M/s. Kaypee Electronics & Associates Pvt. Ltd.,, Bangalore v. ACIT, Bangalore

ITA 1247/BANG/2010 | 2005-2006
Pronouncement Date: 29-09-2011 | Result: Allowed

Appeal Details

RSA Number 124721114 RSA 2010
Bench Bangalore
Appeal Number ITA 1247/BANG/2010
Duration Of Justice 10 month(s) 13 day(s)
Appellant M/s. Kaypee Electronics & Associates Pvt. Ltd.,, Bangalore
Respondent ACIT, Bangalore
Appeal Type Income Tax Appeal
Pronouncement Date 29-09-2011
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted B
Tribunal Order Date 28-09-2011
Assessment Year 2005-2006
Appeal Filed On 16-11-2010
Judgment Text
IN THE INCOME-TAX APPELLATE TRIBUNAL BANGALORE BENCH B BANGALORE BEFORE SHRI N.K.SAINI ACCOUNTANT MEMBER AND SMT. P MADHAVI DEVI JUDICIAL MEMBER I.T.A. NO.1247(BANG.)/2010 (ASSESSMENT YEAR : 2005-06) M/S KAYPEE ELECTRONICS & ASSOCIATES PVT. LTD. NO.18/2 SRINIVASA INDUSTRIAL ESTATE 7 TH MILE KANAKAPURA MAIN ROAD BANGALORE-560 062. PAN NO.AADFK1203(OLD) PAN NO.AACCK1203(NEW) APPEL LANT VS THE ASSISTANT COMMISSIONER OF INCOME-TAX CIRCLE-11(5) BANGALORE RESPO NDENT APPELLANT BY : SMT. SHEETHAL ADVOCATE RESPONDENT BY : SHRI HARSHA PRAKASH CIT-II DATE OF HEARING : 28-09-2011 DATE OF PRONOUNCEMENT : 28 -09-2011 O R D E R PER SMT P. MADHAVI DEVI JM ; THIS APPEAL BY THE ASSESSEE RELATES TO ASSESSMENT Y EAR 2005-06. THE ASSESSEE HAS RAISED THE FOLLOWING CONC ISE GROUNDS IN ITS APPEAL; 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) ERRED IN UPHOLDING THE ADDITION U/S 68 ITA.NO.1247(B)/10 2 OF THE ACT IN RESPECT OF SHARE APPLICATION AND SHARE PREMIUM AMOUNTING TO RS.1 78 30 151/- 2. ON THE FACTS THE LD. CIT(A) OUGHT TO HAVE APPRECIATED THAT ALL THE APPLICANTS WERE IDENTIFIED AND CONFIRMED HAVING GIVEN THE MONEY AND IN THE CIRCUMSTANCES THE PROVISION OF SEC.68 OF THE ACT COULD NOT BE INVOKED IN THE CASE OF THE COMPANY AND THE IMPUGNED ADDITION AS MADE WAS LIABLE TO BE QUASHED. 3. THE LD. CIT(A) GROSSLY ERRED IN NOT FOLLOWING TH E RATIO OF THE SUPREME COURT IN THE CASE OF CIT VS STELLAR INVESTMENT LTD REPORTED IN (2001) 251 ITR 263(SC) WHICH HAD IMPLIEDLY OVER-RULED THE JUDGMENT OF THE DELHI HIGH COURT IN CIT VS SOPHIA FINANCE LTD. (1994) 205 ITR 98(DEL)(FB) AND ALSO THE JURISDICTIONAL HIGH COURT JUDGMENT WHILE UPHOLDING THE ADDITION U/S 68 OF THE ACT. 4. WITHOUT PREJUDICE THE ADDITION AS SUSTAINED BY THE LD. CIT(A) IS ARBITRARY EXCESSIVE AND OUGHT TO BE DELE TED IN TOTO. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESS EE IS A PRIVATE LIMITED COMPANY AND 100% EXPORT ORIENTED UNIT(EOU) AND IT IS ENGAGED IN THE BUSINESS OF MANUFACTURE OF ELECTRONI C ITEMS LIKE CAPACITORS RESISTORS ETC. DURING THE ASSESSMENT PROCEEDINGS U/S 143(3) OF THE IT ACT THE ASSESSEE WAS ASKED TO PRO DUCE THE DETAILS ITA.NO.1247(B)/10 3 RELATING TO ITS INCOME HOWEVER NO DETAILS WERE FU RNISHED AND THEREFORE THE AO PROCEEDED TO COMPLETE THE ASSESSM ENT U/S 144 OF THE IT ACT AND HELD THAT THE INTRODUCTION OF SHARE CAPITAL OF RS.1 78 30 151/- REMAINED UNEXPLAINED. HE ACCORDIN GLY ADDED THE SAME TO THE RETURNED INCOME OF THE ASSESSEE AS UNEX PLAINED CASH CREDIT U/S 68 OF THE IT ACT. 2.1 AGGRIEVED THE ASSESSEE PREFERRED AN APPEAL BE FORE THE CIT(A) FURNISHING VARIOUS DETAILS RELATING TO THE S HARE CAPITAL SHARE PREMIUM SHARE APPLICATION MONEY PENDING ALLOTMENT RESERVES & SURPLUS AND ALSO THE DETAILS OF THE SHAREHOLDERS AN D THEIR RESPECTIVE SHARES. SINCE THE ASSESSMENT WAS COMPLETED U/S 14 4 OF THE IT ACT THE CIT(A) CALLED FOR A REMAND REPORT FROM THE AO W HO SUBMITTED HIS REMAND REPORT STATING THAT THE ASSESSEE SUBMITTED T HE DETAILS OF THE AMOUNT RECEIVED IN LIEU OF EQUITY SHARE CAPITAL AND THE ASSESSEE WAS ASKED TO PROVIDE THE PROOF OF INTIMATION GIVEN TO R BI WITH RESPECT TO THE FOREIGN EXCHANGE INWARD REMITTANCE. IT WAS STAT ED THAT THE ASSESSEE COMPANY HAS PRODUCED ONLY TWO SUCH INTIMAT IONS PROVIDED TO THE RBI BUT FAILED TO PRODUCE THE INTIMATION OF FOREIGN INWARD REMITTANCE SUBMITTED TO THE RBI RELATING TO THE SHA RE CAPITAL RECEIVED FROM M/S FALCO LIMITED A FOREIGN COMPANY. THE ASSESSEE FILED A REJOINDER STATING THAT WITH REGARD TO FOREI GN INWARD REMITTANCES TAKING APPROVAL OR PRIOR PERMISSION IS NOT NECESSARY ITA.NO.1247(B)/10 4 AND THE RBI ONLY ACKNOWLEDGED SUCH INWARD REMITTANC ES AND PRAYED FOR DELETION OF THE ADDITIONS MADE U/S 68 OF THE IT ACT. 3. THE CIT(A) AFTER CONSIDERING THE REMAND REPORT AS WELL AS THE REJOINDER HAS HELD THAT THOUGH THE ASSESSEE I S NOT REQUIRED TO TAKE PERMISSION OR APPROVAL FROM RBI THE ASSESSEE SHOULD HAVE SHOWN THE PROOF THAT AFTER RECEIPT OF THE FOREIGN E XCHANGE REMITTANCE THE INTIMATION HAD BEEN SENT TO RBI AND SINCE HAS FAILED TO DO SO HE ACCORDINGLY DISMISSED THE ASSESSEES APPEAL. 3.1 AGGRIEVED THE ASSESSEE IS IN SECOND APPEAL BE FORE US. 4. THE LEARNED COUNSEL FOR THE ASSESSEE SMT.SHEETA L REITERATED THE SUBMISSIONS MADE BEFORE THE CIT(A) WHILE ON TH E OTHER HAND LEARNED DR SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 5. HAVING HEARD BOTH THE PARTIES AND HAVING CONSID ERED THE MATERIAL ON RECORD WE FIND THAT THE ASSESSEE HAS N OT RAISED ANY GROUND OF APPEAL BEFORE THE CIT(A) AS REGARDS THE C ORRECTNESS OF THE ADDITION U/S 68 OF THE IT ACT. IT IS FOR THE FIRST TIME BEFORE US THAT THE ASSESSEE IS RAISING SUCH A GROUND OF APPEAL. T HE ASSESSEE IS ALSO REQUIRED TO PRODUCE THE INTIMATION GIVEN TO TH E RBI FOR FOREIGN EXCHANGE REMITTANCES WHICH IS DISALLOWED BY THE CIT (A). IN VIEW OF THE SAME WE DEEM IT FIT AND PROPER TO REMAND THE I SSUE TO THE FILE OF THE ASSESSING AUTHORITY FOR CONSIDERING THE ISSUE O N MERITS. THE ASSESSEE SHALL BE GIVEN A FAIR OPPORTUNITY OF HEARI NG AND ALSO TO ITA.NO.1247(B)/10 5 SUBMIT INTIMATION IF ANY GIVEN TO THE RBI WITH REG ARD TO FOREIGN INWARD REMITTANCES. 5. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THE 28 TH SEPTEMBER 2011. SD/- SD/- (N.K.SAINI) (SMT. P. MADHAVI DEVI) ACCOUNTANT MEMBER JUD ICIAL MEMBER PLACE: BANGALORE DATED: 28-09-2011 AM* COPY TO : 1. THE ASSESSEE 2. THE REVENUE 3. CIT(A) 4. CIT 5. DR 6. GF(BLORE) BY ORDER AR ITAT BANGALORE