M/s. ATC Logistics Private Limited, Kolkata V. ACIT, Circle - 14(1), Kolkata, Kolkata

MA 153/KOL/2018

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 1943 (ITAT-KOLKATA)
• Duration Of Justice: 2 month(s) 28 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 20-11-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2012-2013
• Appeal Filed On: 23-08-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Bogus Share capital
• Section: 194C; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : KOLKATA [BEFORE HONBLE SHRI ABY. T. VARKEY, JM & SHRI M. BALAGANESH, AM ] M.A. NO. 153/KOL/2018 (ARISING OUT OF I.T.A NO. 1619/KOL/2016 ) ASSESSMENT YEAR : 2012-1 3 M/S ATC LOGISTICS PVT. LTD. -VS- ACIT, C IRCLE-14(1),KOLKATA [PAN: AAHCA 3020 A ] (APPELLANT) (RE SPONDENT) FOR THE APPELLANT : SHRI S.M SURANA, ADVOCATE FOR THE RESPONDENT : SHRI SANKAR HALDER, JCIT SR. DR DATE OF HEARING : 02.11.2018 DATE OF PRONOUNCEMENT : 20.11.2018 ORDER PER M. BALAGANESH, AM BY VIRTUE OF THIS MISCELLANEOUS APPLICATION, THE AS SESSEE SEEKS TO RECALL THE ORDER PASSED BY THIS TRIBUNAL IN I.T.A. NO. 1619/KO L/2016 FOR ASSESSMENT YEAR 2012- 13 AND C.O. NO. 57/KOL/2016 DATED 11.07.2018. THE F IRST ERROR POINTED OUT BY THE LD. AR WAS WITH REGARD TO ERRONEOUS CONCLUSION REACHED BY THIS TRIBUNAL ON THE ASPECT OF DISALLOWANCE OF TRANSPORTATION CHARGES U/S 40A(I A) OF THE ACT, BY NOT CONSIDERING THE CO-ORDINATE BENCH DECISION OF THIS TRIBUNAL IN THE CASE OF SOMARANI GHOSH VS. DCIT IN I.T.A. NO. 1420/KOL/2015 FOR ASSESSMENT YEA R 2012-13 DATED 09.09.2016, TOGETHER WITH OTHER CASE LAWS WHICH WERE DULY FILED BY THE LD. AR AT THE TIME OF HEARING IN HIS WRITTEN SUBMISSIONS. WE FIND FROM TH E RECORDS THAT THE ASSESSEE HAD INDEED FILED ITS WRITTEN SUBMISSIONS AND THE SAME H AD NOT BEEN CONSIDERED BY THIS 2 MA NO.153/KOL/2018 (ARISING OUT OF I.T.A. NO.1619/KOL/2016) M/S ATC LOGISTICS PVT. LTD. A.YR. 2012-13 2 TRIBUNAL WHILE DISPOSING OFF THE REVENUE APPEAL AND CROSS-OBJECTIONS OF THE ASSESSEE. IT WAS POINTED OUT THAT NON-CONSIDERATION OF THE CO -ORDINATE BENCH DECISION OF THIS TRIBUNAL CONSTITUTES AN ERROR APPARENT FROM RECORD WARRANTING RECTIFICATION U/S 254(2) OF THE ACT. WE FIND THAT THE CO-ORDINATE BENCH OF M UMBAI TRIBUNAL IN THE CASE OF RELIANCE COMMUNICATIONS LTD VS DDIT AND ITS GROUP C ONCERNS VIDE ORDER IN VARIOUS ITA NUMBERS DATED 18.11.2016 HAD HELD THAT NON-CONS IDERATION OF THE DECISION RENDERED BY CO-ORDINATE BENCH ON IDENTICAL ISSUE CO NSTITUTES MISTAKE APPARENT FROM RECORD WITHIN THE MEANING OF SECTION 254(2) OF THE ACT. ACCORDINGLY, WE RECALL THE IMPUGNED ORDER IN EXERCISE OF POWERS GRANTED U/S 25 4(2) OF THE ACT WITH REGARD TO THIS ISSUE OF DISALLOWANCE U/S 40(A)(IA) OF THE ACT ON ACCOUNT OF TRANSPORTATION CHARGES FOR VIOLATION OF PROVISIONS OF SECTION 194C (7) OF THE ACT. THE ASSESSEE IS AT LIBERTY TO SUBMIT FRESH EVIDENCES, IF ANY, IN SUPP ORT OF ITS CONTENTIONS BEFORE THIS TRIBUNAL, IF IT SO DESIRES. 2. WITH REGARD TO GROUND NO. 3 RAISED BY THE REVENU E ON DELETION OF ADDITION MADE U/S 68 OF THE ACT TOWARDS SHARE CAPITAL AND SHARE PREMI UM, THE LD. CIT(A) HAD DELETED THE ADDITION ON THE GROUND THAT THE LD. AO HAVING A CCEPTED THE SHARE CAPITAL AND SHARE PREMIUM RECEIVED FROM THREE INDIVIDUAL SHARE HOLDERS IN CHEQUES OUGHT TO HAVE ACCEPTED THE RECEIPT OF THE SHARE CAPITAL AND SHARE PREMIUM FROM VERY SAME SHARE HOLDER IN CASH, INASMUCH AS THE THREE NECESSA RY INGREDIENTS OF SECTION 68 HAVE BEEN DULY FULFILLED BY THE ASSESSEE. THE LD. AR AR GUED IN THE MISCELLANEOUS APPLICATION PROCEEDINGS THAT THE NATURE AND SOURCE OF THE CREDIT OF RECEIPT OF SHARE CAPITAL AND SHARE PREMIUM FOR THREE SHAREHOLDERS HA S BEEN PROVED BEYOND DOUBT BY THE ASSESSEE. HE DREW OUR ATTENTION TO GROUND NO.3 RAISED BY THE REVENUE WHEREIN THE REVENUE HAD SOUGHT TO DISPUTE THE ISSUE THAT ASSESS EE HAD FAILED TO ESTABLISH THE CREDITWORTHINESS OF THE PARTIES. HE STATED THAT ALL THE THREE SHAREHOLDERS ARE HAVING SUFFICIENT CREDITWORTHINESS FOR MAKING CASH INVESTM ENTS IN THE ASSESSEE COMPANY 3 MA NO.153/KOL/2018 (ARISING OUT OF I.T.A. NO.1619/KOL/2016) M/S ATC LOGISTICS PVT. LTD. A.YR. 2012-13 3 WHICH ASPECT MAY BE DIRECTED TO BE VERIFIED BY THE LD. AO . HOWEVER HE PRAYED FOR MODIFICATION OF THE DIRECTIONS GIVEN BY THIS TRIBUN AL TO EXAMINE THE CASH BALANCES FROM THE CASH BOOK OF RESPECTIVE THREE INDIVIDUALS FOR MAKING CASH INVESTMENTS IN SHARE CAPITAL AND SHARE PREMIUM IN THE ASSESSEE COM PANY. WE FIND FORCE IN THE MISCELLANEOUS APPLICATION PREFERRED BY THE ASSESSE E WITH REGARD TO THIS ISSUE AND IN THE ARGUMENT OF THE LD. AR. ACCORDINGLY, WE HOLD TH AT THE LD. AO IS HEREBY DIRECTED TO EXAMINE THE CREDITWORTHINESS OF THE THREE SHARE HOLDERS ALONE, WHICH IN OUR CONSIDERED OPINION, WOULD BE DULY ADDRESSING THE GR OUND NO. 3 RAISED BY THE DEPARTMENT BEFORE THIS TRIBUNAL IN THE ORIGINAL APP EAL. WE FIND THAT THE LD. AR MADE AN ARGUMENT THAT THE CREDITWORTHINESS OF THESE PART IES STAND CONCLUSIVELY PROVED FROM THE ASSESSMENT ORDERS FRAMED IN THEIR HANDS IT SELF. HOWEVER NO SUCH ORDERS WERE PLACED ON RECORD BEFORE US. HENCE THERE IS NO PURPOSE IN RECALLING THE ORDER IN THIS REGARD. HENCE WE DEEM IT FIT TO MODIFY THE ORD ER PASSED BY THIS TRIBUNAL WITH REGARD TO THE SAID GROUND NO.3 OF THE DEPARTMENT. ACCORDINGLY, THE ORDER PASSED BY THIS TRIBUNAL ON 11.07.2018 IN PARA 4.6 STANDS MODI FIED AS UNDER: 4.6 WE FIND THAT REVENUE HAS RAISED GROUND BEFORE US STATING THE LD. CITA ERRED IN DELETING THE ADDITION MADE ON ACCOUNT OF UNEXPLAINED SHARE CAPITAL INTRODUCED THOUGH THE ASS ESSEE FAILED TO ESTABLISH THE CREDITWORTHINESS OF THE PARTIES. ACCO RDINGLY, WE DIRECT THE LD. AO TO EXAMINE THE CREDITWORTHINESS OF THE THREE SHAREHOLDERS WHO HAD MADE CASH INVESTMENTS IN THE ASSESSEE COMPANY. THE ASSESSEE IS ALSO GIVEN LIBERTY TO PRODUCE FRESH EVIDENCES, IF ANY, BEFORE THE LD. AO IN SUPPORT OF ITS CONTENTIONS. ACCORDINGLY GROUND NO. 3 RAISED BY THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSES. 3. WITH REGARD TO DECISION TAKEN BY THIS TRIBUNAL I N PARA 3.4 OF THE ORDER TOWARDS THE ADDITION ON ACCOUNT OF DIFFERENCE IN TURNOVER AS PE R FORM 26AS AND THAT REPORTED IN 4 MA NO.153/KOL/2018 (ARISING OUT OF I.T.A. NO.1619/KOL/2016) M/S ATC LOGISTICS PVT. LTD. A.YR. 2012-13 4 PROFIT AND LOSS ACCOUNT BY THE ASSESSEE, THE ASSESS EE STATED THAT IT HAD PLACED RELIANCE ON THE CO-ORDINATE BENCH DECISION OF THIS TRIBUNAL IN THE CASE OF TULTUL CHOWDHURY VS ACIT IN ITA NO. 2328/KOL/2016 DATED 07.07.2017 I N SUPPORT OF THE CONTENTION RAISED BY THE REVENUE IN GROUND NO. 2 AND IN SUPPOR T OF GROUND NO. 3 OF THE CROSS OBJECTION RAISED BY THE ASSESSEE. ACCORDING TO LD. AR, NON-CONSIDERATION OF THE CO- ORDINATE BENCH DECISION OF THIS TRIBUNAL CONSTITUTE S AN ERROR APPARENT FROM RECORD WARRANTING RECTIFICATION U/S 254(2) OF THE ACT. WE FIND THAT THE CO-ORDINATE BENCH OF MUMBAI TRIBUNAL IN THE CASE OF RELIANCE COMMUNICATI ONS LTD VS DDIT AND ITS GROUP CONCERNS VIDE ORDER IN VARIOUS ITA NUMBERS DA TED 18.11.2016 HAD HELD THAT NON-CONSIDERATION OF THE DECISION RENDERED BY CO-OR DINATE BENCH ON IDENTICAL ISSUE CONSTITUTES MISTAKE APPARENT FROM RECORD WITHIN THE MEANING OF SECTION 254(2) OF THE ACT. ACCORDINGLY, WE RECALL THE IMPUGNED ORDER IN EXERCISE OF POWERS GRANTED U/S 254(2) OF THE ACT WITH REGARD TO THIS ISSUE OF ADD ITION MADE ON ACCOUNT OF DIFFERENCE IN TURNOVER REPORTED IN FORM 26AS AND THAT REPORTED IN PROFIT AND LOSS ACCOUNT. THE ASSESSEE IS AT LIBERTY TO SUBMIT FRESH EVIDENCES, I F ANY, IN SUPPORT OF ITS CONTENTIONS BEFORE THIS TRIBUNAL, IF IT SO DESIRES. 4. IN THE RESULT, THE MISCELLANEOUS APPLICATION OF THE ASSESSEE IS ALLOWED AND ORDER OF THIS TRIBUNAL DATED 11.07.2018 IN PARA 4.6 STANDS M ODIFIED AS STATED SUPRA. ORDER PRONOUNCED IN THE COURT ON .11 .2018 [A.T.VARKEY] [ M. BALAGANESH ] JUDICIAL MEMBER ACCO UNTANT MEMBER DATED : .11.2018 SB, SR. PS 5 MA NO.153/KOL/2018 (ARISING OUT OF I.T.A. NO.1619/KOL/2016) M/S ATC LOGISTICS PVT. LTD. A.YR. 2012-13 5 COPY OF THE ORDER FORWARDED TO: 1. M/S ATC LOGISTICS PRIVATE LIMITED, BADU ROAD, RA NI PARK, MADHYAMGRAM, KOLKATA- 700129. 2. ACIT, CIRCLE-14(1), KOLKATA, AAYAKAR BHAWAN POOR VA, 110, SHANTIPALLY, E.M. BYE PASS, 6 TH FLOOR, KOLKATA-700107. 3..C.I.T(A).- 4. C.I.T.- KOLKATA. 5. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY BY ORDER ASSISTANT REGISTRAR ITAT, KOLKATA BENCHES