ARISTO INFRACON PVT. LTD.,KOLKATA vs. ITO, WARD-9(1), KOLKATA, KOLKATA

This appeal filed by the assessee is against the order of Ld. CIT(A)-16, Kolkata, dated 09.08.2016 for AY 2012-13.

At the outset, it has been brought to our notice by the ld AR of the assessee that the Ld. CIT(A) has not applied his mind and has passed a cryptic order without considering the material placed on record. It was brought to our notice that the impugned order of the Ld. CIT (A) is a non-speaking order and since the Ld. CIT(A) has not discussed the matter on merits and without evaluating the evidence placed on record makes the order bad in law. We note that the Ld. CIT(A) has passed the order as under:

We note that the AO has made addition u/s. 144 of the Act, which is the best judgment assessment since assessee did not participate during the assessment proceedings. On appeal, the Ld. CIT(A) has taken note of the fact that the assessee has filed detailed paper book before him which was sent to the AO for remand report and comments were sought for by ld CIT(A) from AO vide letters dated 06.04.2016, 22.04.2016 and 13.06.2016. However, the Ld. CIT(A) notes that no comments were received from the AO, therefore, he has examined the documents submitted by the assessee before him and has passed the impugned order. We note that on 09.08.2016 (within two months after calling for remand report from AO) without the aid of remand report from the AO, the Ld. CIT (A) has concluded that all the subscribing companies from whom capital has been taken are paper Companies and they hardly do any business throughout the year. After noticing that M/s. Anjiputra Sales Pvt. Ltd. has got total income of Rs.15,081/- Calendula Vincon Ltd. has got total income of Rs.26,670/-. PPJ Heavy Gear Pvt. Ltd. has got total income of Rs.40,236/-, according to Ld. CIT(A), all the subscribing companies are virtually paper companies and have got no creditworthiness to subscribe huge amount as capital. Thereafter the Ld. CIT(A) after going through the Bank statements, was of the opinion that there is hardly any activity other than the deposit of cheques and finally the subscription is made. And Ld. CIT (A) noted that no business activity is carried out by these subscribing companies. After having made the said observations the Ld. CIT (A) has passed the impugned order, supra. We note that the Ld. CIT (A) has passed the impugned order, after taking note that assessee had filed detailed paper books before him and the AO has not rendered the remand report sought by him. When the assessment order has been passed by the AO u/s. 144 of the Act, and during appeal when assessee has furnished detailed paper book to discharge the onus casted upon it, in the interest of justice and fair play, the Ld. CIT (A) ought to have obtained the remand report from AO before proceeding to pass the impugned order. Taking into consideration the fact that the assessment order was passed by AO u/s. 144 of the Act and since the assessee has filed detailed paper book in its defence, the Ld. CIT (A) should have insisted that AO give his remand report before disposing the appeal on merit. The impugned order of the Ld. CIT(A) is, therefore, set aside and the appeal remanded back to Ld. CIT(A), to decide the appeal on merit after calling for remand report from the AO. Needless to say the assessee to be provided adequate opportunity to rebut the remand report Aristo Infracon (P) Ltd., AY 2012-13 of AO and after hearing the assessee, the Ld. CIT (A) to pass a speaking order. Appeal of assessee is allowed for statistical purposes.

In the result, appeal of assessee is allowed for statistical purposes.