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Income Tax Appellate Tribunal, “B”, BENCH
Before: SHRI SANDEEP GOSAIN, JM & SHRI RAJESH KUMAR, AM
आदेश / O R D E R PER SANDEEP GOSAIN (JM):
This appeal in A.Y.2009-10 arises out of the order by the ld. Commissioner of Income Tax (Appeals)-12, Mumbai in appeal No.CIT(A)-12/ITO-6(1)(2)/113/15-16 dated 09/09/2016 (ld. CIT(A) in short) against the order of assessment passed u/s.143(3) r.w.s. 147 of the Income Tax Act, 1961 (hereinafter referred to as Act) dated 23/03/2015 by the ld. Dy. Commissioner of Income Tax-6(1)(2), Mumbai (hereinafter referred to as ld. AO). 2. The first issue in this appeal of assessee is against the order of CIT(A) confirming the action of the AO in reopening of assessment. For this, assessee has raised the following ground No.1:- 1. a) On the facts and circumstances of the case and in law the Ld Commissioner of Income Tax (Appeals)
12. (hereinafter referred to as Ld CIT(A)-12) erred in confirming action of Ld Assessing Officer (hereinafter referred to as Ld AO)in re-opening the assessment. b) On the facts and circumstances of the case and in law the Ld C1T (A) erred confirming Ld AO's order rejecting Appellant's objections (especially objection relating to the fact that share premium is not in the nature of income) to reopening the assessment.
Ld. AR appearing on behalf of the assessee submitted before us that this ground is covered by the order of Hon'ble ITAT in for AY 2009-10 in assessee's own case, wherein the identical ground raised
in the present appeal has already been decided on merits.
4. On the other hand, Ld. DR fairly agreed to the contention of Ld. AR that the issue is covered in favour of assessee.
5. We have heard both the parties and we have also perused the material placed on record as well as the orders passed by revenue authorities. We find that the identical ground has already been decided by the Coordinate Bench of Hon'ble ITAT in ITA No. 6593/Mum/2016 for AY 2009-10 in assessee's own case. The operative portion of the order of Hon'ble ITAT passed in ITA No. 6593/Mum/2016 for AY 2009-10 contained in para no. 11 & 12, which is reproduced below:-
“11. We have heard rival contentions and gone through the facts and circumstances of the case. We find from the reasons recorded reproduced above that the AO failed to appreciate that the law does not permit him to reopen assessment unless he has tangible material on the basis of which he forms reason to belief that income has escaped assessment. The mere fact that the assessee has issued shares at a certain premium itself cannot be a reason to belief that income has escaped assessment. The AO has neither mentioned by how much the shares are overvalued i.e. by what amount the premium exceeds the instinct value of the shares nor the amount, which according to him, has escaped assessment. The reasons are reproduced above but for the sake of brevity the relevant part of reasons are that, “from the records, it is seen that the assessee is in receipt of huge share premium amounting to ₹ 4,56,00,000 during the F.Y. 2008-09 relevant to AY 2009-10. As there was no scrutiny assessment done for this year, the so-called share premium having been received by the assessee was not examined. The assessee is an unlisted company and the source of the share premium so received as well as the nature of the share application received (the intrinsic value of the share in comparison to the excess premium received) is not substantiated.” We also find from the above that the AO stated that income in the grab of share application money received in this case has escaped assessment but he could not point out on what basis / material does he belief that the share capital is not genuine. In the similar circumstances, Hon’ble Bombay High Court in the case of Khubchandani Healthparks Pvt. Ltd. (supra) held that regular Return of income was assessed by Intimation under Section 143(1) of the Act and no scrutiny assessment was done. In the above view, to ascertain the nature and the justification for charging share premium, the Assessing Officer has reason to believe that charging of share premium over and above the intrinsic value of the share is income which has escaped assessment. The Notice itself does not indicate the approximate amount of income, which the Assessing Officer has reason to believe has escaped assessment nor does it quantify the extent to which the share premium received was in excess of intrinsic value, which has escaped assessment. It gives no reasons to indicate the basis of coming to the conclusion that share premium is excessive and, therefore, income. Moreover, the Notice also does not dispute that this is a share premium but seek justification for charging the share premium over and above intrinsic value of the share premium. 12.Similar are the facts in the present case as was before Hon’ble Bombay High Court in the case of Khubchandani Healthparks Pvt. Ltd. (supra). Respectfully following Hon’ble Bombay High Court, we are of the view that the AO has absolutely no material to even suspect, forget believe that income has escaped assessment. Hence, we quash the re-opening and accordingly, the issue of assessee’s appeal on jurisdiction is allowed.
After having gone through the facts of the present case as well as considering the orders passed by revenue authorities and Hon'ble ITAT as mentioned above in assessee's own case, we find that the identical issue has already been decided by the Hon'ble ITAT in for AY 2009-10 in assessee's own case. Therefore, respectfully following the decision of the Coordinate Bench of Hon'ble ITAT and in order to maintain judicial consistency, we apply the same findings in the present case which are applicable mutatis mutandis in the present case.
In the net result, the appeal filed by the assessee stands allowed. Order pronounced in the open court on this 20/06/2019.