DCIT, New Delhi V. M/s Complete New & Entertainment Broadcasting (P) Ltd., New Delhi

ITA 4577/DEL/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 97009 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-08-2015
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2007-2008
• Appeal Filed On: 02-08-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: AKASH CHUGH
• Assessee Lawyers: ANURADHA MISHRA
• Keywords: Unexplained cash credit; Bogus Share capital; Unexplained investment; Search and seizure; Loose papers; Opportunity of being heard; Additional evidence; Accommodation entries
• Section: 133A; 153A; 68; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: B NEW DELHI BEFORE SMT DIVA SINGH, JUDICIAL MEMBER AND SH.INTURI RAMA RAO, ACCOUNTANT MEMBER I.T.A .NO. - 4731 /DEL/201 3 (ASSESSMENT YEAR S - 200 7 - 08) COMPLETE NEWS & ENTERTAINMENT BROADCASTING PVT.LTD., B - 53, B - 1, COMMUNITY CENTRE, JANAKPURI, NEW DELHI. PAN - AACCH8813G (APPELLANT) VS ACIT, CENTRAL CIRCLE - 4, NEW DELHI (RESPONDENT ) I .T.A .NO. - 4577 /DEL/201 3 (ASSESSMENT YEAR S - 200 7 - 08) ACIT, CENTRAL CIRCLE - 4, NEW DELHI (APPELLANT) VS COMPLETE NEWS & ENTERTAINMENT BROADCASTING PVT.LTD., B - 53, B - 1, COMMUNITY CENTRE, JANAKPURI, NEW DELHI. PAN - AACCH8813G (RESPONDENT ) APPELLANT BY MS.RUCHIKA JAIN & SH. AKASH CHUGH, CA RESPONDENT BY MS.ANURADHA MISHRA, CIT DR ORDER PER DIVA SINGH, JM THESE ARE CROSS APPEALS FILED BY THE ASSESSEE AND THE REVENUE ASSAILING THE CORRECTNESS OF THE ORDER DATED 01.04.2013 OF CIT(A) - XXXIII, NEW DELHI PERTAINING TO 200 7 - 08 ASSESSMENT YEAR ON VARIOUS GROUNDS WHICH WE PROPOSE TO ADDRESS IN THE LATER PART OF THE ORDER. 2. A PERUSAL OF THE RECORD SHOWS THAT A SEARCH AND SEIZURE OPERATION U/S 132 OF THE INCOME TAX ACT, 1961 WAS CARRIED OUT IN HBN GROUP ON 20.11.2009 AS PER THE ASSESSMENT ORDER. THE GROUP IS STATED TO BE ENGAGED IN DIVERSE BUSINESSES RANGING FROM DAIRY DEVELOPMENT AND MARKETING OF DAIRY PRODUCTS; REAL ESTATE DEVELOPMENT, HOME LOAN FINANCE; INSURANCE AGENTS AND DATE OF HEARING 01 .0 7 .2015 DATE OF PRONOUNCEMENT 19 .0 8 .2015 I.T.A .NO. - 4731 & 4577/ DEL/201 3 PAGE 2 OF 8 RUNNING A BROADCAST CHANNEL UNDER THE NAME OF CNEB THROUGH VARIOUS COMPANIES. THE G ROUP IS STATED TO BE CONTROLLED BY SH.HARMENDER SINGH SRAN, CHAIRMAN AND HIS SON SH.AMANDEEP SINGH SRAN, DIRECTOR IN VARIOUS GROUP COMPANIES ASSOCIATED WITH HBN GROUP. DURING THE COURSE OF SEARCH AND SEIZURE OPERATION, LOOSE PAPERS AND OTHER DOCUMENTS WERE FOUND AND SEIZED. CONSEQUENTLY, NOTICE U/S 153A WAS ISSUED TO THE ASSESSEE ON 02.06.2010 WHEREIN THE ASSESSEE WAS REQUIRED TO FILE A RETURN IN THE PRESCRIBED FORMAT FOR THE YEAR UNDER CONSIDERATION WITHIN 60 DAYS. THE SAID NOTICE WAS SENT BY THE SPEED POST AND AS PER THE ASSESSMENT ORDER WAS SERVED UPO N THE ASSESSEE . RETURN DECLARING A NIL INCOME WAS FILED ON 20.07.2010 PURSUANT TO THIS AFTER ISSUANCE OF NOTICE AND QUESTIONNAIRES ISSUED AS PER THE ASSESSMENT ORDER THE ASSESSEE WAS REPRESENTED. IN THE ASSESSMENT PROCEEDINGS THE AO TAKES COGNIZANCE OF T HE FACT THAT THE ASSESSEE COMPANY WAS INCORPORATED ON 26.06.2006 WITH THE OBJECT OF RUNNING A TELEVISION NEWS CHANNEL. HE ALSO TOOK NOTE OF THE FACT THAT IN THE AUDIT REPORT OF THE ASSESSEE COMPANY FOR THE FINANCIAL YEAR 2006 - 07 ISSUED SHARE CAPITAL HA D B EEN DECLARED AT RS.1,54,50,000/ - AND A SUM OF RS.1,53,50,000/ - HAD BEEN SHOWN AS RESERVE S AND SURPLUS WHICH SOLELY REPRESENTED THE SHARE PREMIUM. THUS IT WAS NOTICED THAT A TOTAL SUM OF RS.3,08,00,000/ - HAD BEEN SHOWN AS LIABILITIES ARISING ON ACCOUNT OF SHARE HOLDER S FUNDS. IN VIEW OF THESE FACTS THE AO REQUIRED THE ASSESSEE TO EXPLAIN THE SAME. 2.1. CONSIDERING THE REPLIES AND AFTER AFFORDING SUFFICIENT OPPORTUNITY AS REFERRED TO IN PARAS 6 TO 8 OF THE ASSESSMENT ORDER AND THE LEGAL POSITION ON THE ISSUE THE AO PROCEEDED TO CON SIDER THE ISSUE ON THE BASIS OF SEIZED MATERIAL / MATERIAL GATHERED DURING THE SEARCH & SEIZURE AT HBN GROUP PREMISES AND SURVEY OPERATIONS AT S.L. MAKHANLAL S I NGLA & CO. PROP. M.L.SI NGLA AND CONCLUDE THAT DESPITE PROVIDING THE OP PORTUNITY IT WAS NOT AVAILED O F BY THE ASSESSEE. T HE FOLLOWING DECISIONS OF THE JURISDICTIONAL HIGH COURT WERE CONSIDERED TO BE APPLICABLE ON THE ISSUE : - (I) CIT VS DIVINE LEASING & FINANCE LTD. 299 ITR 168 (DEL.); (II) CIT VS LOVELY EXPORTS (P.) LTD. 216 CTR 195 (SC); (III) SOPHIA FINANCE; (IV) OASIS HOSPITALITY SERVICES (P.) LTD. 333 ITR 169; (V) VIJAY POWER GENERATORS LTD. I.T.A .NO. - 4731 & 4577/ DEL/201 3 PAGE 3 OF 8 3 . ACCORDINGLY CONSIDERING THE SEIZED MATERIAL WHICH CLEARLY MENTIONED FREQUENTLY SANJAY JAIN COMMISSION AND M.L.SINGLA COMMISSION WHICH PROVED THAT TH EY HAD RECEIVED COMMISSION AND THE STATEMENT ON OATH U/S 132(4) OF THE ACT OF SH. SH. S. G. BHA V NANI, CFO OF THE HBN GROUP AND THE STATEMENT OF OATH RECORDED OF SH. M.L.SINGLA (E - 2/77, SECTOR - 16, ROHINI, NEW DELHI) CONF R O N T E D TO HIM WHO WAS ALSO COVERED IN SECTION 133A WHO ACCEPTED THAT ACCOMMODATION ENTRIES HAD BEEN ARRANGED BY HIM AND S TATEMENT OF SH.H.S.SRAN, HBN GROUP WHO HAD ADMITTED THE FACT O F BOGUS CAPITAL SHARE INTRODUCTION IN VARIOUS HBN GROUP OF COMPANIES AND MADE A SURRENDER IN ASSESSMENT YEARS 2008 - 09 & 2009 - 10 INCOME FROM UNEXPLAINED CREDIT OF RS.3,08,00,000/ - WAS MADE AS REFER R E D TO IN PARA 13.5 OF THE ASSESSMENT ORDER ADDITION OF THE SAID AMOUNT WAS MADE IN THE HANDS OF THE ASSESSEE . 4. FOR READY - REFERENCE, THE RELEVANT PORTION I S EXTRACTED FROM TH E ASSESSMENT ORDER HEREUNDER: - 13.4. THOUGH THE STATEMENT OF SH M.L. SINGLA WAS RECORDED DURING THE COURSE OF SURVEY PROCEEDINGS AND WAS NOT A STATEMENT U/S 132(4) OF THE ACT, HOWEVER IN HIS STATEMENT THERE IS CLEAR AFFIRMATION OF THE FACTS RECORDED ON TH E ABOVE MENTIONED DOCUMENTS AND AS ALSO THE CORROBORATION OF THE STATEMENT OF SH S.G. BHAVNANI HBN GROUP CFO. 13.5. DURING THE COURSE OF RECORDING OF THE STATEMENT OF SH HARMENDER SINGH SRAN, HBN GROUP CHAIRMAN, THE FACTUM OF BOGUS SHARE CAPITAL INTRODUCT ION IN VARIOUS HBN GROUP COMPANIES WAS CATEGORICALLY ADMITTED AND UNDISCLOSED INCOME WAS SURRENDERED IN VARIOUS GROUP COMPANIES. IN THE CASE OF ASSESSEE COMPANY SURRENDER WAS MADE FOR THE ASSESSMENT YEARS 2008 - 09 & 2009 - 10. 14. THE FACTS FOR THE PRESENT C ASE ARE NOT DIFFERENT FROM THE FACTS OF SUBSEQUENT YEARS. DURING THE YEAR UNDER CONSIDERATION THERE IS INTRODUCTION OF SHARE CAPITAL OF RS.3,08,00,000/ - IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE COMPANY. 14.1 FROM WHATEVER DETAILS FILED BY THE ASSESSEE IT APPEARS THAT THE FOLLOWING SHARE CAPITAL WAS RECEIVED BY THE ASSESSEE COMPANY FROM THE MEMBERS OF SRAN FAMILY WHO ARE ALSO DIRECTORS IN THE ASSESSEE COMPANY OR OTHER HBN GROUP COMPANIES. IN RESPECT OF SHARE CAPITAL CONTRIBUTION MADE BY THEM, THE ASSESSEE H AS FILED CONFIRMATION WITH THEIR PAN NUMBER. COPIES OF THEIR INCOME TAX RETURNS HAVE ALSO BEEN FILED. THE DETAILS OF SUCH SHARE CAPITAL CONTRIBUTION ARE AS UNDER; (I) HARMENDER SINGH SRAN RS. 11,75,000/ - (II) GURVIR KAUR SRAN RS. 11,75,000/ - (III)MANJEET KAUR SRAN RS. 11,75,000/ - (IV)HARMEET KAUR SRAN RS. 9,25,000/ - THAT APART, IT IS ALSO MENTIONED IN THE DETAILS THAT INVESTMENT IN SHARE CAPITAL OF THE ASSESSEE COMPANY OF AN AMOUNT OF RS. 12,70,000/ - I.T.A .NO. - 4731 & 4577/ DEL/201 3 PAGE 4 OF 8 WAS MADE BY SH. AMANDEEP SINGH SRAN A ND OF RS. 11,75,000/ - WAS MADE BY MS. BRINDERJEET KAUR SRAN. THUS, THE TOTAL CAPITAL CONTRIBUTION FROM THE MEMBERS OF SRAN FAMILY COMES TO RS. 68, 95,000/ - . PROCEEDINGS FOR ASSESSMENT OF THEIR TOTAL INCOME UNDER SECTION 153 A HAVE ALSO BEEN TAKEN. IN THE C IRCUMSTANCES, THE CASH CREDITS APPEARING IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE IN THE FORM OF SHARE CAPITAL TO THE EXTENT OF CAPITAL CONTRIBUTION MADE BY SRAN FAMILY APPEARS TO BE ACCEPTABLE. HOWEVER CURIOUSLY ENOUGH, IT IS ALSO NOTICED THAT IDENTICAL D ETAILS 7 CONFIRMATIONS HAVE BEEN FILED FOR THE ASSESSMENT YEAR 2008 - 09 AND 2009 - 10 ALSO. FROM THE BALANCE SHEET IT IS SEEN THAT DURING THE FINANCIAL YEAR 2008 - 09, NO FRESH SHARE CAPITAL HAS BEEN ISSUED BY THE ASSESSEE COMPANY. THERE IS NO RECEIPT OF SHAR E APPLICATION MONEY DISCLOSED IN THE ACCOUNTS EITHER. THUS, THE CONFIRMATIONS/ DETAILS FURNISHED IN RESPECT OF INVESTMENT IN SHARE CAPITAL MADE BY THE SRAN FAMILY COULD NOT BE RELIED UPON. IN THE CIRCUMSTANCES, WHEN THE FACTS RELATING TO CAPITAL CONTRIBUT ION MADE BY THE SRAN FAMILY MEMBERS ARE NEITHER DISCERNIBLE WITH FULL PRECISION NOR THE SAME ARE INDEPENDENTLY VERIFIABLE, I AM CONSTRAINED TO CONSIDER ENTIRE SHARE CAPITAL RAISED DURING THE YEAR, HITHERTO REMAINING UNVERIFIABLE AS UNEXPLAINED CASH CREDITS WITHIN THE MEANING OF SECTION 68 OF THE ACT. 15 . IN THE CIRCUMSTANCES, I HAVE NO HESITATION IN TREATING THE ENTIRE UNVERIFIED SHARE CAPITAL INCLUDING THE SHARE PREMIUM AMOUNT AGGREGATING TO RS. 3,08,00,000 / - AS INCOME OF THE ASSESSEE FROM UNDISCLOSED SOU RCES UNDER THE PROVISIONS OF SECTION 68 OF THE ACT. 5 . AGGRIEVED BY THIS, THE ASSESSEE CAME IN APPEAL ASSAILING THE ACTION OF THE AO ON VARIOUS GROUNDS. CONSIDERING THE ARGUMENTS THE CIT(A) PROCEEDED TO PARTLY ACCEPT SOME OF THE CLAIMS OF THE ASSESSEE A ND PARTLY REJECTED THE GROUNDS OF THE ASSESSEE. APART FROM THAT THE CIT(A) ALSO RESTORED THE ISSUE BACK TO THE FILE OF THE AO FOR VERIFICATION ON FACTS . 6 . AGGRIEVED BY TH I S ORDER , BOTH THE ASSESSEE AND THE REVENUE ARE IN A PPEAL BEFORE THE TRIBUNAL. THE GROUNDS RAISED BY THE ASSESSEE IN I.T.A .NO. - 4731/DEL/2013 R EAD AS UNDER : - 1. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE, LD. FIRST APPELLATE AUTHORITY HAS GROSSLY ERRED IN DIRECTING THE LD. ASSESSING AUTHORITY TO VERIFY THE LIST OF SHAREHOLDERS AND SH ARE APPLICANTS DURING THE YEAR UNDER CONSIDERATION IN RESPECT OF INVESTMENT OF RS.1,51,40,000/ - IN SHAREHOLDER'S FUND OF APPELLANT COMPANY MADE BY M/S HBN DAIRIES & ALLIED LIMITED, INSTEAD OF DIRECTLY DELETING THE ADDITIONS OF AFORESAID AMOUNT OF RS.1,51, 40,000/ - , WHEN IT WAS CLEARLY EVIDENT FROM THE RECORDS AVAILABLE BEFORE HIM THAT THE FUNDS FOR THE AFORESAID AMOUNT HAD FLOWN FROM M/S HBN DAIRIES & ALLIED LIMITED OUT OF ITS DULY EXPLAINED SOURCES AND IS DULY RECORDED IN ITS BOOKS OF ACCOUNTS AS INVESTMEN TS IN HBN DAIRIES & ALLIED LTD I.T.A .NO. - 4731 & 4577/ DEL/201 3 PAGE 5 OF 8 2. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE, LD. FIRST APPELLATE AUTHORITY HAS GROSSLY ERRED IN DIRECTING THE LD. ASSESSING AUTHORITY TO VERIFY THE INVESTMENT TO THE EXTENT OF RS.31,95,000/ - MADE IN THE APPELLANT COMPANY BY FAMILY MEMBERS OF CHAIRMAN OF HBN GROUP AND OTHER INDIVIDUALS INSTEAD OF DIRECTLY DELETING THE ADDITIONS OF AFORESAID AMOUNT, WHEN IT WAS CLEARLY EVIDENT FROM THE RECORDS AVAILABLE BEFORE HIM THAT THE AFORESAID FAMILY MEMBERS WERE ALREADY CENTRA LLY ASSESSED U/S 153A AND NO DISCREPANCY IN RESPECT OF INVESTMENT IN APPELLANT COMPANY WAS POINTED OUT IN THEIR RESPECTIVE ASSESSMENTS. 3. UNDER THE FACTS & CIRCUMSTANCES OF THE CASE, LD ASSESSING AUTHORITY HAS GROSSLY ERRED IN NOT ADMITTING UNDER RULE - 46A OF INCOME TAX RULES, 1962, ADDITIONAL EVIDENCE IN THE FORM OF THE CONFIRMATIONS FROM THE FIVE PARTIES SUBMITTED BY THE APPELLANT IN RESPECT OF INVESTMENT IN SHAREHOLDER'S FUND TOTALING TO RS. 34,60,000/ - 4. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE, LD. FIRST APPELLATE AUTHORITY HAS GROSSLY ERRED IN AFFIRMING THE ADDITION OF BALANCE AMOUNT OF RS.90,05,000/ - MADE BY THE LD. ASSESSING AUTHORITY ON ACCOUNT OF UNEXPLAINED INVESTMENT IN SHAREHOLDER'S FUNDS, WHICH IS GROSSLY INJUDICIOUS, AGAINST THE F ACTS AND BAD AT LAW. 5. THE APPELLANT PRAYS FOR LEAVE TO ADD, AMEND, ALTER OR WITHDRAW ANY GROUNDS OF APPEAL. 7. THE REVENUE S GROUNDS IN I.T.A .NO. - 4 57 7/DEL/2013 R EAD AS UNDER: - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE CIT (A) HAS E RRED IN GIVING RELIEF TO THE ASSESSEE COMPANY ON ACCOUNT OF UNEXPLAINED INVESTMENT IN SHARE CAPITAL / PREMIUM BY FAMILY MEMBERS OF SH. H.S. SARAN AND M/S HBN DAIRIES & ALLIED LTD. THOUGH IT WAS CLEARLY ESTABLISHED THAT IT WERE BOGUS SHARE CAPITAL INTRODUCT ION. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE EASE, THE CIT (A) HAS ERRED IN ALLOWING RELIEF TO THE ASSESSEE COMPANY ON ACCOUNT OF SHARE CAPITAL / PREMIUM INTRODUCTION BY M/S HBN DAIRIES & ALLIED LTD. WHEN THERE IS NO MENTION IN THE ASSESSMENT RE CORDS THAT THE ASSESSEE COMPANY HAS CLAIMED SUCH INVESTMENT DURING THE ASSESSMENT PROCEEDINGS. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE CIT (A) HAS ERRED IN ALLOWING RELIEF TO THE ASSESSEE COMPANY ON ACCOUNT OF SHARE CAPITAL / PREMIUM I NTRODUCTION IN THE NAME OF FAMILY MEMBERS AND M/S HBN DAIRIES & ALLIED LTD. WHEN IT WAS CLEARLY ESTABLISHED BY THE FINDINGS OF CIT(A) ITSELF THAT NEITHER DURING ASSESSMENT PROCEEDINGS NOR DURING APPELLATE PROCEEDINGS, THE APPELLANT COMPANY HAS PRODUCED EVI DENCE IN SUPPORT OF GENUINENESS OF THE TRANSACTION AND CREDITWORTHINESS OF SHARE HOLDER. 4. THE ORDER OF THE CIT (A) IS ERRONEOUS AND IS NOT TENABLE ON FACTS AND IN LAW. I.T.A .NO. - 4731 & 4577/ DEL/201 3 PAGE 6 OF 8 5. THE APPELLANT CRAVES LEAVE TO ADD, ALTER OR AMEND ANY/ ALL OF THE GROUNDS OF A PPEAL BEFORE OR DURING THE COURSE OF THE HEARING OF THE APPEAL. 8 . IN THE ABOVE FACTUAL BACK GROUND, THE LD. AR INVITING ATTENTION TO THE SYNOPSIS FILED IN THE COURT SUBMITTED THAT THE FINDING ARRIVED AT IN THE IMPUGNED ORDER IS VITIATED AS INSTEAD OF GIV ING A CLEAR - CUT FINDING AS THE STATUTE MANDATES THE CIT(A) AS WOULD BE EVIDENT FROM PAGE 14 OF THE IMPUGNED ORDER HAS REMITTED THE ISSUES TO THE AO. RELYING ON THE SYNOPSIS FILED IT WAS SUBMITTED THAT THE SAID ACTION BEING CONTRARY TO STATUTORY MANDATE MAKES THE IMPUGNED ORDER TAINTED AS SUCH IT MAY BE SET ASIDE AND RESTORED TO THE CIT(A ) AFRESH DIRECTING THE SAID AUTHORITY TO COME TO A CONCLUSIVE FINDING. IN SUPPORT OF THE SAID SUBMISSION, RELIANCE WAS PLACED ON THE ORDER OF THE CO - ORDINATE BENCH ORDER DATED 03.01.2014 IN ITA 2834/DEL/2013 AND OTHERS IN THE CASE OF ITO VS ZUARI INVESTMENT LTD. 9. IN THESE CIRCUMSTANCES, THE LIMITED PRAYER OF THE ASSESSEE WAS THAT BY ALLOWING THE APPEAL OF THE REVENUE AND THAT OF THE ASSESSEE, THE ENTIRE ISSUE MAY BE RESTORED TO THE CIT(A) WITH THE DIRECTION TO PASS A SPEAKING ORDER AFTER HEARING THE ASSESSEE. 10. CONSIDERING THE PRAYER OF THE LD. AR, THE LD.CIT DR HAD NO OBJECTION IF THE ENTIRE ORDER IS SET ASIDE AGAIN TO THE CIT(A). 11. WE HAVE HEARD THE RIVAL SUBM ISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. ON A CONSIDERATION THEREFORE, IN THE LIGHT OF THE SUBMISSIONS ADVANCED BY THE PARTIES BEFORE THE BENCH, WE FIND THAT AS FAR AS THE STATUTORY MANDATE IS CONCER NED, SECTION 250(6 ) OF THE INCOME TAX ACT W HICH SETS OUT THE PROCEDURE WHICH THE CIT(A) IN APPEAL IS REQUIRED TO FOLLOW IT IS SEEN THAT THE STATUTE DOES NOT PERMIT THE LD. CIT(A) TO REMAND THE ISSUE TO THE AO. THE STATUTE CONTEMPLATES THAT AN ENQUIRY MAY BE REQUIRED WHICH HE HIMSELF MAY ENQUIRE I NTO OR MAY DIRECT THE AO TO INQUIRE. HOWEVER, IF THE INQUIRY IS CAUSED THROUGH THE AO THE CIT(A) APPEALS HAS TO OBTAIN A REMAND REPORT AND CANNOT REMAND THE ISSUE COMPLETELY AS CONSIDERING THE REMAND REPORT A FINDING STILL HAS TO BE GIVEN BY THE CIT(A) HI MSELF. THE RELEVANT PROVISION S READ AS UNDER: - 250(1) . (2) I.T.A .NO. - 4731 & 4577/ DEL/201 3 PAGE 7 OF 8 (3) (4).THE COMMISSIONER (APPEALS) MAY, BEFORE DISPOSING OF ANY APPEAL, MAKE SUCH FURTHER INQUIRY AS HE THINKS FIT, OR MAY DIRECT THE ASSESSING OFFICER TO MAKE FURTHER INQUIRY AND REPORT THE RESULT OF THE SAME TO THE COMMISSIONER (APPEALS). (5) (6) THE ORDER OF THE COMMISSIONER (APPEALS) DISPOSING OF THE APPEAL SHALL BE IN WRITING AND SHALL STATE THE POINTS FOR DETERMINATION, THE DECISION THEREON AND THE REASON FOR THE DECISION. (6A) . (7) 12 . IN THE LIGHT OF THE ABOVE LEGAL MANDATE, WE ARE CALLED UPON TO CONSIDER WHETHER THE ASSESSEE S REQUEST WHICH HAS NOT BEEN OPPOSED BY THE REVENUE ON FACTS CAN BE ACCEPTED OR NOT. FOR THE SAID PURPOSE, WE REPRODUCE HEREUNDER THE RELEVANT EXTRACT FROM THE IMPUGNED ORDER AT PAGE 14: - THE NEXT ARGUMENT OF LD. AR IS THAT PART OF THE SHARE CAPITAL WERE RECEIVED BY THE APPELLANT COMPANY FROM FAMILY MEMBERS OF SH. H.S. SRAN CHAIRMAN OF THE HBN GROUP IN WHOSE HAND ASSESSMENTS WERE MADE U/S 153 A/153C FOR RESPECTIVE ASSESSMENT YEARS AND NO A DVERSE INFERENCE WAS TAKEN IN THEIR ASSESSMENT ORDER. THIS CLAIM WAS MADE BEFORE THE ASSESSING OFFICER. THIS ISSUE HAS BEEN CONSIDERED BY THE ASSESSING OFFICER IN PARA 14.1 OF THE ASSESSMENT ORDER. THE ASSESSING OFFICER HAS NOT GIVEN THE RELIEF ON THE GROU ND THAT SIMILAR CONFIRMATION FROM FAMILY MEMBERS FOR MAKING INVESTMENT IN SHARES OF THE COMPANY WAS FILED FOR A.Y. 2008 - 09. THE ASSESSING OFFICER IS DIRECTED TO VERIFY THE SHARE CAPITAL INTRODUCED DURING THE YEAR UNDER CONSIDERATION DURING THE YEAR UNDER C ONSIDERATION FROM FAMILY MEMBERS OF SH.H.S.SRAN CHAIRMAN OF HBN GROUP. THE ASSESSING OFFICER SHOULD ALSO VERIFY WHETHER THESE FAMILY MEMBERS WERE ALSO ASSESSED U/S 153A/153C & IF THERE IS NO ADVERSE FINDINGS DURING ASSESSMENT PROCEEDINGS OF THESE PERSON, T HEN THE ASSESSING OFFICER IS DIRECTED TO DELETE THE ADDITION FOR SHARE CAPITAL/ SHARE PREMIUM RECEIVED FROM THESE FAMILY MEMBERS AS THEIR CREDITWORTHINESS IS PROVED. A NEXT ARGUMENT OF LD.AR IS THAT M/S. HBN DAIRY & ALLIED PRODUCTS LTD. FLAGSHIP COMPANY OF HBN GROUP, HAS INVESTED IN SHARE CAPITAL/ PREMIUM IN APPELLANT COMPANY. THE ASSESSING OFFICER SHOULD VERIFY THE LIST OF SHARE HOLDERS & SHARE APPLICANT DURING THE YEAR UNDER CONSIDERATION IF THE SHARE CAPITAL/ PREMIUM IS RECEIVED DURING THE YEAR FROM M/S HBN DAIRY & ALLIED PRODUCTS LTD. & THE SAME IS REFLECTED IN THE BOOKS OF ACCOUNTS OF M/S HBN DAIRY & ALLIED PRODUCTS LTD., THEN THE ASSESSING OFFICER IS DIRECTED TO DELETE THE ADDITION TO THE EXTENT OF SHARE CAPITAL/ PREMIUM IN THE NAME OF M/S HBN DAIRY & ALLIED PRODUCTS LTD, AS M/S HBN DAIRY & ALLIED PRODUCTS LTD. IS SEPARATELY ASSESSED U/S 153A FOR SAME ASSESSMENT YEAR. (EMPHASIS PROVIDED) I.T.A .NO. - 4731 & 4577/ DEL/201 3 PAGE 8 OF 8 13 . A PERUSAL OF THE ABOVE DEMONSTRATE S THAT THE LD. CIT(A) INSTEAD OF OBTAINING A REMAND REPORT FROM THE AO AS PER THE STATUTORY MANDATE IN ORDER TO CONCLUSIVELY DECIDE THE ISSUE INSTEAD RESTORE D THE ISSUE TO THE AO CON TRARY TO THE STATUTORY MANDATE. IN VIEW OF THIS OBVIOUS STATUTORY VIOLATION, THE IMPUGNED ORDER CANNOT BE UPHELD . T HE ISSUES RAISED ARE I NTER - LINKED AND THE FINDING ARRIVED AT IT IS SEEN IS WITHOUT CONSIDERING THE RELEVANT MATERIAL ON RECORD. ACCORDINGLY IN VIEW OF THE AFORE - MENTIONED FACTUAL POSITION ; LEGAL MANDATE AND CONSIDERING THE SUBMISSIONS OF THE PARTIES BEFORE THE BENCH, WE DEEM IT APPROPRIATE TO SET ASIDE THE IMPUGNED ORDER AND RESTORE THE ISSUES BACK TO THE FILE O F THE LD. CIT(A ) WITH THE DIRECTION TO PASS A SPEAKING ORDER IN ACCORDANCE WITH LAW AFTER GIVING THE ASSESSEE A REASONABLE OPPORTUNITY OF BEING HEARD. IN VIEW OF THE ABO VE, THE GROUNDS RAISED BY THE ASSESSEE AND THE DEPARTMENT BOTH STAND ALLOWED FOR STATISTICAL PURPOSES AS PER THE PRONOUNCEMENT MADE IN THE OPEN COURT AT THE TIME OF HEARING. 14 . IN THE RESULT THE APPEALS OF THE ASSESSEE AND THE REVENUE ARE ALLOWED FOR STA TISTICAL PURPOSES. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 1 9 T H OF AUGUST , 2015. S D / - S D / - (INTURI RAMA RAO) (DIVA SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 1 9 /08 /2015 * AMIT KUMAR * COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI