M/S. EXPAND CONSTRUCTION PVT. LTD.( EARLIER KNOWN AS M/S. SURAKSHA VYAPAAR PVT. LTD.),KOLKATA vs. A.C.I.T., CENTRAL CIRCLE-1(3), KOLKATA

The assessee in the present case is a Company, which is engaged in the business of share transactions. The return of income for the year under consideration was filed by the assessee on 27.09.2012 declaring a loss of Rs.4,77,076/-. In the assessment originally completed under section 143(3) vide an order dated 16.03.2015, the total income of the assessee for the year under consideration was determined by the 1

Assessing Officer at Rs.NIL. Thereafter the assessment was reopened by the Assessing Officer and a notice under section 148 was issued by him to the assessee on 15.03.2019. In response to the said notice, the return of income was finally filed by the assessee on 23.11.2019 declaring a loss of Rs.4,77,076/-. Subsequently the notice under section 143(2) of the Act was issued by the Assessing Officer to the assessee on 25.11.2019. The said notice as well as the subsequent notices issued by the Assessing officer under section 142(1), however, remained un-complied with by the assessee. The Assessing officer, therefore, was left with no option but to complete the assessment ex-parte to the best of his judgment on the basis of material available on record. In the assessment so completed under section 143(3)/147 of the Act vide an order dated 29.11.2019, the following additions were made by the Assessing Officer to the total income of the assessee:- (i) Amount received from Rs.10,00,000/- Shell Company treated as unexplained cash credit under section 68

We have heard the arguments of both the sides and also perused the relevant material available on record. The ld. Counsel for the assessee has submitted that the main issue involved in this appeal of the assessee relates to the addition of Rs.6,92,50,000/- made by the Assessing Officer and confirmed by the ld. CIT(Appeals) on account of sale of investment in unquoted shares by treating the same as unexplained cash credit. He has submitted that the said investment was made by the assessee out of the money received on account of share capital and share premium aggregating to Rs.11.04 crores in the previous year relevant to A.Y. 2008- 09. He has submitted that the entire amount of share capital and share premium received in A.Y. 2008-09 was added by the Assessing Officer to the total income of the assessee by treating the same as unexplained cash credit and the assessee has already settled the said controversy involved in A.Y. 2008-09 by opting Vivad Se Vishwas Scheme. He has contended that the treatment given by the Department to the share capital and share premium aggregating to Rs.11.04 crores as income of the assesse for A.Y. 2008-09 thus has been accepted by the assessee and since the same now represents the source of income of the assessee, the application of the said amount for making the investment as well as realisation of sale proceeds of such investment cannot again be treated as income of the assessee under section 68 or otherwise since the source of the same is already well established. He has contended that any such addition would result in double addition and in order to avoid such double addition, the matter may be sent back to the Assessing officer to verify the claim of the assessee that the source of the relevant investment having been duly established and accepted in AY 2008-09 by opting Vivad Se Vishwas Scheme, the proceeds of sale of such investment cannot be treated as unexplained and added to the total income of the assessee for the year under consideration as the same would amount of double addition. The ld. D.R., on the other hand, has submitted that if the Tribunal is inclined to restore this matter to the file of the Assessing Officer for the limited

In the result, the appeal of the assessee is treated as partly allowed for statistical purposes. Order pronounced in the open Court on April 16, 2021.