2021 (9) TMI 281

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.... business of trading in shares and securities. A return of income was filed for the instant year on 19.09.2010 declaring an income at Rs. 7,956/-. The assessment was framed u/s 143(3) vide order dated 11/03/2013 after calling for details in respect of issue of share capital and share premium by the AO. Subsequently, the case was re-opened by the AO by issuing notice u/s 148 of the I T Act on 31.03.2017, which was apparently beyond four years to verify transactions carried out by the assessee company with M/s Bhavani Enterprises and M/S Asher Ventures Pvt. Limited in respect of money received from these two companies which belonged to and controlled by Shri Praveen Aggarwal. It is pertinent to mention that the said assessment was not reopene....

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....case of 'inadequate enquiry' which by itself does not give rise to action u/s 263 of the Act as held by the jurisdictional high court in the case of CIT Vs. Gabriel India Ltd. [(1993) 203 ITR 108(Bom)]. 3. Further in doing so, the ld. Pr. CIT did not appreciate that the revisionary jurisdiction cannot be exercised only on the ground that the AO did not have sufficient time to independently enquire to establish the identity and creditworthiness of the parties from whom the share capital was raised at a premium and genuineness of the transaction though the full details were furnished by the appellant in the course of re-assessment proceedings which were also furnished in the course of original assessment proceedings and were extensiv....

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....the Act on the ground that the 263 proceedings are hopelessly barred by limitation. 5. The ld. AR vehemently submitted that the revisionary proceedings and consequent order passed under section 263 of the Act is invalid and nullity as the same is barred by limitation in terms of section 263(2) of the Act. The ld AR argued that the ld. PCIT did not appreciate that issue of genuineness of credits aggregating to Rs. 1.00 Cr from two parties referred to in the show cause notice issued u/s 263 of the Act, which was the ground for re-opening of the assessment u/s 147 of the Act , was duly examined by the AO in the re-assessment proceedings and with regard to issue of share capital at a premium, the same was not the ground on which the assessme....

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....ide letter dated 20.12.2012 submitted copies of all the bank statements with ledger accounts. The AO thereafter also issued notices under section 133(6) of the Act, which were also complied with by the allottee companies. Subsequently, AO had issued a show cause notice and assessee vide letter dated 25.02.2013 made further submissions and objected to proposed additions. Having considered and taken into account the submissions and contentions of the assessee, the AO framed the assessment order under section 143(3) of Income Tax Act on 11.03.2013 by assessing income at Rs. Nil. The ld AR submitted that subsequently, the assessment was re-opened u/s 147 of the Act by issuing notice u/s 148 dated 31/03/2017 after recording reasons to believe, c....

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....ave to be taken from the date of assessment framed u/s 143(3) r.w.s. 147 of the Act dated 29.12.2017 and not from the date of original assessment order passed u/s 143(3) of the Act dated 11.03.2013.The ld DR relied on the revisionary order passed by the ld PCIT and submitted that the grounds raised by the assessee may kindly be dismissed. 7. We have heard the rival contentions of both the parties and perused the materials on records including the impugned order of ld. PCIT. The undisputed facts are that the assessment was framed u/s 143(3) vide order dated 11.03.2013 in which the issue of shares capital and share premium was specifically asked and replied during the course of assessment proceedings. The date of questionnaire and reply of....

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....ngs u/s 147 of the Act nor addition was made on the items of escapement of income as recorded u/s 148(2) of the Act. We are therefore of considered view that the revisionary order is barred by limitation and accordingly the entire proceedings are invalid and nullity. The case of the assessee is squarely covered by the decision of the Apex court in the case of CIT Vs. Alagendran Finance Ltd. (supra) wherein the very same issue of limitation has been decided in favour of the assessee under similar facts. The operative part is extracted below: "We, therefore, are clearly of the opinion that keeping in view the facts and circumstances of this case and, in particular, having regard to the fact that the Commissioner of Income Tax exercis....