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TMI Blog2022 (7) TMI 1303X X X X Extracts X X X X X X X X Extracts X X X X ..... sment year. After issuance of notice and on physical verification of the residential properties, the AO opined that the property is not residential house and it is a small portion of construction and the assessee has let out the same and offered the income. Accordingly, the AO has completed the assessment dated 143(3) dated r.w.s. 263 - Therefore, we are of the view that initiation of proceedings u/s 263 is incorrect and not permissible under law. Therefore, we hold that the assessment order passed u/s 143(3) r.w.s. 263 dated 16.08.2018 holds good and thus quash the order passed u/s 263 dated 24.03.2021. Therefore, the grounds raised by the assessee are allowed. - I.T.A.No.100/Viz/2021 And 101/Viz/2021 - - - Dated:- 28-7-2022 - Shri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nable opportunity of being heard to the assessee. Consequent to the order of the Ld.Pr.CIT, the AO completed the assessment u/s 143(3) r.w.s. 263 and passed consequential order dated 16.08.2018 determining the total income at Rs.9,75,130/-. On subsequent examination, the Ld.Pr.CIT observed that the AO while completing the assessment u/s 143(3) r.w.s. 263 had travelled beyond the directions of the Pr.CIT to disallow the claim of the deduction u/s 54F of the Act amounting to Rs.55,45,275/- and passed assessment order without making inquiries or verification, which is erroneous and prejudicial to the interest of the revenue. The Pr.CIT observed from the records that the assessee during the financial year 2012-13 sold two sites on 04.07.2012 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 000/- per month . Hence, submitted that the assessee hold only one residential house property on the date of transfer of capital asset and the assessee is eligible to claim exemption u/s 54F of the Act. The Ld.Pr.CIT observed that the assessment order was passed without making inquiries or verification, and without following the directions of the Pr.CIT in the order u/s 263 which should have been followed with regard to the issue of deduction u/s 54F of the Act for which the Ld.Pr.CIT had made a specific direction. Hence, invoking the revisionary powers u/s 263 of the Act, the Ld.Pr.CIT set aside the assessment order as erroneous and prejudicial to the interest of the revenue with a direction to redo the assessment by disallowing the ded ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessment and also examine fact that the assessee is holding two residential properties during the year and also offered the property income from the said two residential properties amounting to Rs.66,577/-. The Ld.AR submitted that the Ld.Pr.CIT viewed, as per the provisions of Sec.54F, exemption shall be available only when the assessee does not own more than one residential property on the date of transfer of such asset exclusive of the one which he has bought for claiming exemption u/s 54F. Therefore, the Ld.Pr.CIT held that the assessee is not eligible for exemption u/s 54F and directed the AO to disallow the deduction claimed u/s 54F. Thereafter, the AO issued notice and he has examined the properties and came to conclusion that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dential properties and also offered rental income for the relevant assessment year. After issuance of notice and on physical verification of the residential properties, the AO opined that the property is not residential house and it is a small portion of construction and the assessee has let out the same and offered the income. Accordingly, the AO has completed the assessment dated 143(3) dated r.w.s. 263 dated 16.08.2018. Therefore, we are of the view that initiation of proceedings u/s 263 is incorrect and not permissible under law. Therefore, we hold that the assessment order passed u/s 143(3) r.w.s. 263 dated 16.08.2018 holds good and thus quash the order passed u/s 263 dated 24.03.2021. Therefore, the grounds raised by the assessee are ..... X X X X Extracts X X X X X X X X Extracts X X X X
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