TMI Blog2023 (6) TMI 133X X X X Extracts X X X X X X X X Extracts X X X X ..... ch 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. Decided in favour of assessee. - INCOME TAX APPEAL NO. 455 OF 2018 - - - Dated:- 19-4-2023 - HON BLE MR. JUSTICE P.S. DINESH KUMAR AND AND HON BLE MR. JUSTICE C.M. POONACHA For the Appellant (By Shri. A. Shankr, Senior Advocate For Shri. M. Lava, Advocate) For the Respondent (By Shri. E.I. Sanmathi, Standing Counsel) JUDGMENT, P.S. DINESH KUMAR, J., This appeal by the assessee, directed against the order dated February 09, 2018 in ITA No. 665/Bang/2017 passed by the ITAT [Income Tax Appellate Tribunal] has been admitted to consider following questions of law: 1. Whether the authorities below were justified in law in holding that the mandatory conditions for reopening of assessment has been complied and consequently reopening is valid in law and the facts and circumstance of the case? 2. Whether the reasons recorded constitute reasons to believe to enable reopening of assessment on the facts and circumstance of the case? 3. Whether the Tribunal was justified in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he AO dropped the re-assessment proceedings under Section 147 of the Act. 4. The AO again issued a fresh notice under Section 148 of the Act. In response to the said notice, assessee vide letter dated July 18, 2013 submitted that there was no income which had escaped the assessment, the notice issued was illegal and without jurisdiction; and requested the AO to treat the earlier return as one filed under protest in response to the notice under Section 148 of the Act. 5. An assessment order dated March 20, 2015 was passed under Section 143(3) read with Section 147 of the Act by making an addition of Rs. 49.50 crores on account of share premium received from M/s. Walden Properties Investment Pvt Ltd. On appeal, the CIT(A) [Commissioner of Income Tax (Appeals)] and the ITAT have dismissed assessee s appeals and confirmed the addition made by the AO. Hence, this appeal. 6. Shri. A. Shankar, learned Senior advocate for the assessee, praying to allow the appeal, submitted that: the order of re-assessment is bad in law and void ab initio for want of requisite jurisdiction especially, the mandatory requirements to assume jurisdiction under Section 148 of the Act which d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee has failed to prove the creditworthiness of the investor. The ITAT has rightly held that the receipt of Rs. 49.50 Crores by assessee falls under the head Income from Other Sources . 8. In support of his contentions, Shri. Sanmathi has placed reliance on: Principal Commissioner of Income Tax (Central) Vs. NRA Iron Steel Pvt. Ltd (2019) Taxman 0074 (SC) , wherein the Supreme Court has laid down principles which emerge where sums of money are credited as Share Capital/Premium; Pragati Financial Management (P.) Ltd. Vs. Commissioner of Income-tax-II (2017) Taxmann.com 12 (Calcutta). and prayed for dismissal of this appeal. 9. We have carefully considered the rival contentions and perused the records. 10. Undisputed facts of the case are, a notice dated 18.4.2012 under Section 148 of the Act was issued to assessee. After considering assessee s reply, the AO dropped re-assessment proceedings. Subsequently, the AO issued another notice dated 10.06.2013 under Section 148 of the Act. Assessee replied to the said notice stating that there was no escapement of income and to treat the earlier return filed by assessee as filed under protest . The AO has made an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ptioned as valuation of shares of CPIPL as Rs. 337.04 for F.Y. 12 2007-08, Rs. 336.44 for F.Y. 2008-09 and Rs. 335.04 for F.Y. 2009-10. Having so recorded he has held the maximum share value as Rs. 139.36 in his analyses. 14. The mode of transfer of money from M/s. Walden to assessee through bank is not in dispute. It was argued by Shri. Shankar that before the ITAT, which is the last fact finding authority, assessee had annexed various documents including copies of relevant assessee s bank statements, copies of share certificates, copy of annual return filed before the Registrar, copy of assessment order under Section 143 r/w Section 153C of the Act in case of M/s Walden. We have perused the copy of the paper-book filed before the ITAT and annexed to this appeal as Annexure-R20. In addition to the aforesaid documents, assessee has also annexed the balance sheet of M/s. Walden as on 31.03.2008 and ITAT s order in the 12 Financial Year case of M/s. Alpha Vilas Pvt. Ltd as Annexure-R22. The said documents show that M/s. Walden had taken term loan of Rs. 2,781,107,247/-. from Bank of India, IDBI Ltd, India Bulls Financial Ltd, IDFC ltd., Kotak Mahindra Bank. It had reserves and s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty in NRA Iron Steel Pvt. Ltd has no application. 20. Revenue has also placed reliance on para 13 of Pragati Financial Management (P.) Ltd Vs. Commissioner of Income-tax and Others [2017] 394 ITR 27 (Cal) which reads thus: 13. We have already observed that the judgment in the case of Rajmandir Estates (P) Ltd (supra) was delivered considering the unamended provision of Section 68 of the Act. In the case of the assessees before us, there is no differing feature so far as applicability of the said statutory provision is concerned, even though the Tribunal in Subhlakshmi Vanijya (P) Ltd. (supra) had held that the provisos to Section 68 of the Act are retrospective in their operation, and delivered the decision against the assessee in that case that reasoning. In the appeal of Rajmandir Estates (P) Ltd. (supra), the Coordinate Bench did not consider it necessary to examine the question of retroactivity of the aforesaid provision. The Coordinate Bench found the order of the 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 th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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