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TMI Blog2023 (4) TMI 95X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee. PCIT has given no finding as to why the assessment order was in error on the issue of cash deposit short considered by the AO. And with respect to the error relating to the issue of acceptance of source of cash deposit by the AO he has merely reiterated his earlier observation that no evidences proving the source as noted by the AO were found in the case record. Ignoring the explanation of the assessee, we find, the Ld. PCIT has simply reiterated his reason for assuming jurisdiction to revise the order of the AO, while finding the assessment order erroneous and causing prejudice to the Revenue. Merely because documents, noted by the AO to be produced by the creditor of source of cash deposit of Rs. 98.09 lacs in response to summons issued to him u/s. 131 were not found in the case records, that cannot be the reason for holding the assessment order to be in error for accepting the genuineness of the source of cash deposit. The fact of issuance of summons by the AO is not doubted or disputed by the Ld. PCIT. AO has also categorically noted relevant documents submitted by the depositor proving genuineness of the source of cash deposit. The Ld. PCIT has not found ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under consideration, which the said party furnished to the AO on summons issued to him by the AO under section 131 of the Act; but as per the ld. Pr. CIT, these documents were not available in the case records of the assessee. 4. On account of the above two issues, the ld. Pr. CIT was of the view that the assessment had been framed in the present case without making due verification or inquiry on the above issues. The notice issued to assessee under section 263 of the Act, bringing out the above, is placed before us at PB Page No. 193 194 and reproduced hereunder: NOTICE FOR THE HEARING M/s/Mr/Ms Subject: Notice for Hearing in respect of Revision proceedings u/s. 263 of the INCOME TAX ACT, 1961-Assessment Year 2017-18. In this regard, a hearing in the matter is fixed on 07/03/2022 at 01:07 PM. You are requested to attend in person or through an authorized representative to submit your representation, if any alongwith supporting documents/information in support of the issues involved (as mentioned below). If you wish that the Revision proceeding be concluded on the basis of your written submissions/representations filed in this office, on or before the said ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sing Officer in your case for the A.Y. 2017-18 on 31/12/2019 is found to be erroneous in so far as it is prejudicial to the interest of revenue within the meaning of Section 263 of the IT. Act. 4. In view of the above, the undersigned proposes to pass an order u/s. 263 of the IT. Act setting aside the assessment order u/s. 143(3) of the IT. Act for the A.Y. 2017-18 passed by the Assessing Officer on 31/12/2019 with a direction to make fresh assessment after due verification/inquiry on the above issues and in accordance with the provisions of law. 5. In case you have any objection for the proposed action u/s. 263 of the IT. Act, you are hereby given an opportunity to submit your written submission/explanation, if any, electronically on or before 07/03/2022. Please note that in case of noncompliance on your part, the matter will be decided on merits on the basis of the materials available on record and no further opportunity will be given to you in this regard. 6. Please note that your personal attendance or attendance of any other person authorized by you is not required before me and you are requested to submit your written submission/explanation, if any, electronica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the amassment u/s; 143(3) of the I.T. Act for the A.Y. 2017-18 on 31/12/2019 Accordingly the assessment order passed by the Assessing Officer is erroneous in so far as it is prejudicial to the interest of the revenue, in terms of clause (a) of Explanation 2 to Section 263(1) of the Income Tax Act. Therefore, the said assessment order is set aside with a direction to the Assessing Officer to pass a fresh assessment order after taking into consideration the issues as may have been already Considered together with issues discussed herein above also. Needless to mention that while passing the fresh assessment order, consequent to this order being passed under Section 263 of the IT. Act, the Assessing Officer shall grant reasonable and sufficient opportunity of being heard to the assessee. 6. Pleadings of the ld. counsel for the assessee, while challenging of this order passed by the ld. Pr. CIT under section 263 of the Act was that- a) with respect to issue of cash deposit made in the bank account of the assessee, wherein ld. Pr. CIT had noted difference of Rs. 1,00,000/- in the figure considered by the AO, the ld. counsel for the assessee contended that before the ld. Pr. C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d above, are that the assessment order was found to be erroneous on account of: the AO considering figures of cash deposited in the bank account of the assessee short by Rs. 1,00,000/- i.e. taking it as Rs. 117.12 crores as opposed to the assessee submitting to the AO a figure of Rs. 117.13 crores, and secondly; for the reason, the AO accepting the genuineness of the cash deposits of Rs. 98,09,203/- from one of the parties on the basis of certain documents filed, which as per the Ld. PCIT were found to be missing in the case records. Undeniably before the ld. Pr. CIT the assessee had claimed that the assessment order was not erroneous on either of the grounds, and had substantiated the same also. 8. With respect to the anomaly found in the figure of cash deposits made by the assessee during the year, the assessee had infact clarified to the Ld. PCIT that before the AO he had mentioned an inflated figure of cash deposits of Rs. 117.12/Rs. 117.13 crores, and in fact the actual amount of cash deposits was of Rs. 113.66 crores. He had substantiated the same by furnishing of his entire cash books. His reply to the Ld. PCIT dated 18-01-2022 to this effect is placed before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... revenue within the meaning of section 263 of the Act. 9. With respect to the source of deposits found to be genuine by the AO of Rs. 98,09,203/-, the assessee again provided copies of all the documents which were furnished to the AO. His explanation alongwith evidences, in the reply filed to the Ld. PCIT vide letter dated 18-01-2022 is as under: (v) Vide Para 3 of the notice u/s. 263, your honour have also proposed to withdraw the exclusion of Rs. 98,09,203/- granted by the Assessing Officer in the name of Chirag Tiger to whom summons u/s. 131 were issued in which he had confirmed the transactions and had also furnished the copy of his return of income, copy of PAN card, copy of licence and ledger. account etc, The exclusion is proposed to be withdrawn for the reason that no details are available in the case records at the time of taking up the case records for examination, by the, PCIT concerned. In this regard it is submitted that at Para 7 at Page 4 on Sr. No. 14 of the assessment order, date of issuance of summons u/s. 131 is stated to be as 03/12/2019. At Page 7.1 at Page 5 of the assessment order, the Assessing Officer in unambiguous terms has stated/concluded a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he case of CIT. v, Nirav Modi - [2016] 71 taxmann.com 272 (Bombay) [SLP of Revenue also dismissed by SC], In the case of. your assessee, necessary inquiry as. deemed fit by the Assessing Officer was indeed conducted and results of such inquiry have also been discussed/enumerated in the assessment order. Contents of the assessment order categorically indicate and demonstrates that the Assessing Officer completed assessment after making due inquiries and after recording result of such inquiry and, therefore, averment that the Assessing Officer completed assessment without proper verification/inquiry in the notice u/s. 263 is without any substance and is outside the ambit of provisions of section 263 of the Act and is not sustainable. Without prejudice to the above, I am also enclosing herewith following documents in support of the finding of the Assessing Officer with regard to Chirag Tiger at Para 7.1 of the assessment order- (a) ITR acknowledgement No. ASOPJ9493J of Shri Chirag D Jain alias Tiger for A.Y. 2017-18 for return furnished on 25/10/2017 under PAN: 25-10-2017 as Annexure- (b) Copy of letter dated 09/12/2019 submitted by him to the Assessing Officer in compl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt considered by the AO. And with respect to the error relating to the issue of acceptance of source of cash deposit of Rs. 98.09 lacs by the AO he has merely reiterated his earlier observation that no evidences proving the source as noted by the AO were found in the case record. Ignoring the explanation of the assessee, we find, the Ld. PCIT has simply reiterated his reason for assuming jurisdiction to revise the order of the AO, while finding the assessment order erroneous and causing prejudice to the Revenue. There cannot, in such facts and circumstances, be said to be any finding of error in the order of the AO causing prejudice to the Revenue, by the Ld. PCIT. 12. Moreover merely because documents, noted by the AO to be produced by the creditor of source of cash deposit of Rs. 98.09 lacs in response to summons issued to him u/s. 131 of the Act, were not found in the case records, that cannot be the reason for holding the assessment order to be in error for accepting the genuineness of the source of cash deposit. The fact of issuance of summons by the AO is not doubted or disputed by the Ld. PCIT. The AO has also categorically noted relevant documents submitted by the dep ..... X X X X Extracts X X X X X X X X Extracts X X X X
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