9911796707
TMI Blog2012 (5) TMI 808X X X X Extracts X X X X X X X X Extracts X X X X ..... djudication. 3. Brief facts are: One of the directors of the assessee company Shri Sunil Bhatia contributed following share capital and share premium: S. No. Name of person Share application money received 1. Mr. Sunil Bhatia towards share capital 11955000 2. Towards share capital by way of take over of Mr. Sunil Bhatia's proprietary concern 2261900 3. Mr. Sunil Bhatia towards share premium 5895000 Total 2,01,11,900 3.1. From the bank statement, it was revealed that Sunil Bhatia had subscribed an amount of ₹ 3,50,000/- through bank, whereas for the balance amount of ₹ 1,9761,000/- the assessee furnished only copies of foreign remittance vouchers. Besides, the assessee did not furnished any RBI approval for such foreign remittance. Though it was pleaded that Shri Sunil Bhatia had field return of income for A.Y. 2007-08 declaring income of ₹ 2,67,967/-, on computer check it was found that application for PAN was lying with ITO Ward 23(1), New Delhi. AO, therefore, could not cross check the creditworthiness of Shri Sunil Bhatia in respect of vouchers of foreign remittance. Besides, AO questioned the propriety of charging of huge premium in the very ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e from producing before the Assessing Officer any evidence which is relevant to any ground of appeal. iv) Where the Assessing Officer has made the order appealed against without giving sufficient opportunity to the appellant to adduce evidence relevant to any ground of appeal. However, the case of the assessee does not fall in any of the conditions laid down in Rule 46A of the IT Rules as reproduced above. Hence, the additional grounds of appeal submitted by the assessee should not be admitted, since it is amply clear from perusal of the assessment proceedings before the AO. However, factual report in respect of the submissions made before the ld. CIT(Appeals) is as under: The company was incorporated on 01-07-2006, hence, the year under consideration is the first year of the assessee company. During the year under consideration, the assessee company was engaged in the business of conducting exhibition in New Delhi at DND Flyway compound. During the course of assessment proceedings, the assessee filed copy of balance sheet, profit & loss account and the relevant schedules and annexure. From the balance sheet filed, it is seen that the assessee has raised share capital t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the case u/s 68 of the IT Act by holding that the source of this investment in name of Shri Sunil Bhatia is unexplained therefore a remand report from AO was called for. In response thereto the AO has submitted his report which is reiteration of the earlier observation in the assessment order & that as Shri Bhatia had been given sufficient opportunity during the assessments proceedings therefore, the additional evidence may not be admitted U/R 46A. In counter reply to the remand report the appellant again submitted that as Sh. Sunil Bhatia is a nonresident based in Dubai therefore it took some time to get the above documents and that in meantime the AO had passed the assessment order on 10-11-09, without providing sufficient opportunity. That as the additional evidenced pertains to creditworthiness of Shri Sunil Bhatia therefore required to be admitted. On a consideration of reply of the appellant the objection of the AO on non-admission of additional evidence are not found acceptable as the additional evidence I form of Bank A/c, Passport and the professional license of the firm in Dubai in which Shri Sunil Bhatia is a partner are crucial to the issue in Ground nos. 1 & 2 of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 10200003863 in Bank of Baroda, Dubai Main Branch in case of E-4, Entertainment P.O. Box 48654, Dubai, United Arab Emirates was also filed for the relevant period. Copy of Passport of Shri Sunil Bhatia issued from Dubai on 09- 08-2005 (Date of expiry 08-08-05) has been submitted as also the professional license dated 07-09-02 issued by the Department of Economic Development Government of Dubai in name of E-4 Entertainment. Shri Sunil Bhatia is a 50% share holder in E-4 Entertainment as per license. The licensed activities are exhibition, organizing parties & private functions, entertainment service, conferences and seminar organizing. The appellant also provided copy of current account of Shri Sunil Bhatia in books of M/s E-4 Entertainment(Dubai), from which is observed that a total amount of 14,61,175/- (DHS) has been debited, which has consequently been remitted by Shri Sunil Bhatia as share capital to E-4 Entertainment P. Ltd., for ₹ 1,75,00,000/- in Bank A/c No. 0963020000779 in Bank of Baroda, East of Kailash, New Delhi." 4. Ld. DR at the out set vehemently argues that: (i) order of ld. CIT(Appeals) is illegal and perverse inasmuch as the objections raised by AO were p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... time of hearing of the appeal." 4.2. A perusal of grounds of appeal will reveal that assessee had no where raised a ground that the assessment was completed in a hurry or that sufficient opportunity of hearing was not given by AO. Having not raised any ground of appeal before ld. CIT(Appeals) it was neither justified for the assessee to make a false statement that assessee was not given proper opportunity by AO and at the same time, ld. CIT(Appeals) was not justified in admitting the additional evidence without appreciating that there was no compliance to Rule 46A. The relevant evidence was not filed before AO to avoid first hand investigations for the reasons best known to the assessee. 4.3. So called additional evidence filed by the assessee are copies of foreign records and bank statements which are neither notarized nor verified by any diplomatic agency. Ld. CIT(Appeals) without giving adequate reasons for admission of additional evidence, fully relied on all these unadmissible copies of documents. Thus, the entire relief has been given on extraneous evidence which was neither before AO nor certified properly. It is, therefore, pleaded that ld. CIT(Appeals) miscarried himse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee company is engaged in the business of conducting exhibitions at DND Flyway compound and other entertainment activities. The company was formed by taking over Mr. Bhatia's proprietorship concern. The question of addition, if any, arises only in the case of Shri Sunil Bhatia and not the assessee company. Shri Sunil Bhatia being an identified individual, having PAN no. and known sources of investment, the assessee had discharged its burden cast on it in terms of sec. 68. Therefore, ld. CIT(Appeals) has deleted the addition on just and proper considerations. Reliance is placed on Hon'ble Supreme Court judgments in the cases of Lovely Exports 216 ITR 195; and Oasis Hospitality 333 ITR 119. 6. We have heard rival contentions and gone through the relevant material available on record. 6.1. Coming to the additional evidence, we have perused form no. 35 i.e. memo of appeal filed by the assessee before ld. CIT(Appeals). In the grounds raised, there is neither any ground nor whisper about not providing sufficient opportunity by AO while framing the assessment. It is further evidenced from the fact that the assessment proceedings commenced on 26- 9-2008 and assessment order has been passe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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