S.P. TEA ESTATE (INDIA)(P)(LTD),GWALIOR V. ACIT, CIRCLE -2, GWALIOR

ITA 249/AGR/2025

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The case involves S.P.Tea Estate (India) (P) Ltd., the appellant, contesting an order from the National Faceless Appeal Centre, Delhi/Ld. CIT(A), which confirmed additions made by the ACIT under Section 68 of the Income Tax Act, 1961. The additions pertained to Rs.30,00,000 as share capital and Rs.60,00,000 as share premium, which were treated as unexplained credits. The CIT(A) had dismissed the appeal ex-parte, noting the absence of the assessee's representation despite multiple notices. The appellant argued that they did not receive the notices, leading to the appeal before the ITAT. The ITAT found merit in the appellant's claim of not receiving the notices and thus set aside the CIT(A)'s order, remanding the case for a fresh hearing.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 712588 (ITAT-AGRA)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-07-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: 2009-2010
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANIL KUMAR
• Assessee Lawyers: NEERAJ AGARWAL
• Keywords: Opportunity of being heard; Unexplained cash credit; Principle of natural justice; Bogus
• Section: 143(3); 68

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL AGRA BENCH ‘DB’ AGRA (Through Physical/Virtual Hearing) BEFORE SHRI SUNIL KUMAR SINGH, JUDICIAL MEMBER AND SHRI BRAJESH KUMAR SINGH, ACCOUNTANT MEMBER ITA No.249/Agr/2025 [Assessment Year: 2009-10] S.P.Tea Estate (India) (P)(Ltd.), 2nd Floor, Opp. Inderganj Police Station, Jayendraganj Lashkar, Gwalior, Madhya Pradesh-474009 Vs ACIT, Circle-2, Aayakar Bhawan, City Center, Gwalior, Madhya Pradesh-474002 PAN-AAICS2523F Appellant Respondent Appellant by Shri Neeraj Agarwal, CA Respondent by Shri Anil Kumar Sr. DR Date of Hearing 15.07.2025 Date of Pronouncement 15.07.2025 ORDER, PER BRAJESH KUMAR SINGH, AM, This appeal filed by the assessee is directed against an order dated 04.07.2022 of the National Faceless Appeal Centre, Delhi/Ld. CIT(A), relating to Assessment Year 2009-10 arising out of order u/s 143(3) r.w.s. 147 of the Income Tax Act, 1961 (hereinafter referred to ‘the Act’) dated 24.03.2014. 2. This appeal is delayed by 976 days. In this regard, a condonation application and an affidavit is filed on page no.22 to 24 of the appeal set, which is reproduced as below:- Printed from counselvise.com 2 ITA No.249/Agr/2025 Printed from counselvise.com 3 ITA No.249/Agr/2025 Printed from counselvise.com 4 ITA No.249/Agr/2025 3. We have carefully considered the facts stated in the said application and in the affidavit. Upon consideration, we are of the considered view that the assessee was prevented by sufficient cause in filing the said appeal. We, therefore, condone the delay of 976 days and admit this appeal for hearing. 4. The grounds of appeal raised by the assessee are as under:- “1. That the Learned CIT(A) Passed the order without providing sufficient opportunity of being heard to the assessee Hence, the order so passes is against the Principle of Natural Justice and here should be remanded back to CIT(A) 2. That the Learned CIT(A) erred in law and on facts in confirming the addition of Rs.30,00,000/- made by the ACIT on account of share capital, despite the assessee having furnished complete details of the shareholders, including their identity, PAN, and confirmation documents. The addition was wrongly made by treating the said amount as unexplained credits under Section 68 of the Income-tax Act, even though the share capital was genuinely raised and duly supported by documentary evidence. Hence the addition is bad in fact and should be deleted. 3. That the Learned CIT(A) confirmed the addition Rs.60,00,000/- made by the Learned ACIT on account of genuine share premium received by the company, despite the fact that complete details of the shareholders, including their identity, PAN, confirmation, and other supporting documents, were duly submitted during the assessment proceedings. The addition was unjustly made by treating the said amount as unexplained credits under Section 68 of the Income-tax Act, which is bad in law Hence the addition so made should be deleted. 4. That the learned Assessing Officer / Commissioner of Income Tax (Appeals) erred in law and on facts in making / sustaining the addition, on the ground that the assessee did not have any net worth, turnover, or profitability, and had not carried on any business activity during the last two years, to justify the share premium of Rs.20 per share, without appreciating that the mere absence of recent business operations or profitability does not render the share valuation invalid, especially when the valuation is based on prospective business potential and other relevant commercial considerations. Hence the addition is bad and should be deleted. 5. That the Assessing Officer erred in treating Tristar Agencies Pvt. Ltd., Welon Advisory Services Pvt. Ltd., and SK Stock Dealers Pvt. Ltd. as bogus investor companies solely on the basis of handwriting similarity in the share application forms, without conducting any independent inquiry or bringing any adverse material on record. This was done despite the assessee having submitted complete documentary evidence to establish the identity, creditworthiness, and genuineness of Printed from counselvise.com 5 ITA No.249/Agr/2025 the said companies. The addition made is thus arbitrary, presumptive, and not sustainable in law. Hence should be deleted. \" 5. Brief facts of the case:- The assessment was completed u/s 147 r.w.s. 143(3) of the Act, wherein, the assessment was reopened on the basis of information that the assessee company had received credit of Rs.90 lakhs in the form of share application money of Rs.30 lakhs and share premium of Rs. 60 lakhs. The Assessing Officer after considering the reply of the assessee added a sum of Rs.90 lakhs u/s 68 of the Act. 6. Against the above order, the assessee filed an appeal before the ld. CIT(A). The Ld. CIT(A) dismissed the appeal of the assessee ex-parte. The Ld. CIT(A) noted in para 4 of his order that in spite of multiple hearing of notices right from 2015 onwards, none appeared on behalf of the assessee in this case nor any written submissions were filed. Thereafter, the ld. CIT(A) also discussed the issue on merits and dismissed the appeal of the assessee and confirmed the addition of Rs.90 lakhs. 7. Aggrieved by the order of the ld. CIT(A), the assessee is in appeal before us. 8. The ld. AR submitted that the notice of hearing of the ld. CIT(A) was not received by the him and the assessee became aware of the ld. CIT(A)’s order dismissing the appeal of the assessee only when the assessee received a call from the Department for recovery of outstanding dues. 9. The ld. DR supported the orders of the authorities below. 10. We have heard both the parties and perused the material available on record. In view of the fact that the assessee did not receive any notice of hearing in this case of the Ld. CIT(A), we are of the considered view that the assessee was prevented by sufficient reason for not appearing before the ld. CIT(A) to pursue its appeal. Therefore, in the interest of justice, the order of the Ld. CIT(A) is set-aside and we restore the matter to his file for fresh adjudication on this issue as per law after giving reasonable opportunity of being heard to the Printed from counselvise.com 6 ITA No.249/Agr/2025 assessee. Further, the assessee is also directed to appear before the Ld. CIT(A) during the course of hearing. 11. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 15th July, 2025. Sd/- Sd/- [SUNIL KUMAR SINGH] [BRAJESH KUMAR SINGH] JUDICIAL MEMBER ACCOUNTANT MEMBER Dated 15.07.2025. f{x~{tÜ f{x~{tÜ f{x~{tÜ f{x~{tÜ Copy forwarded to: 1. Appellant 2. Respondent 3. PCIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, Agra Printed from counselvise.com "