loans.” 5. Perusal of the above observation of Ld. CIT(A) and considering the prayer of the assessee, cited supra, we in the interest of justice and fair play give one more opportunity to the assessee to appear before the Ld. CIT(A) and place all the related evidence filed before us in order to prove the identity and creditworthiness of the share applicants/ cash creditors and genuineness of the transaction. Further, we direct the Ld. CIT(A) that if the assessee file all these details then a remand report to be called from the jurisdictional AO who shall carry out necessary enquiry/investigation so as to check the veracity of the claim of the assessee. After receiving the remand report, ld. CIT(A) can decide the issues on merits in accordance with law after giving a fair and reasonable opportunity of hearing to the assessee. Assessee is also directed not to take any adjournment without a reasonable cause. 6. In the result, the appeal of the assessee is allowed for statistical purposes. Order is pronounced in the open court on 26.02.2024. Sd/- Sd/- [Sanjay Garg] [Manish Borad] Judicial Member Accountant Member Dated: 26 th February, 2024 J.D. Sr. PS. I.T.A. No. 414/Kol/2019 A Y: 2012-13, Kalyani Barter P. Ltd. Page 4 of 4 Copy of the order forwarded to: 1. Appellant – Kalyani Barter Pvt. Ltd., 2, Ganesh Chandra Avenue, 2 nd floor, Room No. 5, Kolkata-700013. 2. Respondent – DCIT, Circle-2(1), Kolkata. 3. CIT(A)-1, Kolkata. 4. CIT- 5. Departmental Representative 6. Guard File. True copy By order Assistant Registrar ITAT, Kolkata Benches Kolkata