RADISON ESTATES PRIVATE LIMITED,BANGALORE vs. ASSISTANT COMMISSIONER OF INCOME TAX CIRCLE 5(1)(1) BANGALORE, BANGALORE

ITA 519/BANG/2026Status: DisposedITAT Bangalore29 September 2026AY 2012-136 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the notice under Section 148 of the Act was valid. It reasoned that the reopening was based on information from the Director of Investigation Wing, Kolkata, and a statement recorded under Section 132 from Shri Praveen Agarwal, who had floated numerous companies. The assessee's objections to the reopening were disposed of, and prior approval was obtained. Therefore, the issue regarding the validity of the notice was dismissed. Regarding the addition under Section 68, the Tribunal noted that while the assessee provided PAN, addresses, ITR acknowledgments, and bank statements of shareholders, notices under Section 133(6) to these entities returned as 'non-existence'. The Tribunal found that although the identity of shareholders was established, the genuineness of the transaction and the creditworthiness of the shareholders were not proved beyond doubt. It observed multiple circuit entries in the shareholders' bank accounts immediately transferred to the assessee. Since no evidence regarding the source for the shareholders was established, the Tribunal found no infirmity in the CIT(A)'s order and dismissed the issue related to the additions. The appeal was dismissed.

What were the facts?

The assessee, Radison Estates Private Limited, engaged in real estate, filed its return for Assessment Year 2012-13 showing a loss. The case was reopened under Section 147 based on information from the Investigation Wing, Kolkata, alleging transactions with shell companies worth Rs. 9.50 Crores. A notice under Section 148 was issued. The Assessing Officer (AO) observed that the assessee received share capital and share premium from six entities. Notices under Section 133(6) to these entities mostly returned as 'non-genuine'. The AO found high-value transactions in investor entities' bank accounts disproportionate to their financial capacity, indicating they existed only on paper. Consequently, the AO treated the entire share premium of Rs. 24,82,98,870/- as unexplained cash credit under Section 68 and added it to the total income. The CIT(A) upheld the AO's order.

What were the issues?

1. Whether the notice under Section 148 of the Income Tax Act, 1961, is valid, considering it was based on information from the Investigation Wing and a statement recorded during a search. - Assessee's contention: Reopening based on such information and statements is not a valid ground. The assessee had discharged its onus by furnishing PAN, addresses, ITR acknowledgments, and bank statements for shareholders, fulfilling the ingredients of Section 68. - Revenue's contention: The notice under Section 148 was not challenged before lower authorities. The source of investment by shareholders was not proved beyond doubt. 2. Whether the addition sustained by the learned CIT(A) amounting to Rs. 24,82,99,870/- as unexplained cash credit under Section 68 of the Act is justified. - Assessee's contention: The assessee discharged its onus by furnishing PAN, addresses, ITR acknowledgments, and bank statements of shareholders, making the addition under Section 68 unjustified. Share premium cannot be taxed under Section 56(2)(viib) as the amendment is effective from AY 2013-14. Relied on Lovely Exports and Gagandeep Infrastructure (P) Ltd. - Revenue's contention: Source for investment by shareholders was not proved beyond doubt.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 147,Section 148,Section 143(1),Section 142(1),Section 133(6),Section 68,Section 56(2)(viib),Section 132

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, BANGALORE BENCHES, BANGALORE

Before: SHRI BALAKRISHNAN S & SHRI KESHAV DUBEY

For Respondent: Shri. N. S. Shashidhara - CIT
Pronounced: 29.09.2026

PER SHRI BALAKRISHNAN S, ACCOUNTANT MEMBER:

This appeal is filed by the assessee against the order of Ld.CIT (NFAC) vide DIN: ITBA/NFAC/S/250/2025-26/1083779087(1) dated 17-Dec-2025 for the Assessment Year 2012-13, arising out of the Order passed under section 143(3) r.w.s. 147 of the Act, dated 31.12.2019. ITA 519/BANG/2026 RADIS

The order continues below.

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