DCIT, CENTRAL CIRCLE-4(2), KOLKATA, AAYAKAR BHAWAN POORVA, KOLKATA vs. DHANLAXMI TIE-UP PRIVATE LIMITED, NARIMAN POINT, MUMBAI

Per Sanjay Garg, Judicial Member:

The present appeal by the revenue and the corresponding Cross
Objection by the assessee have been directed against the order dated
03.02.2024 of the Commissioner of Income Tax (Appeals), Kolkata-27
[hereinafter referred to as Ld. “CIT(A)”] passed u/s. 250 of the Income Tax Act,
1961 (hereinafter referred to as the “Act”) for Assessment Year 2013-14. 2. Revenue’s appeal is time barred by 30 days. A separate condonation of delay petition in filing the appeal has been placed in file. Considering the averments made in the said condonation petition and shortness of the delay, we condone the delay in filing the appeal by the revenue and accept the appeal for hearing on merits.
3. The revenue in this appeal is aggrieved by the action of the Ld. CIT(A) in deleting the addition made by the Assessing Officer of Rs.3,84,00,000/- treating the proceeds from sale of shares/investments as unaccounted income of the assessee. Whereas, the assessee in its Cross Objection has challenged the validty of the reopening of the assessment u/s. 147 of the Act.
First, we take up revenue’s appeal.
4. Brief facts of the case are that earlier the assessee filed its return of income u/s 139 of the Act on 15.09.2013 declaring total income of Rs.16,25,290/-. Later, a search and seizure operation u/s 132 of the Act was conducted in the case of 'Rika Group' on 11.02.2020. During examination of the seized documents, certain facts came up that the assessee had raised bogus share capital/premium to the tune of Rs.7,83,00,000/- during the Financial Year (FY) 2007-08 and the same was utilized for investing in unlisted equities which were liquidated later on in a sole motive to routing back its unaccounted money in its regular books of account. Based on the facts, it was opined since the generation of the fund was bogus, which was I.T.A. No.: 1072/KOL/2024 &
CO No. 34/Kol/2024
Assessment Year: 2013-14
Dhanlaxmi Tie-up Pvt. Ltd.

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raised through various paper / shell entities, hence liquidating the same and giving as share capital/premium loans and advances to various entities was nothing but the routing of the unaccounted income of the Rika Group through layering to bring back the same to their regular books. The Assessing Officer, therefore, was of the view that income of the assessee for the year under consideration has escaped assessment. Reasons for of reopening of assessment were recorded and the assessee was issued a notice u/s. 148
dated 31.03.2021 after obtaining due approval from the respective higher authority. In response to notice u/s 148, the assessee filed return of income for the instant year on 29.05.2021 at the same income as earlier i.e.
Rs.16,25,290/-.
5. During the assessment proceedings, the assessee explained to the Assessing Officer that the observation of the Assessing Officer that the assessee had sold the investments in shares to shell companies was factually wrong. That all the purchaser companies were active compliant companies with the