ITO, WARD - 5(3), KOLKATA, KOLKATA vs. M/S. BLUEMOTION AWAS PVT. LTD.,, KOLKATA

The assessee is a company and during the previous year it raised share capital amounting to Rs. 9,70,00,000/-, including share premium. The assessing officer made an addition u/s 68 of the Act, of this amount for the reason that there was non-compliance on part of the assessee company as well as due to non-appearance of directors of the share applicant companies, in response to the notices issued u/s 131 of the Act, and that consequently the genuineness of the credit could not be proved. Aggrieved the assessee carried the matter in appeal. The ld. CIT(A) granted relief.

Aggrieved the revenue is in appeal before us.

We have heard rival contentions. On careful consideration of the facts and circumstances of the case, perusal of the papers on record, orders of the authorities below as well as case law cited, we hold as follows:- 4.1. We find that the ld. CIT(A) has contradicted himself by saying that “The AO has not doubted the transaction of allotment of shares against the purchase of investment;” on Assessment Year: 2012-13 M/s. Bluemotion Awas Pvt. Ltd the one hand and on the other hand states that, “ the one hand and on the other hand states that, “The assessee allotted its shares to the The assessee allotted its shares to the companies to whom it had debts companies to whom it had debts to pay . The Assessing Officer also records that the . The Assessing Officer also records that the assessee had initially complied to the notices and on later dates did not file further assessee had initially complied to the notices and on later dates did not file further assessee had initially complied to the notices and on later dates did not file further details. 4.2. Before us, the ld. D/R, submits that the Assessing Officer was not given adequate Before us, the ld. D/R, submits that the Assessing Officer was not given adequate Before us, the ld. D/R, submits that the Assessing Officer was not given adequate opportunity to examine all the details filed by the assessee before the ld. CIT(A) and that ne all the details filed by the assessee before the ld. CIT(A) and that ne all the details filed by the assessee before the ld. CIT(A) and that fresh evidence were brought on record before the ld. CIT(A). He prayed that the issue fresh evidence were brought on record before the ld. CIT(A). He prayed that the issue fresh evidence were brought on record before the ld. CIT(A). He prayed that the issue may be remanded back to the file of the Assessing Officer for fresh adjudication in light may be remanded back to the file of the Assessing Officer for fresh adjudication in light may be remanded back to the file of the Assessing Officer for fresh adjudication in light of all the fresh evidences filed by the assessee. he fresh evidences filed by the assessee. 4.3. The ld. A/R, though not leaving his ground did not raise any objection to the The ld. A/R, though not leaving his ground did not raise any objection to the The ld. A/R, though not leaving his ground did not raise any objection to the matter being set aside to the file of the Assessing Officer for fresh adjudication. matter being set aside to the file of the Assessing Officer for fresh adjudication. matter being set aside to the file of the Assessing Officer for fresh adjudication.

After hearing both sides we are of the opini After hearing both sides we are of the opinion that this case has to be restored to on that this case has to be restored to the file of the Assessing Officer the file of the Assessing Officer for fresh adjudication, in light of the new evidences filed for fresh adjudication, in light of the new evidences filed by the assessee before the ld. CIT(A) by the assessee before the ld. CIT(A). We find that this bench of the ITAT in all such . We find that this bench of the ITAT in all such cases has been restoring the matter cases has been restoring the matter to the file of the Assessing Officer for fresh to the file of the Assessing Officer for fresh adjudication. 5.1. In the case of Sriram Tie Up Pvt. Ltd. supra at para 6 and 7 held as follows: In the case of Sriram Tie Up Pvt. Ltd. supra at para 6 and 7 held as follows: In the case of Sriram Tie Up Pvt. Ltd. supra at para 6 and 7 held as follows: “6. In the case of M/s. Sukanya Merchandise Pvt. Ltd. vs ITO (ITA In the case of M/s. Sukanya Merchandise Pvt. Ltd. vs ITO (ITA In the case of M/s. Sukanya Merchandise Pvt. Ltd. vs ITO (ITA 291/Kol/2016 dated 15.12.2017) cited by 291/Kol/2016 dated 15.12.2017) cited by the learned counsel for the assessee, a the learned counsel for the assessee, a similar view has been taken by the Co similar view has been taken by the Co-ordinate Bench of this Tribunal and the ordinate Bench of this Tribunal and the similar issue relating to the addition made under section 68 on account of share similar issue relating to the addition made under section 68 on account of share similar issue relating to the addition made under section 68 on account of share capital contribution by treating the same as unexplained capital contribution by treating the same as unexplained cash credits is restored cash credits is restored back by the Tribunal to the file of the A.O. in almost similar situation after back by the Tribunal to the file of the A.O. in almost similar situation after back by the Tribunal to the file of the A.O. in almost similar situation after recording its observations / findings as under: recording its observations / findings as under: We note that the AO pursuant to the order of Ld. CIT had taken note of the We note that the AO pursuant to the order of Ld. CIT had taken note of the We note that the AO pursuant to the order of Ld. CIT had taken note of the directions of the Ld. CIT and directions of the Ld. CIT and issued notice u/s. 142(1) dated 16.08.2013 and has issued notice u/s. 142(1) dated 16.08.2013 and has acknowledged that the assessee had furnished the copy of final account, I. T. acknowledged that the assessee had furnished the copy of final account, I. T. acknowledged that the assessee had furnished the copy of final account, I. T. Acknowledgement, bank statement for the relevant period evidencing the receipt Acknowledgement, bank statement for the relevant period evidencing the receipt Acknowledgement, bank statement for the relevant period evidencing the receipt of share application money from the share appli of share application money from the share applicants. Thereafter, the AO makes cants. Thereafter, the AO makes certain inferences based on the list of shareholders and taking note of the bank certain inferences based on the list of shareholders and taking note of the bank certain inferences based on the list of shareholders and taking note of the bank statement furnished by the assessee. We note that after the initial notice dated statement furnished by the assessee. We note that after the initial notice dated statement furnished by the assessee. We note that after the initial notice dated 16.08.2013, thereafter the AO had issued the notice on 26.02 16.08.2013, thereafter the AO had issued the notice on 26.02.2014 which has been .2014 which has been reproduced at page 3 of the reassessment order, wherein AO required the reproduced at page 3 of the reassessment order, wherein AO required the reproduced at page 3 of the reassessment order, wherein AO required the directors of the assessee company to be present before him on 06.03.2014. directors of the assessee company to be present before him on 06.03.2014. directors of the assessee company to be present before him on 06.03.2014. However, according to the Ld. AR, the assessee received the notice only on However, according to the Ld. AR, the assessee received the notice only on However, according to the Ld. AR, the assessee received the notice only on Assessment Year: 2012-13 M/s. Bluemotion Awas Pvt. Ltd 07.03.2014 and thereafter, the assessee requested the AO to provide another d thereafter, the assessee requested the AO to provide another d thereafter, the assessee requested the AO to provide another opportunity of hearing vide its letter dated 20.03.2014. Thereafter, the AO fixed opportunity of hearing vide its letter dated 20.03.2014. Thereafter, the AO fixed opportunity of hearing vide its letter dated 20.03.2014. Thereafter, the AO fixed the date of hearing on 12.03.2014 vide notice dated 10.03.2014. So, according to the date of hearing on 12.03.2014 vide notice dated 10.03.2014. So, according to the date of hearing on 12.03.2014 vide notice dated 10.03.2014. So, according to the assessee company since t the assessee company since the directors were not in station till 23.03.2014, the he directors were not in station till 23.03.2014, the Ld. AR had requested for adjournment till that time. Though the AO has stated Ld. AR had requested for adjournment till that time. Though the AO has stated Ld. AR had requested for adjournment till that time. Though the AO has stated that he has issued summons on 24.03.2014 to the assessee company to produce that he has issued summons on 24.03.2014 to the assessee company to produce that he has issued summons on 24.03.2014 to the assessee company to produce the directors of the company before him on 26.03 the directors of the company before him on 26.03.2014, the assessee company .2014, the assessee company contended that it has not received the said summon and, therefore, could not contended that it has not received the said summon and, therefore, could not contended that it has not received the said summon and, therefore, could not make the personal appearance. The AO has drawn adverse conclusion basically make the personal appearance. The AO has drawn adverse conclusion basically make the personal appearance. The AO has drawn adverse conclusion basically because of non-appearance of the directors of the assessee company and tha appearance of the directors of the assessee company and tha appearance of the directors of the assessee company and that of the shareholder companies. We note that initially the AO started the enquiry on the shareholder companies. We note that initially the AO started the enquiry on the shareholder companies. We note that initially the AO started the enquiry on 16.08.2013 which was complied by the assessee by submitting documents which 16.08.2013 which was complied by the assessee by submitting documents which 16.08.2013 which was complied by the assessee by submitting documents which has been acknowledged by the AO. Thereafter, the enquiry was started only at has been acknowledged by the AO. Thereafter, the enquiry was started only at has been acknowledged by the AO. Thereafter, the enquiry was started only at the fag end of February 2014 and the assessee company had informed the AO that February 2014 and the assessee company had informed the AO that February 2014 and the assessee company had informed the AO that their directors were out of station till 23.03.2014. In the light of the aforesaid their directors were out of station till 23.03.2014. In the light of the aforesaid their directors were out of station till 23.03.2014. In the light of the aforesaid facts, we are of the opinion that the assessee did not get fair opportunity to facts, we are of the opinion that the assessee did not get fair opportunity to facts, we are of the opinion that the assessee did not get fair opportunity to present the evidences before present the evidences before the AO so, there was a lack of opportunity as the AO so, there was a lack of opportunity as aforesaid, therefore, it has to go back to AO. aforesaid, therefore, it has to go back to AO.

8. We also note that Ld. Cit while setting aside the order of the AO which was We also note that Ld. Cit while setting aside the order of the AO which was We also note that Ld. Cit while setting aside the order of the AO which was passed u/s. 147/143(3) of the Act, the Ld. CIT gave certain guidelines to follow fo passed u/s. 147/143(3) of the Act, the Ld. CIT gave certain guidelines to follow fo passed u/s. 147/143(3) of the Act, the Ld. CIT gave certain guidelines to follow for conducting deep investigation. We also note that similarly placed assessees had conducting deep investigation. We also note that similarly placed assessees had conducting deep investigation. We also note that similarly placed assessees had challenged the exercise of revisional jurisdiction u/s. 263 of the Act before this challenged the exercise of revisional jurisdiction u/s. 263 of the Act before this challenged the exercise of revisional jurisdiction u/s. 263 of the Act before this Tribunal in those cases one of it of Subha Lakshmi Vanijya Pvt. Ltd. Vs. CIT in ITA Tribunal in those cases one of it of Subha Lakshmi Vanijya Pvt. Ltd. Vs. CIT in ITA Tribunal in those cases one of it of Subha Lakshmi Vanijya Pvt. Ltd. Vs. CIT in dated 30.07.2015, wherein the Tribunal was pleased to 04/Kol/2014 dated 30.07.2015, wherein the Tribunal was pleased to 04/Kol/2014 dated 30.07.2015, wherein the Tribunal was pleased to uphold the order passed by the Ld. CIT passed u/s. 263 of the Act, which we learn uphold the order passed by the Ld. CIT passed u/s. 263 of the Act, which we learn uphold the order passed by the Ld. CIT passed u/s. 263 of the Act, which we learn to have been confirmed by the Hon’ble jurisdictional High Court and the SLP to have been confirmed by the Hon’ble jurisdictional High Court and the SLP to have been confirmed by the Hon’ble jurisdictional High Court and the SLP preferred against the decision o preferred against the decision of the Hon’ble jurisdictional High Court has been f the Hon’ble jurisdictional High Court has been dismissed by the Hon’ble Supreme Court. Therefore, similar order of the Ld. CIT dismissed by the Hon’ble Supreme Court. Therefore, similar order of the Ld. CIT dismissed by the Hon’ble Supreme Court. Therefore, similar order of the Ld. CIT passed u/s. 263 of the Act has been upheld. We note that the AO while giving passed u/s. 263 of the Act has been upheld. We note that the AO while giving passed u/s. 263 of the Act has been upheld. We note that the AO while giving effect to the CIT’s 263 order has noted that the effect to the CIT’s 263 order has noted that the assessee company has in fact assessee company has in fact furnished the documents sought by him to his notice u/s. 142(1) of the Act. furnished the documents sought by him to his notice u/s. 142(1) of the Act. furnished the documents sought by him to his notice u/s. 142(1) of the Act. However, the AO took the adverse view against the assessee on the plea that the However, the AO took the adverse view against the assessee on the plea that the However, the AO took the adverse view against the assessee on the plea that the directors of the assessee company and share subscribing companies had directors of the assessee company and share subscribing companies had directors of the assessee company and share subscribing companies had not appeared before him on 26.03.2014 and t after taking note that none appeared on appeared before him on 26.03.2014 and t after taking note that none appeared on appeared before him on 26.03.2014 and t after taking note that none appeared on 26.03.2014 concluded on the same day 26.03.2014 that entire amount of share 26.03.2014 concluded on the same day 26.03.2014 that entire amount of share 26.03.2014 concluded on the same day 26.03.2014 that entire amount of share application money received along with premium amounting to Rs.8,06,00,000/ application money received along with premium amounting to Rs.8,06,00,000/ application money received along with premium amounting to Rs.8,06,00,000/- which has remained unexplained and added to the income of the assessee. We d unexplained and added to the income of the assessee. We d unexplained and added to the income of the assessee. We also note that the Ld. CIT after looking into the pernicious practice of converting also note that the Ld. CIT after looking into the pernicious practice of converting also note that the Ld. CIT after looking into the pernicious practice of converting black money into white money has given the guidelines to AO as to how the black money into white money has given the guidelines to AO as to how the black money into white money has given the guidelines to AO as to how the investigation should be conducted to fi investigation should be conducted to find out the source of source. Since similar nd out the source of source. Since similar order of the Ld. CIT passed u/s. 263 of the Act has been upheld by the Tribunal as order of the Ld. CIT passed u/s. 263 of the Act has been upheld by the Tribunal as order of the Ld. CIT passed u/s. 263 of the Act has been upheld by the Tribunal as well as by the Hon’ble Calcutta High Court as well as the SLP has been dismissed well as by the Hon’ble Calcutta High Court as well as the SLP has been dismissed well as by the Hon’ble Calcutta High Court as well as the SLP has been dismissed by the Hon’ble Supreme Court, similar order of t by the Hon’ble Supreme Court, similar order of the Ld. CIT has to be given effect to he Ld. CIT has to be given effect to as directed by the Ld. CIT. We take note that the Ld. CIT with his experience and as directed by the Ld. CIT. We take note that the Ld. CIT with his experience and as directed by the Ld. CIT. We take note that the Ld. CIT with his experience and wisdom has given certain guidelines in the backdrop of black money menace wisdom has given certain guidelines in the backdrop of black money menace wisdom has given certain guidelines in the backdrop of black money menace should have been properly enquired into as directed by him. T should have been properly enquired into as directed by him. The AO ought to have he AO ought to have followed the investigating guidelines and method as directed by him to unearth followed the investigating guidelines and method as directed by him to unearth followed the investigating guidelines and method as directed by him to unearth the facts to determine whether the identity, genuineness and creditworthiness of the facts to determine whether the identity, genuineness and creditworthiness of the facts to determine whether the identity, genuineness and creditworthiness of the share subscribers. We note that the Hon’ble Supreme Court in three judg the share subscribers. We note that the Hon’ble Supreme Court in three judg the share subscribers. We note that the Hon’ble Supreme Court in three judges Assessment Year: 2012-13 M/s. Bluemotion Awas Pvt. Ltd bench in the case of Tin Box, (supra), has held that since there was lack of bench in the case of Tin Box, (supra), has held that since there was lack of bench in the case of Tin Box, (supra), has held that since there was lack of opportunity to the assessee at the assessment stage itself, the assessment needs to opportunity to the assessee at the assessment stage itself, the assessment needs to opportunity to the assessee at the assessment stage itself, the assessment needs to be done afresh and thereby reversed the Hon’ble High Court, Tribunal and be done afresh and thereby reversed the Hon’ble High Court, Tribunal and be done afresh and thereby reversed the Hon’ble High Court, Tribunal and CIT(A)’s orders and remanded the matter back to AO for fresh assessment. So, d remanded the matter back to AO for fresh assessment. So, d remanded the matter back to AO for fresh assessment. So, since there was lack of opportunity as aforestated it has to go back to AO. We also since there was lack of opportunity as aforestated it has to go back to AO. We also since there was lack of opportunity as aforestated it has to go back to AO. We also note that the Hon’ble Delhi High Court in the case of CIT Vs. Jansampark note that the Hon’ble Delhi High Court in the case of CIT Vs. Jansampark note that the Hon’ble Delhi High Court in the case of CIT Vs. Jansampark Advertising & Marketing Pvt. Ltd. in Advertising & Marketing Pvt. Ltd. in dated 11.03.2015 wherein ITA No. 525/2014 dated 11.03.2015 wherein after noticing inadequate enquiry by authorities below have held as under: after noticing inadequate enquiry by authorities below have held as under: after noticing inadequate enquiry by authorities below have held as under: “41. We are inclined to agree with the CIT(Appeals), and consequently with ITAT, “41. We are inclined to agree with the CIT(Appeals), and consequently with ITAT, “41. We are inclined to agree with the CIT(Appeals), and consequently with ITAT, to the extent of their conclusion that the assessee here to the extent of their conclusion that the assessee herein had come up with some in had come up with some proof of identity of some of the entries in question. But, from this inference, or proof of identity of some of the entries in question. But, from this inference, or proof of identity of some of the entries in question. But, from this inference, or form the fact that the transactions were through banking channels, it does not form the fact that the transactions were through banking channels, it does not form the fact that the transactions were through banking channels, it does not necessarily following that satisfaction as to the creditworthiness of necessarily following that satisfaction as to the creditworthiness of the parties or the parties or the genuineness of the transactions in question would also have been established. the genuineness of the transactions in question would also have been established. the genuineness of the transactions in question would also have been established.

The AO here may have failed to discharge his obligation to conduct a proper 42. The AO here may have failed to discharge his obligation to conduct a proper 42. The AO here may have failed to discharge his obligation to conduct a proper inquiry to take the matter to logical conclusion. But CIT(Appeals), having no inquiry to take the matter to logical conclusion. But CIT(Appeals), having no inquiry to take the matter to logical conclusion. But CIT(Appeals), having noticed want of proper inquiry, could not have closed the chapter simply by allowing the want of proper inquiry, could not have closed the chapter simply by allowing the want of proper inquiry, could not have closed the chapter simply by allowing the appeal and deleting the additions made. It was also the obligation of the first appeal and deleting the additions made. It was also the obligation of the first appeal and deleting the additions made. It was also the obligation of the first appellate authority, as indeed of ITAT, to have ensured that effective inquiry was appellate authority, as indeed of ITAT, to have ensured that effective inquiry was appellate authority, as indeed of ITAT, to have ensured that effective inquiry was carried out, particularly in the fact of the allegations of the Revenue that the d out, particularly in the fact of the allegations of the Revenue that the d out, particularly in the fact of the allegations of the Revenue that the account statements reveal uniform pattern of cash deposits of equal amounts in account statements reveal uniform pattern of cash deposits of equal amounts in account statements reveal uniform pattern of cash deposits of equal amounts in the respective accounts preceding the transactions in question. This necessitated a the respective accounts preceding the transactions in question. This necessitated a the respective accounts preceding the transactions in question. This necessitated a detailed scrutiny of the material submitted by the assessee in response to the of the material submitted by the assessee in response to the of the material submitted by the assessee in response to the notice under Section148 issued by the AO, as also the material submitted at the notice under Section148 issued by the AO, as also the material submitted at the notice under Section148 issued by the AO, as also the material submitted at the stage of appeals, if deemed proper by way of making or causing to be made a stage of appeals, if deemed proper by way of making or causing to be made a stage of appeals, if deemed proper by way of making or causing to be made a 'further inquiry’ in exercise of the po 'further inquiry’ in exercise of the power under Section 250(4). His approach not wer under Section 250(4). His approach not having been adopted, the impugned order of ITAT, and consequently that of having been adopted, the impugned order of ITAT, and consequently that of having been adopted, the impugned order of ITAT, and consequently that of CIT(Appeals), cannot be approved or upheld." CIT(Appeals), cannot be approved or upheld." In view of the aforesaid order and in the light of the Hon’ble Supreme Court’s In view of the aforesaid order and in the light of the Hon’ble Supreme Court’s In view of the aforesaid order and in the light of the Hon’ble Supreme Court’s decision in Tin Box Company (supra) and taking into consideration the fact the Box Company (supra) and taking into consideration the fact the Box Company (supra) and taking into consideration the fact the order of the Ld. CIT passed u/s. 263 of the Act in similar cases being upheld up to order of the Ld. CIT passed u/s. 263 of the Act in similar cases being upheld up to order of the Ld. CIT passed u/s. 263 of the Act in similar cases being upheld up to the level of Apex Court, and taking note of Hon’ble Delhi High Court’s order in the level of Apex Court, and taking note of Hon’ble Delhi High Court’s order in the level of Apex Court, and taking note of Hon’ble Delhi High Court’s order in Jansampark Advertising & Mar Jansampark Advertising & Marketing Pvt. Ltd. (supra), we set aside the order of keting Pvt. Ltd. (supra), we set aside the order of the Ld. CIT(A) and remand the matter back to the file of AO for de novo the Ld. CIT(A) and remand the matter back to the file of AO for de novo the Ld. CIT(A) and remand the matter back to the file of AO for de novo assessment and to decide the matter in accordance to law after giving assessment and to decide the matter in accordance to law after giving assessment and to decide the matter in accordance to law after giving opportunity of being heard to the assessee. opportunity of being heard to the assessee.

The Kolkata Bench of the ITAT has passed similar order in many cases on the nch of the ITAT has passed similar order in many cases on the nch of the ITAT has passed similar order in many cases on the same issue of additions made u/s 68 of the share capital. It ade u/s 68 of the share capital. It has set aside the assessment has set aside the assessment Assessment Year: 2012-13 M/s. Bluemotion Awas Pvt. Ltd to the file of the AO for fresh adjudication to the file of the AO for fresh adjudication, on the lines stated in the above above quoted orders after giving the assessee adequate opportunity. The Assessing Officer may examine giving the assessee adequate opportunity. The Assessing Officer may examine giving the assessee adequate opportunity. The Assessing Officer may examine all the documentary evidences which the assessee has filed documentary evidences which the assessee has filed both before the Assessing both before the Assessing Officer as well as at the appellate stage at the appellate stage and evidence which he further may choose to further may choose to file, in support of his case.

Keeping in view the totality of the facts and circumstances of the case and also Keeping in view the totality of the facts and circumstances of the case and also Keeping in view the totality of the facts and circumstances of the case and also the orders of the Co-ordinate Bench of the Tribunal in similar matters, we set aside this ordinate Bench of the Tribunal in similar matters, we set aside this ordinate Bench of the Tribunal in similar matters, we set aside this issue to the file of the AO for fresh adjudication in accord to the file of the AO for fresh adjudication in accordance with law, after giving the ance with law, after giving the assessee adequate opportunity of being heard. assessee adequate opportunity of being heard.

In the result, appeal of the In the result, appeal of the revenue is allowed for statistical purposes. is allowed for statistical purposes. Kolkata, the Kolkata, the 11th day of December, 2019.