Tribunal remands appeals challenging assessment reopening & addition under Income Tax Act for fresh adjudication

The Tribunal remanded the appeals challenging the validity of reopening the assessment and an addition made under section 68 of the Income Tax Act for A.Yrs. 2008-09 & 2009-10 back to the ld. CIT(A) for fresh adjudication. The assessee was granted the opportunity to submit further evidence and raise additional grounds. The stay applications were dismissed as the appeals had been disposed of, leading to the allowance of both appeals for statistical purposes.

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Issues:
1. Validity of reopening the assessment
2. Addition made under section 68 of the Income Tax Act

Analysis:
1. The appeals in ITA Nos.2481/Mum/2019 & 2482/Mum/2019 for A.Yrs. 2008-09 & 2009-10 challenged the order by the ld. Commissioner of Income Tax (Appeals) against the assessment passed u/s.143(3) r.w.s. 147 of the Income Tax Act, 1961. The common issue raised by the assessee was the validity of reopening the assessment and an addition made u/s.68 of the Act concerning share capital received under foreign direct investment (FDI) group.

2. The assessee, a private limited company engaged in a residential township project in Pune, raised share capital from its shareholders during A.Y.2008-09. The assessment for that year was reopened, and an addition was made u/s.68 of the Act in respect of share capital received. The ld. CIT(A) disposed off the appeal without considering crucial submissions and documentary evidence provided by the assessee, which included proof of identity and creditworthiness of shareholders, along with the genuineness of the transaction.

3. The Tribunal found that the documents submitted by the assessee were not considered by the ld. CIT(A) while disposing off the appeal for A.Y.2008-09. Therefore, in the interest of justice, the Tribunal remanded the appeal to the file of the ld. CIT(A) for a fresh adjudication of all issues raised. The assessee was granted the liberty to raise additional grounds and submit further evidence. The decision rendered for A.Y.2008-09 would apply for A.Y.2009-10 as well.

4. The stay applications related to the appeals were dismissed as infructuous since the appeals had been disposed of. Consequently, both appeals of the assessee were allowed for statistical purposes, and the stay petitions were dismissed as infructuous. The order was pronounced on 12/06/2019.

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