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2019 (3) TMI 146 - AT - Income TaxRevision u/s 263 - Unexplained cash credit u/s. 68 - amounts received by the assessee towards share capital and share premium - as per assessee no proper opportunity was given to the assessee to discharge the onus casted upon it as required when section 68 - change in address of assessee initimated - summons u/s. 131 of the directors of the assessee company (to old address) - reassessment order ex parte by invoking sec. 144 - no proper opportunity provided to the assessee. HELD THAT - Effective verification of the documents produced by the assessee could not be possible because within 30 days of the assessee submitted the written submission along with documents, the AO passed the Best Judgment Assessment u/s. 144 of the Act. And we note that other than issuing summons u/s. 131 of the directors of the assessee company (to old address) no other investigation as directed by Ld. CIT was conducted by AO as is discernable from the order. So, in the light of the aforesaid facts, we find force in the submission of the Ld. AR that no proper opportunity the assessee got during the reassessment proceedings before the AO. Since proper opportunity was not given to assessee by AO during the reassessment proceedings, we are of the opinion that assessee should get proper opportunity before the AO during reassessment proceedings. In the light of the Hon ble Supreme Court s decision in Tin Box Company 2001 (2) TMI 13 - SUPREME COURT and taking into consideration the fact the order of the IT passed u/s. 263 of the Act in similar cases being upheld up to the level of Apex Court, and taking note of Hon ble Delhi High Court s order in Jansampark Advertising & Marketing Pvt. Ltd. 2015 (3) TMI 410 - DELHI HIGH COURT , we set aside the order of the Ld. CIT(A) and remand the matter back to the file of AO for de novo assessment and to decide the matter in accordance to law after giving opportunity of being heard to the assessee. - Decided in favour of assessee for statistical purposes.
Issues Involved:
Confirmation of addition of unexplained cash credit under section 68 of the Income-tax Act, 1961. Detailed Analysis: 1. Background and Assessment Proceedings: The appeal was filed against the order of Ld. CIT(A)-7, Kolkata for AY 2010-11. The main issue was the addition of ?8,97,65,750 as unexplained cash credit under section 68 of the Act. The assessment was completed u/s 147/143(3) of the Act, which was set aside by the CIT u/s 263 for lack of proper inquiries regarding the identity and creditworthiness of shareholders. The AO initiated reassessment proceedings and added the amount as unexplained credit. 2. Assessee's Contentions and AO's Investigation: During reassessment, the AO added the amount as unexplained credit due to lack of verification of share capital and premium. The AO issued summons but no investors appeared for examination. The AO raised doubts about the genuineness of transactions. The AR argued that the assessee was not given proper opportunity to discharge the burden of proof under section 68. 3. Judicial Precedents and Tribunal's Observations: The Tribunal noted the lack of proper opportunity given to the assessee during reassessment. Citing the Tin Box Company case, it emphasized the importance of providing a reasonable opportunity to the assessee. Referring to a similar case, the Tribunal highlighted the need for thorough investigation as directed by the CIT to determine the identity and creditworthiness of shareholders. 4. Remand Order and Legal Precedents: Considering the precedents and lack of proper opportunity, the Tribunal set aside the CIT(A)'s order and remanded the matter to the AO for de novo assessment. The decision was in line with the Tin Box Company case and the Delhi High Court's ruling in a similar matter. The Tribunal emphasized the importance of conducting a detailed inquiry to establish the genuineness of transactions and creditworthiness of parties. 5. Conclusion: The Tribunal allowed the appeal for statistical purposes and directed the AO to conduct a fresh assessment after giving the assessee a proper opportunity to present evidence and clarify the issues raised. The decision was based on the principles of natural justice and the need for a thorough investigation to ensure the correctness of the assessment. This detailed analysis highlights the key aspects of the judgment, including the background of the case, the contentions of the parties, the Tribunal's observations, the legal precedents cited, and the ultimate decision to remand the matter for fresh assessment.
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