M/S SPLENDOR POWER PVT LTD.,KOLKATA vs. CIT, KOLKATA-1I, KOLKATA

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCHES : D : KOLKATA ITA No.487/Kol/2014 1vyi 6 Assessment Year:2009-10 M/s. Ganapati Financial Advisory PvLLtd. 309, B.B.Ganguly Street, Kolkata-700012- Vs Commissioner 0f Income [ax; Kolkata-[ , AayakarBhawan, P-7, Chowringhee Square, Kolkata 700 069. PAN AADCG 2451 P ITA No.907/Kol/2014 Assessment Year:2010-11 M/s. Splendor Power PvuLtd. Vs. Commissioner 0f Income Tax; The Knowledge Hub, DN-23 Kolkata-I[ 5"h Floor; Sector-V, Salt Lake, AayakarBhawan_ Kolkata-700091, P-7, Chowringhee Square, Kolkata 700 069_ PAN AAJCS 5989 E (Appellants Assessee BBy Department By (Respondents None Shri.S Srivastava CTT, DR_ Date of Hearing Dale of Pronouncement 30.10.2015 30.10.2015 ORDER Per Bench Through these appeals, different assessees assail the correctness 84 Justice AW 6 of separate orders passed by the Commissioners of Income-tax (CIT) ITA No.487/K0l/2014 & 907/Kol/2014 U/s 263 of the Income-tax Act; 1961 (hereinafter also called 'the Act' ) in relation to thc captioned assessment years. Since all these appeals are based on largely similar facts and common grounds of appeal, we 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, we consider it expedient to record that these have earlier comc up for hearing on several occasions and the assessees have sought adjournments on one pretext or the other: Today, when these appeals were called for hearing; neither any one appeared on behalf of the assesseess nor any adjournment applications have been filed. We find that the issues raised in these appeals are squarely covered against the assessee by several orders passed by this bench 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_ Brieflly staled the facts of both the cases in this balch are similar & JUStice inasmuch as returns were filed by such companies with Vmcagre 2 ITA No.487/K0l/2014 & 907/Kol/2014 TX ^7754 income; intimations were issued U/s 143(1); therealter notices W/s 148 were issued cither at the instance of" such companies divulging a paltry escapement of income or otherwise assessment orders were passed uls 143(3) read with section 147 after making nominal additions and the AOs; during the coursc of such assessment proceedings, made some formal enquiries about shares issued by such companies at huge premium by issuing notices U/s 13366) t0 some of the shareholders and getting satisfied without any further investigation. The jurisdictional CITs have passed orders W/s 263 in all such cases, which have been assailed before the Tribunal. 4 , We have heard the Id. DR and perused the relevant material on record It is relevant to mention that we have disposed ol 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 0f the cases under consideration are mutatis mutandis JUSTICE 0 similar t0 those decided earlier. In our aforesaid order in Subhlakshmi ITA No.487/K0l/2014 & 907/Kol/2014 3 ~ Vanijya Pvt. Ltd. VS. CIT (ITA No_ 1104/Kol/2014 ^.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 0f receipt of share capital with Or withoul premium before amendment t0 section 68 by the Finance Acl, 2012 W.e.( A.Y. 2013-14 and hence the CIT by means 0f impugned order W/s 263 could nol have directed the AO lo do SO, is unsustainable. B. Failure ol the AO t0 give a logical conclusion t0 the enquiry conducted by him gives power to the CIT Lo 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 0f 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 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 t0 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 ol issue o[ share capital al a huge premium ; and the AO in the given circumstances can 1 be said t0 have & JUsTIce taken a possible view as the revision is sought to be done on the premise that the AO did not make enquiry thereby ITA No.487/K0l/2014 & 907/Kol/2014 TRRUE ell rendering the assessment order erroneous and prejudicial to the interest of the revenue on that score itself: C In the given facts and circumstances 0f all such cases, the notices us 263 werc properly served through affixture Or otherwise. Further the law does not require the service 0f notice W/s 263 strietly as per the terms of section 282 of the Act: The only requirement enshrined in the provision is to give an opportunity Of hearing t0 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 scc. 14303) and nol the date of Intimation issued W/s 143(1) of the Act; which is nol 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 W/s 147 read with section 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 0l incorporation. G. Afier amalgamation, no order can be passed W/s 263 in the name Ol the amalgamating company. Bul, 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 assesscc were completed on an earlier working day . L. Order us 263 cannot be declared as a nullity for the notice having not been signed by the CIT; when opportunity ol hearing was Otherwise given by the CIT. J. Refusal by the Revenue t0 accept the wrillen submissions 0f the assessec sent after the conclusion of hearing cannot ~render JUSTIce the order void ab initio_ At any rate, it is an irregularily ITA No.487/K0l/2014 & 907/Kol/2014 5 APPEUUA K Search proceedings do not debar the CTT from revising order u/s passed u/s 147 of the Act 6_ It is noticed that all or some of the above conclusions are applicable to instant two appeals. In view of the foregoing discussion and following the view taken in Subhlakshmi Vanijya Pvt. Ltd. supra), we uphold both the impugned orders: 7 _ In the result; both the appeals are dismissed. The order pronounced in the open court on 30.10.2015 - [RS. SYAL] ACCOUNTANT MEMBER RG [N.V. VASUDEVAN| JUDICIAL MEMBER Dated, 30" October, 2015. Copy forwarded t0: Appellant Respondent CIT CIT (A) DR, ITAT AW JUSTIce AR, ITAT; Kolkata. 1 ITA No.487/Kol/2014 & 907/Kol/2014 Fceu T <v ApPELLAT?