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Income Tax Appellate Tribunal, ‘B’ BENCH, CHENNAI
Before: SHRI MAHAVIR SINGHAND SHRI MANOJ KUMAR AGGARWAL
आदेश /O R D E R PER MAHAVIR SINGH, VP: This appeal by the assessee is arising out of the order of the Commissioner of Income Tax (Appeals)-15, Chennai in dated 31.03.2017. The assessment was framed by the Income Tax Officer, Ward 6(2), Chennai for the assessment year 2012-13 u/s.143(3) of the Income Tax Act, 1961, (hereinafter ‘the Act’) vide order dated 31.03.2015.
At the outset, it is noticed that the appeal filed by the assessee is barred by limitation by 693 days. The order of CIT(A) dated 31.03.2017 was received by assessee on 31.03.2017 as per Form 36. The appeal has to be filed on or before 31.05.2017 but was filed only on 23.04.2019. The assessee has filed affidavit for condonation of delay, stating the following reasons:- 3. The Deponent submits as the addition was deleted the deponent was advised by their counsel that no further appeal is required.
4. Based on the order of the Commissioner of Income Tax (Appeals)-15 dated 31.12.2017 the share application money received was assessed in the AY 2011-12. It is only during this that the issue came to light the an appeal ought to have been filed by the deponent against the Commissioner of Income Tax (Appeals) order, though the addition was deleted for the AY 2012-13, it had an impact in the assessment year 2011-12.However, there was a change in counsel at this time and the issue was not addressed to the new counsel.
5. Subsequently the deponent was advised by the new counsel that an appeal is to be filed against the order of the Commissioner of Income Tax (Appeals)-15 dated 31.03.2017 as it has an impact on the assessment for the AY 2011-12.
6. The deponent now files the appeal before this Hon'ble Tribunal with a delay of 693 days.
- 3 - When these facts were confronted to ld.CIT-DR, he objected for condoning the delay. We find the cause as reasonable and hence, condone the delay and admit the appeal.
The only issue in this appeal of assessee is that the assessee had challenged the addition of investment made in share capital of SBQ Steels Ltd., by AO as unexplained income u/s.68 of the Act for assessment year 2012-13 at Rs.3,50,50,000/-:-
We have heard rival contentions and gone through facts and circumstances of the case. We noted a search action u/s.132 of the Act was carried out in the case of assessees and its group companies, in connection with the search in the case of other concerns of Kolkata companies on 26.09.2012. The AO noted that the assessee have made investments in share capital of its group companies i.e., SBQ Steels Ltd., and RKKR Steels Ltd., of Rs.3,50,50,000/- in assessment year 2012-13, out of the alleged claim of sale proceeds of its share investments. The AO after considering the enquiry conducted by the investigation wing and that these investments are out of sale proceeds of alleged share from shell companies of Kolkata, providing accommodation entries on - 4 - AO noting the following facts confirmed the addition:- (i) The assessee did not have the share capital and share premium. Their existence was not proved beyond doubt.
(ii) The assessee did not have the capacity to command share premium as it did not have any asset backing of any king and income of scale.
(iii) The existence of share investments were not proved beyond doubt. Hence, the claimed sale proceeds are receipts originated from unknown sources. The only evidences were photo copies of self-made computer printed invoices whose genuineness was not proved.
(iv) The erstwhile Directors were never produced before this office. No contact particulars, communication details were furnished. Hence, these so called Directors are only name lenders who could not be traced.
(v) The assessee as well as its group companies did not explain how they came to know each other. Only vague replies were furnished. Hence, genuineness of the claimed business transactions, was not proved.
(vi) Further No capital gains were ever offered. If these companies were really dealing in share investments, particularly as unquoted equities were not exempt from tax, the requisite evidences to prove the cost as well as sale price valuations must have been kept. Lack of them only point to the fact such activities were not carried out in reality.
(vii) Complete financial documents for earlier years (beyond A.Y:2007-08) were not furnished to evidence the scale of the activities of the assessee and other similar companies.
(viii) The alleged share holder companies as well as companies whose share investments were statedly held were all un-listed companies based at Kolkata and many share the same address.
- 5 - Aggrieved, assessee preferred appeal before CIT(A). The CIT(A) also confirmed the action of the AO. Aggrieved, assessee came in appeal before the Tribunal.
Now before us, nothing was produced by the assessee to prove that the investments in shares of SBQ Steels Ltd., of Rs.3,50,50,000/- in assessment year 2012-13, is out of the explained investment. Since the assessee could not produce anything before us, we dismiss this issue of assessee and the orders of the lower authorities are confirmed.
In the result, the appeal filed by the assessee is dismissed.
Order pronounced in the court on 25th November, 2022 at Chennai.