Vivasvat Retail and IT Services Pvt. Ltd. Vs ITO (ITAT Delhi)
The appeal was filed against the order of the National Faceless Appeal Centre dated 12.06.2025 arising from an assessment order passed under Section 143(3) for Assessment Year 2016–17. The assessee had filed its return declaring NIL income and deemed income under Section 115JB, which was processed under Section 143(1). The case was selected for limited scrutiny under CASS to verify the large share premium received and the applicability of Section 56(2)(viib).
During assessment, the Assessing Officer (AO) noted that although the assessee furnished investor details, share valuation reports, and bank statements, it failed to provide sufficient evidence regarding identity, creditworthiness, and genuineness of transactions. The AO conducted enquiries under Section 68 and treated the entire share capital and premium of Rs. 3,47,47,166 as unexplained credit, adding it to income. The AO further held that once the transaction failed under Section 68, examination under Section 56(2)(viib) was not required.
The assessee’s appeal before the Commissioner (Appeals) was dismissed in limine due to a delay of 246 days. The assessee then appealed before the Tribunal, raising multiple grounds including that the AO exceeded the scope of limited scrutiny by making additions under Section 68 instead of restricting the enquiry to Section 56(2)(viib).
