M/s Edward Supply Pvt. Ltd., Kolkata V. DCIT, CC-XXX, KOLKATA, Kolkata

ITSSA 58/KOL/2015

• Counselvise Citation: [2016] 122 COUNSELVISE.COM (IT) 2834 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 8 month(s) 16 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 02-12-2016
• Appeal Filed By: Assessee
• Bench Allotted: A
• Assessment Year: 2004-2005
• Appeal Filed On: 16-03-2015
• Court: TRIBUNAL
• Keywords: Validity of assessment
• Section: 244A; 153A; 132

Judgement Text

I.T.(S.S.)A. NOS. 58, 59 & 60/KOL./2015 ASSESSMENT YEARS: 2004-2005, 2005-200 6 & 2006-2007 & I.T.(S.S.)A. NOS. 99 & 100/KOL./2015 ASSESSMENT YEARS: 2005-2006 & 2006-20 07 PAGE 1 OF 6 IN THE INCOME TAX APPELLATE TRIBUNAL, KOLKATA A BENCH, KOLKATA BEFORE SHRI P.M. JAGTAP, ACCOUNTANT MEMBER AND SHRI N.V. VASUDEVAN, JUDICIAL MEMBER I.T.(S.S.)A. NOS. 58, 59 & 60/KOL/ 2015 ASSESSMENT YEARS: 2004-2005, 2005-2006 & 2006-2007 M/S. EDWARD SUPPLY PVT. LIMITED,................... ............................APPELLANT 16B, SHAKESPEARE SARANI, 2 ND FLOOR, KOLKATA-700 071 [PAN: AAACE 5578 J] -VS.- DEPUTY COMMISSIONER OF INCOME TAX,................. ....................RESPONDENT CENTRAL CIRCLE-XXX, KOLKATA, AAYAKAR BHAWAN POORVA, 110, SHANTI PALLY, E.M. BYE PASS, KOLKATA-700 107 ` & I.T.(S.S.)A. NOS. 99 & 100/KOL/ 2015 ASSESSMENT YEARS: 2005-2006 & 2006-2007 M/S. BUDHIYA MARKETING PVT. LIMITED,............... .......................APPELLANT C/O. SALARPURIA JAJODIA & CO., 7, C.R. AVENUE, KOLKATA-700 072 [PAN: AABCB 3055 G] -VS.- DEPUTY COMMISSIONER OF INCOME TAX,................. ....................RESPONDENT CENTRAL CIRCLE-XXX, KOLKATA, AAYAKAR BHAWAN POORVA, 110, SHANTI PALLY, E.M. BYE PASS, KOLKATA-700 107 APPEARANCES BY: SHRI S. JHAJHARIA, FCA, FOR THE ASSESSEES SHRI R.S. BISWAS, CIT, D.R., FOR THE DEPARTMENT DATE OF CONCLUDING THE HEARING : NOVEMBER 22, 2016 DATE OF PRONOUNCING THE ORDER : DECEMBER 02, 2016 I.T.(S.S.)A. NOS. 58, 59 & 60/KOL./2015 ASSESSMENT YEARS: 2004-2005, 2005-200 6 & 2006-2007 & I.T.(S.S.)A. NOS. 99 & 100/KOL./2015 ASSESSMENT YEARS: 2005-2006 & 2006-20 07 PAGE 2 OF 6 O R D E R PER SHRI P.M. JAGTAP: THESE FIVE APPEALS FILED IN THE CASE OF TWO ASSESSE ES INVOLVE A COMMON ISSUE AND THE SAME, THEREFORE, HAVE BEEN HEA RD TOGETHER AND ARE BEING DISPOSED OF BY A SINGLE COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. FIRST WE SHALL TAKE UP THE APPEALS FILED IN THE CASE OF M/S. BUDHIYA MARKETING PVT. LIMITED BEING I.T.(S.S.)A. NOS. 99 & 100/KOL/2015, WHICH ARE DIRECTED AGAINST TWO SEPARATE ORDERS PASSED BY THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-21, KOLKATA, BOTH DATED 12. 06.2015 FOR A.YS. 2005-06 AND 2006-07. 3. THE SOLITARY COMMON ISSUE INVOLVED IN THESE APPE ALS OF THE ASSESSEE, AS PRESSED AND ARGUED BY THE LD. COUNSEL FOR THE ASSESSEE, RELATES TO THE ACTION OF THE LD. CIT(APPEALS) IN CO NFIRMING THE ORDER OF THE ASSESSING OFFICER NOT GRANTING THE INTEREST UNDER S ECTION 132B(4) OF THE INCOME TAX ACT, 1961 ON THE ADJUSTED SEIZED CASH FR OM THE DATE OF SEIZURE TILL THE DATE OF COMPLETION OF SUCH ASSESSMENT UNDE R SECTION 143(3)/153A. 4. THE RELEVANT FACTS OF THE CASE APROPOS THIS ISSU E ARE THAT THE ASSESSEE IS A NON-BANKING FINANCIAL COMPANY. DURING THE COURSE OF SEARCH CONDUCTED UNDER SECTION 132(1) OF THE ACT ON 15.12.2009 IN THE CASE OF ONE SHRI SANTOSH KUMAR SAHA, A PROHIBITORY ORDER UNDER SECTION 132(3) OF THE ACT WAS ISSUED BY THE ADIT(INV.), KOL KATA IN RESPECT OF A CURRENT ACCOUNT NO. 5906 MAINTAINED BY THE ASSESSEE -COMPANY WITH AXIS BANK LIMITED, LAKE TOWN BRANCH, KOLKATA. THE ENTIRE BALANCE OF RS.13,87,13,704/- LYING IN THE SAID BANK ACCOUNT OF THE ASSESSEE THEREAFTER WAS SEIZED AND REALIZED BY THE DEPARTMEN T ON 11.02.2010 BY I.T.(S.S.)A. NOS. 58, 59 & 60/KOL./2015 ASSESSMENT YEARS: 2004-2005, 2005-200 6 & 2006-2007 & I.T.(S.S.)A. NOS. 99 & 100/KOL./2015 ASSESSMENT YEARS: 2005-2006 & 2006-20 07 PAGE 3 OF 6 OBTAINING A PAY ORDER FROM THE BANK. SUBSEQUENTLY N OTICES UNDER SECTION 153A WERE ISSUED BY THE CONCERNED ASSESSING OFFICER TO THE ASSESSEE ON 06.09.2010 FOR THE RELEVANT SIX YEARS INCLUDING BOT H THE YEARS UNDER CONSIDERATION. IN RESPONSE TO THE SAID NOTICES, RET URNS OF INCOME WERE FILED BY THE ASSESSEE ON 05.10.2010 DECLARING THE S AME TOTAL INCOME AS WAS DECLARED EARLIER IN THE RETURNS ORIGINALLY FILE D UNDER SECTION 139(1) OF THE ACT. IN THE ASSESSMENTS COMPLETED UNDER SECT ION 143(3)/153A FOR THE RELEVANT SIX YEARS INCLUDING BOTH THE YEARS UND ER CONSIDERATION, SUBSTANTIAL ADDITIONS WERE MADE BY THE ASSESSING OF FICER TO THE TOTAL INCOME OF THE ASSESSEE AND DEMANDS WERE RAISED. AGA INST THE SAID ORDERS, APPEALS WERE PREFERRED BY THE ASSESSEE BEFORE THE L D. CIT(APPEALS), WHO DELETED ALL THE ADDITIONS MADE BY THE ASSESSING OFF ICER TO THE TOTAL INCOME OF THE ASSESSEE IN THE ASSESSMENTS COMPLETED UNDER SECTION 143(3)/153A. HE, HOWEVER, DID NOT FIND MERIT IN THE PRELIMINARY ISSUE RAISED BY THE ASSESSEE CHALLENGING THE VALIDITY OF THE ASSESSMENTS MADE UNDER SECTION 143(3)/153A AND UPHELD THE SAME AS VA LID. AGAINST THE ORDERS OF THE LD. CIT(APPEALS), APPEALS WERE FILED BY THE REVENUE BEFORE THE TRIBUNAL CHALLENGING THE RELIEF GIVEN BY HIM TO THE ASSESSEE ON MERIT WHILE THE ASSESSEE ALSO FILED ITS CROSS OBJECTIONS CHALLENGING THE VALIDITY OF ASSESSMENT ORDERS PASSED BY THE ASSESSING OFFICE R UNDER SECTION 143(3)/153A OF THE ACT. AS INFORMED BY THE LD. COUN SEL FOR THE ASSESSEE, THE TRIBUNAL HAS ALREADY ALLOWED THE CROSS OBJECTIO NS OF THE ASSESSEE AND QUASHED THE ASSESSMENTS MADE BY THE ASSESSING OFFIC ER UNDER SECTION 143(3)/153A. 5. MEANWHILE ORDERS UNDER SECTION 251/143(3)/153A O F THE ACT WERE PASSED BY THE ASSESSING OFFICER ON 20.07.2012 GIVIN G EFFECT TO THE ORDERS OF THE LD. CIT(APPEALS) FOR THE YEARS UNDER CONSIDE RATION. BY THE SAID ORDERS, THE REFUND DUE TO THE ASSESSEE ALONG WITH I NTEREST UNDER SECTION 244A OF THE ACT WAS ALLOWED BY THE ASSESSING OFFICE R. INTEREST UNDER SECTION 132B(4) OF THE ACT, HOWEVER, WAS NOT ALLOWE D BY THE ASSESSING I.T.(S.S.)A. NOS. 58, 59 & 60/KOL./2015 ASSESSMENT YEARS: 2004-2005, 2005-200 6 & 2006-2007 & I.T.(S.S.)A. NOS. 99 & 100/KOL./2015 ASSESSMENT YEARS: 2005-2006 & 2006-20 07 PAGE 4 OF 6 OFFICER TO THE ASSESSEE-COMPANY IN RESPECT OF SEIZE D CASH FROM THE DATE OF SEIZURE TILL THE DATE OF ASSESSMENTS MADE UNDER SEC TION 143(3)/153A. THE ASSESSEE, THEREFORE, AGAIN PREFERRED APPEALS BEFORE THE LD. CIT(APPEALS) CLAIMING SUCH INTEREST UNDER SECTION 132B(4) FOR BO TH THE YEARS UNDER CONSIDERATION. THE LD. CIT(APPEALS), HOWEVER, DISMI SSED THE APPEALS OF THE ASSESSEE ON THIS ISSUE BY HOLDING THAT THE ISSU E RELATING TO THE ASSESSEES CLAIM FOR INTEREST UNDER SECTION 132B(4) WAS NOT ARISING FROM THE ORDERS OF THE ASSESSING OFFICER PASSED UNDER SE CTION 251/143(3)/153A OF THE ACT. AGGRIEVED BY THE ORDERS OF THE LD. CIT(APPEALS), THE ASSESSEE HAS PREFERRED THIS APPEA L BEFORE THE TRIBUNAL. 6. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AN D ALSO PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. AS PER THE P ROVISIONS OF SUB- SECTION (4) OF SECTION 132B, THE CENTRAL GOVERNMENT IS LIABLE TO PAY SIMPLE INTEREST AT THE PRESCRIBED RATE ON THE AMOUN T BY WHICH THE AGGREGATE AMOUNT OF MONEY SEIZED UNDER SECTION 132 OR REQUISITIONED UNDER SECTION 132A, AS REDUCED BY THE AMOUNT OF MON EY, IF ANY, RELEASED UNDER THE FIRST PROVISO TO CLAUSE (I) OF SUB-SECTIO N (1), EXCEEDS THE AGGREGATE OF THE AMOUNT REQUIRED TO MEET THE LIABIL ITIES REFERRED TO IN CLAUSE (I) OF SUB-SECTION (1) OF SECTION 132B AND S UCH INTEREST IS PAYABLE FROM THE DATE IMMEDIATELY FOLLOWING THE EXPIRY OF T HE PERIOD OF ONE HUNDRED AND TWENTY DAYS FROM THE DATE ON WHICH THE LAST OF THE AUTHORISATIONS FOR SEARCH UNDER SECTION 132 OR REQU ISITION UNDER SECTION 132A WAS EXECUTED TO THE DATE OF COMPLETION OF THE ASSESSMENT UNDER SECTION 153A UNDER CHAPTER XIV-B. AS RIGHTLY SUBMIT TED BY THE LD. COUNSEL FOR THE ASSESSEE IN THIS REGARD, THE QUANTUM OF AMO UNT DUE TO THE ASSESSEE AS REFUND FROM THE MONEY SEIZED AFTER THE ADJUSTMENT OF THE AMOUNT REQUIRED TO MEET HIS TAX LIABILITIES WAS DET ERMINED WHEN THE APPEAL EFFECTS WERE GIVEN BY THE ASSESSING OFFICER TO THE ORDERS OF THE LD. CIT(APPEALS) VIDE ORDERS PASSED UNDER SECTION 251/1 43(3)/153A AND CONSEQUENTLY IT WAS INCUMBENT UPON THE ASSESSING OF FICER TO GRANT I.T.(S.S.)A. NOS. 58, 59 & 60/KOL./2015 ASSESSMENT YEARS: 2004-2005, 2005-200 6 & 2006-2007 & I.T.(S.S.)A. NOS. 99 & 100/KOL./2015 ASSESSMENT YEARS: 2005-2006 & 2006-20 07 PAGE 5 OF 6 INTEREST, IF ANY, PAYABLE TO THE ASSESSEE UNDER SUB -SECTION (4) OF SECTION 132B WHILE PASSING THE SAID ORDERS GIVING APPEAL EF FECT TO THE ORDERS OF THE LD. CIT(APPEALS). SINCE THE SAME WAS NOT DONE B Y THE ASSESSING OFFICER, THE ISSUE RELATING TO THE GRANT OF INTERES T TO THE ASSESSEE UNDER SECTION 132B(4) DEFINITELY AROSE FROM THE ORDERS OF THE ASSESSING OFFICER PASSED UNDER SECTION 251/143(3)/153A AND THE LD. CI T(APPEALS), IN OUR OPINION, OUGHT TO HAVE ENTERTAINED THE ISSUE RAISED BY THE ASSESSEE IN THE APPEALS FILED AGAINST THE SAID ORDERS CLAIMING INTE REST UNDER SECTION 132B(4). AT THE TIME OF HEARING BEFORE US, EVEN THE LD. D.R. HAS NOT BEEN ABLE TO CONTROVERT OR REBUT THIS POSITION. HE, HOWE VER, HAS CONTENDED THAT IF AT ALL THE TRIBUNAL IS OF THE OPINION THAT THE I SSUE RELATING TO THE ASSESSEES CLAIM FOR INTEREST UNDER SECTION 132B(4) SHOULD HAVE BEEN ENTERTAINED BY THE LD. CIT(APPEALS) AS THE ISSUE AR ISING FROM THE ORDERS OF THE ASSESSING OFFICER UNDER SECTION 251/143(3)/153A UNDER APPEALS, THE SAME MAY BE REMANDED TO THE LD. CIT(APPEALS) FOR DE CIDING IT ON MERIT. WE FIND MERIT IN THIS CONTENTION OF THE LD. D.R. AN D SINCE THE LD. COUNSEL FOR THE ASSESSEE ALSO HAS NOT RAISED ANY OBJECTION IN THIS REGARD, WE SET ASIDE THE IMPUGNED ORDERS OF THE LD. CIT(APPEALS) O N THIS ISSUE AND REMIT THE MATTER BACK TO HIM FOR DECIDING THE ISSUE RELAT ING TO THE ASSESSEES CLAIM FOR INTEREST UNDER SECTION 132B(4) ON MERIT I N ACCORDANCE WITH LAW. BOTH THE APPEALS OF THE ASSESSEE ON THIS ISSUE ARE ACCORDINGLY TREATED AS ALLOWED. 7. AS REGARDS THE APPEALS FILED IN THE CASE OF M/S. EDWARD SUPPLY PVT. LTD. BEING IT(SS)A. NOS. 58 TO 60/KOL/2015, WHICH A RE DIRECTED AGAINST THE ORDERS OF THE LD. CIT(APPEALS)-21, KOLKATA DATE D 08.01.2015 FOR A.YS. 2004-05, 2005-06 & 2006-07, IT IS OBSERVED THAT THE SOLITARY COMMON ISSUE INVOLVED THEREIN, AS PRESSED AND ARGUED BY TH E LD. COUNSEL FOR THE ASSESSEE AT THE TIME OF HEARING BEFORE US, RELATING TO THE CLAIM OF THE ASSESSEE FOR INTEREST UNDER SECTION 132B(4) IS SIMI LAR TO ONE INVOLVED IN THE CASE OF BUDHIYA MARKETING PVT. LIMITED, WHICH H AS ALREADY BEEN I.T.(S.S.)A. NOS. 58, 59 & 60/KOL./2015 ASSESSMENT YEARS: 2004-2005, 2005-200 6 & 2006-2007 & I.T.(S.S.)A. NOS. 99 & 100/KOL./2015 ASSESSMENT YEARS: 2005-2006 & 2006-20 07 PAGE 6 OF 6 DECIDED BY US IN THE FOREGOING PORTION OF THIS ORDE R. SINCE ALL THE RELEVANT FACTS MATERIAL TO THE SAID ISSUE AS INVOLVED IN THI S CASE AS WELL AS THE ARGUMENTS RAISED BY THE LD. REPRESENTATIVES OF BOTH THE SIDES ARE SIMILAR TO THAT OF THE CASE OF M/S. BUDHIYA MARKETING PVT. LIMITED, WE FOLLOW OUR CONCLUSION DRAWN IN THE CASE OF BUDHIYA MARKETING P VT. LTD. AND REMIT THE MATTER TO THE LD. CIT(APPEALS) FOR DECIDING THE ISS UE RELATING TO THE CLAIM OF THE ASSESSEE FOR INTEREST UNDER SECTION 132B(4) ON MERIT IN ACCORDANCE WITH LAW. 8. IN THE RESULT, ALL THE FIVE APPEALS OF THE ASSES SEES ARE TREATED AS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON DECEMBER 02, 2016. SD/- SD/- (N.V. VASUDEVAN) (P.M. JAGTAP) JUDICIAL MEMBER ACCOUNTANT MEMBER KOLKATA, THE 2 ND DAY OF DECEMBER, 2016 COPIES TO : (1) M/S. EDWARD SUPPLY PVT. LIMITED, 16B, SHAKESPEARE SARANI, 2 ND FLOOR, KOLKATA-700 071 (2) M/S. BUDHIYA MARKETING PVT. LIMITED, C/O. SALARPURIA JAJODIA & CO., 7, C.R. AVENUE, KOLKATA-700 072 (3) DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-XXX, KOLKATA, AAYAKAR BHAWAN POORVA, 110, SHANTI PALLY, E.M. BYE PASS, KOLKATA-700 107 (4) COMMISSIONER OF INCOME TAX(APPEALS)-21, KOLKATA, (5) COMMISSIONER OF INCOME TAX- , KOLKATA (6) THE DEPARTMENTAL REPRESENTATIVE (7) GUARD FILE BY ORDER ASSISTANT REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, KOLKATA BENCHES, KOLKATA LAHA/SR. P.S.