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2022 (4) TMI 102 - AT - Income TaxRevision u/s 263 - order passed by him u/s.153A r.w.s.143(3) - HELD THAT - We are of the considered view, that now when the AO acting well in conformity with the aforesaid view of the Hon ble Jurisdictional High Court, had therein in the absence of any incriminating material in respect of the unabated assessment of the assessee for the year under consideration, not made any addition, therefore, the order passed by him u/s.153A r.w.s.143(3) on the said count could have been by any stretch of imagination held as erroneous by the Pr. CIT u/s.263. We, thus, finding no infirmity in the view taken by the AO which as observed by us hereinabove falls within the four corners of the aforesaid judgment in the case of Continental Warehousing Corporation (Nhava Sheva) Ltd. 2015 (5) TMI 656 - BOMBAY HIGH COURT , therefore, set-aside the order passed by the Pr. CIT u/s.263 and restore the order passed by the AO u/s.153A r.w.s. 143(3) - Decided in favour of assessee.
Issues Involved:
1. Validity of the order passed under Section 263. 2. Jurisdiction of the Principal Commissioner of Income Tax (Pr. CIT) under Section 263. 3. Applicability of Section 56(2)(vii)(b) in the assessment year 2014-15. 4. Service of the order under Section 263. Detailed Analysis: 1. Validity of the Order Passed Under Section 263: The assessee contended that the order under Section 263 was erroneous and bad in law. The original assessment order was passed on 21.12.2014, and a subsequent order under Section 143(2) read with Section 153A was passed on 28.11.2016. The assessee argued that the order under Section 263 was without jurisdiction and out of time limit with reference to the original order dated 21.12.2014. The Pr. CIT's order, dated 27.09.2018, was challenged on the grounds that no payment was effected in the assessment year 2014-15, and the full payment was made in the assessment year 2012-13, when the provisions of Section 56(2)(vii)(b) were not applicable. 2. Jurisdiction of the Principal Commissioner of Income Tax (Pr. CIT) Under Section 263: The Pr. CIT observed that a sale deed executed on 22.10.2013 indicated a consideration of ?30 lakhs, while the market value of the property was ?60,06,000/-. The Pr. CIT held that the failure of the Assessing Officer to add the difference of ?30,06,000/- rendered the assessment order erroneous and prejudicial to the interest of the revenue under Section 263. However, the Tribunal found that no incriminating material was found during the search proceedings under Section 132 conducted on 12.02.2015. The assessment for the year under consideration was unabated, and in the absence of any incriminating material, the Assessing Officer was within his jurisdiction to not make any addition. The Tribunal cited the Hon’ble High Court of Bombay's judgment in CIT Vs. Continental Warehousing Corporation, which stated that no addition could be made in respect of an unabated assessment if no incriminating material was found during the search proceedings. Thus, the Pr. CIT exceeded his jurisdiction under Section 263. 3. Applicability of Section 56(2)(vii)(b) in the Assessment Year 2014-15: The assessee argued that the provisions of Section 56(2)(vii)(b) were not applicable in the assessment year 2014-15 as the full payment was made in the assessment year 2012-13. The Tribunal did not specifically address this issue in detail, as it quashed the order passed by the Pr. CIT under Section 263 on the grounds of jurisdiction and the absence of incriminating material. 4. Service of the Order Under Section 263: The assessee contended that the order under Section 263, based on which the demand was raised on 20.06.2018, was not served on the assessee. The Tribunal did not specifically address this issue, as it quashed the order under Section 263 on other grounds. Conclusion: The Tribunal quashed the order passed by the Pr. CIT under Section 263, dated 27.09.2018, and restored the order passed by the Assessing Officer under Section 153A read with Section 143(3), dated 28.11.2016. The Tribunal held that the Pr. CIT had exceeded his jurisdiction under Section 263, as no incriminating material was found during the search proceedings, and the assessment for the year under consideration was unabated. The Tribunal allowed the grounds of appeal related to the jurisdiction of the Pr. CIT and refrained from adjudicating other contentions raised by the assessee. The appeal of the assessee was allowed, and the general ground of appeal was dismissed as not pressed.
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