SKYVIEW DEALTRADE PVT. LTD.,SILIGURI vs. DCIT, CENT. CIR-2(1), KOLKATA, KOLKATA

The assessee in this appeal has contested the addition made by the Assessing Officer and further confirmed by the CIT(A) in respect of share capital of Rs.3,49,87,796/- and unsecured loans of Rs.34,83,745/- received by the assessee which have been treated by the lower authorities as unexplained income of the assessee and further of disallowance of expenditure claimed of Rs.38,973/-. The impugned additions were made by the Assessing Officer on account of the failure Assessment Year: 2012-13 Skyview Dealtrade Pvt. Ltd of the assessee to satisfactorily explain the transactions in question. Since the assessee did not furnish any documents in support of the transactions, the Assessing Officer made the impugned additions in an ex parte assessment carried out u/s 144 of the Income Tax Act.

The undisputed fact is that the return of income for the assessment year 2012-13 was filed 28.09.2012 by the assessee disclosing total income at nil. Thereafter, a search and seizure operation u/s 132 of the Act was conducted in the case of Choudhary group of assessees. Consequent to said search and seizure operation on Choudhary group, a survey u/s 133A was also conducted on 24.10.2013. During the said search operation, various documents were seized out of which certain documents were found belonging to the assessee. Thereafter, a notice u/s 153C of the Act was issued on 16.10.2015 asking the assessee to file correct return of total income. In the meantime, the concerned Assessing Officer completed the assessment proceedings in relation to the original return filed by the assessee on 28.09.2012 and passed the impugned assessment order dated 17.03.2015. But in the parallel proceedings, after the search action, the assessment was carried out in the case of the assessee by the Assessing Officer i.e. DCIT, Central Circle-2(2), Kolkata u/s 153C r.w.s 143(3) of the Act, whereby, he accepted the return of income of the assessee.

Now, the contention raised by the assessee in this appeal is that in the earlier assessment order passed u/s 143(3) of the Act was an ex parte order u/s 144 of the Act. Since the assessee company failed to appear before the Assessing Officer, the Assessing Officer therefore made the impugned additions without verification of any documents. Assessment Year: 2012-13 Skyview Dealtrade Pvt. Ltd 5. However, in the subsequent assessment proceedings, the above issues of share capital, unsecured loans and expenditure claimed were duly enquired by the Assessing Officer and in response to the queries made by the Assessing Officer, the assessee duly furnished the requisite documents and evidences to prove the identity and creditworthiness of the creditors/share subscribers and genuineness of the transaction and even the other claim of expenditure was also considered. The Assessing Officer was satisfied with the submissions made by the Assessing Officer and accepted the returned income. The ld. AR therefore has submitted that since in the subsequent assessment proceedings the issue has been examined and the returned income has been accepted, therefore, the additions made in the earlier ex parte assessment order are not sustainable. He has submitted that even if the Tribunal will restore the matter to the Assessing Officer to decide the issue afresh, no useful purpose will be served as the issue has already been looked into and decided on merits by the Assessing Officer in the subsequent assessment proceedings.

It is pertinent to mention here to verify the aforesaid aspects, the ld. DR has also called a report from the Assessing Officer. In the said report, it has been mentioned that while passing the assessment order u/s 153C of the Act, the then Assessing Officer, DCIT, Central Circle- 2(2), Kolkata has given a note which read as under: