AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2025 (12) TMI 1817
X X X X Extracts X X X X
X X X X Extracts X X X X
....essing Officer issued Summons u/s 131 of the Act and the directors of the assessee company itself had been show caused to explain as to why addition u/s 68 of the Act should not be made? 3. Further, the revenue has raised following additional ground of appeal: "Whether in facts and circumstances of the case, the ld. CIT(A) is right in not considering the remand report duly submitted while submitted in compliance to directions of ld. CIT(A), while deciding the issue on merits. " 4. We have heard the both the parties on admission of additional ground. In our opinion, all the facts are already on record and there is no necessity of investigation of any fresh facts for the purpose of adjudication of above ground. Accordingly, by placing reliance on the judgement of Hon'ble Supreme Court in the case of NTPC Vs. CIT 229 ITR 383 (SC) we inclined to admit the additional ground for the purpose of adjudication as there was no investigation of any fresh facts otherwise on record and the action of the assessee is bonafide. 5. Brief facts of the case are that the assessee company filed return of income for the assessment year 2016-17 on 6.9.2016 declaring total income of R....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... to the following reasons: 1. The companies were not operating from the address furnished to this office as reported by the ADIT (Inv.), Unit- 2(3), Kolkata. 2. Mere production of PAN number Income Tax Returns and Bank statement of a investor does not establish identity of a investor. 3. There are many companies operating from the same address and a screen shot from the web site of Zauba is placed for ready reference. 4. Shri Suresh Kumar Ramsisaria and Shri Karan Ramsisaria stated under oath that the company was incorporated in 2011 wherein they have invested in a property bought from Union Bank of India, Bangalore. This property is still under litigation and though the registration has been done, Debt Recovery Tribunal (DRT), Chennai has passed an order for invalidation of the auction. The assessee company is yet to receive the amount invested from the Union Bank of India. 5. Apart from this, there is no other business activity till date. 6. No prudent investor would make investment in such a company. 7. From the financials and bank statements of the company, it is observed that it is acting as a conduit of funds. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....,08,294/- Audited Balance Sheet Attached 3 Isotech Vyapaar Pvt Ltd Rs. 15,70,94,137/- Audited Balance Sheet Attached 4 Yashman Vyapaar Ltd Rs. 49,93,04,074/- Audited Balance Sheet Attached ii) The ITR filing and tax payment status of the investor companies are as under :- S. No CO Name of the company PAN ITR showing income of Tax Paid 1 RGF Fincon Pvt Ltd. AABCR4654B 3126981 983586 2 Piyush Fiscal Ltd AABCP4802F 21707671 7352914 3 Isotech Tie Up Pvt Ltd AAACI5914N 3263025 1045817 4 Yashman Vyapar Limited AAACY0987H 18654457 6319008 Based on above table verified from the records, it is evident and apparent that all of the four companies are having sufficient financial capacity and means to invest in the shares of appellant company from its accumulated capital as well as income. Notably no single notice sent by Inv wing has been returned unserved at the addresses of the above investor companies. Notably as culled out from the assessment order, there is no single notice u/s 133(6) issued from the AO to above investor comp....
X X X X Extracts X X X X
X X X X Extracts X X X X
....essment order. It is trite law that CBDT Instructions are binding upon AO and therefore assessment framed by the AO in contravention of the CBDT Instruction are liable to be quashed. 5.4 Following above finding regarding jurisdictional ground no.1 to 4 along with additional ground of the appellant's submissions, I am constrained to allow this appeal on above grounds urged by the appellant and consequentially quash the assessment order. 6. In the final result, the appeal is thus treated as allowed. 8. Aggrieved by the order of ld. CIT(A)/NFAC the revenue has filed the appeal before this Tribunal. 9. Before us, the ld. A.R. of the assessee vehemently submitted that the revenue appeal is liable to be dismissed as the ld. CIT(A)/NFAC has passed an order in favour of the assessee on the ground of absence of show cause notice in the impugned assessment framed u/s 143(3) of the Act. However, the revenue has not taken any grounds related to this. Further, ld. A.R. of the assessee supported the order of ld. CIT(A) and submitted that the ld. CIT(A)/NFAC after taking into consideration the networth as well as income tax return and the amount of tax paid by the inve....
X X X X Extracts X X X X
X X X X Extracts X X X X
....t framed by the AO in contravention of the CBDT instruction are liable to be quashed. 11.2 Thus, from the above, the ld. CIT(A)/NFAC not only allowed the appeal of the assessee on merits but also on the legal ground stating that the breach of CBDT instruction which cast mandatory obligation on the AO to issue prior show cause notice before making addition in the assessment order are liable to be quashed. On going through the grounds of appeal, we take a note of the fact that the revenue has raised mainly two grounds i.e. the ld. CIT(A)/NFAC erred in deleting addition without appreciating that AO had done necessary enquiries by issuing commission u/s 131(1)(d) of the Act and secondly the ld. CIT(A) erred in deleting addition without appreciating that the assessing officer issued summons u/s 131 of the Act and the director of the assessee company itself had been show caused to explain as to why addition u/s 68 of the Act should not be made. Further, the revenue has also raised additional ground that ld. CIT(A)/NFAC erred in fact and in law in not considering the remand report duly submitted in compliance to direction of ld. CIT(A)/NFAC while deciding the issue on merits. We find t....