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Income Tax Appellate Tribunal, DELHI BENCH: ‘F’ NEW DELHI
Before: SHRI SAKTIJIT DEY & PRADIP KUMAR KEDIA
ORDER PER SAKTIJIT DEY, JUDICIAL MEMBER: This is an appeal by the assessee against order dated 12.10.2018 of learned Commissioner of Income-Tax(Appeals)-36, New Delhi for the assessment year 2010-11.
Before we proceed to decide the appeal, it is necessary to observe that vide order dated 27.11.2000, the Tribunal accepting assessee’s request has fixed the appeal for hearing on an out of turn basis. However, on the subsequent dates of hearing, i.e. 18.01.2021, 15.03.2021 and 11.05.2021, no one appeared on behalf of the assessee to represent the case.
Considering the above, on 11.05.2021, the Bench withdrew the benefit of early hearing and adjourned the matter. When the appeal was called for hearing today i.e. 4th May 2022, no one 4. appeared for the assessee.
The aforesaid factual position reveals complete lack of interest by the assessee in pursuing the present appeal. Since, sufficient opportunity of being heard has been granted to the assessee, which the assessee has not availed, we deem it appropriate to proceed with the appeal ex parte qua the assessee after hearing the learned Departmental Representative and based on material available on record. The assessee has raised the following grounds:
1. Action of learned Commissioner (A) in passing the order without considering the circumstances of the case and confirming the action of Income Tax Officer in reopening the assessment under section 148 of the Income Tax Act is unjust, illegal, arbitrary and against the facts and circumstances of the case.
2. Action of learned Commissioner (A) in treating the loss from F & O Trading of Rs.1,21,17,685 as non genuine, as made by the Income Tax Officer, is unjust, illegal, arbitrary and against the facts and circumstances of the case.
3. The assessee craves leave to add, amend, alter, submit and withdraw any ground before the appeal is heard.
Briefly, the facts are, assessee is a resident company. For the assessment year under dispute, assessee filed its return of income on 13.10.2010, declaring income of Rs.14,060. Return of income so filed was initially processed under Section 143(1) of the Act. Subsequently, Assessing Officer received information from the Director of Income Tax (Intell. CR. Inv.), Mumbai, indicating that assessee is one of the entities which has credited fictitious profit and loss by misusing the Client Code Modification facility in the future and option segments of National Stock Exchange. Based on such information, Assessing Officer reopened the assessment under Section 147 of the Act. In course of assessment proceedings, the Assessing Officer called upon the assessee to prove the genuineness of the loss shown in respect of the share transactions. Further, to independently verify the genuineness of the transaction, Assessing Officer issued notice under Section 133(6) of the Act to the concerned broker. As observed by the Assessing Officer, the concerned broker furnished a general reply without providing the information called for. Therefore, Assessing Officer completed the assessment disallowing the loss of Rs.1,21,17,685 by treating it as non-genuine. Learned Commissioner (Appeals) confirmed the aforesaid disallowance while deciding assessee’s appeal.
We have considered the submissions of learned Departmental Representative and perused the material available on record.
As regards the issue relating to validity of reopening of assessment under Section 147 of the Act, it is noticed that the return of income filed by the assessee was not subjected to scrutiny but was only processed under Section 143(1) of the Act. Subsequently, Assessing Officer received the specific information indicating that the loss from share transaction claimed by the assessee is non-genuine as such undue benefit was gained through Client Code Modification. Thus, it is very much clear that the Assessing Officer had tangible material to reopen the assessment under Section 147 of the Act. Further, the objection raised by the assessee against reopening of assessment was disposed of by the Assessing Officer by a separate order.
In view of the aforesaid, we do not find any merit in the grounds raised by the assessee challenging the validity of reopening of assessment under Section 147 of the Act.
As regards the merits of the issue, it can be seen that the Assessing Officer in course of assessment proceedings has made inquiry to find out the genuineness of the loss claimed. However, the result of inquiry did not prove the genuineness of the loss claimed. Even, the assessee was not unable to furnish any conclusive evidence to support its claim that loss is genuine.
Before us also, assessee has not brought any material on record to controvert the factual finding of the departmental authorities. In the aforesaid circumstances, we do not find any valid reason to interfere with the decision of learned Commissioner (Appeals). Grounds are dismissed.
In the result, appeal is dismissed.
Order pronounced in the open court on 19th May, 2022.