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TMI Blog2022 (3) TMI 1207X X X X Extracts X X X X X X X X Extracts X X X X ..... nt proceedings and it was responded by the assessee, mere fact that it is not dealt within by the A.O. in the order cannot implied that there is no application of mind. Hence, the PCIT action cannot be acceptable as the order passed by the A.O. does not satisfy the twin conditions of erroneous and prejudicial to the interest of the revenue. Accordingly we do not find any merits in the order and we set aside the order u/s 263 passed by the PCIT and allow the grounds of appeal of in favour of the assessee. - ITA No. 517 And 518/Mum/2021 - - - Dated:- 24-2-2022 - Shri S Rifaur Rahman, Accountant Member And Shri Pavan Kumar Gadale, Judicial Member For the Appellant : Mr.Neelkanth Khandelwal.AR For the Responden : Mr.Rakesh Garg, C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to have reached the aforesaid conclusion inasmuch as her conclusion is based on the same material which has been considered by the Assessing Off icer to make the addition in his assessment order, and thus, the impugned order passed by the Pr. CIT under section 263 is bad in law. 4. The PCIT has erred in directing the Assessing Officer to add a sum of ₹ 15,00,000/- as undisclosed income under section 68 of Income Tax Act, 1961, representing the purchase puce of shares incurred in the earlier year. 5. The Appellant further, contends that on the facts and in the circumstances of the case and in law, the Pr.CIT lacks jurisdiction to pass the impugned order inasmuch as the Assessing Officer on the basis of same material has made ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cause notice for denial of claim of exemption u/sec10(38) of the Act. In compliance, the assessee has filed the details which was dealt in the A.O. order. Finally the A.O was not satisfied with the explanations and determined the total income with the denial of exemption of Long Term Capital gains u/sec10(38) of the act and made addition of sale proceeds u/s 68 of the Act of ₹ 8,81,74,941/- and assessed the total income of ₹ 9,42,52,171/- and passed the order u/s 143(3) r.w.s 147 of the Act dated 28.12.2017. 3. Subsequently, the PCIT on perusal of the record found that the A.O has not made any enquiry on the submissions and made addition of sale proceeds U/sec 68 of the Act. The PCIT is of the view that the A.O should have co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Honble Tribunal on similar and identical issue and prayed for allowing the assessee appeal. Contra, the Ld. DR supported the order of the PCIT. 5. We heard the rival submissions and perused the material available on record. Prima-facie, the sole crux of the disputed issue is with respect to directions of the PCIT to consider the purchases price as the part of the long term capital gains and the whole sale proceeds are to be treated as income u/sec68 of the Act. The Ld. AR submitted that the Assessment order set aside by the PCIT does not satisfy the twin conditions being erroneous and prejudicial to the interest of the revenue. The assessee has diligently complied with the notice u/s 148 and u/sec142(1) of the Act. Whereas the A. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of purchase and sale of shares. Another reason for invoking revisional jurisdiction by the PCIT is, that the assessee in IDS 2016 has only declared long term capital gain on penny stock, whereas, the assessee should have declared gross sale receipt of the shares. The immunity is granted to the assessee to the extent ITA NO. 3001/MUM/2019 (A.Y.2015-16) declaration is made under IDS 2016 and not against the entire transaction. The PCIT invoked revisional jurisdiction to tax the difference between gross sale price of the shares ₹ 34,30,000/- and Long Term Capital Gains declared by the assessee ₹ 32,86,815/- In other words, the PCIT seeks to tax even the purchase cost of the shares i.e. ₹ 1,43,185/- stating it to be a bogu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he notice issued under section 142(1) of the Act, wherein the assessee while replying to the query on transaction of shares, informed that a declaration under IDS 2016 has been made in respect of long term capital gain arising on sale of shares to GCM Securities Ltd. Ostensibly, the Assessing Officer after examining the documents accepted the same and made no addition. Merely for the reason that the Assessing Off icer has taken a plausible view after examining the records that is not acceptable to the PCIT, would not make the assessment order erroneous. In the present case twin conditions set out in section 263 are not satisfied and hence, the PCIT wrongly assumed revisional jurisdiction. 5.2. In view of the above facts and circumstanc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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