ITO, WARD-6(1), KOLKATA, KOLKATA vs. M/S CONFIRM REALBUILD PVT. LTD., KOLKATA

This appeal preferred by the revenue is against the order of the Ld. CIT(A)-23, Kolkata dated 02.06.2017 for AY 2012-13.

Confirm Realbuild Pvt. Ltd., AY 2012-13 Confirm Realbuild Pvt. Ltd., AY 2012-13 Confirm Realbuild Pvt. Ltd., AY 2012-13 Confirm Realbuild Pvt. Ltd., AY 2012-13 3. On perusal of the aforesaid remand report, we note that the conclusion made by the AO is that he has examined the directors of the assessee company and the share-subscribing companies and after examination of the documents filed by the assessee which was placed in the paper book before him, made him return a finding that there is no infirmity in the matter related to general criteria set-for mode of financial transaction, namely identity of entity involved, creditworthiness of investors and genuineness of the transactions. The Ld. CIT(A) after perusal of the remand report of the AO and after independently examining the documents furnished before him, has taken a decision to delete the addition. We note that u/s. 68 of the Act where any sum is found credited in the books of an assessee maintained for any previous year, and the assessee offers no explanation about the nature and source thereof or the explanation offered by him is not satisfactory in the opinion of the AO, the sum so credited may be charged to income tax as the income of the assessee of that previous year. So, here in this case, the assessee has offered its explanation about the nature and source thereof of the share capital and premium it collected by furnishing details of share- subscribers, about their identity, creditworthiness and genuinity of the transaction and the AO though during remand proceedings was satisfied about the nature and source thereof, then question of addition invoking the deeming provision does not arise. Here in this case, the AO has recorded his satisfaction as evident from perusal of remand report [supra] which action of AO has been confirmed by the Ld. CIT(A). So, the addition u/s. 68 of the Act was rightly deleted by the Ld. CIT(A). In the light of the aforesaid facts and circumstances, we wonder as to how the AO/ITO has again raised this ground challenging the action of Ld. CIT(A) by preferring an appeal before us, when he (AO) himself has given a clean chit to the assessee company in respect to share capital and premium collected by it. We note that assessment of a subject has to be done by the AO and in this case, the AO himself after examining the directors of the assessee company as well as that of the share subscribing companies and after making enquiries in respect of the documents filed before him has recorded his satisfaction about the nature and source of the credits found in the books of the assessee which were in the form of share capital as convincing because the assessee as able to discharge the onus of proving the identity, creditworthiness and genuineness of the share capital. In such a scenario, the filing of the appeal by the AO before us is nothing but an Confirm Realbuild Pvt. Ltd., AY 2012-13 abuse of the process of law when on one hand he is satisfied with the identity, creditworthiness and genuineness of the share capital introduced by the assessee and thereafter again challenging it before the Tribunal is against the principle of estoppel because AO cannot blow hot and cold at the same time. Therefore, in the facts and circumstances discussed above and after having a look at the documents filed before us by the assessee to prove the identity, creditworthiness and genuineness of the transaction, we are of the considered opinion that assessee has discharged its onus by placing materials to explain the nature and source of the share capital, therefore, we find no infirmity in the action of Ld. CIT(A) in deleting the addition made u/s. 68 of the Act. Therefore, we are inclined to dismiss this appeal of the revenue.