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TMI Blog2023 (2) TMI 412X X X X Extracts X X X X X X X X Extracts X X X X ..... e Act is merely on suspicions is untenable. Further, the Ld. PCIT has not made any discussion on the issues pointed out by him and exercised the power conferred u/s 263 of the Act on the ground that the explanation of the assessee seems to be plausible and it is not conclusive which is not permissible u/s 263. Thus the impugned order passed by the Ld. PCIT liable to be quashed. Accordingly, the Grounds of appeal of the assessee are allowed. - I.T.A. No. 8607/DEL/2019 - - - Dated:- 9-2-2023 - Shri Pradip Kumar Kedia, Accountant Member And Shri Yogesh Kumar U.S., Judicial Member For the Assessee : Ms. Supriya Mehta, CA For the Department : Shri P Praveen, CIT D.R.; ORDER PER YOGESH KUMAR U.S., JM This appeal is filed by the assessee for assessment year 2015-16 against the order of the ld. Commissioner of Income Tax (Appeals) Noida-24,dated 04/09/2019. 2. The assessee has raised the following grounds of appeal :- 1. On the facts and circumstances of the case, the order passed by the learned Principal Commissioner of Income Tax (Pr. CIT) under Section 263 of the Act is bad, both in the eye of law and on facts. 2. On the facts and circumst ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion to ESI from April 2004 to March 15 totaling of Rs. 5,275/- which was deposited after the due date. 4. The Ld. PCIT while exercising power conferred u/s 263 of the Act, on examination of the assessment record found that (a) there was difference between the sale as admitted by the assessee and sales as reflected in form No. 26AS, [b] there was doubt regarding the identity and creditworthiness of some purchase parties and genuineness of the transactions made with them and [c] there was doubt regarding the genuineness of salary paid to related persons, i.e., the wives of the Directors of the Company. Accordingly, the proceedings u/s 263 of the Act has been initiated against the assessee and passed order dated 04/09/2019 by setting aside the assessment order and directed the A.O. to make the assessment afresh. 5. Aggrieved by the order of the Ld. PCIT dated 04/09/2019, the assessee has preferred the present appeal on the grounds mentioned above. 6. The Ld. Counsel for the assessee submitted that, after passing of the impugned order by the Ld. PCIT, the assessment order came to be passed u/s 143(3) read with Section 263 with Section 144B of the Act on 29/09/2021, wherein, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IT on the issue as to how the order is erroneous and prejudicial to the interest of the Revenue. Therefore submitted that, the impugned order of the Ld. PCIT deserves to be set aside. 9. Per contra, the Ld. DR submitted that the explanation given by the assessee before the PCIT was not satisfactory, thus it is necessary to examine the issue by the A.O. Therefore, by relying on the order of the Ld. PCIT the Ld. DR prayed for dismissal of the appeal. 10. We have heard the parties, perused the material available on record and gave our thoughtful consideration. During the original assessment proceedings the Ld. A.O. has issued notice u/s 142(1) of the Act on 02/02/2017 a copy of the same has been produced by the assessee at Page No. 65 to 69 of the paper book wherein as per Query No. 7 the Ld. A.O. has specifically asked for furnishing the copy of form No. 26AS reflecting all TDS Certificate with reconciliation of receipt as per the certificates with those shown in the income of the A.Y 2015-16 and also called the assessee to furnish explanation for any mismatch if evident. In reply, the assessee has filed point wise reply which has been placed at page No. 70 to 94 of the paper b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had filed reply before the Ld. PCIT on 16/04/2019. In so far as difference in sales as per books of assessee and as per 26AS concerned, the assessee had furnished copy of the purchase bills confirmation from purchase parties and also explained the nature of the transaction with Ms. Babita and Ms. Seema. The copy of the reply filed before the PCIT is placed in the paper book at Page No. 111 to 114 of the paper book. The relevant portion of the reply regarding the difference between sales as per the books of accounts as per 26AS is as under:- 2.0. As you have mentioned in your notice that you have pointed out the difference of Form 26AS total sale receipt of Rs.25,75,90,255/- and as per balance sheet sales amounting Rs 24,68,40,105/- difference Rs.1,07,50,150/- was due to service tax differences of Rs.66,11,777/- and balance amount Rs.41,38,373/- as advance from customers. As per the balance sheet of 31/03/2015 the assessee has shown service tax of Rs. 66,11,477/- in profit and loss account. In case of mobilization advance of Rs.41,38,373/- which was received from M/s Alpha Crop Development Pvt. Ltd. (As formally known as Alpha G Corp Development Pvt. Ltd.) and also submit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as it is prejudicial to the interest of the Revenue. 14. It is observed that the Ld. PCTI is of the opinion that the Ld. A.O. has not verified details in respect of the issues pointed out by the Ld. PCIT. On the other hand, the Ld. PCIT was of the opinion that the issues require further verification by the A.O. It is undisputed fact that all the three issues pointed out by the Ld. PCIT in the show cause notice dated 02/02/2017 have been replied by the assessee and the Ld. A.O. has satisfied on verifying the reply and passed the assessment order. Thus, in our opinion, invoking revisionary power u/s 263 of the Act is merely on suspicions is untenable. Further, the Ld. PCIT has not made any discussion on the issues pointed out by him and exercised the power conferred u/s 263 of the Act on the ground that the explanation of the assessee seems to be plausible and it is not conclusive which is not permissible u/s 263 of the Act. The said view of ours are supported by the Hon ble Bombay High Court in the case of CIT Vs. Gabriel India Ltd., wherein it is held as under:- 14. We may now examine the facts of the present case in the light of the powers of the Commissioner set out a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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