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2023 (3) TMI 1144 - AT - Income TaxRevision u/s 263 - scope of revision proceedings initiated - Proof of erroneous order prejudicial to the interests of the Revenue - HELD THAT - Possible view shall mean a issue, which is debatable and there could be more than one possible views. The consideration of the Commissioner as to whether an order is erroneous in so far it is prejudicial to the interests of Revenue must be based on materials on record of the proceedings called for by him. If there are no materials on record on the basis of which it can be said that the Commissioner acting in a reasonable manner could have come to such a conclusion, the very initiation of proceedings by him will be illegal and without jurisdiction. The Commissioner cannot initiate proceedings with a view to start fishing and roving enquiries in matters or orders which are already concluded. Since the AO has already examined the case and made complete enquiry wherein no infirmity appears then in that case, the Ld PCIT was not justified in passing the impugned revision order. Appeal of the assessee is allowed.
Issues involved:
The issues involved in this judgment include jurisdiction under section 263 of the Income Tax Act, 1961, erroneous assessment order, source of cash deposit during demonetization period, delay in filing appeal, and application of law by the Assessing Officer. Jurisdiction under Section 263: The appeal was filed against an order by the ld. Pr.CIT, Udaipur, raising grounds of appeal related to the jurisdiction under section 263 of the Act. The appellant contended that the impugned action was bad in law without jurisdiction and void abinitio. The appellant argued that the assumption of jurisdiction under section 263 was contrary to the provisions of law and facts on record, and the impugned direction deserved to be quashed. The Tribunal observed that the Commissioner cannot invoke powers of revision under section 263 if the Assessing Officer has conducted inquiries, applied his mind, and taken a possible view of the matter. The Tribunal quashed the impugned revision order and restored the assessment order dated 15-07-2019. Source of Cash Deposit during Demonetization Period: The issue of the source of a cash deposit of Rs.17,86,000 during the demonetization period was examined. The Assessing Officer did not make any addition as the source of the deposit was explained by the assessee. However, the ld. PCIT found that the assessment order was erroneous and prejudicial to the interest of revenue as the source of the cash deposit could not be reasonably explained by the appellant. The Tribunal, after considering the submissions of both parties, held that the ld. PCIT was not justified in passing the revision order as the AO had already made a complete inquiry and no infirmity appeared. Consequently, the Tribunal allowed the appeal of the assessee. Delay in Filing Appeal: During the hearing, it was noted that there was a delay of 9 days in filing the appeal by the assessee due to postal delay. The Tribunal, considering the explanation provided by the assessee and the decision of the Hon'ble Supreme Court, condoned the delay in filing the appeal. Application of Law by the Assessing Officer: The Assessing Officer had considered the reply of the assessee regarding a cash deposit and other financial details. The AO did not make any addition to the amount deposited as the source was explained by the assessee. However, the ld. PCIT found the assessment order to be erroneous and prejudicial to the interest of revenue based on the source of the cash deposit. The Tribunal, after examining the relevant legal provisions and precedents, concluded that the ld. PCIT's decision was not justified, and therefore, quashed the revision order and restored the original assessment order. Conclusion: The Tribunal allowed the appeal of the assessee, quashed the revision order passed under section 263, and restored the assessment order dated 15-07-2019. The principles laid down by the courts emphasized that the Commissioner cannot invoke revision powers under section 263 if the Assessing Officer has conducted inquiries and applied his mind, and there is a possible view of the matter.
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