Silkina Commodeal Pvt. Ltd. Vs ITO (ITAT Kolkata)
ITAT Kolkata Deletes ₹21.39 Cr Section 68 Addition—Share Capital & Premium Cannot Be Added Solely for Non-Appearance of Investors
The Kolkata Bench of the ITAT allowed the appeal of Silkina Commodeal Pvt. Ltd. for AY 2008-09 and deleted the addition of ₹21.39 crore made under section 68 on account of share capital and share premium. The Tribunal held that once the assessee has furnished all primary evidences to establish the identity of shareholders, their creditworthiness, and the genuineness of transactions, an addition cannot be sustained merely because the shareholders or directors failed to appear personally in response to summons under section 131.
The Tribunal noted that in both the original assessment and the set-aside proceedings pursuant to revision under section 263, the assessee had filed confirmations, PANs, income-tax returns, audited financial statements, and bank statements of the share subscribers. Notices under section 133(6) were duly complied with by the subscribers, even several years after the investments. Despite this, the Assessing Officer did not point out any discrepancy in the documentary evidence and made no independent enquiry to rebut the materials placed on record.
The ITAT observed that issuance of a show-cause notice even before the scheduled date of personal appearance indicated a predetermined approach. Relying on a consistent line of jurisdictional Calcutta High Court decisions, the Tribunal held that non-compliance with summons, by itself, cannot override documentary evidence already on record. In the absence of any adverse material or finding to discredit the evidences furnished, the addition under section 68 was unsustainable. Accordingly, the order of the CIT(A) was set aside and the Assessing Officer was directed to delete the addition in full.
FULL TEXT OF THE ORDER OF ITAT KOLKATA
