ITO, Kolkata vs. Sumeru Retailers Pvt. Ltd.

Parties Involved

Facts Summary

The assessee company, Sumeru Retailers Pvt. Ltd., filed its return of income for the assessment year 2009-10 declaring a total loss. The case was reopened under section 147 of the Income Tax Act, 1961, and the Assessing Officer determined the total income at Rs. 77,290/-. Subsequently, revision proceedings under section 263 were initiated, leading to a revision order setting aside the initial assessment. The Assessing Officer then re-assessed the case and made an addition of Rs. 10,00,00,000/- in respect of share capital and security premium. The assessee appealed this order, and after several rounds of appeals and reassessments, the case reached the Income Tax Appellate Tribunal. During the reassessment, the Assessing Officer noticed large cash credits in the assessee's bank account, which were immediately transferred out, leading to the addition under section 68 of unexplained cash credits. The assessee submitted various documents to explain these transactions, including audited final accounts, ITR acknowledgments, and bank statements of shareholders, claiming the funds were genuine investments.…

Legal Issues

• 1. Whether the addition of Rs. 10,00,00,000/- made by the Assessing Officer under section 68 of the Income Tax Act, 1961, was justified.

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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