JUDGMENT :

Goutam Bhaduri, J

Heard.

1. The instant appeal has been filed against the order dated 29/11/2023 passed by the Income Tax Appellate Tribunal (hereinafter referred to as ‘the ITAT’), whereby the order passed by the Commissioner of Income Tax (Appeals) adding Rs.1,87,00,000/- was upheld.

2. The brief facts of the case are that in respect of the F.Y. 2013-14 and A.Y. 2014-15, the original return was filed by the appellant-company on 30/09/2014. Subsequently, the case was taken up in a scrutiny under Section 143 (3) of the Income Tax Act, 1961 (hereinafter referred to as the Act, 1961) and on 27/12/2016 the Assessment Officer passed an order of addition of Rs.4,13,41,500/- under Section 68 of the Act, 1961 assigning the reason that share application money was received from bogus shell companies, which actually belong to the appellant.

3. According to the respondent, the case of the assessee company was selected for complete scrutiny to verify the share premium received during the year under consideration whereas the company has shown low income in comparison to high loans & advances and investment in share and the investment made in unlisted equities. The details were asked to be supplied about the shareholders who actually invested the money. Subsequently, in order to verify the genuineness and creditworthiness of the shareholding companies, a notice was issued under Section 133(6) of the Act, 1961 to Kolkata based share companies namely M/s Eagle Commotrade Pvt. Ltd. and M/s Krishnakali Distributors Pvt Ltd at their registered address. The notices were returned unserved, consequently, the Assessment Officer deputed one Inspector to find out the identity of the companies. On a verification, it was found that the companies namely Eagle Commotrade Pvt. Ltd. and M/s Krishnakali Distributors Pvt Ltd do not exist. Since the credible explanation regarding the amount credited to the company was not explained, the amount of unexplained cash credit was added under Section 68 of the Act, 1961 for the A.Y. 2014-15.

4. The appellant filed an appeal before the CIT (Appeals) and the CIT (Appeals) by its order dated 23/03/2018 carved out the addition of Rs.4,13,41,500/- as it was found to be for different Assessment Year. Rs.2,26,41,500/- was found to have been received for previous assessment year and for the relevant Financial Year 2013-14: Assessment Year 2014-15. It was also found that Rs.1,87,00,000/- was received by the assessee company during the year which is subject matter of consideration in appeal. The appellant filed an appeal before the ITAT wherein the ITAT by its order dated 29/11/2013 dismissed the appeal. Hence this appeal.

5. Learned counsel for the appellant would submit that admittedly the income of Rs.1,87,00,000/- was added to the income of one Rashi Steels and the Rashi Steels having been subjected to assessment, there cannot be double taxation towards the M/s Sumit Global Pvt Ltd i.e. the appellant herein. He placed his reliance on the ratio laid down by the Delhi High Court in the matter of PRO Commissioner of Income Tax Vs. Vijay Conductors India Pvt Ltd, and other connected matters {2015 (9) TMI 1519-Delhi High Court} to submit that the assessee and Eagle Commotrade Pvt. Ltd. and M/s Krishnakali Distributors Pvt Ltd, if were found to be conduit entities/non-existing and if ultimate beneficiary was Rashi Steels, the appellant cannot be subjected to assessment and it cannot be added to the income of the appellant. He would further submit that Section 68 of the Act, 1961 uses the word “may” and if it has been found that Rashi Steels is the ultimate beneficiary and the present appellant along with Eagle Commotrade Pvt. Ltd. and M/s Krishnakali Distributors Pvt Ltd are continued companies then there is no mandate to impose the tax liability as the Rashi Steels is already under assessment to tax.

6. Per contra, learned counsel for the respondent opposes the submission advanced by learned counsel for the appellant. She wo