Appeal details
Counselvise Citation
[2023] 140 COUNSELVISE.COM (IT) 127330 (ITAT-KOLKATA)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
2 month(s) 12 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
04-04-2023
Appeal Filed By
Assessee
Order Result
Allowed
Bench Allotted
C
Next Hearing Date
15-03-2023
Assessment Year
2013-2014
Appeal Filed On
23-01-2023
Judgement Text
आयकर अपील य अ धकरण, कोलकाता पीठ ‘‘सी’’, कोलकाता IN THE INCOME TAX APPELLATE TRIBUNAL “C” BENCH: KOLKATA ी राजेश क ु मार, लेखा सद य एवं ी संजय शमा या यक सद य के सम [Before Shri Rajesh Kumar, Accountant Member & Shri Sonjoy Sarma, Judicial Member] I.T.A. No. 59/Kol/2023 Assessment Year: 2013-14 Priya Agarwal (PAN: BBNPA 6573 A) Vs. PCIT-13, Kolkata Appellant / (अपीलाथ ) Respondent / ( !यथ ) Date of Hearing / स ु नवाई क$ त&थ 16.03.2023 Date of Pronouncement/ आदेश उ)घोषणा क$ त&थ 05.04.2023 For the Appellant/ नधा /रती क$ ओर से Shri Siddharth Agarwal, Advocate For the Respondent/ राज व क$ ओर से Shri G. Hukugha Sema, CIT ORDER / आदेश Per Rajesh Kumar, AM: This is the appeal preferred by the assessee against the order of the Ld. Principal Commissioner of Income Tax -13, Kolkata (hereinafter referred to as the Ld. PCIT”] passed u/s 263 of the Income Tax Act, 1961 (hereinafter referred to as the Act) dated 23.03.2022 for the AY 2013-14. 2. At the outset, the issue of delay in filing the appeal of 247 days was brought to our notice for which the counsel has drawn our attention to condonation petition filed by the assessee. The Ld. Counsel for the assessee submitted that Shri Mahesh Agarwal, FCA was handling the tax matters of the assessee and under his advice the assessee did not file any appeal against the order u/s 263 of the Act on the bonafide 2 I.T.A. No. 59/Kol/2023 Assessment Year: 2013-14 Priya Agarwal belief the order is not appealable. The previous Counsel for the assessee suggested that the proceedings can be participated before the AO in the set aside proceedings u/s 263 and if any adverse order is received then the same can be appealed before the higher authority and thus no appeal was filed. Therefore the assessment proceedings were initiated pursuant to revisionary order passed by the PCIT. Now the assessee has changed the counsel and has engaged Shri Subash Agarwal, Advocate on 24.01.2023 and seeking his advice. It is now when the advice of new counsel of assesse was taken , an appeal against the order u/s 263 of the Act was filed with a delay of 247 days. The Ld. Counsel therefore submitted before the bench that delay is occurred because of the reasons which are not attributable to the assesse. Besides he submitted that the assesse is not benefitted by late filing of the appeal in any manner and therefore prayed that the delay in filing the appeal may be condoned and the appeal may be adjudicated on merit. 3. The ld. D.R on other hand objected the arguments of the Ld. A.R and submitted that the reasons cited by the Ld. A.R is not a good and sufficient reasons for condonation of delay. 4. After hearing rival submissions and perusing the material on record, we are inclined to condone the delay as the assessee cannot be penalized for the mistake which is committed by the ld. Counsel for the assessee. Besides substantive justice has to be availed upon technicalities and the assessee cannot be denied justice on these technicalities. 5. The only issue raised by the assessee in the various ground of appeal is against the invalid order passed u/s 263 by the Ld. PCIT upon the wrong assumption of jurisdiction u/s 263 of the Act. 6. Facts in brief are that the PCIT upon perusal of the assessment record came to the conclusion that the order passed by the AO u/s 143(3) read with 147 of the Act dated 9.12.2019 is erroneous insofar as prejudicial to the interest of the revenue as the AO has failed to conduct any necessary legal verifications or investigations into the 3 I.T.A. No. 59/Kol/2023 Assessment Year: 2013-14 Priya Agarwal receipt of 15,00,000/- by the assessee by sale of shares which according to PCIT were bogus sales controlled by Banka Group. Pertinent to state that the assessee has filed the return of income on 23.07.2013 declaring total income of Rs. 2,24,780/-. Thereafter consequent to search and survey operation conducted on Banka Group of cases, an information was received by the AO from DDI (Inv), Unit-1(3), Kolkata on 19.12.2018 that the assessee has made some transactions with M/s Time Sound Barter Pvt. Ltd. a shell company and accordingly the case was reopened by issuing notice u/s 148 of the on 27.03.2010 to examine the sale of shares of Rs. 15,00,000/-. After issuing notice along with questionnaire to the assesse calling upon information on sale of shares the AO accepted the reply of the assesse and did not make any addition in the assessment framed u/s 143(3) r.w.s. 147 of the Act dated 09.12.2019. This was brought to the notice of the Ld. PCIT however he set aside the order of AO and directed to frame the assessment afresh after conducting necessary verification into the transaction of sale of shares. 7. The Ld. Counsel for the assessee pointed out that these 3750 equity shares of M/s A.C Fincom pvt. Ltd. were purchased for Rs. 15,00,000/- in the FY 2010-11 and were held for a period of more than two years before being sold. The Ld. A.R pointed out that the order passed by the Ld. PCIT is invalid and nullity , in view of the fact that the issue was examined by the AO by reopening the assessment u/s 147 of the Act as this particular issue was the subject matter of the reasons recorded u/s 148(2) of the Act. The AO examined this issue and gave a specific finding at page no. 2 and thus accepted the same and no addition was made. Now the Ld. PCIT has revised the assessment on the same issue which has been concluded by the AO in favour of the assessee after examination of the evidences as filed by the assessee and giving specific observations/findings in the assessment order.The Ld. A.R therefore prayed that the order of PCIT may kindly be quashed as being nullity and invalid in the eyes of law. The Ld. A.R relied on the decision of Co-ordinate Bench in defense of his arguments in the case of ITO vs. M/s Impala Industrial Enterprises Ltd. in ITA No. 247/GTY/2019 for AY 2010-11 wherein the similar issue has been decided by the 4 I.T.A. No. 59/Kol/2023 Assessment Year: 2013-14 Priya Agarwal Tribunal. The Ld. A.R therefore prayed that the appeal of the assessee may kindly be allowed. 8. The Ld. D.R on the other hand, relied on the order of Ld. PCIT by submitting that the AO has failed to conduct necessary enquiries into the sale of shares which were of bogus/shell company and thus the jurisdiction exercised by Ld. PCIT is in consonance with the provisions of Section 263 of the Act. 9. After hearing the rival contentions and perusing the material on record, the undisputed facts are that the assessee has purchased 3750 equity shares of M/s A.C Vincom Pvt. Ltd. for consideration of Rs. 15,00,000/- which were continued to be held for more than 2 years and were duly shown in the financial statements of the assessee. During the year the assessee sold these shares on the same price to M/s Time Sound Barter Pvt. Ltd. and the money was received through banking channel. Even the notice issued u/s 133(6) of the Act was responded by the buyer by confirming the said transactions. The AO after examination the various aspects of the transactions and evidences accepted this transaction and no addition was made in the assessment u/s 143(3) read with 147 of the Act dated 9.12.2019. We note that the Ld. PCIT exercised the jurisdiction on the same issue that the AO has failed to conduct requisite enquiry into the sale of shares by the assessee as the transactions of sale of assessee were made with the shell company belonging to Banka Group of companies. In our opinion, the jurisdiction exercised by the Ld. PCIT in respect of the issue which has been decided by the AO on the basis information gathered after eliciting the necessary evidences/ records from the assessee and also after calling for the information 133(6) of the Act from the buyer of shares M/s Time Sound Barter Pvt. Ltd. is contrary to the provisions of Act. In the present case the AO has taken a plausible view on the basis of available evidences/facts as has been stated earlier that these investments were duly shown in the balance sheet of the assessee as these shares were purchased in FY 2010-11 and were not doubted there at all by the revenue authorities. Under these circumstances, we are not in a position to sustain the order of Ld. PCIT passed u/s 263 of the Act. We are supported in our decision by decision of 5 I.T.A. No. 59/Kol/2023 Assessment Year: 2013-14 Priya Agarwal the coordinate bench in the case of M/s Impala Industrial Enterprises Ltd. (supra) wherein the Co-ordinate Bench has held as under: “10. We, therefore, considering the facts and circumstances of the case and observing that the assessee made legitimate purchases in the preceding year and the said purchases were held as investments and their genuineness is not doubted by the Revenue authorities and during the year under consideration some of the investments have been sold through a broker registered with the Guwahati Stock Exchange Ltd. and the said transaction has been carried out through stock exchange and sale consideration has been received through banking channel via registered broker and, therefore, we do not find any reason to dispute the genuineness, identity and creditworthiness of the share broker at the point of time when transaction was carried out. Thus, no infirmity is called for in the finding of Id. CIT(A) deleting the alleged addition made u/s 68 of the Act. Therefore, all the grounds raised by the Revenue are dismissed.” Since the facts of the case before us are quite similar to one as decided above, we ,therefore respectfully following the same, quash the order passed by Ld. PCIT u/s 263 of the Act. 10. In the result, the appeal of the assessee is allowed. Order is pronounced in the open court on 5 th April, 2023 Sd/- Sd/- (Sonjoy Sarma /संजय शमा ) (Rajesh Kumar/राजेश क ु मार) Judicial Member/ या यक सद य Accountant Member/लेखा सद य Dated: 5 th April, 2023 SB, Sr. PS Copy of the order forwarded to: 1. Appellant- Priya Agarwal, Siddha Gibson, 1, Gibson Lane, Suite 213, 2 nd Floor, Kolkata-700069 2. Respondent – PCIT-13, Kolkata 3. DR, Kolkata Benches, Kolkata (sent through e-mail) True Copy By Order Assistant Registrar ITAT, Kolkata Benches, Kolkata
AI Insights
The case involves Priya Agarwal, the appellant, contesting an order by the PCIT-13, Kolkata, which was passed under section 263 of the Income Tax Act, 1961, for the assessment year 2013-14. The PCIT had set aside the AO's earlier order, which had accepted the assessee's transactions involving the sale of shares, and directed a fresh assessment. The tribunal examined whether the PCIT was justified in revising the AO's order, which had been based on a detailed investigation and had not found any discrepancies in the transactions. The tribunal concluded that the PCIT's order was invalid as it revisited an issue already conclusively decided by the AO.
