C P METALIKS PRIVATE LIMITED,G.T. ROAD BHIRINGEE vs. INCOME TAX OFFICER, WARD 1(2), DURGAPUR, DURGAPUR

This appeal filed by the assessee is against the order of National Faceless Appeal Centre (NFAC), Delhi (hereinafter referred to as “the Ld. CIT(A)”) passed u/s. 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) for AY 2009-10 dated 13.03.2024.

The grounds of appeal raised by the assessee are reproduced as un- der:

Brief facts of the case are that assessee company was incorporated on 15.05.2007. During the F.Y. 2008-09, it had received share application from three different entities. The assessee filed the details before the Ld. AO. The Ld. AO held that the assessee had failed to substantiate the cre- ditworthiness and genuineness of the transaction for the introduction of ₹2,48,30,000/- (₹51,10,000/- as share capital and ₹1,97,20,000/- as share premium) in the books of account shown as share capital including share premium by issue of fresh shares, which was without any justifiable basis. Accordingly, the Ld. AO made the addition to the extent of ₹2,48,30,000/- u/s 68 of the Act. Aggrieved the assessee preferred an appeal before the Ld. CIT (A) who partly upheld the order of the Ld. AO “9.1 The appellant has challenged the addition of Rs.2,48,30,000/- u/s.68 in the assessment order. The appellant company had filed its return of income for A.Y.2009-10 on 21.01.2010 at NIL returned income. Notice u/s.148 was issued for the reason that the appellant company had received share premium of Rs.1,97,20,000/- along with the issued share capital of Rs.51,10,000/-. In response to notice u/s.148, no return was filed and no compliance was made in response to notice u/s.142(1) also. The completed the assessment by making addition of the entire share capital and the share premium of Rs.2,48,30,000/- u/s.68 of the Act. 9.2 During the appellate proceedings the appellant had filed a written submission along with additional evidences which were forwarded to the A.O. for remand report. The A.O. vide remand report dated 23.08.2023 has given comments on admissibility of additional evidence and objected to the admission of the same. The remand report of the A.O. has been forwarded to the appellant vide notices dated 07.12.2023 to offer its comments and subsequent notices u/s.250 dated 18.01.2024 and 04.03.2024 but no comments has been received from the appellant. However, considering the submission of the appellant and the remand report of the A.O. and the provisions of Rule 46A and the factual matrix of the case, I deem it fit to admit the additional evidences under Rule 46A and to consider the same on the merits to adjudicate the appeal. 9.3 The appellant has stated that the A.O. has made addition of Rs.2,48,50,000/- on account of share capital of Rs.51,10,000/- and share securities premium of Rs.1,97,20,000/- whereas share capital of Rs.15,90,000/- and share premium of Rs.63,60,000/- was received during theF.Y.2008-09 and the balance amount was already received and considered in F.Y.2007-08, as evident from financial statement attached. Thus, the amounts to be considered for F.Y.2008-09 i.e. A.Y.2009-10 was only Rs.79,50,000/-. The A.O. in para 2 of its remand report has also stated that “from copy of return for A.Y.2008-09, it is seen that assessee had paid up capital of Rs.35,20,000/- and securities premium of Rs.1,33,60,000/- and from copy of return for A.Y.2009-10 it is seen that assessee had paid up capital of Rs.51,10,000/- (growth of Rs.15,90,000/-) and securities premium of Rs.1,97,20,000/- (growth of Rs.63,60,000/-)”. In view of the above facts, the claim of the appellant is correct that the A.O. should have only considered Rs.79,50,000/- as the amount received during the year under consideration as share capital/share premium, as the amount received during the earlier year and appearing as opening balance in the financial statements cannot be considered for addition u/s.68 for the year under consideration. The A.O. is accordingly directed to delete the addition of the balance amount of Rs.1,17,70,000/- (Rs.1,97,20,000-Rs.79,50,000) on above account. 9.4 As regards the issue of addition of Rs.79,50,000/- (Rs.63,60,000/- + Rs.15,90,000) is concerned, the A.O. had made the inquiries as directed during the appellate/remand proceedings and examined the additional evidences filed

We have heard the submissions made by the Ld. DR. During the course of the appellate proceedings, we note that a proper submission was not made before the Ld. AO and the assessment order was passed

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