INCOME TAX OFFICER, WARD-9(2), KOLKATA vs. FRONT LINE VYAPAR PRIVATE LIMITED , KOLKATA

Shri Giridhar Dhelia appeared on behalf of the assessee and Shri Kapil Mandal, Sr. DR appeared on behalf of the revenue.

It was submitted by the ld. Sr. DR that the assessment in the case of the assessee came to be completed u/s 143(3) on 23.03.2015. It was noticed that the assessee company had raised fresh paid-up share capital of ₹2,25,00,000/- including share premium during the impugned assessment year. It was the submission that in the course of assessment the ld. AO had wanted the assessee to prove the identity, creditworthiness and genuineness of the transactions. It was the submission that there was no compliance whatsoever in the course of the assessment proceedings. It was the submission that consequently,

It was the submission that in the remand report the directors of the assessee company had been asked to appear in they were also share subscribers and one M/s Sunirmiti Mercantiles private Limited and Stronach Trade Private Limited so also Gangadham Tracon Private Limited, Sunidhi Fincom Private Limited and Aakansha Advisory Services Limited. had also brought in shares. The ld. AO had called for the directors of the assessee company. The directors nor the allottee companies made any appearance before the ld. AO even in the remand proceedings. The documents, however, were sent through email. The ld. AO had also mentioned that in respect of Akansha Advisories Services Pvt. Ltd., their share application was only for 72,000/- shares but 1,00,000/- shares have been issued to them. It was the submission by the ld. Sr. DR that the ld. CIT (A) did not consider the objections of the ld. AO but has, at page no. 126 of the order of the ld. CIT (A), recorded that in respect of the merits of the additional evidences adduced by the assessee, there is no adverse observation of the ld. AO in the remand report. The ld. CIT (A) has further gone on to hold that the remand report is completely bereft of any observations that the impugned amount of ₹2,25,00,000/- had emanated out of the coffers of the assessee or that the share capital subscribers did not have the capacity of making investments or that the share capital subscribers

In reply, the ld. AR submitted that the assessee has produced all the documents before the ld. Assessing Officer. It was the submission that even the memorandum of Association (MoU) of the assessee company clearly showed that the directors of the assessee company were at Meghalaya and consequently the assessee was unable to produce the directors before the ld. AO. It was the further submission that the assessee had produced the documents before the ld. AO in regard to all the share subscribers. It was the submission that there were two directors in the assessee company. It was the submission that in regard to other share subscribers, their books were audited and their audited reports have also been produced. It was the submission that the ld. CIT (A) has considered all the facts when he has deleted the addition as made by the ld. Assessing Officer.

We have considered the rival submissions. A perusal of the assessment order clearly shows that initially documents were submitted but there has been no co-operation before the ld. AO as any of the directors was not produced. The copy of the remand report shows that the remand reference is dated 08.06.2022 and the remand report is dated 24.06.2022. The AO admittedly could not have done anything in such short time in any case even before the ld. AO in the remand proceedings other than emails no personal appearance has been made. One of the primary conditions that the ld. AO had been repeatedly asking for the personal appearance of the directors. This has been continuously

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