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Facts
The assessee received Rs. 16,50,000/- as advance against sale of shares. The Assessing Officer treated Rs. 9,00,000/- as unexplained cash credit and brought it to tax under Section 115BBE. The CIT(Appeals) confirmed the addition.
Held
The Tribunal found that the assessee had filed documents like paper book, bank statement, audited balance sheet, and ledger copy. However, it was concluded that these documents needed detailed examination by the Assessing Officer. Therefore, the matter was remitted back to the Assessing Officer.
Key Issues
Whether the AO and CIT(Appeals) properly examined the documents filed by the assessee regarding the advance for sale of shares, and if the addition of Rs. 9,00,000/- as unexplained cash credit was justified without considering the merits and facts.
Sections Cited
148A, 148, 143(2), 142(1), 68, 115BBE
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, ‘SMC’ BENCH, KOLKATA
Before: Shri Duvvuru RL Reddy, Vice-(KZ)
Assessment Year: 2018-2019 Indivar Marketing Private Limited,…....……Appellant 8, Lake Town, Block-‘B’, Nikita Tower, Kolkata-700089 [PAN:AACCI8193B] -Vs.- Income Tax Officer,……………………………....Respondent Ward-14(1), Kolkata, Aayakar Bhawan, P-7, Chowringhee Square, Kolkata-700069 Appearances by: Shri Giridhar Dhelia, Advocate, appeared on behalf of the assessee Shri Somnath Das Biswas, Sr. D.R., appeared on behalf of the Revenue Date of concluding the hearing: January 21, 2025 Date of pronouncing the order: March 17, 2025 O R D E R
The present appeal is directed at the instance of assessee against the order of ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi dated 13th May, 2024 passed for Assessment Year 2018-19.
(A.Y. 2018-2019) Indivar Marketing Pvt. Limited 2. Brief facts of the case are that the assessee is a Private Limited Company, which filed its return of income for the assessment year 2018-19 declaring total income of Rs.20,980/-. The assessee has received Rs.16,50,000/- from M/s. Aditi Sanchar Suvidha Pvt. Limited for the purpose of advance against sale of shares. Notice under section 148A(b) of the Act was issued to the assessee on 21.03.2022 providing an opportunity and asking why the notice under section 148 of the Act should not be issued. The assessee-Company furnished its reply on 23.02.2022 wherein the assessee has claimed that the above said amount of Rs.16,50,000/- was received as advance for sale of shares, but the assessee-Company has not produced any details of shares. Therefore, the ld. Assessing Officer initiated proceedings and issued notice under section 148 of the Act. In response to the notice issued under section 148, the assessee has filed the return of income for the assessment year 2018-19 declaring total income of Rs.20,980/-. Notice under section 143(2) was issued to the assessee and the assessee-Company filed its Bank statement, ledger copy of Aditi Sanchar Suvidha Pvt. Limited. During the course of assessment proceedings, notice under section 142(10 was issued to the assessee but the assessee has not filed any reply in response to the notice. The ld. Assessing Officer concluded the assessment. The ld. Assessing Officer has categorically mentioned the total receipt of Rs.16,50,000/- and out of this, Rs.7,50,000/- was returned by the assessee. Therefore, the amount payable by the assessee to M/s. Aditi Sanchar Suvidha Pvt. Limited as on 31.03.2018 is Rs.9,00,000/- since the assessee failed to explain the nature of receipt. Therefore, the total cash credit of (A.Y. 2018-2019) Indivar Marketing Pvt. Limited Rs.9,00,000/- is deemed to be the income of the assessee and assessed as unexplained credit under section 68 of the Act and brought o tax under section 115BBE of the Act.
On being aggrieved, the assessee preferred an appeal before the ld. CIT(Appeals).
The ld. CIT(Appeals) confirmed the addition made by the ld. Assessing Officer.
On being aggrieved, the assessee preferred an appeal before the Tribunal and raised the following issues:- “(1) That the order of the ld. CIT(Appeals) and ld. Assessing Officer are bad in law and on facts of the case and is full of biased and preconceived notions regarding share capital raising and its modus operandi. (2) That the ld. CIT(Appeals) erred in confirmation addition of Rs.9,00,000/- towards ‘unexplained cash credit’ without considering the merit and facts of the case.
I have heard both the sides. It was the submission of the ld. Counsel for the assessee that the ld. Assessing Officer did not examine the documents filed by the assessee and simply mentioned in the assessment order that the assessee has not filed any documents to establish its claim. He further submitted that all the details placed before both the revenue authorities, but they have not at all examined the documents filed by the assessee- Company. Therefore, the ld. Counsel pleaded to remit the matter (A.Y. 2018-2019) Indivar Marketing Pvt. Limited back to the file of ld. Assessing Officer to examine the documents filed by the assessee before the ld. Assessing Officer.
On the other hand, ld. Departmental Representative argued that the ld. Assessing Officer has examined all the details and passed the assessment order. He also argued that the ld. CIT(Appeals) passed the appellate order after examining the facts and the documents filed by the assessee. Therefore, he pleaded to uphold the order passed by the ld. CIT(Appeals).
I have perused the material available on record. It is an admitted fact that the assessee filed paper book showing the details of transactions with M/s. Aditi Sanchar Suvidha Pvt. Limited, Bank statement, audited balance-sheet etc. I have perused the ledger copy of the purchaser company and also all other documents filed by the assessee-Company and after perusing all these documents, I came to the conclusion that it should be examined by the ld. Assessing Officer in details. Therefore, Considering the facts and circumstances of the case, I am inclined to set aside the order passed by the revenue authorities in order to meet the principle of natural justice, and remit the matter back to the file of ld. Assessing Officer with a direction to provide one more opportunity of being heard to the assessee. At the same breath, I also hereby caution the assessee to promptly co-operate with the proceedings before the Ld. Assessing Officer failing which the Ld. Assessing Officer shall be at liberty to pass appropriate order in accordance with law and merits (A.Y. 2018-2019) Indivar Marketing Pvt. Limited based on the materials available on the record. Thus, the grounds raised by the assessee are allowed for statistical purposes.
In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open Court on 17/03/2025.