CITRON INFRAPROJECTS LIMITED,MUMBAI vs. PRINCIPLE COMMISSIONER OF INCOME TAX, (CENTRAL)-4, MUMBAI

Briefly stated facts necessary for consideration and adjudication of the issues at hand are : on the basis of search and seizure operation carried out at the premises of assessee “incriminating material” was seized on the basis of which notice under section 153A of the Income Tax Act, 1961 (for short ‘the Act’) was issued. During the course of assessment proceedings the assessee filed submissions in response to the notice issued under section 142(1) of the Act. Assessing Officer (AO) noticed that during the year under consideration the assessee company had issued 31,00,000 shares at premium of Rs.190/- per share (issue price Rs.200/-) to the different applicants detailed as under: 3 M/s. Citron Infraprojects Ltd.

The value of the share got determined by valuation report issued by M/s. Sanjay & Shah Company, Chartered Accountant at Rs.200/- per share.

However, the Ld. PCIT by invoking the revisionary jurisdiction issued a notice under section 263 of the Act by flagging the issue that the AO should have computed the fair market value of the assessee company as per NAV method provided in rule- 11UA(2)(a) of the Income Tax Rules, 1962 (for short ‘the Rules’) and thereby invoked the provisions contained under section 56(2)(viib) of the Act and worked out the share value as per rule 11U at Rs.136/-.

The Ld. PCIT reported to have given the opportunity to the Assessee proposing to revise the assessment order but show cause notice was not complied. Another notice was again issued but the assessee failed to respond. Consequently the Ld. PCIT held the order passed under section 144 read with section 153A of the Act as erroneous in so far as being prejudicial to the interest of the Revenue and thereby set aside the same. 4 M/s. Citron Infraprojects Ltd.

The assessee carried the matter before the Ld. PCIT by way of filing appeal who has confirmed the addition by dismissing the appeal. Feeling aggrieved with the impugned order passed by the Ld. PCIT the assessee has come up before the Tribunal by way of filing present appeal.

Notice of the present appeal was issued to the assessee on the address given in form No.36 on 22.06.2023 but has not received back served/unserved and as such presumed to have been served upon the assessee. But the assessee has not preferred to prosecute the present appeal. So the Bench has decided to dispose of the present appeal on the basis of material available on record with the assistance of the Ld. D.R. for the Revenue.

We have heard the Ld. D.R. for the Revenue, perused the orders passed by the Ld. Lower Revenue Authorities and documents available on record in the light of the facts and circumstances of the case and case law relied upon.

From the facts and circumstances of the case, we are of the opinion that the impugned order has been passed in haste without bringing on record if alleged notices issued to the assessee were ever served upon. It is also a fact on record that assessment order in this case is also passed at the back of the assessee. In these circumstances we do not find any reason to keep the appeal pending because ultimately order needs to be passed on merits by procuring the presence of the assessee by way of dasti summons by providing adequate opportunity of being heard. In these circumstances, we hereby set aside the impugned order passed by the Ld. PCIT and remit the case back to Ld. PCIT to decide afresh after procuring assessee’s presence and by providing opportunity of being heard.

Resultantly the appeal filed by the assessee is allowed for statistical purposes.