EASTERN COPPER MANUFATURING CO.PVT. LTD.,KOLKATA vs. DCIT, CIR 9(1), KOLKATA, KOLKATA

Eastern Copper Manufacturing Co. Ltd vs. DCIT Cir-9(1) Kol. Page 2 2. We notice at the outset that CIT(A) has his lower appellate order ex parte whilst affirming the impugned unexplained share premium addition of ₹2,00,00,000/- made in the course of assessment. The assessee had claimed to have received the same at premium of ₹490/- each per share having face value of ₹10/- each during the course of assessment. We find from assessment order that it had submitted the relevant list of eight investor parties in the course of scrutiny. The Assessing Officer took recourse to section 133(6) and u/s 131 of the Act to verify correctness thereof. He observed in assessment order that the assessee had failed to produce said parties for the purpose of verification. The Assessing Officer thereafter went into detailed discussion in view of hon'ble apex court’s landmark decision in Sumati Dayal vs. CIT (1995) 80 Taxman 89 (SC) and CIT vs. Durga Prasad More (1971) 82 ITR 540 (SC) to conclude that the assessee had failed to satisfy the relevant genuineness and creditworthiness test as per the relevant facts of the instant case. All this resulted in the impugned addition being made in assessee’s hands u/s 68 of the Act.

We now advert to lower appellate proceedings. The CIT(A) observes in para 2 of his order that he fixed the case for hearing 29.11.2016. The assessee filed adjournment therein. The lower appeal stood postponed hearing for 07.12.2016. The CIT(A) thereafter records that the assessee did not appear making him to confirm the impugned addition with much a detailed discussion.

We have given our thoughtful consideration to rival submissions. Suffice to say, the CIT(A) has passed his ex parte order against the assessee in confirming the impugned addition. It has come on record that the assessee had sought adjournment on 29.11.2016. The CIT(A) records that the assessee did not appear thereafter. Learned counsel has filed assessee’s authorized person’s affidavit solemnly averring therein that he had duly appeared and sought adjournment on 07.12.2016 which was not even received in the case file. Be that as it may, we find that there is no discussion on the relevant evidence filed at the assessee’s behest running into almost 100 pages containing all details of its investors entities as well as lower appellate proceedings. We therefore deem it appropriate to remit the instant issue back to the CIT(A) in Eastern Copper Manufacturing Co. Ltd vs. DCIT Cir-9(1) Kol. Page 3 larger interest of justice for adjudication afresh as per law after affording adequate opportunities of hearing to assessee.