RATHI CERMICS PVT. LTD.,NEW DELHI vs. ITO, NEW DELHI

The appeal has been preferred by the Assessee against the order dated 25.10.2016 of CIT(A)-10, New Delhi (hereinafter referred as Ld. First Appellate Authority or in short Ld. ‘FAA’) arising out of an appeal before it against the order dated 04.02.2014 passed u/s 147/143(3) of the Income Tax Act, 1961 (hereinafter referred as ‘the Act’) by the ITO, Ward-15(3), New Delhi (hereinafter referred as the Ld. AO).

2. On the facts and circumstances of the case, the learned CIT(A) has erred, both on facts and in law, in rejecting the contention of the assessee that the initiation of the proceedings under Section 147, read with Section 148, is bad and liable to be quashed as the condition and procedure prescribed under the statute have not been satisfied and complied with.

3. On the facts and circumstances of the case, the learned CIT(A) has erred both on facts and in law in rejecting the contention of the assessee that the reassessment proceedings initiated by the learned A.O. are bad in the eye of law as the reasons recorded for the issue of notice under Section 148 are bad in the eye of law and are contrary to the facts.

5. On the facts and circumstances of the case, the learned CIT(A) has erred both on facts and in law in rejecting the contention of the assessee that the order passed by learned A.O. is bad both in the eye of law and on facts as the same has been reopened on the basis of reasons without there being any whisper that the income has escaped due to the failure on part of the assessee to disclose fully and truly all material facts necessary for assessment, as the same has been reopened after a period of four years from the end of relevant assessment year and the assessment has already been made under Section 143(3).

5. On the facts and circumstances of the case, the learned CIT(A) has erred both on facts and in law in rejecting the contention of the assessee that the order passed by learned A.O. is bad both in the eye of law and on facts, as the assessee had already disclosed fully and truly all material facts necessary for the assessment under Section 143(3).

6. On the facts and circumstances of the case, the learned CIT(A) has erred both on facts and in law in rejecting the contention of the assessee that the order passed by learned A.O. under Section 147 is bad both in the eye of law and on facts, as the same has been passed without service of statutory notice under section 148.

7. On the facts and circumstances of the case, the learned CIT(A) has erred both" on facts and in law in rejecting the contention of the assessee that the order passed by AO is bad both in the eye of law and on facts as the same has been passed without receiving statutory notices under section 143(2) of the Act. 8. (i) On the facts and circumstances of the case, the learned CIT(A) has erred both on facts and in law in confirming the action of the AO in making an addition of Rs.85,00,000/- as income from undisclosed sources, u/s 68 of the Act. (ii) That the above-said additions have been made by indulging in surmises conjecture and without bringing any adverse material on record.

9. On the facts and circumstances of the case, the learned CIT(A) has erred both on facts and in law in confirming the addition by rejecting the explanation and evidences brought on record by the assessee to prove the identity and creditworthiness of the payer as well as the genuineness of the transactions.

10. That the learned CIT(A) has erred both on facts and in law in confirming above-said addition ignoring the fact that the same has been made on the basis of the material collected at the back of the assessee without providing copy of the same & providing opportunity to rebut the same. 11. (i) On the facts and circumstances of the case, the learned CIT(A) has erred both on facts and in law in confirming the addition of Rs. 1,75,110/- made by the AO on account of commission of 2%. (ii) That the commission was added @ 2% without there being any basis for the same.

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3. Thereafter assessee has raised the following additional grounds :- "13. On the facts and circumstances of the case, the learned CIT(A) has erred, both on facts and in lavv, in confirming the order passed by the AO u/s 147/143(3), despite the fact that the same being passed in the name of a nonexistent entity, is illegal and void ab-initio.

14. On the circumstances and facts of the case, the reassessment framed in the name of M/s Rathi Ceramics Pvt. Ltd. which had since amalgamated with M/s DBG Leasing and Housing Ltd. and had ceased to exist in the eye of law, was non est."

4. At the time of hearing ld. Counsel had stressed that the additional grounds primarily arise from questions of law as they go to the root of exercises of jurisdiction by the Ld. AO against non-existing company. It was submitted that as such the assessment order is void ab initio. Reliance was placed on the following judgments :- 1. C.l.T New Delhi vs m/s Spice Enfotainment ltd. 2017(12) TMI 754 Dated: 2-11-2017 (SC) 2. Spice Entertainment ltd. Vs. Commissioner of Service Tax [Printed As: Spiceentertainment Ltd. vs. Commissioner of Service Tax 2011 (8) TMI 544 Dated 3.8.2011 (Delhi HC) 3. Pr. Commissioner of Income Tax, New Delhi vs. Maruti Suzuki India Limited 2019 (7) TMI 1449 Dated: -25-7-2019 (SC) 4. Commissioner of Income Tax vs. Sony Mobile Communications IND Pvt Ltd (Now Merged With Sony India Pvt. Ltd.) 2023 (2) TMI 1074 Dated - 2.2.2023 (Delhi HC) 5. Kunvarji Fincorp Pvt. Ltd. vs. Dy. Commissioner of Income Tax Circle 2(1)(1), Ahmedabad 2023 (2) TMI 357 Dated 6-2-2023, Gujarat High Court 6. State Bank of India (Successor to State Bank of Travancore) Financial Reporting& Taxation, Mumbai vs. The Asstt. Commissioner of Income Tax-2(2) (1), Mumbai and DCIT- 2(2)(1), Mumbai Vs. State Bank of India (Successor to State Bank of Travancore) Financial Reporting & Taxation, Mumbai2022 (11) TMI 528 Dated: 31-10-2022 (ITAT Mumbai) 7. M/s. Biocon Biologics Ltd. (Formerly known as Biocon Biologics India Ltd.) vs. The Deputy Commissioner of Income- Tax, Circle 1(1)(1) Bengaluru 2022(9), TMI 1113 dated 13.09.2022 8. State Bank of India (Successor to Erstwhile State bank of Indore) vs. DCIT- Central Circle-2(2) Mumbai and ACIT- 2(2) (1), Mumbai vs. State Bank of India (Successor to Erstwhile State Bank of Indore) 2022(11)TMI 429 Dated 20.09.2022 ITAT Mumbai 9. Expedia Online Travel Services India Pvt. Ltd. (As successor in Interst for Orbits India services Pvt. Ltd. ) vs. DCIT, National E assessment Centre, Delhi (NEAC) 2022(10) TMI 279 Dated 4.10.2022 (ITAT Delhi) 10. Savera Marketing Pvt. Ltd. vs. ITO Ward 7(4), New Delhi 2022(4) TMI 617 Dated 11.04.2022 (ITAT Delhi) 11. 31 Infotech Consultancy services Ltd. vs. Assistant Commssioner Of Income Tax-11(3) (1), Mumbai 2022(10) TMI 391 Dated 21.09.2022 (ITAT Mumbai) 12. ITO, Ward-6 (2) Kolkata vs. M/s. IFGL Refractories Ltd. and (Vice-versa) 2022 (6) TMI 1279 Dated 28.06.2022 (ITAT Kolkata) BASF India Ltd. Vs. DCIT Circle -6 (1), Mumbai 2019(11) TMI 1719 Dated 19.11.2019 (ITAT Mumbai)”

8. Accordingly, we quash the assessment order dated 10/03/2014 and also the order of CIT(A) dated 05/09/2016 by allowing the addition grounds of appeal taken by the assessee. The other grounds of appeal are dismissed having become infructuous.”

To, Date : June 18, 2011 THE ASSESSING OFFICER, Income Tax Department, Vikash Bhawan, IP ESTATE, Delhi-110002. Ward Number 15(3) Sub : Cancellation of Permanent Account Number-AAAPR4592F Sir, This is to inform you that pursuant to the order of the Honorable high Court of Delhi dated January 21, 2011 M/s. Rathi Ceramics Private Limited PAN No. AAAPR4592F has been merged with M/s. DBG Leasing and Housing Limited w.e.f. May 7, 2011. In view of the above, you are requested to cancel the PAN No. allotted to M/s. Rathi Ceramics Private Limited. Kindly do the needful and take this information on record. With regards For DBG Leasing and Housing Limited Sd/- Pradeep Rathi Director