TMI Blog2018 (10) TMI 185X X X X Extracts X X X X X X X X Extracts X X X X ..... giving opportunity of being heard to the assessee. - Decided in favour of assessee for statistical purposes. - I.T.A. No. 488/Kol/2016 - - - Dated:- 27-9-2018 - Shri A. T. Varkey, JM And Dr. A. L. Saini, AM For The Appellant : Shri Subash Agarwal, Advocate For The Respondent : Md. Usman, CIT, DR ORDER Per Shri A.T.Varkey, JM This appeal preferred by the assessee is against the order of the Ld. CIT(A)-6, Kolkata dated 03.03.2016 for AY 2008-09. 2. The assessee has preferred this appeal against the order of Ld. CIT(A) wherein he has upheld the order passed by the AO which was completed u/s. 143(3)/263/147 of the Act (hereinafter referred to as the Act ) on 29.03.2014. In this case the assessment order passed u/s. 147/143(3) of the Act on 30.04.2010 assessing the total income at ₹ 25,271/- and against declaring total income of Rs. Nil. Later on, on 30.03.2013, an order u/s. 263 of the Act was passed by the Ld. CIT setting aside the order passed u/s. 147/143(3) of the Act directing the AO to do fresh assessment and spelt out guidelines for conducting the fresh assessment in the following manner: i) Examine the genuineness and sourc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce of realization from the liquidation of asset shown in the balance sheet after the change of Directors, if any. However, we note that AO s investigation as per his own words as stated as under: In the instant case, on perusal of records it appears that during the financial year under consideration the assessee company incorporated with a capital of ₹ 1,00,000/- and further raised share capital amounting to ₹ 51,12,500/- by issuing 05.11250 1acs equity shares of face value of ₹ 10/-- at a premium of ₹ 190/-- by private placement amounting to ₹ 9,71,37,500/-. During the year total 18 [ eighteen ] number of shareholders as per Form 3 2 filed before the ROC. It has also been observed from the balance sheet furnished that during the assessment year under consideration there are investment to the tune of ₹ 10,22,50,000/--. Perusal of the records revealed that the assessee company utilized funds received from the issue of shares in making of the said investment. During the course of hearing, the A/R of the assessee produced the books of accounts like cash book etc. and Bank statement[s] in original which have been examined. He also furni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a newly incorporated unlisted company is also remained unexplained. There has been a specific observation made by the Ld CIT, Kolkata-II, Kolkata as contained in the order u/s.263 of the I. T. Act,1961 that; The A.O seems to have missed the larger picture and unwittingly has ended up giving a certificate of genuineness -of share capital by passing the impugned order. This by itself establishes that such orders are erroneous and prejudicial to the interests of the Revenue administration. Thus, as it is amply clear from the observations made by the CIT, Kolkata-II, Kolkata as spelt out in the order u/s.263 of the I. T. Act,1961, that the transactions of share capital subscription shown by the assessee was only apparent and is not a real one, rather it was not genuine and bogus. Until and unless the assessee can provide adequate satisfactory evidence that the case of the assessee is different, the observation made by the Ld. CIT, Kolkata-II, Kolkata during the revision proceedings is very much correct and as per the law. In this case, the assessee failed to prove beyond reasonable degree of certainty that the fact in case of the assessee company is otherwise than wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat no proper opportunity was given to assessee by AO during the reassessment proceedings and so we are, therefore, of the opinion that assessee did not get proper opportunity before the AO during reassessment proceedings. In such a scenario, the Hon ble (three judge bench) of the Hon ble Supreme Court in Tin Box Company Vs. CIT (2001) 249 ITR 216 (SC) has held as under: It is unnecessary to go into great detail in these matters for there is a statement in the order of the Tribunal, the fact-finding authority, that reads thus : We will straightaway agree with the assessee s submission that the Income-tax Officer had not given to the assessee proper opportunity of being heard. That the assessee could have placed evidence before the first appellate authority or before the Tribunal is really of no consequence for it is the assessment order that counts. That order must be made after the assessee has been given a reasonable opportunity of setting out his case. We, therefore, do not agree with the Tribunal and the High Court that it was not necessary to set aside the order of assessment and remand the matter to the assessing authority for fresh assessment after gi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7. We also note that the Hon ble Delhi High Court in the case of CIT Vs. Jansampark Advertising Marketing Pvt. Ltd. in ITA No. 525/2014 dated 11.03.2015 wherein after noticing inadequate enquiry by authorities below have held as under: 41. We are inclined to agree with the CIT(Appeals), and consequently with ITAT, to the extent of their conclusion that the assessee herein had come up with some proof of identity of some of the entries in question. But, from this inference, or form the fact that the transactions were through banking channels, it does not necessarily following that satisfaction as to the creditworthiness of the parties or the genuineness of the transactions in question would also have been established. 42. The AO here may have failed to discharge his obligation to conduct a proper inquiry to take the matter to logical conclusion. But CIT(Appeals), having noticed want of proper inquiry, could not have closed the chapter simply by allowing the appeal and deleting the additions made. It was also the obligation of the first appellate authority, as indeed of ITAT, to have ensured that effective inquiry was carried out, particularly in the fact of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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