9911796707
TMI Blog2015 (2) TMI 276X X X X Extracts X X X X X X X X Extracts X X X X ..... come Tax Act, which was neither erroneous nor prejudicial to the interest of revenue. The order dated 27.04.2009 passed u/s 154 of the ITA by the Assessing Officer, rectified the assessment order dated 24.12.2008 passed by him u/s 143(3) of the ITA. In restoring the assessment order dated 24.12.2008 passed u/s 143(3) of the ITA, the Ld.CIT both on facts and in law has failed to appreciate that a mistake of law or fact is rectifiable u/s 154 of the ITA. The Ld.CIT, both on facts and in law, has erred in holding that the amount of Rs. 39 lakhs is the appellant's income u/s 68 of the ITA. In doing so the Ld.CIT has failed to appreciate that the appellant had discharged the onus cast upon it u/s 68 of the ITA by furnishing the identity of Mr. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... penditure, therefore, it was not shown. The copy of the said letter along with the certificate from the bank of Nepal have been placed in paper book at pages 17 and 18. A confirmation letter of Mr. K.N. Rana filed before the AO is also placed in the paper book. However, the learned assessing officer without taking cognizance of these vital evidences, held that in absence of any documentary evidence, the sum of Rs. 39 lakhs is added as cash credit u/s 68. 3. After receiving the order mentioning no evidence was filed, the assessee filed a rectification application u/s 154, before the AO are read as under: "Our client has received assessment order for A.Y. 2006-07 along with notice of demand of Rs. 13,65,494/- u/s 143(3). In this regard we h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also referred to a letter dated 10.11.2008 written by him during the course of assessment proceedings admitting that the assessee has filed the loan confirmation and other evidences, however admitted to be considered in the assessment order. He had also referred to the following contents of his letter in the order passed u /s 154 and reduced the said addition from the income of the assessee:- "Pending assessment proceedings, a letter dated 10.11.2008 was written to assessee company the operative part of which is read as under: "It is seen from the loan confirmation letter of Shri K.N. Rana, Director who has given the total loans of Rs. 46,59,000/- to the assessee company. However, out of these loans, fresh loans of Rs. 39,00,000/- were g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8 in so much that the addition of Rs. 39,00,000/- u/s 68, made by him after considering the confirmation letter furnished by the assessee, was deleted by him on the basis of the same confirmation letter. U/s 154 of the Act, only a mistake apparent form records can be rectified. No power is conferred therein to review a finding based on detailed appreciation of facts and law. Hence the order u/s 154 of the Act dated 27.04.2009 passed by the AO being erroneous and prejudicial to the interest of the revenue is set aside. Consequently, the original assessment order dated 24.12.2008 is hereby restored." 5. Before us, the learned counsel submitted that, during the course of the original assessment proceedings, the assessee had furnished all the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dship to the assessee. 6. On the other hand, Ld. DR submitted that once all the documents were furnished before the AO during the course of original assessment proceeding, then it is presumed that all such evidences has been considered by the AO and only after appraisal of evidences, decision has been taken. Duly u/s 154, the scope is very limited and is only confirmed to mistake apparent from record and not to review of decision already taken by the AO. The Ld.CIT has rightly cancelled the order passed u/s 154 as it was passed in violation of scope of the provisions of the law. 7. We have heard the rival submissions, perused the relevant finding given in the impugned order and also the material placed on record. As discussed above, in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entire facts and material on the record and then only from such records he can form on opinion that the order which is subject matter of revisionary jurisdiction u/s 263, is erroneous and also prejudicial to the interest of the revenue. Both the conditions should exist simultaneously. Even if the order of the AO u/s 154 was bad in law then also the Ld.CIT was required to give concrete finding on facts as to how the order is prejudicial to the interest of the revenue. Under the latter later condition, the Ld.CIT is required to examine the merits and the material on record and give his finding. In the impugned order the Ld.CIT has closed all the doors of justice to the assessee and upheld the original assessment order which was patently erro ..... X X X X Extracts X X X X X X X X Extracts X X X X
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