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TMI Blog2014 (12) TMI 186X X X X Extracts X X X X X X X X Extracts X X X X ..... lso does not give names and details of any creditor or debtor who had not furnished or given confirmation. The AO waited till the end and took up the assessment proceedings only three months before the end of the limitation period - a detailed questionnaire was only issued in October, 2009 and the first effective hearing was fixed on 26th October, 2009 - even the order sheets between 26th October, 2009 till 23rd November, 2009 are not on record and have not been shown - a reading of the questionnaire would indicate that enormous and magnitudes of details/information were asked for - This would have required time for compilation, affirmation and clarification - The queries were answered by several letters on record - For confirmations, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; 1 lac at the closing date of the year under consideration. The Tribunal accordingly set aside and quashed the order under Section 263 of the Act passed by the Commissioner of Income Tax. 2. The respondent-assessee is a partnership firm engaged in the business of readymade garments. Search and seizure proceedings were carried out under Section 132 of the Act on 16th October, 2007 in the case of Shri Dwarka Das Agarwal Group and search had also taken place in the business and residential premises of the respondent-assessee. Subsequently, a notice under Section 142(1) of the Act was issued and the respondent-assessee filed return on 2nd April, 2009, declaring the same income as was declared in its original return i.e. ₹ 2,94,87,060/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e submitted to the department. 4. As noticed above, the last hearing before the Assessing Officer was held on 29th December, 2009. On the said date, the assessee had furnished several confirmations and documents. 5. In assessment order passed on 31st December, 2009, two additions of ₹ 11,94,982/- and ₹ 3,64,696/-, on account of discrepancies, were made. 6. The Assessing Officer, it is claimed by the revenue, had recorded the following office note:- Office Note 1. All the documents/materials seized/impound during the course of the search/survey operation conducted on 16.10.2007 in Dwarka Das Agarwal Group of cases have been examined and nothing adverse pertaining to this assessee in previous year under considerati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in his order under Section 263 of the Act dated 27th March, 2012 reads:- It was observed that assessment has been completed by the Assessing Officer without obtaining the complete reply to the questionnaire annexed to notice u/s 142(1) dated 07/10/2009. In the above questionnaire, the assessee was inter alia asked to furnish copy of account, duly confirmed, of the parties from whom loans/deposits were given or taken and also in respect of debtors and creditors having balance above ₹ 1 Lakh. The above information was not fully furnished by the assessee inspite of specific request. Provisions of Section 68 of the Income Tax Act, 1961 clearly lays down that where any sum is found credited in the books of an assessee and the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssioner of Income Tax under Section 263 also does not give names and details of any creditor or debtor who had not furnished or given confirmation. Thus, the finding of the Tribunal cannot be held to be perverse. 11. Learned senior standing counsel for the Revenue had submitted that confirmations were filed on the last day and, therefore, they were not verified. Thus, Commissioner of Income Tax was justified in holding that the assessment order was erroneous and prejudicial to the interest of the Revenue. The said contention must fail for a number of reasons. Firstly, with regard to the confirmations already submitted, note No.2 of the office note is relevant. It records that copy of the accounts of the confirming parties had been verifi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot been shown. A reading of the questionnaire going into 9 pages would indicate that enormous and magnitudes of details/information were asked for. This would have required time for compilation, affirmation and clarification. The queries were answered by several letters on record. For confirmations, the assessee had to write letters to the creditors and debtors all over the India and wait for their response. The Tribunal has noted that the assessee had submitted bill, invoices, vouchers etc. to the Assessing Officer. 13. Normally, scrutiny assessment order under Section 143(3) of the Act should be presumed and hypothesised as made after due verification and ascertainment of facts. Principle of finality has sound and salutatory basis, but ..... X X X X Extracts X X X X X X X X Extracts X X X X
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