9911796707
TMI Blog2022 (12) TMI 171X X X X Extracts X X X X X X X X Extracts X X X X ..... come of Rs.64,71,190/-. This return was revised on 02.09.2015 declaring income of Rs.64,71,190/-. This return was selected for scrutiny assessment. The case was selected for limited scrutiny under CASS on the following reasons :- 1. Sales consideration of property in ITR is less than sales consideration reported in Form 26QB. 2. Tax credit claimed in ITR is less than tax credit available in 26AS. 3. Large difference in opening stock of current year and closing stock of previous year shown in P & L account as per Return of income. 4. Mismatch in sales turnover reported in Audit Report and ITR 5. The assessee filed detailed reply giving explanation point wise in respect of each and every reason for scrutiny selection. Such detailed reply are available in the paper book from pages 50 to 51 alongwith supporting evidences in the form of copies of ledger account, copies of computation of income and copies of financial statement of account. 6. After carefully perusing the reply and the documentary evidences the assessment was completed u/s. 143(3) of the Act at an assessed income of Rs.65,04,660/-. 7. Assuming jurisdiction conferred upon him by the provisions of section 263 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the issue remained unattended. 4. In this background, you are given an opportunity to show cause as to why an order u/s 263 of the Income Tax Act, 1961 should not be passed to set right the above omission. In case you intend to furnish submission, then you are accorded an opportunity to submit the same. Your case is fixed for hearing on 11.03.2020 at 4.00 PM in Room No. 215. C.R. Building. I. P. Estate, New Delhi. Please note that in case of failure to make any submission by this date, the case will be decided on the and the evidences available on record and no further submission will be entertained. 8. Assessee filed a point wise reply to each and every issue raised by the PCIT and the reply has been exhibited in the body of the order of the PCIT from pages- 3 to 7. 9. A detailed reply of the assessee did not find any favour with the PCIT who after referring to various judicial decisions concluded that the assessment order framed u/s.143 (3) of the Act is not only erroneous but also prejudicial to the interest of the revenue. 10. We have given a thoughtful consideration to the order of the PCIT. The first issue relating to interest of Rs.8,368/- u/s. 244 A of the Act has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atch alongwith copies of ledger accounts which have been duly examined by the AO before framing the Assessment Order u/s. 143 (3) of the Act. Exhibit 50 to 56 of the paper book clearly show that to the specific querry of the AO specific reply was furnished by the assessee. 18. The Hon'ble Delhi High Court in the case of DLF Limited 350 ITR 555 has held as under :- * It is not mere prejudice to the revenue, or a mere erroneous view which can be revised under section 263. There should be the added element of 'unsustainability' in the order of the Assessing Officer, which clothes the Commissioner with jurisdiction to issue notice and proceed to make appropriate orders. [Para 10] * In this case, the record reveals that the Assessing Officer had issued notice, and held proceedings on several dates (of hearing) before proceeding to frame the assessment. The Commissioner took the view that the assessment order disclosed an error, in that the deduction under section 14A had not been made. While the statutory direction to the Assessing Officer to calculate, proportionately, the expenditure which an assessee may incur to obtain dividend income, for purposes of disallowance, can ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was adjusted, i. e., deducted from the value of the inventory and not credited to the profit and loss account and that the orders of assessment had been passed without making any enquiries as to whether the interest earned by the assessee had any nexus with the real estate project, the construction of which was undertaken by the assessee. Thus, according to the Principal Commissioner the assessment orders were erroneous in so far as they were prejudicial to the interests of the Revenue. The Tribunal held that the order of revisions was not valid. On appeal: Held, dismissing the appeal, that the Assessing Officer having received a response to his query about the adjustment of interest against inventory, in the assessment years in question, concluded that there was a nexus between the receipt of funds from investors located abroad and the real estate project, which upon being invested generated interest. Thus, it could not be said that the conclusion arrived by the Assessing Officer, that such adjustment was permissible in law, was erroneous. The order of revision was not valid. 20. In the light of the finding given by the PCIT it would be appropriate to refer to the decision o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issioner that any extra stamp duty over and above the transaction value was payable because of the circle rates. On appeal: Held, dismissing the appeal, that the findings recorded by the Tribunal were correct as the Commissioner had[ not given any reason for observing that the order passed by the Assessing Officer was erroneous. The finding recorded by the Commissioner was that "order passed by the Assessing Officer may be erroneous". The Commissioner had doubts about the valuation and sale consideration received but he should have examined this aspect himself and given a finding that the order passed by the Assessing Officer was erroneous. He came to the conclusion and finding that the Assessing Officer had examined this aspect and accepted the computation figures but he had reservations. The Commissioner in the order had recorded that the consideration receivable was examined by the Assessing Officer but was not properly examined and, therefore, the assessment order was "erroneous". This finding would be correct, if he had examined and verified the transaction himself and given a finding on the merits. The Commissioner was patently wrong in stating that Schedule III to the Wea ..... X X X X Extracts X X X X X X X X Extracts X X X X
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