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TMI Blog2020 (12) TMI 42X X X X Extracts X X X X X X X X Extracts X X X X ..... s not made proper investigation and verification about the source of cash deposit. 3. The appellant craves to alter, amend and modify any ground of appeal. 4. Necessary cost be awarded to the assessee." Due to the prevailing situation of COVID 19 pandemic, the hearing of the appeal was concluded through Video Conference. Ground No. 1 is regarding validity revision order passed by the ld. PCIT under section 263 of the IT Act. 2. The assessee is an Individual and engaged in the business of trading in mustard seeds. The assessee did not file any return of income under section 139 for the year under consideration. On the basis of AIR information received by the AO regarding deposit of Rs. 1,04,97,340/- in cash in Savings Bank Account, the AO issued notice under section 148 on 29th March, 2017. The assessee finally filed return of income in response to notice under section 148 on 15th December, 2017 declaring total income of Rs. 1,91,590/-. The assessment was completed under section 143(3) read with section 147 of the IT Act on 26th December, 2017 at a total income of Rs. 2,88,677/-. Subsequently, the ld. PCIT on verification of the assessment record noted that the order passed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er of the assessee. The ld. A/R has thus contended that the very reason for reopening of the assessment is cash deposit in the bank account and the AO has completed the assessment by considering the bank account statement as well as cash book produced by the assessee before the AO. Therefore, it is not a case of no enquiry conducted by the AO but the assessment order was passed after considering and verification of the relevant record produced by the assessee. In support of his contention he has relied upon the decision of Ahmedabad Bench of the Tribunal in case of Torrent Pharmaceuticals Ltd. vs. DCIT, 173 ITD 130 (Ahd. Trib.) and submitted that the ld. Commissioner is expected to show that the view taken by the AO is wholly unsustainable in law before embarking upon revisionary powers under section 263 of the IT Act. Thus the ld. A/R has submitted that if the view taken by the AO is one of the possible views, then the ld. Commissioner is not permitted to invoke the provisions of section 263 of the IT Act merely because he does not agree with the view taken by the AO. He has also relied upon the decision of Delhi Benches of the Tribunal in case of Amira Pure Foods Pvt. Ltd vs. PCI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s the relevant material on record. In the case in hand, the assessee has not filed any return of income under section 139 of the IT Act despite the fact that the assessee is engaged in the business of trading in mustard seeds and having turnover of more than Rs. 1,00,00,000/-. The AO received AIR information regarding deposit of cash in the bank account of the assessee of Rs. 1,04,97,340/- and accordingly issued notice under section 148 on 29th March, 2017. Since the assessee has not filed any return in response to notice under section 148, the AO issued a show cause notice under section 144 of the IT Act on 31.10.2017. Thereafter, the assessee filed the return of income on 15.12.2017 declaring total income of Rs. 1,91,590/-. The AO noted that the assessee is not maintaining any stock register, day to day stock register, no proper bills/vouchers available in support of the expenses, most of the expenses have been booked on the basis of self made vouchers, most of the bills/vouchers are not verifiable, most of sales vouchers are not verifiable, most of the purchase vouchers are also not fully verifiable. Accordingly, the AO invoked the provisions of section 145(3) and rejected the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bank account. Therefore, the order passed by the AO based on incorrect and incomplete facts due to lack of inquiry renders it as erroneous so far as prejudicial to the interest of the revenue. The Commissioner has issued the show cause notice and pointed out the mistakes in the assessment order as under :- " (a) Your case was selected on the specific reason that you had cash deposit amounting to Rs. 1,04,97,340/- in saving bank account maintained with Punjab National Bank. (b) During the year ( as per bank statement) you have deposited cash of Rs. 1,89,51,996/- in your saving bank account, but no enquiry was made regarding source of the cash. (c) On perusal of the assessment record it is seen that AO has reject your books and declared the net profit @ 2.75% only on the total sales of Rs. 1,04,97,340/- i.e. Rs. 2,88,677/- whereas as per bank account statement you have deposited Rs. 1,89,51,996/- during the year. No justification is offered for deciding net profit @ 2.75% only." Thus the assessment order was suffering from error which is factual in nature and not in respect of any view taken by the AO. There is no quarrel on the point that if the AO has taken one of the possib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... osits made in the bank account cannot be considered as turnover, however, when the assessee is not maintaining the books of account as required under section 44AA as well as the audit of the same under section 44AB, then the claim of availability of opening cash balance with the assessee cannot be accepted. The withdrawal of the amount from the bank can be considered as a source for re-depositing if the assessee can fully satisfy the AO that the withdrawal made from the bank is not utilized for any other purposes being the purchases and other expenditures incurred by the assessee in the course of business as well as personal drawings. Therefore, to that extent all the facts and details are required to be properly verified. The ld. Commissioner has finally set aside the order as under :- " I, therefore, set aside the assessment order passed by the AO u/s 147/143(3) on 26.12.2017 with the directions to the assessing officer to pass the speaking assessment order after considering the above mentioned issues, apart from other issues discussed in the assessment order dated 26.12.2017 and also the issues which may subsequently come into the notice of AO during the assessment proceedings ..... X X X X Extracts X X X X X X X X Extracts X X X X
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