M/S IJM ESTATE PRIVATE LIMITED,NAKODAR vs. INCOME TAX OFFICER, NAKODAR

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ITA 774/ASR/2017Status: DisposedITAT Amritsar17 January 2019AY 2013-144 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal decided to remand the case back to the AO. This was because the assessee's counsel stated they could now produce the share applicant and relevant evidence for the ROC fees, and the Tribunal wished to provide a reasonable opportunity for fresh adjudication.

What were the facts?

The assessee received share application money and paid ROC fees. The Assessing Officer (AO) made additions for both amounts as unexplained credit and expenditure, respectively, as the assessee could not produce the share applicant and provide specific evidence for the ROC fees. The CIT(A) sustained these additions.

What were the issues?

Whether the additions made by the AO on account of unexplained share application money and ROC fees were justified without providing a proper opportunity to the assessee to produce evidence.

Which sections of the Income-tax Act were involved?

Section 68,Section 69C

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, CAMP BENCH AT JALANDHAR

Before: Sh. N. K. Saini, Hon’ble & Sh. Ravish Sood

Hearing: 17.01.2019Pronounced: 17.01.2019

IN THE INCOME TAX APPELLATE TRIBUNAL CAMP BENCH AT JALANDHAR Before Sh. N. K. Saini, Hon’ble Vice President and Sh. Ravish Sood, Judicial Member ITA No.774/Asr./2017 : Asstt. Year : 2013-14 M/s IJM Estate Pvt. Ltd., Vs Income Tax Officer, Nakodar Railway Road, Nakodar (APPELLANT) (RESPONDENT) PAN No. AACCI8557M

Assessee by : Sh. Ashray Sarna, CA Revenue by : Sh. Shakil Ahmad, DR Date of Hearing : 17.01.2019 Date of Pronouncement : 17.01.2019

ORDER Per N. K. Saini, Vice President: This is an appeal by the assessee against the order dated 14.11.2017 of CIT(A)-2, Jalandhar. Following grounds have been raised in this appeal:- 1. That the order passed by the Hon’ble CIT(A) dated 14.11.2017 is against the law and facts of the case. 2. That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in confirming the action of Ld. AO in making an addition of Rs.23.75,000/- as unexplained credit u/s 68 of the Act on account of share application money received. 3. That in any case and in any view of the matter, action of Ld. CIT(A) in confirming the action of Ld. AO in making addition of Rs.23,75,000/- u/s 68 of the Act without considering the submissions of the assessee and without giving proper opportunity of being heard, is bad in law and against the facts and circumstances of the case 4. That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in confirming the action of Ld. AO in making an addition of Rs. 1,61,500/- as unexplained expenditure u/s 69C of the Act on account of ROC fees paid and without observing the principles of

ITA No. 774/Asr./2017 2 natural justice. 5. That in view of the matter, action of Ld. CIT(A) in confirming the action of Ld. AO in making addition of Rs.1,61,500/- u/s 69C of the Act by ignoring the submissions of the assessee, is bad in law and against the facts and circumstances of the case. 6. That the appellant craves the leave to add, modify, amend or delete any of the grounds of appeal at the time of hearing and all the above grounds are without prejudice to each other.”

2.

The main grievance of the assessee relates to the sustenance of addition made by the AO under section 68 of the Act on account of share application money received. Another ground has been raised relating to addition on account of the expenditure of ROC fee paid.

3.

Facts of the case in brief are that the assessee filed the return of income which was processed under section 143(1) of the Act. Later on the case was selected for scrutiny. The AO framed the assessment at an income of Rs. 25,36,500/- by making the addition the addition of RS. 23,75,000/- under section 68 for the reason that the assessee could not produce the share applicant. Another addition of Rs. 1,61,500/- was made on account of ROC fee paid for increasing authorized capital. The AO did not accept this contention of the assessee that the directors of the companies made the payments from their individuals cash in hand on behalf of the assessee.

4.

Being aggrieved the assessee carried the matter before the ld. CIT(A) who sustained the additions.

5.

Now the assessee is in appeal.

6.

The learned counsel for the assessee submitted that the assessee could not produce the share applicant Smt. Jaswant Kaur for the reason that she was abroad being Non Resident Indian. It was further submitted that now the

ITA No. 774/Asr./2017 3 assessee can produce the share applicant therefore, the case may be remitted to the AO for fresh adjudication. It was further submitted that the explanation of the assessee relating to the payment of ROC fee was not appreciated in right perspective by the AO or the learned CIT(A).

7.

In his rival submissions, the learned DR strongly supported the orders of the authorities below.

8.

We have considered the submissions of both the parties and perused the material available on the record. In the present case, it appears that the addition on account of share application money was made by the AO for the reasons that the assessee could not produce the share applicant. Another addition has also been made in the absence of specific evidence produced in support of the claim. However, the learned counsel for the assessee stated at bar that the assessee is in a position to produce the share applicant before the AO as well as the relevant evidences for incurring the expenses on account of ROC fee. We, therefore, keeping in view, the principles of natural justice deem it appropriate to remand this case back to the file of the AO to be decided afresh after providing due and reasonable opportunity of being heard to the assessee.

9.

In the result, appeal of the assessee is allowed for statistical purposes.

(Order Pronounced in the Court on 17/01/2019)

Sd/- Sd/- (Ravish Sood) (N. K. Saini) JUDICIAL MEMBER VICE PRESIDENT Dated: 17/01/2019 *SH*

ITA No. 774/Asr./2017 4

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