TaxTMI 
TaxTMI 
2012 (5) TMI 808
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....d nos. 1 & 4 are general in nature and requires no adjudication. 3. Brief facts are: One of the directors of the assessee company Shri Sunil Bhatia contributed following share capital and share premium: S. No. Name of person Share application money received 1. Mr. Sunil Bhatia towards share capital 11955000 2. Towards share capital by way of take over of Mr. Sunil Bhatia's proprietary concern 2261900 3. Mr. Sunil Bhatia towards share premium 5895000 Total 2,01,11,900 3.1. From the bank statement, it was revealed that Sunil Bhatia had subscribed an amount of Rs. 3,50,000/- through bank, whereas for the balance amount of Rs. 1,9761,000/- the assessee furnished only copies of foreign remittance vouchers. Besides, the assessee did not furnished any RBI approval for such foreign remittance. Though it was pleaded that Shri Sunil Bhatia had field return of income for A.Y. 2007-08 declaring income of Rs. 2,67,967/-, on computer check it was found that application for PAN was lying with ITO Ward 23(1), New Delhi. AO, therefore, could not cross check the creditworthiness of Shri Sunil Bhatia in respect of vouchers of....
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.... was prevented by sufficient cause from producing the evidence which he was called upon to produce by the Assessing Officer. iii) Where the appellant was prevented by sufficient cause from producing before the Assessing Officer any evidence which is relevant to any ground of appeal. iv) Where the Assessing Officer has made the order appealed against without giving sufficient opportunity to the appellant to adduce evidence relevant to any ground of appeal. However, the case of the assessee does not fall in any of the conditions laid down in Rule 46A of the IT Rules as reproduced above. Hence, the additional grounds of appeal submitted by the assessee should not be admitted, since it is amply clear from perusal of the assessment proceedings before the AO. However, factual report in respect of the submissions made before the ld. CIT(Appeals) is as under: The company was incorporated on 01-07-2006, hence, the year under consideration is the first year of the assessee company. During the year under consideration, the assessee company was engaged in the business of conducting exhibition in New Delhi at DND Flyway compound. During the ....
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....vidence under Rule 46A of the IT Rules, whereby the AR filed copy of Bank A/c, passport and professional license issued to the firm in Dubai where Shri Sunil Bhatia, the Director of the appellant company is a partner. As the addition of income of Rs. 1,97,61,900/- was made by the AO in the case u/s 68 of the IT Act by holding that the source of this investment in name of Shri Sunil Bhatia is unexplained therefore a remand report from AO was called for. In response thereto the AO has submitted his report which is reiteration of the earlier observation in the assessment order & that as Shri Bhatia had been given sufficient opportunity during the assessments proceedings therefore, the additional evidence may not be admitted U/R 46A. In counter reply to the remand report the appellant again submitted that as Sh. Sunil Bhatia is a nonresident based in Dubai therefore it took some time to get the above documents and that in meantime the AO had passed the assessment order on 10-11-09, without providing sufficient opportunity. That as the additional evidenced pertains to creditworthiness of Shri Sunil Bhatia therefore required to be admitted. On a consideration of reply of the app....
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.... the appellant has filed his confirmation letter as well as PAN No. and assessment details. In the additional evidence the appellant submitted that the above amount has been received from Shri Sunil Bhatia as foreign remittance and in support thereto the copy of current Bank A/c no. 90010200003863 in Bank of Baroda, Dubai Main Branch in case of E-4, Entertainment P.O. Box 48654, Dubai, United Arab Emirates was also filed for the relevant period. Copy of Passport of Shri Sunil Bhatia issued from Dubai on 09- 08-2005 (Date of expiry 08-08-05) has been submitted as also the professional license dated 07-09-02 issued by the Department of Economic Development Government of Dubai in name of E-4 Entertainment. Shri Sunil Bhatia is a 50% share holder in E-4 Entertainment as per license. The licensed activities are exhibition, organizing parties & private functions, entertainment service, conferences and seminar organizing. The appellant also provided copy of current account of Shri Sunil Bhatia in books of M/s E-4 Entertainment(Dubai), from which is observed that a total amount of 14,61,175/- (DHS) has been debited, which has consequently been remitted by Shri Sunil Bhatia as share capital....
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....as erred on facts and in law in not allowing the benefit of unabsorbed depreciation of Rs. 1,01,53,858/-. 5. That the impugned assessment order is arbitrary, illegal, bad in law and in violation of rudimentary principles of contemporary jurisprudence 6. That the appellant craves leave to add/ alter any/ all grounds of appeal before or at the time of hearing of the appeal." 4.2. A perusal of grounds of appeal will reveal that assessee had no where raised a ground that the assessment was completed in a hurry or that sufficient opportunity of hearing was not given by AO. Having not raised any ground of appeal before ld. CIT(Appeals) it was neither justified for the assessee to make a false statement that assessee was not given proper opportunity by AO and at the same time, ld. CIT(Appeals) was not justified in admitting the additional evidence without appreciating that there was no compliance to Rule 46A. The relevant evidence was not filed before AO to avoid first hand investigations for the reasons best known to the assessee. 4.3. So called additional evidence filed by the assessee are copies of foreign records and bank statements which are neither notarized ....
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....been rightly deleted. There is no prejudice caused to the department inasmuch as the additional evidence filed by the assessee was duly forwarded to AO who has not passed any objective adverse comments on merit. Ld. counsel contends that Shri Sunil Bhatia is an assessee with the income-tax department; Shri Bhatia was a non-resident India (NRI), resident of Dubai. The assessee company is engaged in the business of conducting exhibitions at DND Flyway compound and other entertainment activities. The company was formed by taking over Mr. Bhatia's proprietorship concern. The question of addition, if any, arises only in the case of Shri Sunil Bhatia and not the assessee company. Shri Sunil Bhatia being an identified individual, having PAN no. and known sources of investment, the assessee had discharged its burden cast on it in terms of sec. 68. Therefore, ld. CIT(Appeals) has deleted the addition on just and proper considerations. Reliance is placed on Hon'ble Supreme Court judgments in the cases of Lovely Exports 216 ITR 195; and Oasis Hospitality 333 ITR 119. 6. We have heard rival contentions and gone through the relevant material available on record. 6.1. Coming to the additio....