SUNFLOWER MERCHANT PVT LTD,KOLKATA vs. I.T.O WD - 4(2),KOLKATA, KOLKATA

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCHES :D : KOLKATA BEFORE SHRI R.S. SYAL, AM & SHRI N.V. VASUDEVAN, JM ITA No.706/Kol/2014 DuspFB€ Assessment Year 2009-10 Innocent Vanijya Pvt. Ltd. Vs_ Commissioner 0f Income Fax; Clo DJ.Shah & Co Kolkata-III_ Kalyan Bhavan; 2 Elgin AayakarBhawan; Road, P-7, Chowringhee Square, Kolkata 700020_ Kolkata 700 069_ PAN AABCI 8425 M ITA No.1432/K0l/2013 Assessment Year 2008-09 Fast Flow Dealers Pvt: Ltd,, Vs. Commissioner of Income Tax; D J Shah & Co. Kolkata-I, 2, Elgin Road, AayakarBhawan, Kolkata-700020_ P-7, Chowringhee Square, Kolkata 700 069. PAN :AABCF 1395 F ITA No.1508/K0l/2013 Assessment Year 2008-09 Damodar Vincom Pvt. Ltd D J Shah & Co. 2, Elgin Road, Kolkata-700020_ Vs. Commissioncr 0f Income Tax, Kolkata-II AayakarBhawan, P-7, Chowringhee Square, Kolkata 700 069_ PAN : AACCD 7926 M ITA No.16/Kol/2013 Assessment Ycar 2008-09 Sunflower Merchants Pvt. Commissioner 0f Income Lax; Ltd. Kolkata-IL, OF LAW & MNSTRY JUsTice D J Shah & Co_ AayakarBhawan, ITA 706, 1432,150881116/K0l/2013 8 FG FT TiX Appe RRIBUNAL' LZATE 2, Elgin Road, Kolkata-700020_ P-7, Chowringhee Square, Kolkata 5 700 069_ PAN: AALCS 2570 D (Appellant) (Respondent Assessee None Department Shri Niraj Kumar, CIT Date of Hearing 28.10.2015. Date of Pronouncement : 30.10.2015 ORDER Per_Bench Through this batch of appeals, different assessees assail the correctness of separate orders passed by the Commissioners 0f Income-tax (CIT) uls 263 of thc Income-tax Act; 1961 (hercinalicr also called the Act' ) in relation to the captioned assessment years. Since all these appeals are based on largely similar facts and common grounds of appeal, WC are proceeding to dispose them off by this consolidated order for the sake of convenience 2 Before taking up the disposal of the instant appeals on merits; WC consider it expedient to record that these appeals have earlier come up for hearing on several occasions and the asscsscc has sought OF LAW & MINISTRY ustice ITA 706, 1432,150881116/K0l/2013 2 3 ApPe Wl adjournment on one pretext Or the other: Today, when these appeals were called for hearing; either there was adjournment application Or no appearance. The Id. DR strongly opposed t0 the grant 0f adjournments. We do not find any justifiable reason to adjourn these appeals any further. We find that the issues raised in these appeals are squarely covered against the assessce in scvcral orders passed by this bench in numerous cases including Subhlakshmi Vanijya Pvt. Ltd. VS. CIT (infra). Under these circumstances, we are taking up the appeals for disposal on merits ex parte qua the assessee. 3 _ Briefly stated the facts of all the cases in this batch arc similar inasmuch as returns were filed by such companies with mcagrc income; intimations were issued u/s 143(1); thereafter notices U/s 148 were issued either at the instance of such companies divulging a paltry escapement of income Or otherwise , assessment orders were passed Ws 14303) read with section 147 after making nominal additions and the AOs, during the course of such assessment proceedings, made some formal enquiries about shares issued by such companies at huge premium by issuing notices W/s 133(6) t0 some O NNSTRY OF LAW & JUSTICE the shareholders and getting satisfied W ithout any further 0 ITA 706, 1432,150881116/K0l/2013 3 8 874+660d TaX_ Areii 3Bunal investigation. The jurisdictional CITs have passed orders W/s 263 in all such cases, which have been assailed before thc Tribunal. 4_ We have heard the Id. DR and perused the relevant material on record. It is relevant t0 mention that we have disposed of more than 400 cases involving same issue through certain orders with 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_ 5_ We find as has also been admitted by the Id. DR that facts and circumstances of the cases under consideration are mutatis mutandis similar to those decided earlier. In our aforesaid order in Subhlakshmi Vanijya Pvt. Ltd VS: CIT (ITA Noj 1104/K0l/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 Acl; 2012 W.e.[ A.Y 2013-14 and hence the CIT by means of impugned order uls 263 could not have directed the AO to do SO, is unsustainable. B. Failure of the AO to give a logical conclusion t0 the enquiry conducted by him gives power to the CIT to revisc_such assessment order; by holding that Of LAW & Ministry Justice ITA 706, 1432,150881116/K0l/2013 #in:: i) the enquiry conducted by the AO in such cases can 1 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 jurisdiction of thc AO in making enquiries on the issues 01 matters as he considers fit in terms of section 142(1) and 143(2) of the Acl, 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 nol based 0n 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 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 thercby 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 cascs, thc notices uls 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 assessce, which has bcen complied with in all such cases. D. Limitation period for passing order is t0 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 thc 32157 & thc orders have been passed within the time limit. QF JUSTICE MEETRY 9 ITA 706, 1432,150881116/K0l/2013 5 3 {7R 573 TAX JRipuNal APPELLAT E The CIT having jurisdiction over the AO who passed order W/s 147 read with scction 143(3), has the territorial jurisdiction to pass 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 bc 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 docs not bccomc invalid, when the proceedings involving the participation of the assessee were completed on an earlier working day _ L 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 uls 147 of the Act. 6 It is noticed that all Or some of the above conclusions arc applicable to the appeals in this batch: In view of the foregoing discussion and following the view taken in Subhlakshmi Vanijya Pvt. Ltd. (supra) WC uphold all the impugned orders. MINISTR OF LAW & JUSTCe ITA 706, 1432,150881116/K0l/2013 H~Ad €irt 4 o38 l atc TribuNALL