Principal Commissioner Of Income Tax 2 Kolkata v. M/S Arman Advisory Pvt Ltd

OD- 3 IN THE HIGH COURT AT CALCUTTASPECIAL JURISDICTION (INCOME TAX)ORIGINAL SIDE ITAT/208/2023IA NO: GA/2/2023 PRINCIPAL COMMISSIONER OF INCOME TAX 2 KOLKATAVSM/S ARMAN ADVISORY PVT LTD BEFORE : THE HON’BLE THE CHIEF JUSTICE T.S. SIVAGNANAM ANDTHE HON’BLE JUSTICE SUPRATIM BHATTACHARYADATE : 10 January, 2024. Appearance :Mr. Vipul Kundulia, Adv.Mr. Amit Sharma, Adv...for appellant. Mr. Soumitra Chowdhury, Adv.Mr. Avra Mazumder, Adv.Mr. Samrat Das, Adv.…for respondent. The Court: It appears that there is a delay of 342 days in filing theappeal. We have heard Mr. Vipul Kundalia, Mr. Amit Sharma, learned Counselappearing for the appellant and Mr. Saumitra Chowdhury, Mr. Avra Mazumder,learned Advocates appearing for the respondent. We are satisfied with the reasons given in the affidavit filed with thecondone delay petition and the delay is condoned. This appeal filed by the revenue under Section 260A of the Income TaxAct, (the Act) is directed against the order dated 11.03.2022 passed by theIncome Tax Appellate Tribunal “A” Bench Kolkata (the Tribunal) in ITA No. 315/Kol/2021 for the assessment year 2012-13. The revenue has raised thefollowing substantial questions of law for consideration:- i)For that on the facts & circumstances of the case and in law,whether the Hon’ble ITAT, Kolkata Benches, Kolkata has erred outrightly in appreciating the fact that the assessment order passedby the AO U/s 143/263 dated 15.09.2016 acquired the characterof order U/s 143(3) read with 264 of the Act, when the A.O. re-assessed the case at loss of Rs.1560/- against original assessmentof income at Rs.20,38,00,000/-?whether the Hon’ble ITAT, Kolkata Benches, Kolkata has erred outrightly in appreciating the fact that the assessment order passedby the AO U/s 143/263 dated 15.09.2016 acquired the characterof order U/s 143(3) read with 264 of the Act, when the A.O. re-assessed the case at loss of Rs.1560/- against original assessmentof income at Rs.20,38,00,000/-? ii) For that on the facts & circumstances of the case and in law,whether the Hon’ble ITAT, Kolkata Benches, Kolkata had erred inignoring the reversionary powers of Ld. Pr. Commissioner ofIncome Tax U/s 263 of I.T. Act, 1963 where the commissioner canregard the order passed by the AO erroneous on the ground thatthe assessing officer should have made further enquiries ?whether the Hon’ble ITAT, Kolkata Benches, Kolkata had erred inignoring the reversionary powers of Ld. Pr. Commissioner ofIncome Tax U/s 263 of I.T. Act, 1963 where the commissioner canregard the order passed by the AO erroneous on the ground thatthe assessing officer should have made further enquiries ? The short question is whether the assessing officer followed the direction issued by the Principal Commissioner of Income Tax, in exercise of powersunder Section 263 of the Act, which was done for the second time after settingaside the first assessment order. The PCIT had directed the assessing officer toconduct de-novo assessment with specific direction issued, which arereproduced as hereinunder; (i)To carry out proper examination of the books of accounts and bankaccount of he assessee;account of he assessee; 3 (ii)To carry out proper examination of the books of accountsand bank account of the investors;and bank account of the investors; (iii)AO to examine the source of the share applicants; (iv)The AO to examine the identity of the investor and its genuineness; (v)The AO to complete the assessment at the earliest without waitingfor the time barring date.for the time barring date. (i)To carry out proper examination of the books of accounts and bankaccount of he assessee;account of he assessee; 3 (ii)To carry out proper examination of the books of accountsand bank account of the investors;and bank account of the investors; (iii)AO to examine the source of the share applicants; (iv)The AO to examine the identity of the investor and its genuineness; (v)The AO to complete the assessment at the earliest without waitingfor the time barring date.for the time barring date. The learned Tribunal examined the factual position and found that thesecond assessing officer has scrupulously followed the direction issued by thePCIT and had issued summons to the directors of the thirteen share applicantsunder Section 131 of the Act and recorded the statements on oath which wasplaced before the learned Tribunal in the form of a paper book. The learnedTribunal also noted that second assessing officer has approximately put 19questions to each of the directors and all the 13 share applicants. Afterexamining the entire facts and circumstances the learned Tribunal has come tothe conclusion that the direction issued by the PCIT while exercising hisjurisdiction under Section 263 of the Act has been scrupulously followed. Thus, we find that no question of law much less substantial questions oflaw arising for consideration. Accordingly, the appeal is dismissed. . (T.S. SIVAGNANAM)CHIEF JUSTICECHIEF JUSTICE (SUPRATIM BHATTACHARYA,J.)