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2014 (11) TMI 19 - DELHI HIGH COURTRevision u/s 263 – Inquiry conducted or not - Whether or not the AO before passing the order u/s 143(3) of the Act had conducted enquiries which were “necessitated and required” considering the substantial increase in the capital account of the partners as well as investments made by the assessee firm in the form of capital assets – Held that:- The finding recorded by the Tribunal on the basis of documents and papers filed before them, was that the enquiry was duly made - The Tribunal has accepted that the assessee had filed letter dated 26.05.2010 and had also filed copies of income tax returns, computation of income, copy of statement of respective bank accounts of the partners to show that the said additions to the capital account were genuine - Similarly bills etc. for purchase of assets and relevant details were filed during the course of the assessment proceedings - no attempt was made by the CIT to ascertain from the then AO, who had passed original assessment order u/s 143(3) of the Act to assure the correct factual position - nothing prevented or obstructed the Commissioner from ascertaining the truth and verifying the correctness of the contents of the documents – absence or failure to properly maintain records cannot per se and by itself, would be a ground to invoke Section 263 of the Act i.e. the assessment order was erroneous and prejudicial to the interest of the revenue – revenue was not able to ensure the trustworthiness of their records and has, therefore, proceeded on the basis that no enquiry or investigation was conducted by the AO – The Tribunal has accepted the stand of the assessee that confirmation, documents, details were filed and ascertained by the AO – thus, the order of the Tribunal is upheld – Decided against revenue.
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