Principal Commissioner Of Income ... vs Nra Iron And Steel Pvt. Ltd. Through ...

3. The facts of the case, briefly stated are as under :

A Notice was issued u/S. 148 of the Act to re-open the assessment on 13.04.2012 for the reasons recorded therein. 3.2. The Assessee filed submissions on 23.04.2012 to the Notice u/S. 148, and objections on 30.04.2012. The objections were rejected on 13.08.2012. A Show Cause Notice was issued on 13.01.2014. The Assessee filed detailed Written Submissions on 22.01.2014. 3.3. The Assessee Company in its Return showed that money aggregating to Rs. 17,60,00,000/- had been received through Share Capital/Premium during the Financial Year 2009-10 from the following companies situated at Mumbai, Kolkatta, and Guwahati:

The AO issued a detailed questionnaire to the Assessee to provide information with respect to the amount of Rs. 17,60,00,000 shown to have been received as Share Capital/Premium from various legal entities. The AO gave various opportunities to the A.R. of the Assessee to attend the proceedings, and file necessary clarification on the queries raised. 3.6. The Assessee inter alia submitted that the entire Share Capital had been received by the Assessee through normal banking channels by account payee cheques/demand drafts, and produced documents such as income tax return acknowledgments to establish the identity and genuineness of the transaction. It was submitted that, there was no cause to take recourse to Section 68 of the Act, and that the onus on the Assessee Company stood fully discharged. 3.7. The AO had issued summons to the representatives of the investor companies. Despite the summons having been served, nobody appeared on behalf of any of the investor companies. The Department only received submissions 4 through dak, which created a doubt about the identity of the investor companies.

3.8. The AO independently got field enquiries conducted with respect to the identity and credit-worthiness of the investor companies, and to examine the genuineness of the transaction. Enquiries were made at Mumbai, Kolkatta, and Guwahati where these Companies were stated to be situated.

5.12.2008 drawn on Centurion Bank of Punjab Rs. 95 lakhs invested on 5.12.2008 By 2 cheques The Company had shown income of Rs. 9,470/- for A.Y. 2009-10 17 Prominent It was submitted, that the Vyappar company had applied for 47,500 Rs. 95,00,000 Pvt. Ltd. equity shares of Rs. 10/- of NRA invested on Kolkatta Iron and Steel Pvt. Ltd. each at 5.12.2008 a premium of Rs. 190/- each. By 2 cheques The Company had not given any Return reason for paying such a high income premium. (50,00,000/- Ch. No. Rs.10307 205185 dt. 5.12.2008 & Rs.

5.12.2008 drawn on HDFC (Centurion Bank of Punjab) The Company had shown income of Rs. 10,307/- for A.Y. 2009-10 TOTAL 17,60,00,000 The AO recorded that the enquiries at Mumbai revealed that out of the four companies at Mumbai, two companies were found to be non-existent at the address furnished. With respect to the Kolkata companies, the response came through dak only. However, nobody appeared, nor did they produce their bank statements to substantiate the 9 source of the funds from which the alleged investments were made.

6. The Revenue filed an Appeal bearing I.T.A. No. 244/2018 u/S. 260A of the Act before the Delhi High Court to challenge the order of the Tribunal. The Respondent Company – Assessee did not appear before the High Court. Hence, the matter proceeded ex-parte. The High Court dismissed the Appeal filed by the Revenue vide the Impugned Order dated 26.02.2018, and affirmed the decision of the Tribunal on the ground that the issues raised before it, were urged on facts, and the lower appellate authorities had taken sufficient care to consider the relevant circumstances. Hence no substantial question of law arose for their consideration.

The assessee is expected to establish to the satisfaction of the Assessing Officer2 :

15. On the facts of the present case, clearly the Assessee Company

16. The Appeal filed by the Appellant – Revenue is allowed. In the aforesaid facts and circumstances, and the law laid down above, the judgment of the High Court, the ITAT, and the CIT are hereby set-aside. The Order passed by the AO is restored. Pending applications, if any are disposed of. Ordered accordingly.