PCIT Vs Vishnu Distributors Pvt Limited (Calcutta High Court)
Calcutta High Court has dismissed an appeal filed by the Principal Commissioner of Income Tax (PCIT) against Vishnu Distributors Pvt. Limited, upholding the Income Tax Appellate Tribunal’s (ITAT) decision to delete an addition of Rs. 3,98,44,628/- on account of unexplained share capital and share premium for the assessment year 2012-13. The High Court found no substantial question of law warranting its intervention.
The appeal, filed under Section 260A of the Income Tax Act, 1961, initially faced a delay of 98 days, which the High Court condoned after a satisfactory explanation was provided by the revenue.
The revenue had raised two substantial questions of law. Firstly, it questioned whether the ITAT was justified in deleting the addition without considering that the assessee company had allegedly failed to discharge the basic onus of establishing the identity, genuineness, and creditworthiness of the shareholders who infused capital. Secondly, the revenue contended that the ITAT was not justified in not considering the Assessing Officer’s argument that the Commissioner of Income Tax (Appeals) [CIT(A)] had violated Rule 46A of the Income Tax Rules by adjudicating the matter based on new documents without remanding the case to the Assessing Officer for examination.
