OSL DEVELOPERS PRIVATE LIMITED ( FORMERLY KNOWN AS ALTER TOWE PRIVATE LIMITED),KOLKATA vs. C.I.T KOLKATA - II, KOLKATA

ITA No.1153/K0l/2013 & 1820/Kol/2013 IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCHES D : KOLKATA BEFORE SHRI R.S. SYAL, AM & SHRI N.V. VASUDEVAN, JM ITA No.1153/Kol/2013 Assessment Year 2008-09 M/s. Mayfair Commotrade Pvt: Vs. Commissioner 0f Income Tax; Ltd. Kolkata-I, 9, Jagmohan Mullick Lane, 2nd AayakarBhawan, Floor; Room No.20, P-7, Chowringhee Square, Kolkata-700072 Kolkata 700 069_ PAN :AAFCM 2895 P ITA No.1 820/K0l/2013 Assessment Year 2008-09 Ms. OSL Developers Pvt. Vs. Commissioner 0f Income Tax; Ltd , (Formerly known as Alter Kolkata-I, Tower Private Limited), AayakarBhawan, 9/12, Lal Bazar Street P-7, Chowringhee Square, mercantile building, 3rd floor; Kolkata 700 069_ Block-B, Room No.10, Kolkata-700100 . PAN :AAGCA 8599 K (Appellants) (Respondents) Assessee By Mr.Ambit kumar lal for Assessee in ITA 1820/Kol/2013 Mr.Soumitra Choudhry, Advocate, for Assessee in ITA No.1153/K0l/2013 ITA No.1153/K0l/2013 & 1820/Kol/2013 2 Department By Shri S.Srivastav, CIT, DR Date of Hearing Datc of Pronouncement 2.11.2015 03.11.2015 ORDER Per_Bench different assessecs assail the Through this batch of appeals, correctness 0f separate orders passed by the Commissioners of Income- tax (CIT) u/s 263 of thc Income-tax Act; 1961 (hcrcinaficr also callcd to the captioned assessment ycars Since these the Act') in relation based largely similar facts and common grounds of appeals are on appeal, we are proceeding to dispose them off by this consolidated order for the sake of convenience. 2 Briefly stated thc facts in this batch of cases are similar inasmuch as companies with meagre income; intimations returns were filed by such issued uls 143(1); thereafter notices U/s 148 werc issucd cither at were 3 ITA No.1153/K0l/2013 & 1820/Kol/2013 the instance of such companies divulging a paltry escapement 0f income or otherwise assessment orders were passed u/s 143(3) read with scction 147 aftcr making nominal additions and the AOs, during the course of such assessment proceedings, made some formal enquiries about shares issued by such companies at hugc premium by issuing notices u/s 133(6) to some of the shareholders and getting satisfied without any further investigation_ The jurisdictional CITs have passed orders uls 263 in all such cases, which have becn assailed before the Tribunal. 3_ We have heard the rival submissions and perused thc relevant material on record. It is relevant to mention that we have disposed of more than 500 cases involving same issue through certain orders with the main order having been passed in a group of cascs led by Subhlakshmi Vanijya Pvt. Ltd. VS. CIT (ITA No.1104/Kol/2014) dated 30.7.2015 for the A.Y. 2009-10. ITA No.1153/K0l/2013 & 1820/K0l/2013 4 Both the sides have fairly admitted that facts and circumstances 0f the cases under consideration are mutatis mutandis similar to thosc decided carlicr. In our aforesaid order in Subhlakshmi Vanijya Pvt. Ltd. VS. CIT (ITA No. 1104/Kol/2014 A.Y 2009-10), WC havc 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.c f. A.Y. 2013-14 and hence the CIT by means 0f impugncd order uls 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 uls 263 can set aside the assessment order and direct the AO to conduct a thorough enquiry, notwithstanding the jurisdiction of the AO in making enquiries on the issues or mallers as he considers fit in terms of section 142(1) and 143(2) of the Act, which is relevant only up to thc 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 5 ITA No.1153/K0l/2013 & 1820/K0l/2013 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 0l issue of share capital at a huge premium and the AO in the given circumstances can 1 be said t0 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 t0 the interest of the revenue on that score itself: C. In the given facts and circumstances of all such cases, the notices uls 263 were properly served through affixture or otherwise. Further the law does not require the service of notice uls 263 strictly as per the terms of section 282 of the Act. Thc 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 uls 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 uls 147 read with section 143(3), has the territorial jurisdiction t0 pass the order uls 263 andnot other CIT. F Addition in the hands of a company can be made uls 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 eithcr filing rcturns, aftcr ITA No.1153/K0l/2013 & 1820/Kol/2013 amalgamation, in the old name or otherwise, then the order passed in the old name is valid: H. Order passed uls 263 on a non-working day docs not become invalid, when the proceedings involving the participation of the assesscc wcrc completed on an earlier working day _ L. Order uls 263 cannot be declared as a nullity for thc noticc 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 0f 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 uls passed uls 147 of the Act: 5 . It is noticed that all or some of the above conclusions are applicable In view of the foregoing discussion and to the appeals in this batch: following the view taken in Subhlakshmi Vanijya Pvt: Ltd. (supra) , we uphold all the impugned orders. 6_ In the result; both the appeals are dismissed: The order pronounced in the open court on 03.11.2015. - [RS. SYAL] [N.V. VASUDEVAN | JUDICIAL MEMBER ACCOUNTANT MEMBER Dated, 3rd November; 2015_ RG ITA No.1153/K0l/2013 & 1820/K0l/2013 Copy forwarded t0: Appellant Respondent CIT CIT (A) DR, ITAT AR, ITAT, Kolkata: