Appeal details
Counselvise Citation
[2018] 123 COUNSELVISE.COM (IT) 0801 (ITAT-DELHI)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
4 year(s) 7 month(s) 27 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
08-10-2018
Appeal Filed By
Assessee
Order Result
Partly Allowed
Bench Allotted
G
Next Hearing Date
25-05-2017
Assessment Year
2008-2009
Appeal Filed On
11-02-2014
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES G : DELHI BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI L.P. SAHU, ACCOUNTANT MEMBER ITA.NO.787/DEL./2014 ASSESSMENT YEAR 2008-2009 SUNSHINE CAPITAL LTD., 209, BHANOT PLAZA-II, 3-D.B. GUPTA ROAD, NEW DELHI-055 PAN AABCS1913J VS. THE DCIT, CIRCLE-9(1), NEW DELHI. (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI ROHIT GARG, AND SHRI SIDDHARTH JOSHI, ADVOCATES FOR REVENUE : SHRI S.S. RANA, CIT-D.R. DATE OF HEARING : 29.08.2018 DATE OF PRONOUNCEMENT : 08.10.2018 ORDER PER BHAVNESH SAINI, J.M. THIS APPEAL BY ASSESSEE HAS BEEN DIRECTED AGAINST THE ORDER OF THE LD. CIT(A)-XI, NEW DELHI, DATED 29 .11.2013, FOR THE A.Y. 2008-2009. 2 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. 2. WE HAVE HEARD THE LEARNED REPRESENTATIVES OF BO TH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON R ECORD. 3. THE FACTS OF THE CASE ARE THAT ASSESSEE-COMPANY FILED RETURN OF INCOME DECLARING AN INCOME OF RS.19,92,354/- ON 29.09.2008. THE SAME WAS PROCESSE D UNDER SECTION 143(1). CASE WAS SELECTED FOR SCRUTIN Y. THE ASSESSEE DURING THE RELEVANT YEAR DERIVED INCOME FR OM INVESTMENTS. DURING THE YEAR UNDER CONSIDERATION, T HE ASSESSEE HAS INCREASED ITS SHARE CAPITAL FROM RS.3,02,09,000/- TO RS. 13,02,09,000/-. ASSESSEE-CO MPANY HAS ALSO RECEIVED SHARE PREMIUM AMOUNTING TO RS. 90,00,00,000/-. IN ALL, THE ASSESSEE HAS RECEIVED R S.100 CRORES AS SHARE CAPITAL AND SHARE PREMIUM DURING YE AR UNDER CONSIDERATION. THE ASSESSEE HAS SUBMITTED LIS T OF SHAREHOLDERS AS ON 17-03-2008 WHICH RUNS INTO 23 PA GES AND THE SHAREHOLDER ARE 555 ARE IN NUMBER. HOWEVER AS ON 31-03-2008 THE SHAREHOLDERS ARE EIGHT INVESTMENT AN D 3 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. FINANCE COMPANIES ONLY I.E. ALL THE SHARES FROM THE SHAREHOLDERS AS ON 17-03-2008 HAS BEEN TRANSFERRED TO THE EIGHT LISTED COMPANIES MENTIONED AT PAGE-2 OF THE ASSESSMENT ORDER WHICH ARE (1) M/S. HILLRIDGE INVES TMENT LTD., (2) KARISHMA INDUSTRIES LTD., (3) NISHA HOLD ING LTD., (3) PARISUDH FINANCE CO. PVT. LTD., (5) PELLCON FIN ANCE & LEASING LTD., (6) PITAMBARA SECURITIES PVT. LTD., ( 7) S.R. CABLES PVT. LTD., AND (8) VOGUE LEASING & FINANCE P VT. LTD., THE ADDRESSES OF THESE PARTIES, PAN, NUMBER OF SHAR E AND PERCENTAGE ARE MENTIONED. THE ASSESSEE SUBMITTED CONFIRMATION, COPY OF BANK ACCOUNT, COPY OF ITR, CO PY OF AUDITED BALANCE SHEET, STATEMENT OF ACCOUNT FOR F.Y 2007- 08 AND COPIES OF EARLIER ASSESSMENT ORDERS IN RESPE CT OF ALL THESE EIGHT PARTIES. INFORMATION UNDER SECTION 133 (6) WAS CALLED FOR FROM THE BANK, WHICH REVEALED THAT ALMOS T ALL THE ACCOUNTS WERE OPENED IN THE MONTH OF FEBRUARY AND M ARCH, 2008. NONE OF THE ACCOUNT OPENING FORMS WERE INTRO DUCED BY ANY INTRODUCER. THE ACCOUNT OPENING FORMS WERE N OT 4 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. PROPERLY FILLED-UP. THE A.O, THEREFORE, FOUND IT TO BE DUBIOUS. THE A.O. ALSO NOTED THAT FUNDS HAVE MOVED FROM ONE COMPANY TO ANOTHER COMPANY AND FINALLY WENT INT O A COMPANY WHICH IS NOT PART OF THIS WEB OF COMPANIES. THE A.O. IN ORDER TO INVESTIGATE FURTHER, DEPUTED THE I NSPECTOR TO IDENTIFY THE ADDRESSES AND BUSINESS ADDRESSES/ACTIV ITIES OF THE SHAREHOLDERS COMPANIES, WHO HAS FILED ENQUIRY R EPORT DATED 21.12.2010 MENTIONING THE LOCAL INSPECTION DO NE BY HIM THAT THE FIVE OF THE SHAREHOLDER COMPANIES WERE NOT FUNCTIONING FROM THE PROPERTY IN QUESTION AT THE TI ME OF HIS INSPECTION. THE INSPECTOR DID NOT FIND ANY SHARE REGISTER/SHARE TRANSFER CERTIFICATE AT THE TIME OF HIS VISIT. THE ASSESSEE COULD NOT PRODUCE ANY OF THE SINGLE SHAREHOLDER OUT OF 555 SHAREHOLDERS DURING THE ASSE SSMENT PROCEEDINGS. THE A.O. EXAMINED SHRI S.K. JAIN, DIRE CTOR OF THE ASSESSEE-COMPANY UNDER SECTION 131 OF THE I.T. ACT ON 23.12.2010, HIS STATEMENT IS REPRODUCED IN THE ASSE SSMENT ORDER. THE A.O. AFTER EXAMINING THE ISSUE CONCLUDED THAT 5 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. THE SHARE CAPITAL, SHARE PREMIUM RECEIVED BY THE AS SESSEE ARE NOTHING BUT SHAM TRANSACTION TO GIVE LEGAL COLO UR TO THE UNACCOUNTED MONEY OF THE ASSESSEE-COMPANY. THEREFOR E, ENTIRE AMOUNT OF RS.100 CRORES WAS ADDED TO THE INC OME OF ASSESSEE UNDER SECTION 68 OF THE I.T. ACT, 1961. 4. THE A.O. NOTED THAT DURING THE YEAR ASSESSEE- COMPANY HAS EARNED DIVIDEND INCOME OF RS.590/-. THE A.O. ASKED THE ASSESSEE-COMPANY AS TO WHY THE EXPENSES B E NOT DISALLOWED UNDER SECTION 14A READ WITH RULE 8D OF T HE I.T. RULES. THE A.O. AFTER CONSIDERING THE EXPLANATION O F ASSESSEE-COMPANY, DISALLOWED RS.22,74,040/- UNDER SECTION 14A READ WITH RULE 8D OF THE I.T. RULES, 19 62. 5. THE ASSESSEE-COMPANY CHALLENGED BOTH THE ADDITIONS BEFORE THE LD. CIT(A). THE WRITTEN SUBMIS SIONS OF THE ASSESSEE-COMPANY IS REPRODUCED IN THE APPELLATE ORD ER IN WHICH THE ASSESSEE-COMPANY BRIEFLY EXPLAINED THAT A SSESSEE - COMPANY FILED DOCUMENTARY EVIDENCES OF EACH OF THE 6 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. SHAREHOLDER AND DESPITE FINDING NO DEFECT OF THESE EVIDENCES, THE A.O. MADE ADDITION FOR ACCOMMODATION ENTRIES UN DER SECTION 68 OF THE I.T. ACT. THE DOCUMENTS FILED BEF ORE A.O. WERE COPIES OF THE CONFIRMATION FROM ALL THE SHAREHOLDER S, COPIES OF THEIR ITRS, COPIES OF THEIR AUDITED BALANCE-SHEET, COPIES OF THE STATEMENT OF ACCOUNT FOR EACH YEAR IN QUESTION, COP IES OF THE SCHEDULES OF INVESTMENT OF THESE COMPANIES TO SHOW THAT THESE COMPANIES HAVE MADE INVESTMENT IN SHARE CAPITAL OF THE ASSESSEE COMPANY, COPIES OF THE EARLIER ASSESSMENT ORDERS IN THEIR CASES, COPIES OF THE BANK ACCOUNTS, COPIES OF THE BANK STATEMENTS OF ALL THE SHAREHOLDERS OF RELEVANT PERI OD REFLECTING THE TRANSACTION WITH THE ASSESSEE-COMPANY, COPIES O F THE CONFIRMATIONS OF STATEMENT OF ACCOUNTS OF ALL THE S HAREHOLDERS AND COPIES OF MASTER DATA OF THESE EIGHT COMPANIES OBTAINED FROM THE WEBSITE OF REGISTRAR OF COMPANIES. THE ASS ESSEE- COMPANY, THEREFORE, PROVED THE IDENTITY OF THE SHAR EHOLDERS, THEIR CREDITWORTHINESS AND GENUINENESS OF THE TRANS ACTION. THE ASSESSEE-COMPANY ALSO FILED PARAWISE REPLIES TO THE REPORT OF 7 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. THE INSPECTOR ABOVE AND THE FUNCTIONING OF THE SHAR EHOLDERS. IT WAS EXPLAINED THAT ASSESSEE-COMPANY HAS NO CONCERN WITH THE OPENING OF THE BANK ACCOUNT BY THE SHAREHOLDERS. TH EY ARE EXISTING COMPANIES AND ASSESSED TO TAX. THE REPORT OF THE INSPECTOR WAS NOT CONFRONTED TO THE ASSESSEE-COMPAN Y. THE REPORT OF THE INSPECTOR DID NOT DISPUTE THAT THESE COMPANIES WERE FUNCTIONING AT THE ADDRESS GIVEN BY THE ASSESS EE- COMPANY. THE ASSESSEE-COMPANY RELIED UPON THE DECIS ION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. KAMDHENU STEEL AND ALLOYS LTD., 19 TAXMAN.COM 26, CIT VS. OA SIS HOSPITALITIES (P) LTD., 198 TAXMAN 247 (DEL.), CIT VS. WINSTRAL PETROCHEMICALS PVT. LTD., 10 TAXMAN.COM 137 AND CIT VS. DWARADHEESH INVESTMENT PVT. LTD., 194 TAXMAN 42. IT WAS SUBMITTED THAT ASSESSEE-COMPANY IS NBFC AND IS ENGA GED IN THE BUSINESS OF INVESTMENTS, GIVING LOANS AND ADVAN CES AND THEREBY EARNING INTEREST, DIVIDEND AND PROFIT ON SA LE OF SHARES. THE ASSESSEE-COMPANY HAS EARNED EXEMPT INCOME OF RS .590/- 8 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. ONLY. THEREFORE, DISALLOWANCE MORE THAN THE EXEMPT INCOME IS WHOLLY UNJUSTIFIED. 6. THE A.O. FILED THE REMAND REPORT BEFORE LD. CI T(A) IN WHICH FACTS STATED IN THE ASSESSMENT ORDER HAVE BEE N REITERATED. IT IS ALSO SUBMITTED IN THE REMAND REPO RT THAT SUMMONS UNDER SECTION 131 WERE ISSUED TO ALL THE CO RPORATE SHAREHOLDERS. DIRECTORS OF THE SHAREHOLDER COMPANIE S WERE PRESENT AND THEIR STATEMENTS HAVE BEEN RECORDED ON OATH WHO HAVE ALSO SUBMITTED COPIES OF THEIR BALANCE-SHEET F OR A.Y. 2008-2009, BANK STATEMENT, CONFIRMATION OF THE ACCO UNT AND THEIR ASSESSMENT ORDERS UNDER SECTION 143(3) OF THE I.T. ACT. 7. THE ASSESSEE-COMPANY IN THE REJOINDER REITERATE D THE SUBMISSIONS ALREADY MADE ABOVE AND SUBMITTED TH AT INITIAL BURDEN UPON ASSESSEE-COMPANY TO PROVE GENUI NE CREDITS HAVE BEEN DISCHARGED. 8. LD. CIT(A) CONSIDERING THE MATERIAL ON RECORD N OTED THAT THE SHAREHOLDERS HAVE SHOWN NOMINAL PROFIT WHI CH 9 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. INDICATES THE NON-GENUINE ACTIVITY OF THESE COMPANI ES. THE DIRECTORS OF THE COMPANIES ARE FREQUENTLY CHANGED. THE PERSONS WHO APPEARED BEFORE A.O. ARE THE NEW DIRECT ORS AND SOME OF THEM WERE NOT HAVING ANY SHARE IN ANY OF TH E COMPANIES. THE INSPECTOR REPORTED THAT THESE COMPAN IES ARE NOT OPERATING FROM THE PLACE AND ARE MANAGED BY SHR I S.K. JAIN, DIRECTOR OF THE ASSESSEE-COMPANY. THE BANK AC COUNTS HAVE BEEN OPENED BY THE INVESTMENT COMPANIES WITHOU T INTRODUCTION AND NO DETAILS HAVE BEEN SUBMITTED FOR CHARGING OF THE PREMIUM. THOUGH THE ASSESSEE-COMPANY DONE TH E DOCUMENTATION BY FILING THE DOCUMENTARY EVIDENCES, BUT FAILED TO PROVE GENUINENESS OF THE COMPANIES ON THE TRANSA CTIONS. THE LD. CIT(A) RELIED UPON THE DECISION OF THE HON BLE DELHI HIGH COURT IN THE CASE OF CIT VS. N.R. PORTFOLIO PV T. LTD., AND CONFIRMED THE ADDITION AND DISMISSED THIS GROUND OF APPEAL OF ASSESSEE. 9. AS REGARDS ADDITION UNDER SECTION 14A OF THE I. T. ACT, THE LD. CIT(A) ALSO NOTED THAT ASSESSEE-COMPAN Y HAS 10 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. EARNED DIVIDEND INCOME OF RS.590/- ONLY. THE ACTION OF THE A.O. IN MAKING DISALLOWANCE WAS UPHELD IN PRINCIPLE , BUT, IT WAS FOUND REASONABLE IF 1/3 RD OF THE EXPENDITURE CLAIMED BY THE ASSESSEE-COMPANY IS ATTRIBUTABLE TOWARDS EARNIN G OF THE EXEMPT DIVIDEND INCOME. THE LD. CIT(A) ACCORDINGLY UPHELD THE DISALLOWANCE OF A SUM OF RS.5,27,32,100/- AND D ELETED THE REST OF THE ADDITION. THE APPEAL OF THE ASSESSEE-CO MPANY HAS BEEN PARTLY ALLOWED. 10. THE ASSESSEE ON GROUND NOS. 1 TO 8 CHALLENGED THE ADDITION OF RS.100 CRORES UNDER SECTION 68 OF THE I .T. ACT AS WELL AS DISALLOWANCE UNDER SECTION 14A READ WITH RU LE 8D OF THE I.T. RULES, 1962. THE ASSESSEE-COMPANY ALSO FIL ED AN APPLICATION FOR ADMISSION OF THE FOLLOWING ADDITION AL GROUND OF APPEAL : ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND ALSO IN LAW, THE ASSESSMENT ORDER PASSED IN THE APPELLANTS CASE UNDER SECTION 153C/153A DATED 11 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. 28.03.2013 NEED BE GIVEN PRECEDENCE OVER THE IMPUGN ED ORDER OF ASSESSMENT DATED 31.12.2010 IN VIEW OF THE DECISION OF THE HONBLE JURISDICTIONAL DELHI HIGH C OURT IN THE CASE OF CIT VS. ANIL KUMAR BHATIA 352 ITR 493. 11. LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THA T IT IS PURELY A LEGAL GROUND AND ALSO PLACED ON RECORD COPY OF THE ASSESSMENT ORDER DATED 28.03.2013 UNDER SECTION 153 C/153A OF THE I.T. ACT, 1961, FOR THE A.Y. 2008-2009 IN TH E CASE OF ASSESSEE-COMPANY. HE HAS SUBMITTED THAT ONLY ONE ASSESSMENT IS TO BE FRAMED. PROCEEDINGS UNDER SECTI ON 153C SHALL HAVE TO BE DONE ON THE BASIS OF THE INCRIMINA TING MATERIAL. THE ASSESSMENT ORDER UNDER SECTION 153C A RE PREVAILED OVER THE ASSESSMENT ORDER UNDER SECTION 1 43(3). THE PROCEDURE FOR ASSESSMENT UNDER SECTION 153A OR 153C IS SAME. THE ORDER UNDER SECTION 153C IN THE CASE OF A SSESSEE- COMPANY IS FINAL. SO, IT WILL SUPERSEDE THE IMPUGNE D ORDER UNDER SECTION 143(3). LEARNED COUNSEL FOR THE ASSES SEE RELIED UPON DECISION OF THE HONBLE DELHI HIGH COURT IN TH E CASE OF 12 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. CIT VS. ANIL KUMAR BHATIA (2013) 352 ITR 493 (DEL.) IN WHICH IN PARAS 20 TO 23, IT WAS HELD AS UNDER : 20. UNDER THE PROVISIONS OF SECTION 153A , AS WE HAVE ALREADY NOTICED, THE ASSESSING OFFICER IS BOUND TO ISSUE NOTICE TO THE ASSESSEE TO FURNISH RETURNS FOR EACH ASSESSMENT YEAR FALLING WITHIN THE SIX ASSESSMENT Y EARS IMMEDIATELY PRECEDING THE ASSESSMENT YEAR RELEVANT TO THE PREVIOUS YEAR IN WHICH THE SEARCH OR REQUISITIO N WAS MADE. ANOTHER SIGNIFICANT FEATURE OF THIS SECTION I S THAT THE ASSESSING OFFICER IS EMPOWERED TO ASSESS OR REASSES S THE 'TOTAL INCOME' OF THE AFORESAID YEARS. THIS IS A SI GNIFICANT DEPARTURE FROM THE EARLIER BLOCK ASSESSMENT SCHEME IN WHICH THE BLOCK ASSESSMENT ROPED IN ONLY THE UNDISC LOSED INCOME AND THE REGULAR ASSESSMENT PROCEEDINGS WERE PRESERVED, RESULTING IN MULTIPLE ASSESSMENTS. UNDER SECTION 153A , HOWEVER, THE ASSESSING OFFICER HAS BEEN GIVEN THE POWER TO ASSESS OR REASSESS THE TOT AL 13 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. INCOME OF THE SIX ASSESSMENT YEARS IN QUESTION IN SEPARATE ASSESSMENT ORDERS. THIS MEANS THAT THERE C AN BE ONLY ONE ASSESSMENT ORDER IN RESPECT OF EACH OF THE SIX ASSESSMENT YEARS, IN WHICH BOTH THE DISCLOSED AND T HE UNDISCLOSED INCOME WOULD BE BROUGHT TO TAX. 21. A QUESTION MAY ARISE AS TO HOW THIS IS SOUGHT TO BE ACHIEVED WHERE AN ASSESSMENT ORDER HAD ALREADY BEEN PASSED IN RESPECT OF ALL OR ANY OF THOSE SIX ASSESS MENT YEARS, EITHER UNDER SECTION 143(1)(A) OR SECTION 143(3) OF THE ACT. IF SUCH AN ORDER IS ALREADY IN EXISTENCE, HAVING OBVIOUSLY BEEN PASSED PRIOR TO THE INITIATION OF TH E SEARCH/REQUISITION, THE ASSESSING OFFICER IS EMPOWE RED TO REOPEN THOSE PROCEEDINGS AND REASSESS THE TOTAL INC OME, TAKING NOTE OF THE UNDISCLOSED INCOME, IF ANY, UNEA RTHED DURING THE SEARCH. FOR THIS PURPOSE, THE FETTERS IM POSED UPON THE ASSESSING OFFICER BY THE STRICT PROCEDURE TO ASSUME JURISDICTION TO REOPEN THE ASSESSMENT 14 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. UNDER SECTIONS 147 AND 148 , HAVE BEEN REMOVED BY THE NON OBSTANTE CLAUSE WITH WHICH SUB SECTION (1) OF SECTION 153A OPENS. THE TIME-LIMIT WITHIN WHICH THE NOTICE UNDER SECTION 148 CAN BE ISSUED, AS PROVIDED IN SECTION 149 HAS ALSO BEEN MADE INAPPLICABLE BY THE NON OBSTANT E CLAUSE. SECTION 151 WHICH REQUIRES SANCTION TO BE OBTAINED BY THE ASSESSING OFFICER BY ISSUE OF NOTIC E TO REOPEN THE ASSESSMENT UNDER SECTION 148 HAS ALSO BEEN EXCLUDED IN A CASE COVERED BY SECTION 153A . THE TIME- LIMIT PRESCRIBED FOR COMPLETION OF AN ASSESSMENT OR REASSESSMENT BY SECTION 153 HAS ALSO BEEN DONE AWAY WITH IN A CASE COVERED BY SECTION 153A . WITH ALL THE STOPS HAVING BEEN PULLED OUT, THE ASSESSING OFFICER UNDER SECTION 153A HAS BEEN ENTRUSTED WITH THE DUTY OF BRINGING TO TAX THE TOTAL INCOME OF AN ASSESSEE WHO SE CASE IS COVERED BY SECTION 153A , BY EVEN MAKING REASSESSMENTS WITHOUT ANY FETTERS, IF NEED BE. 15 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. 22. NOW THERE CAN BE CASES WHERE AT THE TIME WHEN THE SEARCH IS INITIATED OR REQUISITION IS MADE, THE ASS ESSMENT OR REASSESSMENT PROCEEDINGS RELATING TO ANY ASSESSM ENT YEAR FALLING WITHIN THE PERIOD OF THE SIX ASSESSMEN T YEARS MENTIONED ABOVE, MAY BE PENDING. IN SUCH A CASE, TH E SECOND PROVISO TO SUB SECTION (1) OF SECTION 153A SAYS THAT SUCH PROCEEDINGS 'SHALL ABATE'. THE REASON IS NOT FAR TO SEEK. UNDER SECTION 153A , THERE IS NO ROOM FOR MULTIPLE ASSESSMENT ORDERS IN RESPECT OF ANY OF THE SIX ASSE SSMENT YEARS UNDER CONSIDERATION. THAT IS BECAUSE THE ASSE SSING OFFICER HAS TO DETERMINE NOT MERELY THE UNDISCLOSED INCOME OF THE ASSESSEE, BUT ALSO THE TOTAL INCOME OF THE ASSESSEE IN WHOSE CASE A SEARCH OR REQUISITION HAS BEEN INITIATED. OBVIOUSLY THERE CANNOT BE SEVERAL O RDERS FOR THE SAME ASSESSMENT YEAR DETERMINING THE TOTAL INCOME OF THE ASSESSEE. IN ORDER TO ENSURE THIS STATE OF A FFAIRS NAMELY, THAT IN RESPECT OF THE SIX ASSESSMENT YEARS PRECEDING THE ASSESSMENT YEAR RELEVANT TO THE YEAR IN 16 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. WHICH THE SEARCH TOOK PLACE THERE IS ONLY ONE DETERMINATION OF THE TOTAL INCOME, IT HAS BEEN PROV IDED IN THE SECOND PROVISO OF SUB SECTION (1) OF SECTION 153A THAT ANY PROCEEDINGS FOR ASSESSMENT OR REASSESSMENT OF T HE ASSESSEE WHICH ARE PENDING ON THE DATE OF INITIATIO N OF THE SEARCH OR MAKING REQUISITION 'SHALL ABATE'. ONCE TH OSE PROCEEDINGS ABATE, THE DECKS ARE CLEARED, FOR THE ASSESSING OFFICER TO PASS ASSESSMENT ORDERS FOR EAC H OF THOSE SIX YEARS DETERMINING THE TOTAL INCOME OF THE ASSESSEE WHICH WOULD INCLUDE BOTH THE INCOME DECLAR ED IN THE RETURNS, IF ANY, FURNISHED BY THE ASSESSEE AS W ELL AS THE UNDISCLOSED INCOME, IF ANY, UNEARTHED DURING TH E SEARCH OR REQUISITION. THE POSITION THUS EMERGING I S THAT WHERE ASSESSMENT OR REASSESSMENT PROCEEDINGS ARE PENDING COMPLETION WHEN THE SEARCH IS INITIATED OR REQUISITION IS MADE, THEY WILL ABATE MAKING WAY FOR THE ASSESSING OFFICER TO DETERMINE THE TOTAL INCOME OF THE ASSESSEE IN WHICH THE UNDISCLOSED INCOME WOULD ALSO BE 17 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. INCLUDED, BUT IN CASES WHERE THE ASSESSMENT OR REASSESSMENT PROCEEDINGS HAVE ALREADY BEEN COMPLETE D AND ASSESSMENT ORDERS HAVE BEEN PASSED DETERMINING THE ASSESSEE S TOTAL INCOME AND SUCH ORDERS ARE SUBSISTING AT THE TIME WHEN THE SEARCH OR THE REQUISITION IS MADE , THERE IS NO QUESTION OF ANY ABATEMENT SINCE NO PROCEEDING S ARE PENDING. IN THIS LATTER SITUATION, THE ASSESSING OF FICER WILL REOPEN THE ASSESSMENTS OR REASSESSMENTS ALREADY MAD E (WITHOUT HAVING THE NEED TO FOLLOW THE STRICT PROVI SIONS OR COMPLYING WITH THE STRICT CONDITIONS OF SECTIONS 147 , 148 AND 151 ) AND DETERMINE THE TOTAL INCOME OF THE ASSESSEE. SUCH DETERMINATION IN THE ORDERS PASSED UNDER SECTION 153A WOULD BE SIMILAR TO THE ORDERS PASSED IN ANY REASSESSMENT, WHERE THE TOTAL INCOME DETERMINED IN THE ORIGINAL ASSESSMENT ORDER AND THE INCOME THAT ESCAPED ASSESSMENT ARE CLUBBED TOGETHER AND ASSESSED AS THE TOTAL INCOME. IN SUCH A CASE, TO RE ITERATE, THERE IS NO QUESTION OF ANY ABATEMENT OF THE EARLIE R 18 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. PROCEEDINGS FOR THE SIMPLE REASON THAT NO PROCEEDIN GS FOR ASSESSMENT OR REASSESSMENT WERE PENDING SINCE THEY HAD ALREADY CULMINATED IN ASSESSMENT OR REASSESSMENT OR DERS WHEN THE SEARCH WAS INITIATED OR THE REQUISITION WA S MADE. 23. IN THE LIGHT OF OUR DISCUSSION, WE FIND IT DIF FICULT TO UPHOLD THE VIEW OF THE TRIBUNAL EXPRESSED IN PARA 9 .6 OF ITS ORDER THAT SINCE THE RETURNS OF INCOME FILED BY THE ASSESSEE FOR ALL THE SIX YEARS UNDER CONSIDERATION BEFORE THE SEARCH TOOK PLACE WERE PROCESSED UNDER SECTION 143(1)(A) OF THE ACT, THE PROVISIONS OF SECTION 153A CANNOT BE INVOKED. THE ASSESSING OFFICER HAS THE POWER UNDER SECTION 153A TO MAKE ASSESSMENT FOR ALL THE SIX YEARS AND COMPUTE THE TOTAL INCOME OF THE ASSESSEE, INCLUDING THE UNDISCLOSED INCOME, NOTWITHSTANDING THAT THE ASSESSEE FILED RETURNS BEF ORE THE DATE OF SEARCH WHICH STOOD PROCESSED UNDER SECTION 19 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. 143(1)(A) . THE OTHER REASON GIVEN BY THE TRIBUNAL IN THE SAME PARAGRAPH OF ITS ORDER THAT NO MATERIAL WAS FO UND DURING THE SEARCH IS FACTUALLY UNSUSTAINABLE SINCE THE ENTIRE CASE AND ARGUMENTS BEFORE THE DEPARTMENTAL AUTHORITIES AS WELL AS THE TRIBUNAL HAD PROCEEDED O N THE BASIS THAT THE DOCUMENT EMBODYING THE TRANSACTION W ITH MOHINI SHARMA WAS RECOVERED FROM THE ASSESSEE. WHIL E SUMMARIZING THE CONTENTIONS OF THE ASSESSEE IN PARA GRAPH 5 OF ITS ORDER, THE TRIBUNAL ITSELF HAS REFERRED TO THE CONTENTION THAT NO DOCUMENT MUCH LESS INCRIMINATING MATERIAL WAS FOUND DURING THE SEARCH OF THE ASSESSE E S PREMISES, EXCEPT ONE UNSIGNED UNDERTAKING FOR LOAN. AGAIN IN PARAGRAPH 10 OF ITS ORDER, WHILE DEALING WITH TH E ASSESSEE S CONTENTION AGAINST THE ADDITION OF `1,50,000/- BEING UNEXPLAINED LOAN GIVEN TO MOHINI SHARMA, THE TRIBUNAL HAS STATED THAT IT HAS ANALYZED 'THE SUBJE CT DOCUMENT CAREFULLY, RECOVERED FROM SEARCH' SUGGESTI NG THAT THE DOCUMENT WAS RECOVERED DURING THE SEARCH F ROM 20 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. THE ASSESSEE. THE TRIBUNAL HAS EVEN PROCEEDED TO DE LETE THE ADDITION OF `1,50,000/- AS WELL AS THE NOTIONAL INTEREST ON MERITS, HOLDING THAT THE DOCUMENT WAS UNSIGNED, THAT MOHINI SHARMA WAS NOT EXAMINED BY THE INCOME TAX AUTHORITIES AND THERE WAS NO CORROBORATION OF THE U NSIGNED DOCUMENT. IF IT IS NOT IN DISPUTE THAT THE DOCUMENT WAS FOUND IN THE COURSE OF THE SEARCH OF THE ASSESSEE, THEN SECTION 153A IS TRIGGERED. ONCE THE SECTION IS TRIGGERED, IT APPEARS MANDATORY FOR THE ASSESSING O FFICER TO ISSUE NOTICES UNDER SECTION 153A CALLING UPON THE ASSESSEE TO FILE RETURNS FOR THE SIX ASSESSMENT YEARS PRIOR TO THE YEAR IN WHICH THE SEARCH TOOK PLACE. T HERE ARE CONTRADICTIONS IN THE ORDER OF THE TRIBUNAL. WE ARE UNABLE TO APPRECIATE HOW THE TRIBUNAL CAN SAY IN PARA 9.6 THAT NO MATERIAL WAS FOUND DURING THE SEARCH AND AT THE SAM E TIME IN PARAGRAPH 10 DEAL WITH THE MERITS OF THE AD DITIONS BASED ON THE DOCUMENT RECOVERED DURING THE SEARCH W HICH ALLEGEDLY CONTAIN THE LOAN TRANSACTION WITH MOHINI 21 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. SHARMA. THEREFORE, BOTH THE REASONS GIVEN BY THE TR IBUNAL FOR HOLDING THAT THE ASSESSMENTS MADE UNDER SECTION 153A WERE BAD IN LAW DO NOT COMMEND THEMSELVES TO US. THE RESULT IS THAT THE FIRST SUBSTANTIAL QUESTION O F LAW IS ANSWERED IN THE NEGATIVE, IN FAVOUR OF THE REVENUE AND AGAINST THE ASSESSEE. 11.1. LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED T HAT ADDITIONAL GROUND BEING LEGAL IN NATURE MAY BE ADMI TTED FOR ADJUDICATION IN VIEW OF DECISION OF THE HONBLE SUP REME COURT IN THE CASE OF NATIONAL THERMAL POWER CO. LIMITED V S. CIT (1998) 229 ITR 383 (SC) IN WHICH IT WAS HELD THAT THE TRIBUNAL IS NOT CONFINED ONLY TO ISSUES ARISING OUT OF THE A PPEAL BEFORE THE LD. CIT(A) BUT HAS DISCRETION TO ALLOW A NEW GR OUND TO BE RAISED IF A PURE QUESTION OF LAW ARISE, FOR WHICH A RE ON RECORD OF THE AUTHORITIES BELOW, THE QUESTION SHOULD BE ALLOW ED TO BE RAISED IF IT IS NECESSARY TO ASSESS THE CORRECT TAX LIABILITY. HE HAS SUBMITTED THAT ASSESSEE-COMPANY COULD NOT RAISE THIS 22 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. ADDITIONAL GROUND BEFORE LD. CIT(A) BECAUSE THE ASS ESSMENT ORDER UNDER SECTION 153A/153C DATED 28.03.2013 WAS PASSED AFTER FILING OF THE FIRST APPEAL BEFORE LD. CIT(A). 12. THE LD. D.R. ON THE OTHER HAND, STRONGLY OBJEC TED TO THE ADMISSION OF THE ADDITIONAL GROUND OF APPEAL ON THE GROUND THAT SUCH ADDITIONAL GROUND HAS BEEN RAISED FOR THE FIRST TIME. THERE IS NO MENTION OF ANY SEARCH IN TH E CASE OF ASSESSEE-COMPANY OR ANY ASSESSMENT UNDER SECTION 153A/153C OF THE I.T. ACT. ANY SUBSEQUENT SEARCH OR SUBSEQUENT ASSESSMENT CANNOT INVALIDATE THE ASSESSM ENT ORDER IN DISPUTE. THE ADDITIONAL GROUND OF APPEAL W AS NOT RAISED BEFORE LD. CIT(A). THEREFORE, THERE IS NO JU STIFICATION TO RAISE THE SAME NOW. HE HAS SUBMITTED THAT LD. CIT(A ) PASSED THE ORDER ON 29.11.2013 AFTER THE ASSESSMENT ORDER UNDER SECTION 153C DATED 28.03.2013 WAS PASSED. BUT, ASSE SSEE- COMPANY DID NOT RAISE ANY SUCH QUESTION BEFORE LD. CIT(A). IF THE A.O. DID NOT TAKE ADDITION OF RS.100 CRORES IN ASSESSMENT ORDER UNDER SECTION 153C, IT WOULD NOT MEAN SUCH AD DITION IS 23 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. DELETED. THE ASSESSMENTS UNDER SECTION 153A AND 153 C ARE TOTALLY DIFFERENT. COMPLETED ASSESSMENT CANNOT BE T OUCHED UPON IN THE REGULAR ASSESSMENT PROCEEDINGS. THE LD. D.R. RELIED UPON DECISION OF HONBLE BOMBAY HIGH COURT I N THE CASE OF ULTRATECH CEMENT LTD., VS., ADDL. CIT (2017) 298 CTR 437 (BOM.) AND DECISION OF HONBLE SUPREME COURT IN THE CASE OF ADDL. CIT VS. GURJARGRAVURES (P.) LTD., (1978) 111 ITR 1 (SC). 13. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IN THIS C ASE, THE A.O. PASSED THE IMPUGNED ASSESSMENT ORDER UNDER SECTION 143(3) OF THE I.T. ACT, 1961, FOR THE A.Y. 2008-2009 ON DA TED 31.12.2010 AND MADE THE ABOVE TWO ADDITIONS WHICH W ERE UNDER CHALLENGE BEFORE THE TRIBUNAL. THE A.O. PASSE D ANOTHER ASSESSMENT ORDER IN THE CASE OF SAME ASSESSEE-COMPA NY FOR THE A.Y. 2008-2009 UNDER APPEAL UNDER SECTION 153C/ 153A OF THE I.T. ACT DATED 28.03.2013, COPY OF THE SAME IS FILED ON RECORD. IN THIS ORDER, A.O. HAS MENTIONED THAT SEAR CH AND SEIZURE OPERATION WAS CARRIED-OUT AT VARIOUS PREMIS ES OF SHRI 24 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. S.K. JAIN GROUP OF CASES AND ASSOCIATED PERSONS ON 14.09.2010. DURING THE COURSE OF SEARCH AND SEIZURE OPERATION AT VARIOUS PREMISES OF SHRI S.K. JAIN GROUP OF CASE S, MANY BOOKS OF ACCOUNT AND DOCUMENTS BELONGING TO THE ASS ESSEE COMPANY WERE FOUND AND SEIZED AND A.O. WAS SATISFIE D TO PROCEED UNDER SECTION 153C OF THE I.T. ACT AGAINST THE ASSESSEE-COMPANY. THE A.O. ACCORDINGLY ISSUED NOTIC E UNDER SECTION 153C/153A OF THE I.T. ACT ON 26.02.2013 AND DIRECTED THE ASSESSEE-COMPANY TO FILE RETURN OF INCOME. THE ASSESSEE- COMPANY SUBMITTED BEFORE A.O. THAT THE RETURN ORIGI NALLY FILED ON 29.09.2008 DECLARING INCOME OF RS.19,92,354/- MA Y BE TREATED AS RETURN FILED IN RESPONSE TO NOTICE UNDER SECTION 153C/153A OF THE I.T. ACT, 1961. THE A.O. AFTER DIS CUSSION, ASSESSED THE INCOME AT RETURNED INCOME OF RS.19,92, 354/-. IT IS, THEREFORE, CLEAR FROM THESE TWO ASSESSMENT ORDE RS THAT SEARCH WAS CONDUCTED IN SHRI S.K. JAIN GROUP OF CAS ES AND ASSOCIATED PERSONS. SHRI S.K. JAIN IS DIRECTOR OF T HE ASSESSEE COMPANY. DURING THE COURSE OF SEARCH INCRIMINATING MATERIAL 25 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. PERTAINING TO ASSESSEE-COMPANY WERE FOUND AND SEIZE D. THEREFORE, A.O. INITIATED PROCEEDINGS UNDER SECTION 153C OF THE I.T. ACT, 1961 AGAINST THE ASSESSEE-COMPANY AND ULTIMATELY, COMPLETED THE ASSESSMENT. LEARNED COUNS EL FOR THE ASSESSEE RELIED UPON DECISION OF HONBLE DELHI HIG H COURT IN THE CASE OF CIT VS. ANIL KUMAR BHATIA (SUPRA) IN WH ICH IT WAS HELD THAT THERE CAN BE ONLY ONE ASSESSMENT ORDER IN RESPECT O F EACH OF THE SIX ASSESSMENT YEARS IN WHICH BOTH THE DISCLOSED AND UNDISCLOSED INCOME WOULD BE BROUGHT TO TAX. THE HONBLE DELHI HIGH COURT ALSO FURTHER OBSERVED THAT IN CASE, ASSESSMENTS ARE COMPLETED UNDER SECTIONS 143(1) OR 143(3) AND NOTED THAT IF SUCH AN ORDER IS ALREADY IN EXISTENCE , HAVING OBVIOUSLY BEEN PASSED PRIOR TO INITIATION OF SEARCH /REQUISITION, A.O. IS EMPOWERED TO REOPEN THOSE PROCEEDINGS AND R E-ASSESS THE TOTAL INCOME TAKING NOTE OF UNDISCLOSED INCOME, IF ANY, UNEARTHED DURING THE COURSE OF SEARCH. THEREFORE, N O MULTIPLE ASSESSMENT ORDERS SHALL HAVE TO BE PASSED. THE FINDINGS IN THE CASE OF CIT VS. ANIL KUMAR BHATIA (SUPRA) PRIMA FACIE 26 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. SUPPORT THE ADDITIONAL GROUND OF APPEAL RAISED BY T HE ASSESSEE-COMPANY. 14. THE HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF VMT SPINNING CO. LTD., VS. CIT & ANOTHER (2 016) 389 ITR 326 (P & H) CONSIDERING THE JUDGMENT OF HONBLE SUPREME COURT IN THE CASE OF NATIONAL THERMAL POWER CO. LTD ., (SUPRA) HELD AS UNDER : HELD, THAT THE TRIBUNAL COULD DECIDE THE APPEAL ON A GROUND NEITHER TAKEN IN THE MEMORANDUM OF APPEAL NO R BY SEEKING ITS LEAVE. THE ONLY REQUIREMENT WAS THAT TH E TRIBUNAL COULD NOT RESULTS ITS DECISION ON ANY OTHE R GROUND UNLESS THE PARTY WHO MIGHT BE AFFECTED HAD SUFFICIE NT OPPORTUNITY OF BEING HEARD ON THAT GROUND. THEREFOR E, THE TRIBUNAL OUGHT TO HAVE EXERCISED ITS DISCRETION IN VIEW OF THE FACT THAT THE ASSESSEE INTENDED RAISING ONLY A LEGAL ARGUMENT WITHOUT REFERENCE TO ANY DISPUTED QUESTION S OF FACT: SINCE THERE WERE NO ADDITIONAL EVIDENCE REQUI RED FOR 27 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. THE DECISION ON THE NEW GROUND RAISED BY THE ASSESS EE AND SUCH QUESTION AROSE FROM THE FACTS WHICH WERE ALREADY ON THE RECORD OF THE ASSESSMENT PROCEEDINGS AND SINCE A DECISION UPON THE NEW GROUND RAISED BY THE ASSESSEE WOULD ONLY HELP IN DETERMINING THE ASSESSE E'S CORRECT TAX LIABILITY, THE MATTER COULD BE REMANDED TO THE TRIBUNAL FOR ADJUDICATING UPON THE ADDITIONAL GROUN D ON ITS MERITS. [MATTER REMANDED). 15. THE HONBLE DELHI HIGH COURT IN THE CASE OF PR . CIT VS. NEELKANT CONCAST (P.) LTD., (2016) 387 ITR 568 (DEL.) CONSIDERING THE DECISION OF HONBLE SUPREME COURT I N THE CASE OF NATIONAL THERMAL POWER CO. LTD., VS. CIT (SUPRA) HELD AS UNDER : THE POWERS OF THE TRIBUNAL ARE WIDE ENOUGH TO CONSIDER A POINT WHICH MAY NOT HAVE BEEN URGED BEFORE THE COMMISSIONER (APPEALS) AS LONG AS THE 28 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. QUESTION REQUIRES TO BE EXAMINED IN THE INTEREST OF JUSTICE. HELD ACCORDINGLY, THAT THE TRIBUNAL HAD NOT EXCEEDED ITS JURISDICTION IN EXAMINING THE QUESTION WHETHER THE ASSESSING OFFICER WAS JUSTIFIED IN EXTENDING THE TIME FOR THE AUDITOR NOMINATED UNDER SECTION 142(2C) OF THE INCOME-TAX ACT, 1961, TO SUBMIT THE AUDIT REPORT. 16. SINCE THE ADDITIONAL GROUND OF APPEAL IS LEGAL IN NATURE AND ALL THE FACTS ARE AVAILABLE ON RECORD AN D IS PRIMA FACIE SUPPORTED BY THE JUDGMENT OF HONBLE DELHI HIGH CO URT IN THE CASE OF CIT VS. ANIL KUMAR BHATIA (SUPRA), T HEREFORE, WE ARE OF THE VIEW THAT SUCH ADDITIONAL GROUND SHOULD BE ADMITTED FOR THE PURPOSE OF HEARING. THERE IS NO BA R IN ADMITTING SUCH ADDITIONAL GROUND OF APPEAL EVEN IF IT WAS NOT TAKEN BEFORE THE AUTHORITIES BELOW. THE DELAY IN FI LING THE ADDITIONAL GROUND IS OF NO CONSEQUENCE BECAUSE WHEN APPEAL 29 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. IS FILED WITHIN THE PERIOD OF LIMITATION, THE ADDIT IONAL GROUND COULD BE RAISED AT ANY TIME DURING THE PENDENCY OF THE APPEAL BEFORE THE TRIBUNAL. THE DECISIONS RELIED UPON BY T HE LD. D.R. WOULD NOT SUPPORT THE CASE OF THE REVENUE. CONSIDER ING THE TOTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND ABOVE DISCUSSION, WE ADMIT THE ADDITIONAL GROUND OF APPEA L FOR THE PURPOSE OF DECIDING THE MATTER IN ISSUE. SINCE THIS ISSUE GOES TO THE ROOT OF THE MATTER AND AUTHORITIES BELOW HAS NO OCCASION TO EXAMINE THE CORRECTNESS OF THE ADDITIONAL GROUND RAISED BY THE ASSESSEE-COMPANY FOR THE FIRST TIME BEFORE THE TRIBUNAL, THEREFORE, WE ARE OF THE VIEW THAT THE ADDITIONAL G ROUND SHOULD BE SET ASIDE TO THE FILE OF A.O. FOR DECIDING THE S AME IN ACCORDANCE WITH LAW. WE, ACCORDINGLY, SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND RESTORE THE ADDITIONAL GR OUND OF APPEAL TO THE FILE OF A.O. WITH A DIRECTION TO DECI DE THE ADDITIONAL GROUND OF APPEAL STRICTLY IN ACCORDANCE WITH LAW, BY GIVING REASONABLE, SUFFICIENT OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 30 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. 17. AS REGARDS THE MERIT OF THE ADDITION IS CONCER NED UNDER SECTION 68 OF THE I.T. ACT, WE ARE OF THE VIE W THAT SINCE ADDITIONAL GROUND IS LEGAL IN NATURE SO ADMITTED AB OVE, THEREFORE, MERIT SHALL BE DECIDED BY THE A.O. AFTER DECIDING THE LEGAL QUESTION. BOTH THE PARTIES HAVE EXTENSIVELY A RGUED ON MERIT OF THE ADDITION ALSO. LEARNED COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE AUTHORIT IES BELOW AND SUBMITTED THAT ASSESSEE-COMPANY IS A PUBLIC LIM ITED NBFC COMPANY. ALL DOCUMENTARY EVIDENCES WERE FILED BEFORE THE AUTHORITIES BELOW. ASSESSEE IS A LISTED COMPANY WITH DELHI STOCK EXCHANGE AND REGISTERED WITH RBI. INVESTORS W ERE SUMMONED BY THE A.O. REPORT FROM THE BANK UNDER SEC TION 133(6) WAS NOT CONFRONTED TO THE ASSESSEE-COMPANY. THE REPORT OF THE INSPECTOR WAS ALSO NOT CONFRONTED TO THE ASSESSEE-COMPANY. THE BANK DETAILS CALLED FOR UNDER SECTION 133(6) WERE ALSO NOT CONFRONTED TO THE ASSESSEE-COM PANY. REPORT OF THE INSPECTOR IS WITH REFERENCE TO FIVE I NVESTMENT COMPANIES ONLY. ALL TRANSACTIONS ARE CARRIED-OUT TH ROUGH 31 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. BANKING CHANNEL. THE INVESTORS ARE ASSESSED TO TAX. THERE IS NO EVIDENCE ON RECORD THAT THE AMOUNT IN QUESTION C AME FROM THE COFFERS OF THE ASSESSEE-COMPANY. NO CASH WAS FO UND DEPOSITED IN THE BANK ACCOUNT OF THE INVESTORS. DIR ECTOR OF THE ASSESSEE-COMPANY IN REFERENCE TO QUESTION 12 EXPLAI NED JUSTIFICATION AND REASONS FOR TAKING PREMIUM ON ALL OTMENT OF SHARES. DIRECTORS WERE EXAMINED AT THE REMAND PROCE EDINGS. BUT COPIES OF THEIR STATEMENTS HAVE NOT BEEN PROVID ED TO ASSESSEE-COMPANY. REMAND REPORT IS NOT RELIABLE. A. O. SHOULD NOT SEE PROFIT OF THE INVESTOR COMPANY, BUT SHOULD SEE NET WORTH OF THE INVESTOR COMPANY. NO LINK OF THE ASSES SEE- COMPANY WITH INVESTOR COMPANY HAS BEEN ESTABLISHED. ALL THE INFORMATION HAS BEEN PROVIDED TO THE STOCK EXCHANGE IN WHICH NO OBJECTIONS HAVE BEEN RAISED. HE HAS RELIED UPON SEVERAL DECISIONS IN SUPPORT OF HIS CONTENTION, COPIES OF W HICH ARE FILED IN THE PAPER BOOK. 18. ON THE OTHER HAND, THE LD. D.R. RELIED UPON TH E ORDERS OF THE AUTHORITIES BELOW AND SUBMITTED THAT ASSESSEE 32 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. DECLARED NOMINAL INCOME. INVESTORS HAVE ALSO DECLAR ED NOMINAL INCOME. SEVEN INVESTORS OPENED BANK ACCOUNT WITH THE SAME BANK. BANK OPENING FORMS ARE NOT PROPERLY FILLED-IN. INSPECTOR REPORT WAS AGAINST THE ASSESSEE-COMPANY B ECAUSE THEY WERE NOT FOUND FUNCTIONING FROM THEIR ADDRESS. THE INVESTORS/DIRECTORS WERE NEW ONLY AND APPOINTED AFT ER ASSESSMENT ORDER. MOST OF THEM HAVING NO INVESTMENT IN THEIR COMPANY. THE ONUS IS UPON ASSESSEE-COMPANY WHICH HA VE NOT BEEN DISCHARGED. NO JUSTIFICATION HAVE BEEN GIVEN FOR ISSUING SHARES AT PREMIUM. THE LD. D.R. ALSO RELIED UPON SE VERAL DECISIONS IN SUPPORT OF THE FINDINGS OF THE AUTHORI TIES BELOW IN HIS WRITTEN SUBMISSIONS. 19. WE HAVE CONSIDERED RIVAL SUBMISSIONS. THOUGH W E HAVE NOTED ABOVE THAT ONCE LEGAL GROUND IS RESTORED TO THE FILE OF A.O. FOR ADJUDICATION AS PER LAW, THEREFORE, THI S ISSUE ON MERIT SHALL ALSO BE RESTORED TO THE FILE OF A.O. FO R DECIDING THE SAME AFRESH AFTER TAKING DECISION ON THE LEGAL ISSU E. HOWEVER, WE MAY NOTE CERTAIN MORE FACTS WHICH ALSO JUSTIFY F OR 33 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. REMANDING OF THE MATTER ON MERITS TO THE FILE OF A. O. THE STATEMENT OF SHRI S.K. JAIN, DIRECTOR OF THE ASSESS EE-COMPANY WAS RECORDED AT ASSESSMENT STAGE UNDER SECTION 131 OF THE I.T. ACT IN WHICH IN ANSWER TO QUESTION NO.12 HE HAS GIV EN JUSTIFICATION FOR ISSUING SHARES AT PREMIUM. THE SE BI GUIDELINES WERE FILED IN THE PAPER BOOK TO JUSTIFY THE SAME. BUT THE AUTHORITIES BELOW HAVE NOT EXAMINED OR PROBED T HE EXPLANATION OF ASSESSEE-COMPANY IN THIS REGARD. THE ASSESSEE- COMPANY SUBMITTED SEVERAL DOCUMENTARY EVIDENCES OF THE INVESTOR COMPANIES TO SHOW THEIR IDENTITY, CREDITWO RTHINESS AND GENUINENESS OF THE TRANSACTION IN THE MATTER, T O THE AUTHORITIES BELOW. HOWEVER, THE AUTHORITIES BELOW H AVE NOT EXAMINED THE DOCUMENTARY EVIDENCES IN DETAIL IN THE IMPUGNED ORDERS. THE REPORT OF THE INSPECTOR GIVING ADVERSE COMMENT AGAINST THE INVESTORS HAVE NOT BEEN CONFRON TED TO THE ASSESSEE-COMPANY. UNLESS SUCH REPORT IS CONFRON TED TO THE ASSESSEE-COMPANY, THE SAME WOULD NOT BE ADMISSIBLE IN EVIDENCE AGAINST THE ASSESSEE-COMPANY. THE REPORT O BTAINED 34 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. FROM THE BANK UNDER SECTION 133(6) WAS ALSO NOT CON FRONTED TO THE ASSESSEE-COMPANY. THE STATEMENTS OF THE DIRECTO RS RECORDED AT THE REMAND PROCEEDINGS SUPPORTING THE C LAIM OF ASSESSEE-COMPANY HAVE NOT BEEN PROVIDED TO THE ASSE SSEE- COMPANY. THEY HAVE ALSO PRODUCED DOCUMENTARY EVIDEN CES BEFORE A.O. IN SUPPORT OF THE EXPLANATION WHICH HAV E NOT BEEN DISCUSSED IN DETAIL IN THE IMPUGNED ORDER. WHATEVER MATERIAL IS COLLECTED IN THE REMAND PROCEEDINGS HAVE NOT BEE N PROVIDED TO THE ASSESSEE-COMPANY OR CONFRONTED FOR PROPER EX PLANATION. THEREFORE, SUCH DOCUMENTS SHALL HAVE TO BE PROVIDED TO THE ASSESSEE-COMPANY. IT IS WELL SETTLED LAW THAT THE A UTHORITIES BELOW SHOULD NOT SEE PROFIT OF THE INVESTORS, BUT S HALL HAVE TO SEE THEIR WORTH IN MAKING INVESTMENTS. ALL THESE FA CTS WOULD SHOW THAT AUTHORITIES BELOW HAVE FAILED TO RECORD A NY SPECIFIC FINDING OF FACT AGAINST THE ASSESSEE-COMPANY BASED ON THE EVIDENCE AND MATERIAL AVAILABLE ON RECORD. THEREFOR E, IN SUCH CIRCUMSTANCES, WHEN ENTIRE EVIDENCE ON RECORD HAVE NOT BEEN DISCUSSED BY THE AUTHORITIES BELOW, IT WOULD REQUIR E 35 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. RECONSIDERATION AT THE LEVEL OF THE A.O. MORE PARTI CULARLY, WHEN WE HAVE ADMITTED THE ADDITIONAL GROUND WHICH IS LEG AL IN NATURE, THEREFORE, THE ENTIRE MATTER SHALL HAVE TO BE DEALT WITH BY THE AUTHORITIES BELOW IN ACCORDANCE WITH LAW BAS ED ON THE EVIDENCE ON RECORD. IN THIS VIEW OF THE MATTER, WE ARE OF THE VIEW THAT EVEN THE ADDITION ON MERIT SHALL HAVE TO BE RESTORED TO THE FILE OF A.O. FOR FRESH ADJUDICATION. IN VIEW OF THE ABOVE, THERE IS NO NEED TO CONSIDER THE DECISIONS CITED BY BOTH THE PARTIES. IN VIEW OF THE ABOVE DISCUSSION AND RESTOR ATION OF THE ADDITIONAL GROUND OF APPEAL TO THE FILE OF A.O, WE SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW ON ADDITION ON MERI T OF RS.100 CRORES UNDER SECTION 68 OF THE I.T. ACT, 1961, TO T HE FILE OF A.O. WITH A DIRECTION TO RE-DECIDE THIS GROUND OF APPEAL IN ACCORDANCE WITH LAW ON THE BASIS OF THE ENTIRE EVID ENCE AND MATERIAL ON RECORD, BY GIVING REASONABLE, SUFFICIEN T OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. A.O. SHALL PASS THE ORDER ON MERIT DISCUSSING ALL THE EVIDENCES IN THE ASSESSMEN T ORDER. 36 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. GROUND NOS. 1 TO 7 OF THE APPEAL OF ASSESSEE-COMPAN Y ARE ALLOWED FOR STATISTICAL PURPOSES. 20. ON GROUND NO.8, ASSESSEE CHALLENGED DISALLOWAN CE UNDER SECTION 14A OF THE I.T. ACT. 21. IT IS AN ADMITTED FACT THAT ASSESSEE-COMPANY E ARNED DIVIDEND INCOME OF RS.590/- ONLY. LEARNED COUNSEL F OR THE ASSESSEE RELIED UPON DECISION OF HONBLE DELHI HIGH COURT IN THE CASE OF JOINT INVESTMENT PVT. LTD., VS. CIT (20 15) 372 ITR 694 (DEL.) IN WHICH IT WAS HELD AS UNDER : BY NO STRETCH OF IMAGINATION CAN SECTION 14A OR RU LE 8D BE INTERPRETED SO AS TO MEAN THAT THE ENTIRE TAX EXEMPT INCOME IS TO BE DISALLOWED. THE WINDOW FOR DISALLOWANCE IS INDICATED IN SECTION 14A, AND IS ON LY TO THE EXTENT OF DISALLOWING EXPENDITURE 'INCURRED BY THE ASSESSEE IN RELATION TO THE TAX EXEMPT INCOME'. THIS PROPORTION OR PORTION OF THE TAX EXEMPT INCOME SURE LY 37 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. CANNOT SWALLOW THE ENTIRE AMOUNT AS HAS HAPPENED IN THIS CASE. 21.1 LEARNED COUNSEL FOR THE ASSESSEE, THEREFORE, SUBMITTED THAT DISALLOWANCE UNDER SECTION 14A SHOUL D NOT EXCEED THE EXEMPTED INCOME OF RS.590/- ONLY. 22. LD. D.R. HOWEVER, RELIED UPON THE ORDERS OF TH E AUTHORITIES BELOW. 23. AFTER CONSIDERING THE RIVAL SUBMISSIONS, WE AR E OF THE VIEW THAT CONTENTION OF ASSESSEE-COMPANY IS JUS TIFIED THAT DISALLOWANCE OF EXPENDITURE UNDER SECTION 14A SHOUL D NOT EXCEED THE EXEMPT DIVIDEND INCOME OF RS.590/-. IN V IEW OF THE ABOVE, WE SET ASIDE THE ORDERS OF THE AUTHORITIES B ELOW AND RESTRICT THE DISALLOWANCE UNDER SECTION 14A OF THE I.T. ACT TO RS.590/- ONLY. GROUND NO.8 OF APPEAL OF ASSESSEE IS PARTLY ALLOWED. 24. IN THE RESULT, APPEAL OF ASSESSEE IS PARTLY AL LOWED. 38 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (L.P. SAHU) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER DELHI, DATED 8 TH OCTOBER, 2018 VBP/- *KAVITA ARORA COPY TO 1. THE APPELLANT 2. THE RESPONDENT 3. CIT(A) CONCERNED 4. CIT CONCERNED 5. D.R. ITAT G BENCH 6. GUARD FILE // BY ORDER // ASST. REGISTRAR : ITAT DELHI BENCHES : DELHI. 39 ITA.NO.787/DEL./2014 SUNSHINE CAPITAL LTD., NEW DELHI. DATE OF DICTATION 26.09.2018 DATE ON WHICH THE TYPED DRAFT ORDER IS PLACED BEFOR E THE DICTATION MEMBER 0 5 .10.2018 DATE ON WHICH THE APPROVAL DRAFT COMES TO THE SR. P S DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATION MEMBER FOR PRONOUNCEMENT DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. P.S. DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WE BSITE OF ITAT DATE ON WHICH THE FILE GOES TO THE BENCH CLERK DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER.
