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Income Tax Appellate Tribunal, KOLKATA BENCHES : D : KOLKATA
Before: SHRI R.S. SYAL, AM & SHRI N.V. VASUDEVAN, JM
ORDER Per Bench
Through this appeal, the assessee assails the correctness of the order passed by the Commissioners of Income-tax (CIT) on 28.3.2013 ITA 1891/Kol/13 u/s 263 of the Income-tax Act, 1961 (hereinafter also called ‘the Act’) in relation to the assessment year 2008-09.
Briefly stated the facts of the case are that the return was filed by the assessee with income of Rs.3,300; intimation was issued u/s 143(1); thereafter notice u/s 148 was issued; assessment order was passed u/s 143(3) read with section 147 after making nominal disallowance of Preliminary expenses and Salary; and the AO, during the course of such assessment proceedings, made some formal enquiries about shares issued by the assessee company at huge premium by issuing notices u/s 133(6) to some of the shareholders and getting satisfied without any further investigation. The jurisdictional CIT has passed order u/s 263 in this case, which has been assailed before the Tribunal.
We have heard the rival submissions and perused the relevant material on record after considering the written submissions filed on behalf of the assessee, the gist of which has been reproduced on page 3 of the impugned order. It is relevant to mention that we have disposed of more than 500 cases involving same issue through certain orders with ITA 1891/Kol/13 the main order having been passed in a group of cases led by Subhlakshmi Vanijya Pvt. Ltd. vs. CIT (ITA No.1104/Kol/2014) dated 30.7.2015 for the A.Y. 2009-10.
Both the sides have fairly admitted that facts and circumstances of the instant case are mutatis mutandis similar to those decided earlier except with some additional arguments, which we will deal with hereinafter. In our aforesaid order in Subhlakshmi Vanijya Pvt. Ltd., vs. CIT (ITA No. 1104/Kol/2014 A.Y. 2009-10), we have drawn the following conclusions: -
A. Contention of the assessee that since the AO of the assessee- company was not empowered to examine or make any addition on account of receipt of share capital with or without premium before amendment to section 68 by the Finance Act, 2012 w.e.f. A.Y. 2013-14 and hence the CIT by means of impugned order u/s 263 could not have directed the AO to do so, is unsustainable. B. Failure of the AO to give a logical conclusion to the enquiry conducted by him gives power to the CIT to revise such assessment order, by holding that :- i) the enquiry conducted by the AO in such cases can’t be construed as a proper enquiry; ii) CIT u/s 263 can set aside the assessment order and direct the AO to conduct a thorough enquiry, notwithstanding the 3 ITA 1891/Kol/13 jurisdiction of the AO in making enquiries on the issues or matters as he considers fit in terms of section 142(1) and 143(2) of the Act, which is relevant only up to the completion of assessment ; iii) Inadequate inquiry conducted by the AO in the given circumstances is as good as no enquiry and as such, the CIT was empowered to revise the assessment order ; iv) The order of the CIT is not based on irrelevant considerations and further in the present circumstances, he was not obliged to positively indicate the deficiencies in the assessment order on merits on the question of issue of share capital at a huge premium ; and v) the AO in the given circumstances can’t be said to have taken a possible view as the revision is sought to be done on the premise that the AO did not make enquiry thereby rendering the assessment order erroneous and prejudicial to the interest of the revenue on that score itself. C. In the given facts and circumstances of all such cases, the notices u/s 263 were properly served through affixture or otherwise. Further the law does not require the service of notice u/s 263 strictly as per the terms of section 282 of the Act. The only requirement enshrined in the provision is to give an opportunity of hearing to the assessee, which has been complied with in all such cases. D. Limitation period for passing order is to be counted from the date of passing the order u/s 147 read with sec. 143(3) and not the date of Intimation issued u/s 143(1) of the Act, which is not an order for the purposes of section 263. In all the cases, the orders have been passed within the time limit. E. The CIT having jurisdiction over the AO who passed order u/s 147 read with section 143(3), has the territorial jurisdiction to pass ITA 1891/Kol/13 the order u/s 263 andnot other CIT. F. Addition in the hands of a company can be made u/s 68 in its first year of incorporation. G. After amalgamation, no order can be passed u/s 263 in the name of the amalgamating company. But, where the intention of the assessee is to defraud the Revenue by either filing returns, after amalgamation, in the old name or otherwise, then the order passed in the old name is valid. H. Order passed u/s 263 on a non-working day does not become invalid, when the proceedings involving the participation of the assessee were completed on an earlier working day. I. Order u/s 263 cannot be declared as a nullity for the notice having not been signed by the CIT, when opportunity of hearing was otherwise given by the CIT. J. Refusal by the Revenue to accept the written submissions of the assessee sent after the conclusion of hearing cannot render the order void ab initio. At any rate, it is an irregularity. K. Search proceedings do not debar the CIT from revising order u/s passed u/s 147 of the Act.
The ld. AR argued that his case is distinguishable on account of the following reasons : -
a. Jurisdiction did not lie with the CIT, who has passed the impugned order.
ITA 1891/Kol/13 b. Explanation 3 to section 147 does not apply in the circumstances as are prevailing in this case. c. Notice u/s 148 was sent at a wrong address.
The ld. DR countered the submissions made on behalf of the assessee by contending that all the above arguments have been dealt with by the tribunal in the lead order in Subhlakshmi Vanijya Pvt. Ltd. & Ors. (supra). We are agreeable with the ld. DR that there is no fresh argument raised by the assessee in this appeal. In fact, all the above points have been elaborately dealt with in the lead order.
It is noticed that some of the conclusions drawn in the lead order are applicable to the instant appeal. In view of the foregoing discussion and following the view taken in Subhlakshmi Vanijya Pvt. Ltd. (supra), we uphold the impugned order.
ITA 1891/Kol/13
In the result, the appeal is dismissed.