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TMI Blog2019 (10) TMI 339X X X X Extracts X X X X X X X X Extracts X X X X ..... from Assessment Year 2009-10. Pr.CIT without finding any defect in the inquiry conducted by the Assessing Officer has simply cancelled the assessment order which cannot be sustained. In case he is of the opinion that Assessing Officer inquiry and verification is lacking, then it is incumbent upon the ld. Pr.CIT to himself conduct prima facie inquiry on his own so as to reach to a conclusion that, either the Assessing Officer s inquiry was not proper or there is any inherent lack of application of mind. Hon'ble Delhi High Court in the following cases:- i) DIT vs. Jyoti Foundation [ 2013 (7) TMI 483 - DELHI HIGH COURT] ii) CIT vs. Sunbeam Auto Ltd [ 2009 (9) TMI 633 - DELHI HIGH COURT] ; and iii) ITO vs. D.G. Housing Projects Ltd, [ 2012 (3) TMI 227 - DELHI HIGH COURT] has categorically held, the revising authority must make an inquiry before making a believe that assessment order was erroneous and without making any such inquiry he cannot remand back the issue once again to conduct the inquiry when Assessing Officer has conducted inquiry before conclusion of assessment. Thus we do not find that it is a fit case for cancelling the assessment for framing fresh even on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e in this case, prior to the issuance of notice u/s.148, a query letter was issued by the Assessing Officer on 23.11.2012 regarding source of cash deposit of ₹ 33,15,000/-. In response, the assessee had submitted details of Income Tax particulars, PAN and Income Tax Return. Thereafter, notice u/s.148 was issued on 11.07.2013 and the Assessing Officer and in the course of assessment proceedings, from time to time Assessing Officer has raised specific query with regard source of cash deposit in Saving Bank Account with Punjab National Bank along with other details and on various other issues. The specific query raised by the Assessing Officer with regard to each and every entry in the bank account were as under:- 7. Please explain exact source of cash deposit of ₹ 33,15,000/- into your S.B. A/c with Punjab National Bank as under; ₹ 50,000/- on 15.04.2010, ₹ 50,000/- on 20.04.2009 ₹ 1,50,000/- on 04.07.2009, ₹ 1,00,000/- on 11.07.2009, ₹ 10,00,000/- on 11.02.2010, ₹ 6,00,000/- on 18.02.2010 and ₹ 9,00,000/- on 24.02.2010, ₹ 2,30,000/- on 08.03.2010. ₹ 2,00,000/- on 19.03.2010. Please explain source of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2,450.00 transfer on 02.03.2010 it was transferred for purchase of draft and deposited the same as plot booking advance with BKDA, Bulandshahr. Later on this amount was refunded because of failure in allotment of plot. 5. The assessee has not taken as unsecured loan from any person during the year. 6. Since the assessee has not maintained any regular books of accounts, he has filed his return of income by showing income u/s 44AF. 7. If any more information is required, the assessee is ready to furnish. 5. Apart from that assessee has also filed confirmatory letter and affidavits of various persons from whom assessee has received advances of ₹ 26 lacs for dealing in property. The assessee has also filed date-wise cash flow statement including the summary of bank account and income tax returns for various assessment years. In response to Assessing Officer s summon to produce all the persons, the assessee had produced all the persons, whose statement were recorded by the Assessing Officer; and before the Assessing Officer these persons in their statements have also filed their bank statement. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... py of the bank pass book, confirmatory letters in the form of affidavit along with photo ID as proof of receipt of ₹ 26,00,000/- from different persons for dealing in properly and other document are place on file. Considering the above facts the amount of ₹ 33,15,000/- is concerned, it is found that Assessee received ₹ 4,50,000/- out of the sale proceed of wood ₹ 26,00,000/- from different persons for purchase of property, who has accepted in his statement to this amount. ₹ 2,65,000/- is re-deposit of cash withdrawn by the assessee during the course of his business. The amount of ₹ 26,00,000/- is received by assessee from different persons for purchase of property ₹ 9,50,000/- received from Sh. Taiyab Hasan, ₹ 10,00,000/- received from Sh. Ansar Ahmed, ₹ 3,00,000/- received from Sh. Julfikar. ₹ 3.50.000/- received from Mohd. Talib. All the above persons has given affidavit and accepted in their statement that they have given above advance through cash for purchase of property, but on failure in getting the deal finalized, they have received back the above amount from Asrar Ahmed during the F.Y. 2009-10 th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rough banking channels. In fact the assessee is also maintaining a bank account but the Assessing Officer never enquired as to why the repayments were made in cash. In view of the above facts, the order passed by the A.O. appears to be erroneous and prejudicial to the revenue. Therefore, why it may not be cancelled or modified by invoking the provisions of section 263 of the I.T. Act, 1961. I have been directed to request you to appear before the Pr. Commissioner of Income Tax, C.G.O. Complex- 1, Hapur Chungi, Ghaziabad on 19.01.2017 at 12.30 P.M. either in person or through authorized representative and furnish your explanation with supporting documentary evidences. Please note that in case of non-compliance necessary order will be passed on the basis of material available on record. 8. In response to the show cause notice, the assessee has filed its detailed reply by submission dated 03.03.2017. 9. Shri Rakesh Gupta pointed out that here in this case, firstly, the entire reopening u/s.147 was done on the basis of information of cash deposits in the bank account and even the reassessment proceedings ensued thereafter was only for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his contention, he relied upon the following judgment. Hon ble Supreme Court in the case of Deniel Merchants Pvt. Ltd. vs. ITO(Appeal No. 2396/2017) dated 29.11.2017. In this group of cases, Hon ble Supreme Court has dismissed SLPs in cases where AO did not make any proper inquiry while making the assessment and accepting the explanation of the assessee(s) insofar as receipt of share application money is concerned. On that basis the Commissioner of Income Tax had, after setting aside the order of the Assessing Officer, simply directed the Assessing Officer to carry thorough and detailed inquiry The relevant judgement of Hon ble Calcutta High Court n r s case s also enclosed. 2. Malabar Industrial Co. Ltd. Vs CIT r20001 109 Taxman 66 (SC)/f20001 243 ITR 83 (SC)/r20001 159 CTR 1 (SC) where Hon ble Supreme Court held that where Assessing Officer had accepted entry in statement of account filed by assessee, in absence of any supporting material without making any enquiry, exercise of jurisdiction by Commissioner under section 263(1) was justified. 12. Regarding various other issues raised by the ld. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 377; 26 lacs have been received from different persons for purchase of property on their behalf; and balance ₹ 2,60,000/- was re-deposited out of cash withdrawn by the assessee during the course of his business. In support of the source of the amount of ₹ 26 lacs received from four different persons, the assessee had first of all, has filed their affidavits; and when Assessing Officer asked to produced all the four persons along with their passbook and ID proof. In response, the assessee had produced all the four persons, who had duly appeared before the Assessing Officer and their statement were recorded on oath and have also produced their respective bank passbook before the Assessing Officer. The copies of statement along with their passbook are appearing from pages 29 to 43 of the paper book filed before us. Thereafter, assessee has also filed date-wise cash flow statement along with computation of income and return of income for the earlier years also. After examining all these persons, material placed on record and source of cash deposit, Assessing Officer has accepted it to be genuine. 15. Ld. Pr.CIT has exercised his revisionary jurisdiction u/s. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... asons recorded by the Assessing Officer and ld. Pr.CIT cannot travelled beyond the reasons to rope in other issues not falling in the reasons recorded. Thus, we agree with the contention of the learned counsel that any such direction is beyond the scope of re-assessment proceedings as the same cannot be raised in revisionary jurisdiction u/s 263. Hence, all other direction given by the Ld. PCIT is quashed. 17. Even on the issue of cash deposit, as has stated above, Assessing Officer has duly examined not only all the persons who have given the advance to the assessee but also the entire cash flow statement, vis- -vis the assessee s computation of income and cash flow statement coming from Assessment Year 2009-10. Ld. Pr.CIT without finding any defect in the inquiry conducted by the Assessing Officer has simply cancelled the assessment order which cannot be sustained. In case he is of the opinion that Assessing Officer inquiry and verification is lacking, then it is incumbent upon the ld. Pr.CIT to himself conduct prima facie inquiry on his own so as to reach to a conclusion that, either the Assessing Officer s inquiry was not proper or there is any inherent lack ..... X X X X Extracts X X X X X X X X Extracts X X X X
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