TMI Blog2022 (2) TMI 604X X X X Extracts X X X X X X X X Extracts X X X X ..... and assessee has discharged the onus on it at para4; And after perusing their replies and supporting documents and thereafter having verified their veracity, the second AO was satisfied with the explanation of assessee in respect to the nature and source of credit entries which view of second AO cannot be faulted. And we also note that all the shareholders are regular income tax assessee. Therefore, in the light of the aforesaid documents discussed their identity cannot be disbelieved and the AO s satisfaction in respect of identity of the shareholders is a possible view and cannot be termed as unsustainable in law or facts. Coming to the creditworthiness of the shareholders we note that the assessee and the shareholders have brought to the notice of Second AO that they (share subscribers) have enough net worth to invest in the assessee company and the share subscribing companies pursuant to the AO's notice u/s. 133(6) of the Act have furnished their respective audited accounts from which the aforesaid facts are clearly discernible and moreover the share subscribers have also filed before the second AO the source from which they subscribed to shares of assessee (though not r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... into operation the doctrine of merger the subject matter i.e. share capital premium collected by assessee company. Resultantly the second Ld. Pr.CIT, again cannot rake-up the same subject matter without the second Ld. Pr.CIT in the second revisional order spells out where the error happened to second AO as an investigator or adjudicator, which exercise the Second Ld. Pr.CIT has not done, so the second Ld. Pr. CIT cannot be permitted to again ask the AO to start the investigation in the way he thinks it proper on the very same subject on which merger has taken place by virtue of the order of First Ld. Pr. CIT. And if this practice is allowed, then there will be no end to the assessment proceedings meaning no finality to assessment proceedings Pr. CIT has made a bald statement that the AO s assessment order attracts Explanation 2(c) u/s. 263 of the Act. However, he failed to spell out in his impugned order how the action of AO while framing the assessment order is not in accordance to any order, direction or instruction issued by the Board under section 119 of the Act. So, the deeming fiction as envisaged in Explanation (2) u/s. 263 of the Act cannot be used to interfere with t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nafter referred to as the First Ld. Pr.CIT) interfered with the assessment order dt.12.03.2015 u/s. 263 of the Act. So, in order to carry out proper verification of this issue, the First Ld. Pr.CIT by order dated 21.09.2016 was pleased to set aside the original/first assessment order of the AO dated 12.03.2015 for de-novo assessment and directed the AO to specifically examine the source of share application money, identity of investors and its genuineness (hereinafter referred to as the First revisional order). The First Ld. Pr. CIT s specific direction is given below:- 4(v) Considering the above facts and circumstances of case, the assessment order passed on 12.03.2015 is set aside denovo with a direction to AO to carry out (1) proper examination of books of account and Bank accounts of assessee as well as investors.AO is also directed to (2)examine the source of share application,(3) identity of the investor and its genuineness. The assessment proceedings may be initiated at the earliest and to be completed without waiting time barring date. The A.O must provide sufficient opportunity of being heard to the assessee in order to meet natural justice, equity and fairness. [em ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issue, so we have to first deal with it. 6. The Ld. AR, Shri S.K. Tulsiyan first of all wants us to adjudicate the legal issue. Assailing the impugned action of the Second Ld. Pr. CIT to exercise for the second time revisional jurisdiction u/s. 263 of the Act, as wholly without jurisdiction Shri S.K. Tulsiyan contended that the Ld. Pr.CIT ought not to have invoked the revisional jurisdiction since second AO had framed the reassessment pursuant to the first revisional order of First Ld. Pr.CIT dated 21.09.2016, which impugned action of the second Ld. Pr.CIT, according to him is without satisfying the requisite conditional precedent as stipulated in Section 263 of the Act and so bad in law. According to Ld.AR, the First Ld. Pr.CIT while passing his first revisional order dated 21.09.2016 has given specific direction while setting aside the original first assessment order passed by the First AO on 12.03.2015 wherein he directed the second AO to carry out proper examination in respect of share capital premium which assessee received during the assessment year. Shri S.K. Tulsiyan pointed out the specific instructions of the First Ld. Pr. CIT to the second AO (i) proper examinat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n by the First Ld. Pr.CIT, which since having been complied by the AO, brings into operation the doctrine of merger the subject matter i.e, share capital premium collected by assessee company. Resultantly the second Ld. Pr.CIT, again cannot rake-up the same subject matter without the second Ld. Pr.CIT in the second revisional order spells out where the error happened to second AO as an investigator or adjudicator while the AO was carrying out the directions of First Ld. Pr.CIT pursuant to the first revisional order, which exercise according to Ld.AR unfortunately this Second Ld. Pr.CIT has not done. So according to Ld. A.R, he cannot be permitted to again ask the AO to start the investigation in the way he thinks it proper on the very same subject on which merger has taken place by virtue of the order of First Ld. Pr. CIT. Therefore, according to Ld.AR, if this practice is allowed, there will be no end to the assessment proceedings, since if the next i.e third or fourth Pr. CIT does not like the next assessment orders being passed by an AO under his jurisdiction, in the way he thought it as proper enquiry to have been conducted in a given case or subject matter, then he will inte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ditworthiness and is capable of investing in the assessee, then the AO in turn can verify the identity, creditworthiness and genuineness of the share subscriber from whom the assessee received the share capital and verify whether the identity is proper, whether the transaction took place through banking channel, etc. and the creditworthiness of the share applicant etc. According to Shri S.K. Tulsiyan, if the AO or even the Ld. Pr. CIT expecting/asking the assessee to find out the source of source of share-applicant, when the Law does not in this AY requires assessee to fulfil, then it would be quiet unreasonable, harsh and unfair practice, which action is against the Rule of Law, which is a basic feature of the Constitution of India. Since the law was that assessee should furnish the source of share capital it received in this A.Y, assessee by producing all documents in respect of share-applicants had discharged its onus, then burden shifts to the shoulder of AO to find fault with the documents or test the veracity of the documents. Despite the law was as such, then also AO in the first round itself had issued notice u/s. 133(6) of the Act to all the share applicants/subscribers ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evenue along with the documents furnished and the case law(s) relied upon by both the parties. It is noted that in this case the original return was filed on 11.09.2012 u/s. 139 of the Act showing loss of ₹ 2615 and the original first assessment was framed by the First AO u/s. 143(3) of the Act on 12.03.2015 by making an addition of ₹ 1,89,84,820/-. Thereafter, the First Ld. Pr. CIT-4, Kolkata issued SCN to the assessee-company conveying his intention to interdict in the first AO s action in framing the said original first assessment order dated 12.03.2015. Thereafter, the First Ld. Pr.CIT passed his First Revision order u/s. 263 of the Act on 21.09.2016 wherein he was pleased to set aside the original assessment order dated 12.03.2015 and directed de novo assessment along with the specific direction to inquire about the collection of share capital premium. Pursuant to the direction of the First Ld. Pr.CIT dated 21.09.2016, the second AO framed the de-novo re-assessment order dated 03.11.2016, wherein the second AO was pleased to accept the assessee s transaction in respect of collection of share premium to the of ₹ 1,89,81,000/-. Thereafter, the new incumbent i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... interest of the Revenue. In the following circumstances, the order of the AO can be held to be erroneous order, that is (i) if the Assessing Officer's order was passed on incorrect assumption of fact; or (ii) incorrect application of law; or (iii)Assessing Officer's order is in violation of the principle of natural justice; or (iv) if the order is passed by the Assessing Officer without application of mind; (v) if the AO has not investigated an issue before him; then the assessment order passed by the Assessing Officer can be termed as an erroneous order. Coming next to the second limb, which is required to be examined is as to whether the actions of the AO can be termed as prejudicial to the interest of Revenue. When this aspect is examined one has to understand what is prejudicial to the interest of the revenue? The Hon'ble Supreme Court in the case of Malabar Industries (supra) held that this phrase i.e. prejudicial to the interest of the revenue has to be read in conjunction with an erroneous order passed by the Assessing Officer. Their Lordship held that it has to be remembered that every loss of revenue as a consequence of an order of Assessing Officer cannot b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT issued show cause notice (hereinafter referred to as the second SCN) dated 16.01.2019 pointing out certain faults in the AO s second assessment / re-assessment order dated 03.11.2016. 20. Thereafter, the Second Ld. Pr. CIT again was pleased to set aside the reassessment/second assessment order of the AO dated 03.11.2016 and directed fresh assessment ( which means a third assessment to be framed). 21. The aforesaid action of the Second Ld. Pr. CIT dated 12.03.2019 is challenged before us. According to the Ld. Counsel, Shri S.K. Tulsiyan, the Ld. Pr. CIT erred in assuming his jurisdiction without satisfying the jurisdictional conditional precedents as prescribed u/s. 263 of the Act and, therefore, the action of the Ld. Pr. CIT is wholly without jurisdiction and therefore, ab-initio void and therefore, need to be struck down. We note that in order to interfere with the second assessment/re-assessment order passed by the Second AO u/s. 143(3)/263 of the Act dated 03.11.2016, the Second Ld. Pr. CIT has alleged lack of enquiry on the part of the AO in respect of share application money, and for not collecting the full facts. Therefore, it is noted that according to Ld. Pr. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent proceedings though has been provided with the aforesaid documents has not examined these documents, which according to him, should have been carried out by the AO. At para 4 of his order, the Ld First PCIT has made a important finding of fact that assessee had discharged its onus by furnishing these details/documents. Further, the Ld. Pr. CIT found fault with the AO s order in not discussing the basis of evidence on which adverse inference was drawn against the assessee. Moreover, the First Ld. Pr. CIT found fault with the AO for not bothering to examine the contention of the assessee or to bring on record anything against the assessee and according to him, the AO has simply jumped to the conclusion and treated the share premium as unexplained cash credit. Therefore, according to the First Ld. Pr. CIT the first original assessment order framed u/s. 143(3) dated 12.03.2015 was against the principle of natural justice and, therefore, he found it fit to order de novo assessment and gave specific direction in respect of share capital premium collected by assessee. 23. Thereafter, the Ld. Pr. CIT was pleased to direct assessment order passed on 12.03.2015 is set aside de no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6. The AO also acknowledges in his re-assessment/second assessment order that he has examined the aforesaid details and thereafter verified the investors identity, genuineness and creditworthiness and also their source of fund to invest in the assessee company. Thereafter, the second AO by order dated 03.11.2016 accepted the return filed by the assessee and thus it is noted that second AO did not draw any adverse inference against the share premium collected by the assessee. This action carried out by the second AO while framing the second assessment/re-assessment has been faulted as a case of lack of enquiry by the second Ld. Pr. CIT and the precise question is whether the action of second AO in accepting the share capital and premium collected by the assessee can be termed as a case of lack of enquiry. 27. According to us, when the Assessment Order is framed on an issue which is the result of lack of enquiry, then the assessment order in respect of that issue would be erroneous because of that omission on the part of the AO to investigate that relevant fact which if enquired could have created a different result and consequently affected the veracity of the very claim made b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contained in the first proviso shall apply if the person, in whose name the sum referred to therein is recorded, is a venture capital fund or a venture capital company as referred to in clause (23FB) of section 10]. 29. Here it is to be noted that the first proviso and second proviso was inserted by Finance Act, 2012 with effect from 01.04.2013, so it is applicable only for/from AY 2013- 14 and not for this AY 2012-13. 30. Next let us refer to the definition of income stated in Section 2(24) of the Act. Section 2(24) of the Act includes:- i) profits and gains .. .. xvi) any consideration received for issue of shares as exceeds the Fair Market Value of the shares referred to in clause (viib) of sub-section (2) of section 56. 31. It is noted that this amendment was made by an insertion of clause (xvi) in section 2(24) of the Act was by Finance Act 2012 with effect from 01.04.2013. 32. Correspondingly, the Parliament inserted sub-clause (viib) in sub-section 2 of section 56 of the Act by Finance Act 2012, w.e.f. 01.04.2013, that is for AY 2013-14 (not this AY 2012-13) in respect of computing and taxing the premium of shares in the hands ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bout the share applicants who wish to invest their identity, whether they have the financial capacity (creditworthiness) and they are genuine investors in their company (assessee). In this AY, the assessee is not bound by law at the time of collection of share capital to ask the share-applicants from where it is getting the money to invest in the assessee's company. And we also note that share premium can be taxed if it exceeds the fair market value only from next AY i.e. AY 2013-14 and not in this A.Y. For coming to such a conclusion let us discuss few case laws: (A) Coming to the share premium, it is noted that this Tribunal in ITA- 2411/KOL/2017 in the case of Kanchan Plywood Products Pvt. Ltd. -vs.- ITO vide order dated 01.05.2019 has taken note that - Per contra, the Learned DR vehemently supported the order of the authorities below and wondered us to how the assesseecompany issued share to three Private Limited Companies when its face value of ₹ 10/- at a premium of ₹ 990/-. According to the Learned DR, the assesseecompany had a meager return of income in the year under consideration and therefore, question of any person subscribing such high premium to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... neness (identity) of the shareholders i.e. they are bogus. The Apex Court in CIT vis. Lovely Exports (P) Ltd. 317 ITR 218 in the context to the pre-amended Section 68 of the Act has held that where the Revenue urges that the amount of share application money has been received from bogus shareholders then it is for the Income Tax Officer to proceed by reopening the assessment of such shareholders and assessing them to tax in accordance with law. It does not entitle the Revenue to add the same to the assessee's income as unexplained cash credit. (B) The Tribunal Mumbai Bench in the case of DCIT vs. M/s. Alcon Biosciences (P) Ltd., ITA No. 1946/M/2016, Order dated 28.02.2018 held as under As regards the AOs observation with regard to the issue of shares at a face value of ₹ 10/- issued at a premium of ₹ 990 per share, we find that there is no merit in the findings of the AO for the reason that the issue of shares at a premium and subscription to such shares is within the knowledge of the company and the subscribers to the share application money and the AO does not have any role to play as long as the assessee has proved genuineness of transactions. We fu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat excess premium has been charged, it does not become income as it is a capital receipt. The receipt is not in the revenue field. What is to be probed by the AO is whether the identity of the assessee is proved or not. In the case of share capital, if the identity is proved, no addition can be made u/s 68 of the Act. We draw support from the decision of the Hon'ble Supreme Court in the case of Lovely Exports Ltd. 317 ITR 218: 35. Relying on the aforesaid judicial precedents of Hon'ble High courts and the Tribunal. we are of the opinion that in this AY i.e. AY 2012-13, the amendment in section 68 of the Act took place wherein the addition of proviso was with effect from 01.04.2013 and so is not applicable in this AY. Further, as noted, the definition of income as provided under section 2(24) of the Act at the relevant time (AY 2012-13) did not define as income any consideration received for issue of shares in excess of its fair market value. This came into effect from 01.04.2013 and thus would have no application to the share premium received by the assessee in the previous year relevant to AY 2012-13. With this back-drop in respect of the requirement of law, let us s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssing Officer is dissatisfied about the source of cash deposited in the bank accounts of the creditors, the proper course would be to assess such credit in the hands of the creditor (after making due enquiries from such creditor). In arriving at this conclusion, the Hon'ble Court has further stressed the presence of word may in section 68. The Hon'ble Apex Court ratio was taken note by the Hon'ble Gujarat High Court in the case of Dy CIT vsRohini Builders (2002) 2561TR360 wherein the Hon'ble High Court observed at pages 369 and 370 of this order are reproduced hereunder:- Merely because summons issued to some of the creditors could not be served or they failed to attend before the Assessing Officer, cannot be a ground to treat the loans taken by the assessee from those creditors as non-genuine in view of the principles laid down by the Supreme Court in the case of Orissa Corporation [1986] 159 ITR 78. In the said decision the Supreme Court has observed that when the assessee furnishes names and addresses of the alleged creditors and the GIR numbers, the burden shifts to the Department to establish the Revenue's case and in order to sustain the addition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... remain confined to the transactions, which have taken place between the assessee and the creditor nor does the wording of section 68 indicate that section 68 does not authorize the Revenue Department to make inquiry into the source(s) of the credit and/or sub-creditor. The language employed by section 68 cannot be read to impose such limitations on the powers of the Assessing Officer. The logical conclusion, therefore, has to be, and we hold that an inquiry under section 68 need not necessarily be kept confined by the Assessing Officer within the transactions, which took place between the assessee and his creditor, but that the same may be extended to the transactions, which have taken place between the creditor and his sub-creditor. Thus, while the Assessing Officer is under section 68, free to look into the source(s) of the creditor and/or of the subcreditor, the burden on the assessee under section 68 is definitely limited. This limit has been imposed by section 706 of the Evidence Act which reads as follows: Burden of proving fact especially within knowledge.-When any fact is especially within the knowledge of any person, the burden) of proving that fact is upon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... money of his creditor or of the genuineness of the transactions, which took between the creditor and sub-creditor and/or creditworthiness of the sub- creditors, for, these aspects may not be within the special knowledge of the assessee. If a creditor has, by any undisclosed source, a particular amount of money in the bank, there is no limitation under the law on the part of the assessee to obtain such amount money or part thereof from the creditor, by way of cheque in the form of loan and in such a case, if the creditor fails to satisfy as to how he had actually received the said amount and happened to keep the same in the bank, the said amount cannot be treated as income of the assessee from undisclosed source. In other words, the genuineness as well as the creditworthiness of a creditor have to be adjudged vis-a-vis the transactions, which he has with the assessee. The reason why we have formed the opinion that it is not the business of the assessee to find out the actual source or sources from where the creditor has accumulated the amount, which he advances, as loan, to the assessee is that so far as an assessee is concerned, he has to prove the genuineness of the tran ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have been and ought not to have been, under the law, treated as the income from the undisclosed sources of the assessee himself, when there was neither direct nor circumstantial evidence on record that the said loan amounts actually belonged to, or were owned by, the assessee. Viewed from this angle, we have no hesitation in holding that in the case at hand, the Assessing Officer had failed to show that the amounts, which had come to the hands of the creditors from the hands of the sub-creditors, had actually been received by the sub-creditors from the assessee. In the absence of any such evidence on record, the Assessing Officer could not have treated the said amounts as income derived by the appellant from undisclosed sources. The learned Tribunal seriously fell into error in treating the said amounts as income derived by the appellant fromundisclosed sources merely on the failure of the sub-creditors to prove their creditworthiness. 38. Further, in the case of CIT v. S. Kamaljeet Singh [2005)147 Taxman 18(All.) their lordships, on the issue of discharge of assessee's onus in relation to a cash credit appearing in his books of account, has observed and held as under:- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of Tribunal was challenged in the Hon'ble High Court, Calcutta in the case of Crystal Networks (P.) Ltd. v. Commissioner of Income-tax 353 ITR 171 wherein the Tribunal's decision was overturned and decision of Ld. CIT(A) upheld and the Hon'ble High Court held that when the basic evidences are on record the mere failure of the creditor to appear cannot be basis to make addition. The court held as follows: 8. Assailing the said judgment of the learned Tribunal learned counsel for the appellant submits that Income-tax Officer did not consider the material evidence showing the creditworthiness and also other documents, viz; confirmatory statements of the persons, of having advanced cash amount as against the supply of bidis. These evidence were duly considered by the Commissioner of Income-tax (Appeals). Therefore, the failure of the person to turn up pursuant to the summons issued to any witness isimmaterial when the material documents made available, should have been accepted and indeed in subsequent year the same explanation was accepted by the Income-tax Officer. He further contended that when the Tribunal has relied on the entire judgment of the Commis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as follows: ''The Income-tax Appellate Tribunal performs a judicial function under the Indian Income-tax Act; it is invested with authority to determine finally all questions of fact. The Tribunal must, in deciding an appeal, consider with due care all the material facts and record its finding on all the contentions raised by the assessee and the Commissioner, in the light of the evidence and the relevant law. 11. The Tribunal must, in deciding an appeal, consider with due care all the material facts and record its finding on all contentions raised by the assessee and the Commissioner, in the light of the evidence and the relevant law. It is also ruled in the said judgment at page 465 that if the Tribunal does not discharge the duty in the manner as above then it shall be assumed the judgment of the Tribunal suffers from manifest infirmity. 12. Taking inspiration from the Supreme Court observations we are constrained to hold in this matter that the Tribunal has not adjudicated upon the case of the assessee in the light of the evidence as found by the Commissioner of Income-tax (Appeals). We also found no single word has been spared to up set th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rawn to the decision of the Hon'ble Supreme Court while dismissing SLP in the case of Lovely Exports as has been reported as judgment delivered by the CTR at 216 CTR 295: Can the amount of share money be regarded as undisclosed income under section 68 of the Income tax Act, 1961? We find no merit in this special leave petition for the simple reason that if the share application money is received by the assessee- company from alleged bogus shareholders, whose names are given to the AO, then the Department is free to proceed to reopen their individual assessments in accordance with law. Hence, we find no infirmity with the impugned judgment. 43. Our attention was also drawn to the decision of the Hon'ble Calcutta High Court while relying on the case of Lovely Exports, in the appeal of COMISSIONER OF INCOME TAX, KOLKATA-IV Vs ROSEBERRY MERCANTILE (P) LTD., ITAT No. 241 of 2010 dated 10- 01-2011 has held: On the facts and in the circumstances of the case, Ld. CIT(A) ought to have upheld the assessment order as the transaction entered into by the assessee was a scheme for laundering black money into white money or accounted money and the Ld. CIT (A) ought to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e company. The Assessing Officer accordingly treated the investment as unexplained credit under Section 68 of the Income Tax Act and added the same to the income of the assessee. Being aggrieved, the assessee filed an appeal before the Commissioner of Income Tax (Appeals) being the First Appellate Authority and contended that the Assessing Officer had no material to show that the share capital was the income of the assessee company and as such the addition made by the Assessing Officer under Section 68 of the Act was wrong. The learned Commissioner of Income Tax (Appeals) after hearing the department and the Assessee Company deleted the addition of ₹ 52,03,500/- to the income of the assessee company during the Assessment Year in question. The learned Commissioner of Income Tax Appeals found that there were as many as 2155 allottees, whose names, addresses and respective shares allocation had been disclosed. The Commissioner of Income Tax Appeals, further found that the Assessee Company received the applications through bankers to the issue, who had been appointed under the guidelines of the Stock Exchange and the Assessee Company had been allotted shares ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity of the shareholders. In the instant case, the assessee disclosed the identity and address and particulars of share allocation of the shareholders. It was also found on the facts that all the shareholders were in existence. Only nine shareholders subscribing to about 900 shares out of 6, 12,000 shares were not found available at their addresses, and that too, in course of assessment proceedings in the year 1994, i. e., almost 3 years after the allotment. By an order dated 2nd May, 2001, this Court admitted the appeal on three questions which essentially centre around the question of whether the Appellate Commissioner erred in law in deleting the addition of ₹ 52, 03, 500/- to the income of the assessee as made by the Assessing Officer. We are of the view that there is no question of law involved in this appeal far less any substantial question of law. The learned Tribunal has concurred with the learned Commissioner on facts and found that there were materials to show that the assessee had disclosed the particulars of the shareholders. The factual findings cannot be interfered with, in appeal. We are of the view that once the identity and other relevant partic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld that the onus was validly discharged. We, thus, find that both the authorities below, on consideration of the materials on record, rightly applied the correct law which are required to be applied in the facts of the present case and, thus, we do not find any reason to interfere with the concurrent findings of fact based on materials on record. The appeal is, thus, devoid of any substance and is dismissed summarily as it does not involve any substantial question of law. 46. In the light of the afore-cited judicial precedents, let us examine the case in hand and find out whether pursuant to the specific direction of First Ld. Pr. CIT, the second AO has discharged his role as an investigator in respect of share capital and premium collected by the assessee or whether the AO failed to enquire on this issue and whether his reassessment/ second assessment order is a plausible view or it can be termed as an unsustainable view in law. We on a conjoint reading of the First Revisional Order of the First Pr. CIT dated 21.09.2016 and the reassessment /Second assessment of the AO dated 03.11.2016, the following facts can be discerned:- (a) The First Ld. Pr. CIT has r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uineness . He also directed that the assessment proceedings to be initiated at the earliest and to be completed without waiting for time bar limit. With the aforesaid specific direction, the First Ld. Pr. CIT has set aside the first original assessment order dated 12-03-2015. 49. So we note that the second AO was specifically directed by the First Ld. Pr. CIT to carry out the followings actions in addition to de-novo assessment which means the second AO was free to assess the income of assessee afresh, however, he has to do the following specific actions as directed in respect of share- applicants who applied for shares in assessee-company. The specific directions of Ld. Pr CIT to AO are as under: (i) To carry out proper examination of the books of accounts and bank account of the assessee; (ii) To carry out proper examination of the books of accounts and bank account of the investors; (iii) AO to examine the source of the share applicants; iv)The AO to examine the identity of the investor and its genuineness; v) The AO to complete the assessment at the earliest without waiting for the time barring date. 50. In the second round before the AO for d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oss verify and collect details from the AO of the respective share applicants and independently from the Revenue's departmental data base. We note that all the share subscribing parties filed all the documents called for by the AO [PB-1, PAGES 15-129] and were also examined by the AO along with audited accounts from which these details show their identity;- SL NO NAME OF ALLOTTEE CIN PAN NO Whether ITR filed for AY 2012-13 1 Nayan Tie Up Pvt Ltd U50404MH2009PTC204355 AACCN9155G Yes 2 Tribhuvan Deal Trade Pvt Ltd U52190WB2010PTC155416 AACCT3855B Yes 3 ManomayCommosale Pvt Ltd U74999WB2011PTC163984 AAHCM2756M Yes 4 Intellect Fincon Pvt Ltd U51909WB1994PTC062889 AAGCS8100G Yes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 39 44 31 2 Tribhuvan Deal Trade Pvt Ltd 60,00,000 26,04,94,448 55 49 48 3 ManomayCommosale Pvt Ltd 35,00,000 10,32,95,047 70 77 63 4 Intellect Fincon Pvt Ltd 40,00,000 21,18,73,887 87 96 80 5 BalajiFinvest Pvt Ltd 15,00,000 31,54,34,318 107 100 99 6 Aakriti Overseas Pvt Ltd 20,00,000 13,92,74,548 124 115 117 53. So, from a perusal of the above chart, we note that the assessee and the shareholders have brought to the notice of Second AO that they (share subscribers) have enoug ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an Tie Up Pvt Ltd On perusal of the paper book, it reveals that documents are placed at page 29-44a of share applicant, Nayan Tie Up Pvt Ltd which is a Private Limited Company, and which has Permanent Account No.AACCN9155G and CINU50404MH2009PTC204355.We note that this share applicant company has filed its Pan Card, ITR acknowledgment, relevant Bank Statement, source of funds and audited accounts in response to the notice issued u/s 133(6) of the Act. A copy of its Income Tax Return Acknowledgment for AY 2012-13 is placed at page 32 of the paper book. On perusal of the Audited Accounts of this share applicant (Page 34-43), it is noted that its Net-worth (Share Capital plus Reserves and Surplus) as on 31.03.2012 was ₹ 6,76,05,253/-, page 39 of the paper book and the investment made in the assessee-company including share premium was ₹ 20,00,000/-. Entire Share Application money of ₹ 20,00,000/- was received by the assessee through normal banking channels on 22-09-2011. The financial statement of this share applicant shows that it had enough funds to invest in the assessee-company and the transaction has happened through normal banking channels. Further, it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncluding share premium was ₹ 35,00,000/-. Entire Share Application money of ₹ 35,00,000/- was received by the assessee through normal banking channels on 18-08-2011. The financial statement of this share applicant shows that it had enough funds to invest in the assesseecompany and the transaction has happened through normal banking channel. Further, it is noted that the share applicant had furnished the source of investment made in the assesseecompany after getting the notice under section 133(6) of the Act. 4. Intellect Fincon Pvt Ltd On perusal of the paper book, it reveals that documents are placed at page 78-96a of share applicant M/s Intellect Fincon Pvt Ltd which is a Private Limited Company and which has Permanent Account No.AAGCS8100G and CINU51909WB1994PTC062889.We note that this share applicant company has filed its Pan Card, ITR acknowledgment, source of funds, relevant Bank Statement and audited accounts in response to the notice issued u/s 133(6) of the Act. A copy of its Income Tax Return Acknowledgment for AY 2012-13 is placed at page 81 of the paper book. On perusal of the Audited Accounts of this share applicant(Page 82-95), it is noted that i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt company has filed its Pan Card, ITR acknowledgment, source of funds, relevant Bank Statement and audited accounts in response to the notice issued u/s 133(6) of the Act. A copy of its Income Tax Return Acknowledgment for AY 2012-13 is placed at page 118 of the paper book. On perusal of the Audited Accounts of this share applicant (Page 119-129), it is noted that its Net-worth (Share Capital plus Reserves and Surplus) as on 31.03.2012 was ₹ 13,92,74,548/-, page 124 of the paper book and the investment made in the assessee-company including share premium was ₹ 20,00,000/-. Entire Share Application money of ₹ 20,00,000/- was received by the assessee through normal banking channels on 22-09-2011. The financial statement of this share applicant shows that it had enough funds to invest in the assessee-company and the transaction has happened through normal banking channel. Further, it is noted that the share applicant had furnished the source of investment made in the assessee-company after getting the notice under section 133(6) of the Act. 55. So, from the aforesaid facts revealed during the second round, we note that second AO has discharged his duty as an In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lected from the share subscribers was a plausible view which is not a unsustainable view in law. 56. To sum up, we find from the above said facts that the Second AO has conducted enquiry on the specific subject matter i.e. share capital and premium collected by the assessee-company (CASS items). Therefore, the finding of Second Pr. CIT that the Second AO has not conducted enquiry is incorrect and is flowing from suspicion only. And as discussed, the allegation/fault pointed out by the Second Ld. Pr. CIT that the Second AO failed to collect total facts also cannot be accepted for the simple reason that Ld. Pr. CIT has not spelt out in the impugned order what he meant by total facts or in the alternative when the assessee has discharged its onus, as required by the law in force in this AY 2012-13, then the Ld. Pr. CIT ought to have called for which ever additional documents/materials or issued summons or issued notices and collected those facts which according to Second Ld. Pr. CIT, the AO omitted to collect and then demonstrated that those actions/documents which he collected in that process gave result to a different finding of fact which will turn upside down the claim of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i.e. share capital premium collected by assessee company. Resultantly the second Ld. Pr.CIT, again cannot rake-up the same subject matter without the second Ld. Pr.CIT in the second revisional order spells out where the error happened to second AO as an investigator or adjudicator, which exercise the Second Ld. Pr.CIT has not done, so the second Ld. Pr. CIT cannot be permitted to again ask the AO to start the investigation in the way he thinks it proper on the very same subject on which merger has taken place by virtue of the order of First Ld. Pr. CIT. And if this practice is allowed, then there will be no end to the assessment proceedings meaning no finality to assessment proceedings and that is exactly why the Parliament in its wisdom has brought in safe-guards, restrictions conditions precedent to be satisfied strictly before assumption of revisional jurisdiction. Be that as it may be, as discussed above, we find that the Second Ld. Pr. CIT without satisfying the condition precedent u/s 263 of the Act has invoked the revisional jurisdiction (second time), so all his actions are ab initio void. 57. Lastly, coming to the observations of the Second Ld. Pr.CIT that the as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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