INCOME TAX OFFICER, KOLKATA vs. RAMESWARPUR COLD STORAGE PVT. LTD. , KOLKATA

Contrary to that the ld. A.R supports the impugned order thereby submitting that the notice issued u/s 148 beyond the time limit for AY 2014-15 and as outstanding amount cannot be said to be the income escaping as the above sum was already offered to tax. The Ld. Counsel further submits that the sum of Rs. 53,13,824/- was in fact receivable from NSEL and that was already offered to tax. The Ld. Counsel further submits that it has well-being settled by the various decisions of the Apex Court. The show cause notice should be issued only after proper enquiry/ investigation and the notice should not be exercised in deliberate ambiguity. The Ld. Counsel has further submitted that the Ld. CIT(A) has not only discussed the facts of the case of the assessee rather discussed the judgment of the Hon’ble Apex Court thereafter passed an order in favour of the assessee.

Upon hearing the submission of the counsel for the respective parties. We have perused the order of AO as well as the Ld. CIT(A). The main contention of the assessee is that first 148 notice was issued on 23.04.2021 beyond the time limit for AY 2014-15 C.O. No. 39/Kol/2024 Assessment Year: 2014-15 Rameswarpur Cold Storage Pvt. Ltd. as it was issued only after 01.04.2021. The assessee has also claimed that the sum of Rs. 53,13,824/- was receivable from NSEL that was already offered to tax and AO added this amount without understanding the fact that it was already offered to tax in the previous assessment year. It admits of no doubt that return of income for AY 2014- 15 was processed u/s 143(1) accepting the income disclosed in the return. It is pertinent to mention here that for AY 2014-15 all income accrued and arisen during FY 2013-14 has been acquainted and reflected in the return of income. In the present case, facts are such that return of income was filed for Ay 2014-15 on 2710.2014 declaring total income at Rs. 5,63,587/-. An intimation u/s 143(1) of the act was received by the Income Tax Department reopening of notice u/s 148 of the Act was issued on 23.04.2021 and subsequent letter dated 25.02.2022. As per the reason for reopening request for investigation of source of fund of the traders / brokers have been exposure NSEL exchange platform. The Ld. A.R has submitted that for AY 2014-15 he traded in National Spot Exchange limited through brokers M/s Capital First Commodity Limited dealing commodity trading. The assessee entering into transaction into purchase and sale of commodities through M/s Capital First Commodity Limited and from the statement which can be seen that the amount due to the assessee was Rs. 50,45,752.21/- by M/s Capital First Commodity Ltd. and there was no trading transaction after July, 2013. The assessee has provided following documents: a) Financial statement of Rameswarpur Cold Storage Pvt. Ltd. for the FY 2013-14, highlighting the relevant transaction(s) in schedule 13. b) Full set of income tax Return for the AY 2014-15 highlighting the profit on commodity trading in other income of profit and loss account for the financial year 2013-14. c) Axis bank statement for Rameswarpur Cold Storage Pvt. Ltd. reflecting the transaction(s). d) Ledger of broker M/s Capital First Commodities Ltd. for the AY 2014-15. e) Ledger of profit on commodities Trading for the AY 2014-15. f) 5 Contract note and payment voucher of broker M/s Capital First Commodities Ltd. for the AY 2014-15.

As the notice issued u/s 148 of the IT Act dated 23-04-2021 on the basis of earlier provision u/s 149 of the IT Act was issued beyond the time limit, the AO cannot treat that notice as the notice issued u/s 148A(b) of the IT Act.

Presuming that the notice issued u/s 148 of the IT Act dated: 23-04-2021 was within the time limit, for initiating the proceeding u/s 148A of the IT Act, the AO should have in his possession books of account, other document or other evidence which reveal that the income chargeable to tax, represented in the form of Asset, which has escaped the assessment amounts to or is likely to amount to rupees fifty lakhs or more for that year.

The appellant in the present case filed objection before the AO, claimed that, they have entered into purchase and sale of commodities through M/s Capital First Commodities Limited and this transaction was already reflected in the return of income filed for AY 2013-14. The sum of Rs. 50,45,752/- was receivable as on 31.03.2014. As per the appellant, they have received only small amount of money and balance sum of Rs. 49,90,890/ could not be recovered.

The appellant further contended that receivable cannot be treated as an income from undisclosed source to reopen the assessment for the AY 2014-15.

Going over the discussion made above and the facts of the case, we do not find any infirmity in the impugned order, accordingly, the appeal of the revenue is hereby dismissed.