Made Under Section 68 Of The Act In The Assessment Order Passed Undersection 143(3) Dated March 28, 2015, On The Ground That The Identity Andcreditworthiness Of v. Nra Iron & Steel Pvt. Ltd. [103 Taxmann.com 48 (Sc)]By Hon’ble Apex Court And Also Its Own Judgment In The Case Of Ito,Ward-5(3), Kolkata Vs. M/S. Blessings Com

OD–29 IN THE HIGH COURT AT CALCUTTASPECIAL JURISDICTION (INCOME TAX)ORIGINAL SIDE ITAT/8/2024IA No: GA/1/2024PRINCIPAL COMMISSIONER OF INCOME TAX, CENTRAL-1, KOLKATAVS.YUTHIKA COMMERCIAL PVT. LTD. [PAN : ] BEFORE : THE HON’BLE THE CHIEF JUSTICE T.S. SIVAGNANAMAndTHE HON’BLE JUSTICE HIRANMAY BHATTACHARYYADate : 19[th] February, 2024 Appearance :Ms. Smita Das De, Adv.Mr. Prithu Dudhoria, Adv.…for appellantMr. Saurabh Bagaria, Adv.Mr. Rites Goel, Adv.…for respondent The Court : This appeal filed by the Department under Section 260A ofthe Income Tax Act, 1961 (the Act) is directed against the order dated July 25,2023 passed by the Income Tax Appellate Tribunal, “C” Bench, Kolkata(Tribunal) in ITA No. 565/Kol/2018, for the assessment years 2012-13. The revenue has raised the following substantial questions of law forconsideration : a)Whether on the facts and in the circumstances of the case the LearnedIncome Tax Appellate Tribunal was justified in law, in setting aside theorder of the CIT (Appeals) who confirmed the addition of Rs. 5,42,00,000/- made under Section 68 of the Act in the assessment order passed undersection 143(3) dated March 28, 2015, on the ground that the identity andcreditworthiness of the share applicants as well as the genuineness oftransactions were proved ? b) Whether on the facts and in the circumstances of the case the order of theLearned Income Tax Appellate Tribunal was justified in law to delete theaddition of Rs.5,42,00,000/- without considering the merits of the casethereby giving rise to perversity ? c) Whether on the facts and in the circumstances of the case the order of theLearned Income Tax Appellate Tribunal was justified in law to set asidethe order of the CIT(A) appeals confirming the assessment order passedunder section 143(3) of the Act without appreciating the ratio laid down inthe case of PCIT vs NRA Iron & Steel Pvt. Ltd. [103 taxmann.com 48 (SC)]by Hon’ble Apex Court and also its own judgment in the case of ITO,Ward-5(3), Kolkata vs. M/s. Blessings Commercial Pvt. Ltd. in ITANo.271/Kol/2014 for AY 2010-2011 ? We have heard Ms. Smita Das De, learned standing Counsel appearing forthe appellant and Mr. Saurabh Bagaria, learned Counsel for the respondent. Learned Tribunal had allowed the assessee’s appeal thereby setting asidethe order passed by the CIT (Appeals-2), Kolkata [CIT(A)] dated 23[rd] January,2018, which affirmed the assessment order dated 28[th] March, 2015 passedunder Section 143(3) of the Income Tax Act. The Tribunal has faulted theAssessing Officer in not having examined the materials placed by the assesseewhich, according to the learned Counsel for the respondent, was voluminous. Furthermore, the Tribunal also faulted the Assessing Officer for not conductingan enquiry into the matter based on the documents produced by the assessee.Further, the Tribunal has held that CIT(A) has also not discussed about thecorrectness or otherwise of the documents and materials placed by the assesseebefore the Assessing Officer. In such circumstances, question would be as towhat is to be done in the matter. The learned Tribunal, being the last fact finding authority, was well within itsjurisdiction while examining those documents to ascertain as to the correctness ofthe time taken by the assessee with regard to the genuineness of the transaction. As to the identity and creditworthiness of the investors, the Tribunal couldhave called for a report from the Assessing Officer and upon receipt of such report,examine the same and record its satisfaction that the assessee has been able to provethe identity and the creditworthiness of the investors and the genuineness of thetransaction. However, the Tribunal has not done such exercise and merely proceeded toallow the appeal solely on the ground that the Assessing Officer did not consider thematerials and documents produced by the assessee nor conduct any enquiry. The learned Tribunal, being the last fact finding authority, was well within itsjurisdiction while examining those documents to ascertain as to the correctness ofthe time taken by the assessee with regard to the genuineness of the transaction. As to the identity and creditworthiness of the investors, the Tribunal couldhave called for a report from the Assessing Officer and upon receipt of such report,examine the same and record its satisfaction that the assessee has been able to provethe identity and the creditworthiness of the investors and the genuineness of thetransaction. However, the Tribunal has not done such exercise and merely proceeded toallow the appeal solely on the ground that the Assessing Officer did not consider thematerials and documents produced by the assessee nor conduct any enquiry. Thus we are of the view that the matter has to be examined by the AssessingOfficer on merits and, therefore, we deem it proper to remand the matter back to theAssessing Officer for fresh consideration. Accordingly, the appeal filed by the revenue is allowed and the order passedby the Tribunal is set aside as well as the order passed by the CIT(A) and the matter stands remanded to the Assessing Officer who shall rehear the matter in accordancewith law after affording an opportunity of hearing to the authorised representative ofthe assessee. The Assessing Officer shall examine all the documents and thematerials which are placed by the assessee and thereafter take a reasoned decision.The substantial questions of law raised by the assessee are left open.The stay application stands disposed of. (T.S. SIVAGNANAM) CHIEF JUSTICE (HIRANMAY BHATTACHARYYA, J.)