TaxTMI 
TaxTMI 
2018 (6) TMI 403
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....55,42,00,000/- which included share premium of Rs. 53,15,29,000 @ Rs. 1990/- per share, in respect of 2,67,100 shares issued to 19 different Pvt Ltd Companies. The AO found that the appellant had no business activity, it was its first year of operation and net income of Rs. 1923 only had been declared. Yet, shares had been issued at a premium of Rs. 1990. The AO also made the following observations: "(i) Examination of details furnished by the shareholder companies revealed that the said companies and companies from whom some of shareholder companies had received money which was invested as share capital in the appellant company, had four to five common addresses and few common directors viz Shri Sandip Kumar, Shri Saroj Kumar Das & Shri Pravin Kumar Mishra etc. ii) The aforesaid companies did not have any activities, any fixed assets and had declared nominal returned income. The average bank balance was nominal and the immediate source of investment in the share capital was sales proceeds of share of similar companies. iii) In the case of the assessee company, there were no fixed assets and the closing bank balance stood at Rs. 88l60. Almost entire funds raised as share capi....
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....sued to the Directors of assessee company on 21.03.2014 through emails asking to appear before undersigned on 24.03.2014 for personal appearance and recording his statement on oath. But, there was no compliance. Therefore process of verification of identity, genuineness of the transaction and creditworthiness of the share applicants could not be looked into. 4. Since there is no compliance of the directors of the share holders companies the learned AO on the basis of the details furnished by the assessee passed an order of addition. At the time of hearing of the instant appeal the ld. AR argued in favour of the assessee as it appears from the fact stated above. He further submits before the ld. CIT(A) the assessee has specifically stated that no independent enquiry has been made by the AO to disprove the claim of the assessee company in spite of having all the relevant documents relating to the transactions, identity, creditworthiness and genuineness of the share holders and the AO has passed an order in a mechanical manner. However, the ld. Counsel for the assessee further submits that the AO has not given sufficient/adequate opportunity while passing the order of addition. The ....
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....based on the list of shareholders and taking note of the bank statement furnished by the assessee. We note that after the initial notice dated 16.08.2013, thereafter the AO had issued the notice on 26.02.2014 which has been reproduced at page 3 of the reassessment order, wherein AO required the directors of the assessee company to be present before him on 06.03.2014. However, according to the Ld. AR, the assessee received the notice only on 07.03.2014 and thereafter, the assessee requested the AO to provide another opportunity of hearing vide its letter dated 20.03.2014. Thereafter, the AO fixed the date of hearing on 12.03.2014 vide notice dated 10.03.2014. So, according to the assessee company since the directors were not in station till 23.03.2014, the Ld. AR had requested for adjournment till that time. Though the AO has stated that he has issued summons on 24.03.2014 to the assessee company to produce the directors of the company before him on 26.03.2014, the assessee company contended that it has not received the said summon and, therefore, could not make the personal appearance. The AO has drawn adverse conclusion basically because of non-appearance of the directors of the a....
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....f the Act has been upheld by the Tribunal as well as by the Hon'ble Calcutta High Court as well as the SLP has been dismissed by the Hon'ble Supreme Court, similar order of the Ld. CIT has to be given effect to as directed by the Ld. CIT. We take note that the Ld. CIT with his experience and wisdom has given certain guidelines in the backdrop of black money menace should have been properly enquired into as directed by him. The AO ought to have followed the investigating guidelines and method as directed by him to unearth the facts to determine whether the identity, genuineness and creditworthiness of the share subscribers. We note that the Hon'ble Supreme Court in three judges bench in the case of Tin Box, (supra), has held that since there was lack of opportunity to the assessee at the assessment stage itself, the assessment needs to be done afresh and thereby reversed the Hon'ble High Court, Tribunal and CIT(A)'s orders and remanded the matter back to AO for fresh assessment. So, since there was lack of opportunity as aforestated it has to go back to AO. We also note that the Hon'ble Delhi High Court in the case of CIT Vs. Jansampark Advertising & Marketing Pvt. Ltd. in ITA No. 5....