M/s Jibika Rice Mills Pvt. Ltd., Burdwan V. A.C.I.T.,Circle-1, Burdwan

ITA 521/KOL/2019

AI Insights

The case involves Jibika Rice Mills P.Ltd., a private limited company engaged in the business of flour/rice mills, which appealed against the order of the Commissioner of Income-tax (Appeals) confirming the addition of Rs. 3,06,50,000 to its income for the assessment year 2014-15. This amount was categorized as unexplained share capital and share premium. The primary legal issue was the application of section 68 of the Income Tax Act, which deals with unexplained cash credits. The Tribunal noted the assessee's repeated non-compliance with procedural requirements and failure to substantiate the sources of the share capital and premium during the assessment and appellate proceedings.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 113040 (ITAT-KOLKATA)
• Duration Of Justice: 3 year(s) 9 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-01-2023
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 29-11-2022
• Assessment Year: 2014-2015
• Appeal Filed On: 14-03-2019
• Laws Referred To: Income Tax Act
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Income from undisclosed sources
• Section: 68; 143(3); 143(2)

Judgement Text

1. ITA No 521/Kol/2019 AY 2014-15 Jibika Rice Mills P.Ltd. आयकर अपील य अ धकरण, पीठ “A” , कोलकाता IN THE INCOME TAX APPELLATE TRIBUNAL BENCH “A”KOLKATA Before: Shri Sanjay Garg, Judicial Member and Shri Manish Borad, Accountant Member आयकर अपील सं.य/ ITA No. 521/Kol/2019 A s s e s s me n t Ye a r : 2 014-1 5 M/s. Jibika Rice Mills P.Ltd. Paraj Station Road, East Burdw an- 713406, West Bengal. बनाम V / s . ACIT, Cir-1, Burdw an, Aa ykar Bhavan, Kachari Road, Court Compound, East Burdw an-713101. W.B. PAN: AACCJ 1458N अपीलाथ / A p p e l l a n t . . यथ / Re s p o n d e n t अपीलाथ क ओर से/By Appellant None यथ क ओर से/By Respondent Shri Vijay Kumar, Addl. CIT, ld. Sr.DR स ु नवाई क तार ख/Date of Hearing 30-11-2022 घोषणा क तार ख/ Date of Pronouncement 02-01-2023 आदेश /O R D E R PER MANISH BORAD, AM. This appeal of the assessee for the assessment year 2014-15 is directed against the order dt. 08-01-2019 passed by the ld. Commissioner of Income-tax, Appeals [ in short, hereafter referred to as ‘the ‘ld. CIT(A), Burdwan. 2. ITA No 521/Kol/2019 AY 2014-15 Jibika Rice Mills P.Ltd. 2. When the case was called for, none appeared on behalf of assessee. A perusal of file shows that the assessee’s case was fixed for hearing on 17/8/23,12/10/22 and 30/11/22 but there was no compliance. Last notice fixing the hearing on 30/11/22 sent to addressee through RP/AD, returned unserved with the remark of postal authority “No such person in this address. Return to sender. Sd/- 22.11.22 3. It is, therefore, presumed that the assessee is no more interested to prosecute its appeal. We, therefore, deem it fit and proper to adjudicate the appeal on merits ex parte assessee on the basis of material available on record and with the assistance of the ld. DR. 4. The assessee has raised the following grounds of appeal for the AY 2014-15:- 1. FOR THAT LD. APPELLATE AUTHORITY ERRED ON FACTS AND LAW BY CO FIRMING THE ADDITIO 0 SHARE APPLICATION AND SHARE PREMIUM AMOUNT INSPITE OF APPELLANT PRODUCED ALL DOCUMETAL PROOFS IN APPEAL. 2. FOR THAT IMPUGNED APPELLATE ORDER IN INVALID AND BAD IN LAW SINCE THE APPELLATE AUTHORITY DID OT SEND THOSE DOCUMENTS TO A.O IN REMAND FOR VERIFICATION. 3. FOR THAT APPELLANT HAS ALL DOCUMENTARY EVIDENCES TO PROVE THE IDE TITY OF CREDITORS, GENUINENESS OF TRANSACTION AND CREDIT WORTHLESS. 5. Perusal of records shows that the assessee has challenged the findings of the ld.CIT(A) confirming the addition made u/s. 68 of the Act 3. ITA No 521/Kol/2019 AY 2014-15 Jibika Rice Mills P.Ltd. at Rs.3,06,50,000/- on account of unexplained share capital Rs.1,25,50,000/- and share premium Rs.1,81,00,000/-. 6. Brief facts of the case are that the assessee is a private limited company, engaged in the business of flour/rice mills. Income at Rs. 15,68,280/- declaring in e-return of income was filed on 30.03.2014. Accordingly, assessee’s case was selected for scrutiny under CASS by serving of valid/statutory notices u/s. 143(2)/142(1) of the Act. In response to which, the A/R of the assessee appeared. On perusal of records the ld. AO found that the assessee company raised Rs.3,06,50,000/- on account of share capital Rs.1,25,50,000/- and share premium Rs.1,81,00,000/-. The ld. AO issued/served notices u/s. 133(6) of the Act to the share investors of the assessee company for their personal appearance in respect of introduction of share capital/share premium. But there was no compliance on the part of the assessee. Ld.AO. The AO found that the assessee intentionally avoided the assessment proceeding and not cooperated in completing the assessment by submitting/filing necessary details. Finally he completed assessment assessing income at Rs. 3,22,18,250/- u/s. 143(3) of the Act after making addition of Rs. 3,06,50,000/- for unexplained share capital and share premium u/s. 68 of the Act. 7. Aggrieved, the assessee preferred appeal before the ld. CIT(A) challenging the impugned addition made u/s. 68 of the Act at Rs.3,06,50,000/- but failed to make any compliance and thus ld. CIT(A) confirmed the addition. 4. ITA No 521/Kol/2019 AY 2014-15 Jibika Rice Mills P.Ltd. 8. Aggrieved, the assessee is now in appeal before this Tribunal challenging the impugned additions made u/s. 68 of the Act at Rs.3,06,50,000/-. 9. Nobody has appeared on behalf of the assessee. On the other hand, the ld. DR vehemently argued supporting the orders of lower authorities and prayed for confirming the order of ld. CIT(A). 10. We have heard the ld. Departmental Representative and perused the material placed on record before us. The assessee has challenged the finding of the ld. CIT(A) confirming the addition made u/s. 68 of the Act at Rs.3,06,50,000/- on account of unexplained share capital Rs.1,25,50,000/- and share premium Rs.1,81,00,000/- received during the year. Statutory notice u/s. 143(2) of the Act duly served upon the assessee and there was no proper compliance on the part of assessee. Thereafter, the assessee failed to produce the alleged parties who had subscribed to the equity shares of the assessee company and did not file any documentary evidence to explain the alleged credit. The assessee failed to file necessary details to explain the source of alleged cash credit u/s. 68 and also unable to prove identity, creditworthiness of the share applicants/shareholders as well as genuineness of the transaction. If the assessee had sufficient details to explain the alleged sum, it could have certainly filed those details at any stage. Consistently escaping from appearing/producing the documents and alleged parties before the lower authorities and even before us indicates that the assessee has no plausible explanation to explain the source of alleged sum of share capital and security premium and, therefore, the provisions of section 68 of the Act have rightly been 5. ITA No 521/Kol/2019 AY 2014-15 Jibika Rice Mills P.Ltd. invoked by ld. AO treating the alleged sum as the unaccounted income of assessee be routed in the books through bogus/accommodation entry in the form of share capital and security premium. Therefore, under these facts and circumstances, we find no infirmity in the finding of the ld. CIT(A) confirming the addition of Rs.3,06,50,000/- made u/s. 68 of the Act. Thus, ground nos. 1 to 3 are dismissed. प रणामत: नधा रती क अपील खा रज क जाती है। 11. In the result, the appeal of the assessee is dismissed. आदेश ख ु ले यायपीठ म दनांक 02-01-2023 को उ घो षत। Sd/- Sd/- (SANJAYGARG) (MANISHBORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated : 02-01-2023 **PP/SPS आदेश क त ल प अ े षत / Copy of Order Forwarded to:- 1.अपीलाथ /Appellant/:M/s. Jibika Rice Mills P.Ltd. Paraj Station Road, East Burdw an-713406, West Bengal. 2. यथ /Respondent/: ACIT, Cir-1, Burdw an, Aa yk ar Bhavan, Kachari Road, Court Compound, East Burdw an-713101. W.B. 3. संबं धत आयकर आय ु त / Concerned CIT 4. आयकर आय ु त- अपील / CIT (A) 5. वभागीय त न ध, आयकर अपील य अ धकरण कोलकाता / DR, ITAT, Kolkata 6.गाड फाइल/Guardfile. By order/आदेश से, /True Copy/ Assistant Registrar ITAT, Kolkata