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TMI Blog2022 (7) TMI 957X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Tribunal in holding the order exercising power under Section 263 was barred by Clause (c) of Explanation 1 of Section 263 . Thus reason/basis of the impugned proceeding u/s 263 of the Act when the appeal preferred by the assessee under Section 250 of the Act before the CIT(A) is pending against the order passed by the Ld. AO under Section 147 of the Act which has been sought to be revised by the Ld. PCIT in the garb of the provision of Clause (c) of Explanation 1 of Section 263 of the Act. The same is, thus, found to be unsustainable and therefore, quashed. Assessee s appeal is, therefore, allowed. - I.T.A. Nos. 86 to 89/Rjt/2022 - - - Dated:- 20-7-2022 - Shri Pramod M Jagtap, Vice President And Ms. Madhumita Roy, Judicial Member For the Appellant : Shri D. M. Rindani, A.R. For the Respondent : Shri Sanjeev Jain, CIT D.R. ORDER PER MADHUMITA ROY, JM: - The bunch of appeals preferred by the assessee are directed against the orders all dated 15.02.2022 passed by the Ld. Pr. CIT-1, Rajkot under Section 263 of the Income Tax Act, 1961 (hereinafter referred to as the Act ) arising out of the orders passed by the ACIT, Circle-1(1), Rajkot dated 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .2019 and was served upon the assessee in response whereof the assessee submitted its reply on 16.10.2019, 21.10.2019 19.11.2019. On the basis of the information as regards receiving of amount of Rs. 1,00,000/- from M/s. National Shroff Group during the year under consideration as notice under Section 142(1) of the Act was issued to the assessee on 05.10.2019 30.11.2019 calling for various details, the assessee duly submitted the bank statements, copy of cash book, details of expenses incurred, details of purchases alongwith copy of ledgers, copy of sales ledgers etc. Upon verification and analyzing of the same with the documents/details/information available with the office it was found that the transaction details received by the Revenue are not reflected in the books of accounts of the assessee. A show-cause thereafter, on 05.12.2019 was issued in the following manner: 2. In connection with the ongoing assessment proceedings for the Assessment Year 2012-13 you have submitted the return of income in response to a notice u/s. 148 of the Income Tax Act, 1961 on 30.09.2019. Your case was re-opened u/s 147 of the Act and accordingly statutory notice u/s 143(2) of the Act was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o tax accordingly. Please submit your explanations alongwith all the evidences on any day on or before 10.12.2019 upto 06.00 P.M. Please it may be noted that no adjournment will be granted in any circumstances. Kindly note if no information or explanation is received by the due date, it will be presumed that you have no explanation to offe and assessment order will be passed accordingly. 4. Since assessee did not reply to the show-cause issued to it, taking into consideration the incriminating entry amount of Rs. 1,00,000/- has been treated as unaccounted and unrecorded business transaction of the assessee and accordingly, considering the average gross profit at 30% of the turn over the income of the assessee from such unaccounted and unrecorded transaction was worked out at Rs. 30,000/- which was finally added to the total income of the assessee by the Ld. AO on 22.12.2019. 5. Being aggrieved by and/or dissatisfied with the addition made by the Ld. AO and appeal has been preferred before the First Appellate Authority by the assessee. 6. On the other hand, during the pendency of the appeal before the First Appellate Authority the Ld. PCIT, Rajkot-I, initiated a proceed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... interest of Revenue observing that the AO has not conducted any enquiry in the source of the transaction made for M/s. National Shroff and to the above extent the cash transaction remained unexplained. Hence, the instant appeal before us. 8. At the time of hearing of the appeal the Ld. Counsel appearing for the assessee at the very threshold submitted before us that when the appeal is pending before the First Appellate Authority against the order passed by the Ld. AO finalizing the re-assessment under Section 143 r.w.s. 147 of the Act dated 22.12.2019 upon making addition of Rs. 30,000/- on account of average gross profit of the assessee, assumption of jurisdiction under Section 263 of the Act by the Ld. PCIT would be barred. It is the case of the assessee that the Ld. AO considered the very same issue in the re-assessment proceeding under Section 147 of the Act and all the documents relating to the issue has duly been furnished by the assessee before him. On this issue he has relied upon a judgment passed by the Allahabad High Court in the matter of CIT, Meerut vs. Vam Resorts Hotels (P.) Ltd., reported in (2019)111 taxmann.com 62 (Allahabad). 9. On the other hand, the Ld. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exercise of power under Section 263. Thus, any order passed by the AO in the assessment proceedings after the remand by the CIT cannot be looked upon and the argument made by the counsel for the revenue for relying upon the fresh assessment order made on 7.3.2004 under Section 263/143(3) of the Act cannot be accepted in view of the above provision of law. 27. In the present case, the Tribunal had recorded specific finding of fact that the assessing authority had examined each and every aspect of the case on which the remand order hinges, as such the remand order was not sustainable in the eyes of law. 28. Considering the facts and circumstances of the case, we are of the considered opinion, that the revenue has failed to make any case for interference in the order of the ITAT, as the CIT had proceeded to remand the matter back to the assessing authority while the appeal of the assessee was pending under Section 250 and the power of exercise under Section 263 was barred by Clause (c) to Explanation 1 of Section 263 of the Act. Further, the remand order by the CIT was based merely on suspicion and presumption. 29. The appeal is devoid of merit and is hereby ..... X X X X Extracts X X X X X X X X Extracts X X X X
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