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TMI Blog2021 (12) TMI 23X X X X Extracts X X X X X X X X Extracts X X X X ..... questions of law for consideration :- I. Whether on the facts and circumstances of the case the Learned Tribunal passed the orders under section 263 in the case of 5 out of six share applicants, wherein the learned Commissioner of Income Tax, Kolkata-1 initiated proceedings since in their cases also the Commissioner felt that those persons failed to prove their identity, genuinity and credit worthiness. However in all the five cases the proceedings were dropped after making enquiry. In respect of the sixth share holder also the petitioner filed all the details and evidences on which there was no adverse comment by the Commissioner of Income Tax or by the Tribunal. The learned Tribunal however has confirmed the order of the Commissioner o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pted, then it was not open to the C.I.T. to direct an enquiry to ascertain the source and genuineness of the sums being projected by the appellants as capital receipts. Mr. Majumdar wants us to reject the finding of the Tribunal that Section 68 of the Act, as amended, has retrospective operation. In support of his submissions on this point, he has relied upon on a Constitution Bench judgement of Supreme Court delivered in the case of Commissioner of Income Tax Vs. Vatika Township Pvt. Ltd. (2015) 1 SCC 1. Argument of the appellant is that in the event the amendment made to section 56(2) of the Act is given prospective effect along with provisos to Section 68, then sums received as share capital or share premium would not be taxable in the l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd source thereof even if the same is credited as receipt of share application money. Mere fact that the payment was received by cheque or that the applicants were companies, borne on the file of Registrar of Companies were held to be neutral facts and did not prove that the transaction was genuine as was held in the case of CIT - Vs - Nova Promoters and Finlease (P) Ltd. (supra). Similar views were expressed by this Court in the case of CIT - Vs - Precision Finance Pvt. Ltd. (supra). We need not decide in this case as to whether the proviso to Section 68 of the Income Tax Act is retrospective in nature. To that extent the question is kept open. We may however point out that the Special Bench of Delhi High Court in the case of Sophia Financ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , and the learned counsel for the parties have also confined their submissions to points of law only. The capital receipts in respect of which inquiries have been ordered by the C.I.T. have similar features, being fresh share capital issued at high premium. Mr. Majumdar, however, drew his strength to urge the point that it was only after the aforesaid amendments such inquiries would have relevance. He sought to take cue from the observation of the Coordinate Bench that the question as to whether proviso to Section 68 of Income Tax Act is retrospective in nature or not was being kept open. He also cited the judgement of the Hon'ble Supreme Court in the case of Sneh Vs. Commissioner of Customs (2006) 7 SCC 714] to contend that a judgement is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e C.I.T. to be valid examining the order applying the unamended provision of Section 68 of the Act only. We do not find any other distinguishing element in these appeals which would require addressing the question s to whether the amendment to Section 68 of the Act was retrospective in operation or not. Neither do we need to address the issue that if the inquiries, as directed, revealed that share capital infused were actually unaccounted money, whether the same could be taxed in accordance with Section 56(2)(vii)(b) or not. The ratio of the Constitution Bench decision of the Hon'ble Supreme Court in the case of Vedika Township Private Ltd. (supra) does not apply in the legal context in which we are deciding these appeals. It is not necessa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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