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Tax Publishers Amritrashi Infra (P) Ltd. v. Pr. CIT [ITA No. 838/Kol/2019, dt. 12-8-2020] 2020 TaxPub(DT) 3145 (Kol-Trib) Revision powers under section 263 invoked for the second time on the same topic--Whether permissible--Addition of share capital with large share premium therein. *Facts:* Assessee had received share capital with large share premium to the tune of Rs. 45.66 crores which was added under section 68 by an assessing officer (first) in their scrutiny assessment ignoring the evidentiary submissions made by the assessee manifesting the details of the investors to the share capital. This was revised by a first PCIT with a remand to the assessing officer asking him to do a de novo proper enquiry after giving an opportunity to assessee to meets interests of justice. In the review assessment order a second assessing officer did consider all the submissions of the PAN numbers, the source of the investments and the identity of the investors besides which also issued summons under section 133(6) to corroborate the evidences of the assessee which stood satisfactorily discharged on the point of share premium receipt in his opinion. Thus addition under section 68 was dropped by the second assessing officer. Subsequently a second PCIT once again sought revision proceedings under section 263 citing the order of the second assessing officer to be erroneous and prejudicial interests of the revenue due to improper assessment (in his opinion) of the share capital/premium having been made. It was the plea of the assessee before ITAT that the second revision proceedings were invalid as per law. Held that the second revision proceedings were invalid -- void ab initio. By the second assessing officer forming his assessment order after hearing the assessee's case the revision petition invoked by first PCIT stood merged with the revised assessment order under doctrine of merger. Thereafter once again citing that order to be erroneous and prejudicial to the interests of the revenue under section 263 under the same topic was not permissible. The assessee satisfied the required onus to discharge his obligations on share premium by proving -- Identity of the investors Their tax status Their source of income The receipt of money thru proper banking channels For the said assessment year 2012-13 the law does not envisage one to go beyond proving this or does not warrant proving the source of the source. The amendment in section 68 read with 56(2)(vii) and section 2(24)(xvi) vide Finance Act with effect from 1-4-2013 is only prospective for assessment year 2013-14 and not to years prior to this. The decision of CIT v. Lovely Exports (P) Ltd. 317 ITR 218 (SC) was upheld. In DCIT v. M/s. Alcon Biosciences (P) Ltd., ITA No. 1946/M/2016, Order dated 28-2-2018 : 2018 TaxPub(DT) 2037 (Mum-Trib) it was held that the provisos to section 68 introduced vide Finance Act, 2012 with effect from 1-4-2013 was prospective and not retrospective. Also upheld in CIT v. Gagandeep Infrastructure (P.) Ltd. (2017) 80 taxmann.com 272 (Bom) : 247 Taxman 245 (Bom) : (2017) 394 ITR 680 (Bom) : 2017 TaxPub(DT) 1238 (Bom-HC) Trend Infra Developers Pvt. Ltd. [ITA No. 2270/Kol/2016] Major Metals Ltd. v. Union of India (2012) 19 taxmann.com 176 (Bom) : (2012) 207 Taxman 185 (Bom) : (2013) 359 ITR 450 (Bom) : 2012 TaxPub(DT) 2113 (Bom-HC)

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Amritrashi Infra (P) Ltd. v. Pr. CIT [ITA No. 838/Kol/2019, dt. 12-8-2020] 2020 TaxPub(DT) 3145 (Kol-Trib)

Revision powers under section 263 invoked for the second time on the same topic--Whether permissible--Addition of share capital with large share premium therein.

Facts:

Assessee had received share capital with large share premium to the tune of Rs. 45.66 crores which was added under section 68 by an assessing officer (first) in their scrutiny assessment ignoring the evidentiary submissions made by the assessee manifesting the details of the investors to the share capital. This was revised by a first PCIT with a remand to the assessing officer asking him to do a de novo proper enquiry after giving an opportunity to assessee to meets interests of justice. In the review assessment order a second assessing officer did consider all the submissions of the PAN numbers, the source of the investments and the identity of the investors besides which also issued summons under section 133(6) to corroborate the evidences of the assessee which stood satisfactorily discharged on the point of share premium receipt in his opinion. Thus addition under section 68 was dropped by the second assessing officer. Subsequently a second PCIT once again sought revision proceedings under section 263 citing the order of the second assessing officer to be erroneous and prejudicial interests of the revenue due to improper assessment (in his opinion) of the share capital/premium having been made. It was the plea of the assessee before ITAT that the second revision proceedings were invalid as per law.

Held that the second revision proceedings were invalid -- void ab initio.

By the second assessing officer forming his assessment order after hearing the assessee's case the revision petition invoked by first PCIT stood merged with the revised assessment order under doctrine of merger. Thereafter once again citing that order to be erroneous and prejudicial to the interests of the revenue under section 263 under the same topic was not permissible.

The assessee satisfied the required onus to discharge his obligations on share premium by proving --

Identity of the investors

Their tax status

Their source of income

The receipt of money thru proper banking channels

For the said assessment year 2012-13 the law does not envisage one to go beyond proving this or does not warrant proving the source of the source. The amendment in section 68 read with 56(2)(vii) and section 2(24)(xvi) vide Finance Act with effect from 1-4-2013 is only prospective for assessment year 2013-14 and not to years prior to this.

The decision of CIT v. Lovely Exports (P) Ltd. 317 ITR 218 (SC) was upheld.

In DCIT v. M/s. Alcon Biosciences (P) Ltd., ITA No. 1946/M/2016, Order dated 28-2-2018 : 2018 TaxPub(DT) 2037 (Mum-Trib) it was held that the provisos to section 68 introduced vide Finance Act, 2012 with effect from 1-4-2013 was prospective and not retrospective.

Also upheld in CIT v. Gagandeep Infrastructure (P.) Ltd. (2017) 80 taxmann.com 272 (Bom) : 247 Taxman 245 (Bom) : (2017) 394 ITR 680 (Bom) : 2017 TaxPub(DT) 1238 (Bom-HC)

Trend Infra Developers Pvt. Ltd. [ITA No. 2270/Kol/2016]

Major Metals Ltd. v. Union of India (2012) 19 taxmann.com 176 (Bom) : (2012) 207 Taxman 185 (Bom) : (2013) 359 ITR 450 (Bom) : 2012 TaxPub(DT) 2113 (Bom-HC)