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TMI Blog2014 (10) TMI 461X X X X Extracts X X X X X X X X Extracts X X X X ..... not be held that the assessment orders suffer from unsustainability also - since reasonable enquiries were made, assesssee was called on to file their explanation and submissions on relevant issue and besides the assessment orders are sustainable, it cannot be held that these are cases of any manifest inadequate inquiry or impossible view or unsustainability - the exercise of jurisdiction u/s 263 by CIT in setting aside the assessments passed u/s 153A r/w sec 143(3) in the case of both the assessee is bad in law, his orders are quashed – Decided in favour of assessee. - I.T.A.No.2454/Del/2012, 2455/D/12, 2456/D/12, 2457/D/12 2458/D/12, 2459/D/12, 2460/D/12 I.T.A.No.2447/Del/2012, I.T.A.No.2448/D/2012, 2449/D/2012, 2450/D/12, 2451/D/12, 2452/D/12, 2453/D/12 - - - Dated:- 28-3-2014 - SHRI R.P. TOLANI AND SHRI J.S. REDDY, JJ. For Appellant by: Shri Kapil Goel For Respondent by: Shri A. Mishra, C.I.T. DR PER BENCH This is a group of appeals filed by both assessees who are husband and wife against the orders of CIT- Central Circle II, New Delhi passed u/s 263 of the I T Act, revising the respective assessment orders passed by AO u/s 153A read with section 143(3); h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A, were filed on 14.10.2009 for the assessment years under consideration. It is claimed by the assessees that during the course of assessment proceedings all the relevant explanations and documents as required by the ld. AO were duly submitted. After considering the DIT s appraisal report, detailed investigation of the documents and explanations submitted by the assessee, ld. ACIT, Central Circle-8, New Delhi passed the assessment orders dated 23.12.2009 at the returned income. 4. Subsequently, Show Cause Notices were issued by the ld. Commissioner of Income Tax Central-II under the provisions of section 263 of the Act, as to why the Assessment orders passed by the Ld. AO may not be considered as erroneous and prejudicial to the interest of the revenue, on various counts mentioned as under: (i) In respect of cash of cash found in locker and at residence, no documentary evidence has been furnished. In the bank accounts there were no corresponding withdrawal and in PNB a/c, there were cash deposits; Ld. AO has failed to enquire the source of these deposits. (ii) The opening cash is not supported by any documents. (iii) Qua the source of bank FDRs found the explanation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g herewith the Cash Flow Statement along with the documentary evidences for the same for the period F.Y. 2001-02 to 2007-08, which includes Bank Statements confirming my withdrawals from banks my deposits into the bank. . (b) Household Expenses: I have submitted vide letter dated, 26.10.2009 (copy enclosed) that I do not deep details of daily expenses, but cash withdraws from banks and Post office broadly covers it rather I save out of it. Cash statements in regard to that are already submitted. The fixed expenses like electricity bill, telephone bill, foreign tour expenses are met up by Cheques. I am tea to taller and try for more savings. Also I live with my wife with no other dependents so expenses are very limited. (c) there is no cash deposit in the account with Punjab Notional Bank during the F.Y. 2007-08 and I am enclosing herewith the copy of bank statement for the F.Y. 2007-08. However, there is only one cash deposit of ₹ 10000/- on 14.01.2003 and the same is duly reflected in details furnished in point 1 (a) of my reply. I am also enclosing herewith the bank statements for all the years of account with Punjab National Bank which shows that there has been no ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll July 2006 and thereafter joined Omaxe Limited Oct. 2006 . 2. I and my wife live at 66, Lok Nayak Apartments in Sec-9, Rohini, Delhi. We have two sons. Elder one is working with Seimens Ltd. At Gurgaon and the younger one is in U.S.A. My main source of Income is salary. 3. Presently employed with Omaxe Infrastructure Private Limited. Kalkaji, Delhi My source of income is from salary interest on investments. 4. Copies of Income Tax return for the A.Y.S. from 2003-03 to 2007-08 are already submitted as desired. My Pan No. is ACCPV7041A Last return filed with ward 21 (I) and earlier in ward 46 (2) 5. Details of Immovable Assets:- 6. S.No. SizeandComplete Cost of Date of Incomefrom address of Property Acquisition Acquisition Property if any 1 66, LokNayak ₹ 2.13 Lac 1986 - Apartments, Sector-9, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (v) Gujrat Industries 100 10 Sept. 92 (vi) IDEA Cellular 172 75 Feb. 0 (vii) IFCI 100 10 Feb. 94 (viii) Kirloskar 100 10 March 94 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... L T) B.K. Vinayak 10133966 Omaxe Ltd. 902 310 July 07 8. A. Share Capital and application money Nil B. Loans and Advances.- ₹ 2.50 lac paid on 08/09/2006 to Trivent Infrastructure Development Co., as advance for flat. Payment made through cheque from saving Account 18473 with ICICI Bank. 9. Liabilities, Loans and Advances. A. ₹ 6.25 lac advance received in Nov. 06 against sale of plot at Gurgaon. Copy of agreement already available with the department. b. ₹ 7.00 Lac advance received in Oct. 07 against collaboration agreement for development of plot at Gurgaon. Copy of agreement is enclosed. c. Except above, there is no further liability. d. As regards moveable properties, the original FDR are physically available with the department. These investments are made from personal and salary savings and have been reinvested from time to time on maturity ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome Tax Returns. 18. I do not have any agriculture Income. 19. I am not member of any club etc. hence the information may please be considered as Not Applicable. 20. Syndicate Bank 3033 9891 4400 8320. Bank of India 5420 3430 0742 2001 21. Complete detail of FDR s as per list already available with the department are enclosed. 22. I did not make any investment in the name of minor. Thus it may be treated as Not Applicable. 23. Assessment order not yet received. 24. I do not possess any jewellery/STREEDHAN except one finger ring which I got from my in laws. Rest of information has been made clear in the statement of my spouse. Cash ₹ 92,026/- Was from Cash Withdrawals and savings kept at residence to meet emergent requirement as my wife is a chronic patient. ₹ 3.00 Lacs Amount kept by my co-brother for Treatment. As he was suffering from cancer and was under Treatment at Ganga Ram Hospital at Delhi and his only son was at Bangalore. Unfortunately he had expired last year. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... quantification of income and views adopted by ld. Assessing Officer in due discharge of his statutory power of assessment. The 263 proceedings being for review of a lawfully passed and sustainable order can neither be termed as erroneous nor prejudicial to the interest of revenue. 10. Simillarly Smt. N V Vinayak, wife of the assessee submitted her reply dtd. 10-2-2012 to the 263 proceedings as under: 1. I am also enclosing herewith the details of interest income of from banks during the relevant years. 2. It has been submitted during the course of assessment proceedings vide letter dated 11.11.2009 (copy enclosed) that I do not have any individual bank account and the details of the accounts alongwith bank statements has been filed during the course of assessment proceedings of my husbands. 3. I am enclosing herewith the details of Fixed Deposits found and seized during the course of search proceedings along with sources of each fixed deposits with supporting documents. 4. Regarding cash i.e. 13.25 Lacs, I am enclosing the Sale Agreement showing that the amount of 6.25 lacs was received in A.Y. 2007-08 and 7 lacs in A.Y. 2008-09. 5. Agreement Dated 02.06.2007:- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... est your goodself to drop the proceedings u/s 263 of the Income Tax, 1961 and oblige. If your goodself require any other details/ clarification, I shall be eager to provide the same to you. 11. Ld. Counsel thus pleads that all the relevant material concerning these issues being on search record, appraisal report and duly considered in the assessment proceedings, there is no case whatsoever in terms of sec 263 to set aside the assessment to AO for fresh consideration. Assessee having demonstrated that every thing having been duly considered, CIT was under statutory obligation to consider the explanation instead of summarily rejecting it and setting aside. 12. Ld counsel further contends that the observations of CIT are mistaken and misplaced in as much as: i. Ld CIT- observation that bank statement was not provided to Ld AO is contrary to record as they were supplied. A reference can be made to pg. 6 point no. 6 (B.K.Vinayak paper book); page 22 point no. 3 (B.K.Vinayak paper book); page 32 (B.K.Vinayak paper book); point no. 6 at page 4 of N.K.Vinayak paper book) Thus, the observation is factually incorrect. This was also re-clarified in our reply to CIT during revision p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order in P.K.Noorjahan case 237 ITR 570 is plausible and do not fall for correction u/s 263 of the Act; b. Jewelery found during the course of search proceedings: i. Assessee is a senior citizen ; Married in year 1963 ; ii. Total jewellery weight 940 grams ; iii. CBDT instruction No. 1916 dated 11.05.1994 squarely covers the present case ; refer our reply to Ld AO during assessment at Page 5 13 paper book paper book -1 N.K.Vinayak; iv. Refer show cause notice issued by Ld AO page 3 during assessment of our paper book showing due application of mind by Ld AO; our reply at page 5 to Ld AO during assessment proceedings; v. It is not wealth escaping assessment or wealth tax revision; c. Source of FDR s i. Ld CIT again made factually wrong allegation that source of FDR remained unverified at page 2 of above show cause notice in as much as detailed and extensive inquiry is made as evident from cursory look to detailed show cause issued by Ld AO dated 14/10/2009 replied on 24/10/2009 and 11/11/2009 ii. pages 3, 5,10 for enquiry before Ld AO: N.K.Vinayak) (pages 5,8,11 to 13, 21, 23 to 28: B.K.Vinayak paper book at assessment stage proper replies were filed; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... detailed show cause issued by Ld AO dated 14/10/2009 replied on 24/10/2009 and 11/11/2009 ii. pages 3, 5,10 for enquiry before Ld AO: N.K.Vinayak) (pages 5,8,11 to 13, 21, 23 to 28: B.K.Vinayak paper book assessment stage replies; iii. Assessee s reply on subject issue given the fact that assessee is not is any business and source of fund is husband s money and maturity of earlier FDR s as very well explained in replies to investigation wing at pages pages 28 to 32 paper book (B.K.Vinayak) and supplementary paper book (N.K.Vinayak) pages 1 to 5 is supported by SC order in P.K.Noorjahan case 237 ITR Page 570; iv. Reply dated 12/11/2009 in case of B.K.Vinayak to Ld AO during assessment proceedings at pages 22 to 27 of paper book in B.K.Vinayak case; v. Assessee categorically submitted to CIT u/s 263 that given the length and position of service amount of FDR s is negligible which explanation is plausible to be accepted and proves application of mind on part of Ld AO; vi. Total FDR in question in assessee s and her wife is ₹ 32.60 lacs which is commensurate to tax profile and 50 year service track of assessee; iii) It is vehemently argued that the third ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itten submissions and grounds of appeal. Both the respondent and the Tribunal have based their orders on preconceived notions, conjunctures and surmises, manifestly misread the facts and twisted them to justify their conclusions. ii. Lalchand Bhagat Ambica Ram v. CIT (1959) 38 ITR 288 (SC), held at Page 295 for the [proposition: Para 31: (a) The Commissioner cannot initiate proceedings with a view to start fishing and roving inquiries in matters or orders which are already concluded; that the department cannot be permitted to begin fresh litigation because of new views they entertain on facts or new versions which they present as to what should be the inference or proper inference either of the facts disclosed or the weight of the circumstance; that if this is permitted, litigation would have no end except when legal ingenuity is exhausted. (b) Whether there was application of mind before allowing the expenditure in question has to be seen; that if there was an enquiry, even inadequate that would not by itself give occasion to the Commissioner to pass orders under sec. 263 merely because he has a different opinion in the matter, that it is only in cases of lack of inquir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of the section is manifestly for a purpose. Mere fact that the Commissioner considers on examination of the record that the order has been erroneously passed so as to prejudice the interest of the revenue, will not suffice. The assessee must be called, his explanation sought for and examined by the Commissioner, and thereafter, if the Commissioner still feels that the order is erroneous and prejudicial to the interest of the revenue, he may pass revisional orders. If, on the other hand, the Commissioner is satisfied after hearing the assessee that the orders are not erroneous and prejudicial to the interest of the revenue, he may choose not to exercise his power of revision. This is for the reason that if a query was raised during the course of scrutiny by the Assessing Officer, which was answered to the satisfaction of the Assessing Officer, but neither the query nor the answer was reflected in the assessment order, that would not, by itself, lead to the conclusion that the order of the Assessing Officer called for interference and revision. In the instant case, the Commissioner had observed in the order passed by him that the assessee had not filed certain documents on the reco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eard the rival contentions, material available on the record and case laws cited by both the parties. From the facts narrated above and the paper books filed it emerges that during the course of assessment proceeding questions, enquiries and explanation on the relevant issues were called for by the ld AO and were replied by the assessee. Thus these are not the assessments where there was no enquiry on the relevant aspect. The questionnaires, order sheet entries, assessees submissions and explanations make it quite clear. Thus we are unable to hold that assessment orders suffer from lack of enquiries. In sunbeam Auto case Hon ble Delhi High Court has held that though revision can be made in a case when there is lack of enquiry in the order, however, inadequate inquiries cannot be a basis of revision as it depends on the perception of the officer exercising assessment powers. A mere deference is perception of CIT and AO cannot make the order erroneous and prejudicial to the interest or revenue. Hon ble Delhi High Court in the recent judgment in the case of DLF Ltd. squarely held that: It is not mere prejudice to the revenue, or a mere erroneous view which can be revised under sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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