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TMI Blog2012 (9) TMI 329X X X X Extracts X X X X X X X X Extracts X X X X ..... ld itself make the assessment order erroneous and prejudicial to the interest of the revenue. As in the notice the issued, Commissioner recorded that the AO had accepted an addition in house property at Rs. 7.02 lakhs without holding any enquiry and as from the report of CBI, ACB Gauhati that according to CBI investment made in the aforesaid house property was made by one Shri Moti Lal Datta son-in-law of the assessee and according to the CBI, the cost of acquisition of the house was Rs. 16,16,500/-. On these facts the Ld. Commissioner in the notice issued recorded his opinion that the assessment in question being without necessary enquiries was erroneous and prejudicial to the interest of the revenue. As the revisionary order has been passed in respect of assessment order passed u/s 143(3) r.w.s. 147 on 31.12.2009 the power u/s 263 is available to CIT(A) to revise any order passed by the assessing authority and re-assessment order within from the end of Financial Year in which the order has been passed i.e. 31.3.2010 and would expire on 31.3.2012 whereas the order challenged here has been passed before 28.3.2012 i.e. well within time limit prescribed u/s 263(2). Therefore, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee had paid balance amounts of Rs. 14,17,500/- (Rs. 16,80,000/- minus Rs. 2,62,500/-) out of undisclosed sources and this amount needed to be added back to the returned income.." 3. A show cause notice was accordingly issued in response to the notice, written submissions were made in which it was stated as under :- "This is in response to your notice dated 15.3.2012, proposing to make addition of Rs. 14,17,500/- on the basis that the assessee has entered into agreement to sell dated 14.12.2001 for the purchase of 9 kanals land in village Manimajra, Chandigarh with one Smt. Kailashwati for a sum of Rs. 72 lacs, which gives the average rate of 8 lacs per kanal. Against this agreement, the assessee paid Rs. 4 lacs as advance money and was required to finalise the agreement by 31.12.2002. This agreement could not be acted upon and only 2 kanal 2 marla land was purchased for consideration of Rs. 2,62,500/- in July 2002 for intervening circumstances, viz the Chandigarh Administration had notified the land for acquisition under the Land Acquisition Act, 1894 u/s 4 of the Land Acquisition Act, 1894 vide notification No. 43/3/143-1(5)/8368 dated 1.10.2002 for the developm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hese issues. 6. Before us, the ld. counsel of the assessee submitted that the Department has issued a notice u/s 148 because it seems that the Department was in possession of certain sale agreement pertaining to the assessee. The assessee has filed return in pursuance to notice u/s 148 declaring the same income and copies of the same is placed at page 5 to 7 of the paper book. He argued that the assessee had filed copies of statement of affairs explaining the investment in land during re-assessment proceedings in pursuance of notice issued u/s 143(1) and 143(2). He contended that re-assessment was done on the basis of these replies and certain additions amounting to Rs. 15,21,067/-were made and therefore, the assessment could not be called erroneous and prejudicial to the interest of the revenue. In any case since the copies of statement of affairs and detailed submissions were filed before the ld. Commissioner who has passed the order without considering the same in detail therefore, revision order passed by the Commissioner was not justified. In this regard he strongly relied on the decision of Smt. Lila Choudhury v. CIT [2007] 289 ITR 226/[2008] 167 Taxman 1 (Gau). 7. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Remarks 1 Agricultural land measuring 9 kanal at village Kishangarh vide agreement to sell dt. 14.12.2001 14.12.2001 72,00,000/- The agreement to sell for this property was for Rs. 72,00,000/- but assessee has paid Rs. 4,00,000/- in cash to the proposed seller. Total investment as per available information is Rs. 4,00,000/- 2 Agricultural land measuring 36 bigha and 2 biswa at village Badh, Teh-Kalka vide sale deed dt. 2.8.2001 3.8.2001 4,90,000/- (Cash) + 58,000/- (Stamp papers) The assessee has invested halfl the amount of Rs. 5,48,000/- of the total transaction i.e. Rs. 2,74,000/- (remaining half amount of Rs. 2,74,000/- has been invested by the broehr of the assessee. Total investment is Rs. 2,74,000/- 3 Agricultural land measuring 8 kanals at Village Manimajra vide sale deed dt. 11.5.2001 11.5.2001 8,00,000/-cash + 1,00,000/- The assessee has invested half the amount of Rs. 9,00,000 of the total transaction i.e. Rs. 4,75,000/- (remaining half amount of Rs. 4,75,000/- has been invested by the brother of the assessee. Total investment is Rs. 4,75,000/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has proceed to make assessment u/s 143(3) r.w.s. 147 merely on the basis of statement of affairs and made addition in respect of amounts stated in the statement of affairs which could not be proved. This clearly shows that the Assessing Officer has not examined what was actual consideration for purchase of land and what were the sources. It is settled position of law that failure to make enquires which are required in the facts of the case would itself make the assessment order erroneous and prejudicial to the interest of the revenue. Reference may be made to the decision of Hon'ble Supreme Court in case of Rampyari Devi Saraogi v. CIT [1968] 67 ITR 84 and Smt. Tara Devi Aggarwal v. CIT [1973] 88 ITR 323. The reasoning for this rule that in the absence of proper enquiry the assessment order would become erroneous and prejudicial to the interest of the revenue has been given by Hon'ble Delhi High Court case of Gee Vee Enterprises v. Addl CIT [1975] 99 ITR 375 discussing the case of Rampyari Devi Saraogi ( supra ) and Tara Devi Aggarwal ( supra ) in the following paragraphs:- "The reason is obvious. The position and function of the Income-tax Officer is very differe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted an addition in house property at Rs. 7.02 lakhs without holding any enquiry. It was further mentioned that from the report of CBI, ACB Gauhati that according to CBI investment made in the aforesaid house property was made by one Shri Moti Lal Datta son-in-law of the assessee and according to the CBI, the cost of acquisition of the house was Rs. 16,16,500/-. On these facts the Ld. Commissioner in the notice issued recorded his opinion that the assessment in question being without necessary enquiries was erroneous and prejudicial to the interest of the revenue. On the receipt of this notice the assessee filed detailed explanation and enclosed various annexures showing yearly investment made which was supported by the balance sheets which were annexed. The detail of funds available to the assessee were also disclosed. Thereafter through impugned order the Commissioner after recording his opinion that the assessment was made without making enquiries in respect of house properties and investment in the house property and source of income and written submissions giving exhaustive explanation were filed and the matter required further examination and therefore, assessment was set asid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rily in the normal course, ld. Commissioner was entitled to re-do revisionary exercise if he so desires. The Court has given peculiar circumstances because of which the order passed u/s 263 was quashed. This clearly shows that this kind of extra jurisdiction can be exercised only in specific circumstances and not in all the cases. Therefore, this decision can not be taken as a precedent in all the cases. In any case in the case before us, the finding has been given in the revisionary order also stating why the assessment order passed u/s 143(3) r.w.s. 147 was erroneous because of lack of enquiry. Therefore, we are of the opinion that the ld. Commissioner has clearly exercised the revisionary jurisdiction u/s 263 of the Act because the Assessing Officer has clearly failed to make any enquiry in the given facts of the case as stated above. 14. In this appeal one more ground has been taken in respect of limitation but no arguments were made before us by the ld. counsel of the assessee or the Department. However, from the reading of revisionary order u/s 263 it becomes clear that the revisionary order has been passed in respect of assessment order passed u/s 143(3) r.w.s. 147 on 31 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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