M/s Fred Enterprises Pvt. Ltd., Chandigarh V. ITO, W-5(3), Chandigarh

MA 21/CHANDI/2021

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 7874 (ITAT-CHANDIGARH)
• Duration Of Justice: 30 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 27-08-2021
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 05-08-2021
• Assessment Year: 2015-2016
• Appeal Filed On: 28-07-2021
• Result in Favour of: Revenue
• Court: TRIBUNAL

Judgement Text

, , A, IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, A CHANDIGARH BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER AND SMT. ANNAPURNA GUPTA, ACCOUNTANT MEMBER M.A. NO.21/CHD/2021 IN ./ ITA NO.1379/CHD/2018 / ASSESSMENT YEAR: 2015-16 M/S FRED ENTERPRISES PVT. LTD., SCO 3688, SECTOR 46-C, CHANDIGARH INCOME TAX OFFICER, WARD-5(3), CHANDIGARH ./ PAN NO : AAACF5918R / APPELLANT / RESPONDENT / ASSESSEE BY : SHRI MAYANK PATWARI, C.A. ! / REVENUE BY : SMT. MEENAKSHI VOHRA, ADDL.CIT ' #$ / DATE OF HEARING : 05.08.2021 %&'($ / DATE OF PRONOUNCEMENT : 27.08.2021 (THROUGH VIRTUAL HEARING) / ORDER PER ANNAPURNA GUPTA, ACCOUNTANT MEMBER: THE PRESENT MISCELLANEOUS APPLICATION FILED BY THE ASSESSEE SEEKS RECTIFICATION IN THE ORDER OF THE IT AT IN ITA NO. 1379/CHD/2018 DATED 30.06.2020. 2. THE APPLICATION STATES THE RECTIFICATION SOUGHT AS RELATING TO AN ARGUMENT ADVANCED BY THE ASSESSEE HAVING NOT BEEN CONSIDERED AND DEALT WITH BY THE ITAT WHILE DECIDI NG THE MA NO. 21/CHD/2021 M/S FRED ENTERPRISES PVT. LTD. V.ITO, CHANDIGARH 2 APPEAL. THE LD. COUNSEL FOR THE ASSESSEE ARGUED THA T THE SAME CONSTITUTED A MISTAKE APPARENT FROM RECORD AND ACCO RDINGLY PLEADED RECTIFICATION TO THIS EFFECT BY RECALLING T HE ORDER FOR THE LIMITED PURPOSE OF ADJUDICATING THE ARGUMENT WHICH WAS FAILED TO BE DEALT WITH THE ITAT. HE RELIED ON THE DECISIO N OF THE GUJARAT HIGH COURT IN THE CASE OF THE ACIT V. SAURA SHTRA KUTCH STOCK EXCHANGE LTD. FOR THE PROPOSITION THAT FAILUR E TO CONSIDER AN ARGUMENT ADVANCED BY THE ASSESSEE CONSTITUTED A MISTAKE APPARENT FROM FOR THE PURPOSE OF SECTION 254 SUB-SE CTION 2 OF THE ACT. 3. WE HAVE GONE THROUGH THE ORDER PASSED BY THE ITA T AND ALSO MISCELLANEOUS APPLICATION FILED BEFORE US. THE ISSUE ADJUDICATED IN THE IMPUGNED ORDER RELATED TO THE AP PLICABILITY OF THE PROVISIONS OF SECTION 56(2)(VIIB) OF THE ACT WHETHER THEY WERE TO BE INVOKED AT THE TIME OF RECEIPT OF SHARE APPLICATION MONEY OR AT THE TIME OF ALLOTMENT OF SHARES. THE IT AT ANALYZED AND INTERPRETED THE PROVISIONS OF THE SAID SECTION AND HELD THAT THE SECTION WAS INVOKED ON THE ALLOTMENT OF SHARES. THE ARGUMENT OF THE ASSESSEE BEFORE THE ITAT WAS THAT T HE SECTION WAS INVOKED ON THE RECEIPT OF THE SHARE APPLICATION MONEY AND ONE OF THE ARGUMENTS ADVANCED IN SUPPORT OF ITS CLA IM WAS THAT IF THE TRIGGER FOR THE APPLICABILITY OF THE SECTION IS HELD TO BE ON THE ALLOTMENT OF SHARES, IT WOULD TANTAMOUNT TO THE APPLICATION OF SUBSEQUENT LAW TO A TRANSACTION THAT TOOK PLACE IN AN EARLIER YEAR SINCE IN THE IMPUGNED CASE, THE PROVISIONS OF SECTION MA NO. 21/CHD/2021 M/S FRED ENTERPRISES PVT. LTD. V.ITO, CHANDIGARH 3 56(2)(VIIB) WERE NOT THERE ON THE STATUTE WHEN THE SHARE APPLICATION MONEY WAS RECEIVED. IT IS THIS CONTEXT THAT THE LD. COUNSEL HAS POINTED OUT IN ITS PRESENT APPLICATION THAT THE ITAT FAILED TO ADJUDICATE. 4. WE DO NOT ANY MERIT IN THE PRESENT APPLICATION. THE ITAT HAVING LAID DOWN THE PROPOSITION IN THE SAID CASE T HAT THE TRIGGER OF APPLICABILITY FOR THE SECTION 56(2)(VIIB ) WOULD BE THE POINT OF TIME WHEN THE SHARES ARE ALLOTTED AND THE PROVISIONS OF SECTION 56(2)(VIIB) DULY INCORPORATED IN STATUTE A T THAT POINT OF TIME, THERE WAS NO RETROSPECTIVE APPLICATION OF THE SECTION AT ALL OF THE SECTION. THE RECEIPT OF SHARE APPLICATION MO NEY HAS BEEN RULED OUT BY THE ITAT TO BE THE TRIGGER FOR THE APP LICABILITY OF THE SECTION. THEREFORE THE ABSENCE OF THE PROVISION S OF SECTION 56(2)(VIIB) AT THAT POINT OF TIME IS OF NO RELEVANC E. THE PROVISIONS OF SECTION 56(2)(VIIB) VERY MUCH THERE O N THE STATUTE WHEN THE APPLICABILITY WAS SAID TO BE INVOKED IN TH E PRESENT CASE, THE ARGUMENT OF LD. COUNSEL FOR THE ASSESSEE THAT A RETROSPECTIVE APPLICATION RESULTED, IS TOTALLY DEV OID OF MERITS. THE IMPUGNED CONTENTION OF THE ASSESSEE HAVING NO MERITS OR IMPACT ON THE OUTCOME OF THE ORDER ITAT IN THE LIGH T OF THE PROPOSITION OF THE LAW LAID DOWN IN THE SAID ORDER , THERE IS, WE HOLD, NO ERROR/MISTAKE IN THE ORDER OF THE ITAT AND THE MISCELLANEOUS APPLICATION THEREFORE DESERVES TO BE DISMISSED. MA NO. 21/CHD/2021 M/S FRED ENTERPRISES PVT. LTD. V.ITO, CHANDIGARH 4 5. ACCORDINGLY, THE PRESENT MISCELLANEOUS APPLICATI ON FILED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 27.08.2021. SD/- SD/- (SATBEER SINGH GODARA) (ANNAPURNA GUPTA) JUDICIAL MEMBER ACCOUNTANT MEM BER DATED: 27. 08.2021 GP/SR.PS &) *+,+ / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ' - / CIT 4. ' - ( )/ THE CIT(A) 5. +./ 0 , $0 , 123/4 / DR, ITAT, CHANDIGARH 6. /35# / GUARD FILE &) ' / BY ORDER, ! / ASSISTANT REGISTRAR