Kisan Agro Mart Private Limited Vs PCIT (ITAT Mumbai)
Income Tax Appellate Tribunal (ITAT), Mumbai Bench, has quashed an order passed by the Principal Commissioner of Income Tax (PCIT), Mumbai-1, under Section 263 of the Income Tax Act, 1961, for Assessment Year 2011-12. The ITAT ruled that the PCIT’s assertion that the Assessing Officer (AO) ought to have made an addition for a presumed 3% commission under Section 69C was based purely on surmises and conjectures, lacking any cogent material on record.
The appeal before the ITAT was filed by Kisan Agro Mart Private Limited, challenging the PCIT’s revisional order dated March 31, 2021. The genesis of the dispute lay in the assessment year 2011-12, for which the assessee company’s assessment had been reopened. A notice under Section 148 of the Act was issued on March 28, 2018.
Background of the Case: Share Capital and Premium
During the relevant financial year, Kisan Agro Mart Private Limited had allotted 20,80,000 shares, each with a face value of Re. 1, at a premium of Rs. 99 per share. These shares were allotted to Shri Ramesh Jain and Shri Rishabh Jain, who were identified as both directors and the sole shareholders of the assessee company.
