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TMI Blog2023 (4) TMI 279X X X X Extracts X X X X X X X X Extracts X X X X ..... ld not have been assumed. CIT vs. Bholenath Poly Feb Pvt. Ltd. [ 2013 (10) TMI 933 - GUJARAT HIGH COURT] and PCIT vs. Rishabhdev Technocable Ltd. [ 2020 (2) TMI 662 - BOMBAY HIGH COURT] are eloquent in this regard. The view taken by the Assessing Officer was a possible view, due to which, invocation of powers under section 263 of the I.T. Act could not have been done. Appeal of the assessee is allowed. 22. We find that the Assessing Officer, therefore, had carried out a thorough enquiry and examination of the purchases in question and it was only after such enquiry and examination that the addition was made by the Assessing Officer, by applying GP rate. Appeal of the assessee is allowed. - ITA No. 362/CHD/2022 - - - Dated:- 23-3-2023 - SHRI. A. D. JAIN, VICE PRESIDENT AND SHRI VIKRAM SINGH YADAV, ACCOUNTANT MEMBER For the Appellant : Shri Parikshit Aggarwal, C.A. For the Respondent : Shri Sarabjeet Singh CIT (DR) ORDER Per A. D. Jain, V P This is assessee's appeal against the order dated 25.3.2022 passed by the PCIT-I, Ludhiana, under section 263 of the Income Tax Act, 1961, for the Assessment Year 2012-13. 2. By virtue of show cause not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .1,43,85,000/- remained unverified/unexplained; and that in view of these facts, the ld. PCIT was of the prima-facie opinion that the errors/omissions and non- enquiry into the relevant facts had rendered the assessment order not only erroneous but also prejudicial to the interests of the Revenue in the purview of section 263 of the I.T. Act read with Explanation 2 thereto. 3. After considering the assessee's reply (APB:4-13) dated 17.3.2022, the ld. PCIT passed the impugned order. Therein, inter alia, the ld. PCIT observed that in his reply, the assessee had stated that he had attended the hearing before the Assessing Officer, but the Assessing Officer had not attended, being busy, and he had requested the Assessing Officer to summon the concerned parties, namely M/s Yuvraj Enterprises and M/s Shakti Enterprises. The ld. PCIT observed that theses averments themselves showed that the Assessing Officer did not carry out required investigations and verifications; that if the assessee had asked the parties to be summoned, the Assessing Officer was required to consider this request and either issue summons to the parties or deal with the same in some suitable manner; that it was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the claim. The ld. PCIT placed reliance on the following decisions: 1. 'Malabar Industrial Co. Ltd. vs. CIT', order dated 10.2.2000, passed by the Hon'ble Supreme Court. 2. Jai Commercial Co. Ltd. vs. Joint Commissioner of Income Tax , 66 TTJ (Del) 731. 3. Express Newspapers Pvt. Ltd. vs. CIT , 255 ITR 137 (Chennai). 4. Desai Brothers Ltd. vs. Deputy Commissioner of Income Tax , 66 ITD 203 (Pune). 5. Gee Vee Enterprise vs. Additional Commissioner of Income Tax and Others , 99 ITR 375 (Del.). 6. Lajja Wati Singhal, Smt. Vs CIT , 226 ITR 527 (All). 7. K.A. Ramaswamy Chettiar And Anr. Vs. Commissioner of Income Tax , 220 ITR 657 (Mad.). 4. The ld. PCIT set aside the order to the file of the Assessing Officer for passing a fresh order in accordance with law in respect of the issue discussed, after giving sufficient opportunity of hearing to the assessee. 5. Aggrieved, the assessee is in appeal. 6. Challenging the impugned order, the ld. Counsel for the assessee has contended that the original return filed by the assessee was processed under section 143(1) of the I.T. Act; that thereafter, the Assessing Officer received infor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e issue stood also examined by the VAT Authorities in their assessment, the assessee stated that the issue had already been settled under the Direct Tax Vivad Se Vishwas Act, 2020, which reply has illegally been rejected by the ld. PCIT. It has been contended that a question already settled under The Direct Tax Vivad Se Vishwas Act, 2020 cannot be revisited under section 263 of the I.T. Act. For this proposition, the following decisions have been relied on: 1. Gopalkrishan Rajkumar vs. PCIT, 445 ITR 577 (Mad.). 2. PCIT vs. Manju Osatwal, 443 ITR 107 (Cal.). 3. Mr. Muthusamy Madhangopa vs. PCIT, order dated 1.7.2022 passed by the Chennai Tribunal in ITA No.142/CHNY/2021. 4. M/s Sol India Pvt. Ltd. vs. PCIT, order dated 18.8.2022, passed by the Chennai Tribunal in ITA No.348/CHNY/2022. 7. It has been contended that under the given facts and circumstances, as per the provisions of section 263(1), Explanation 1(c) of the I.T. Act, the ld. PCIT could not have assumed jurisdiction under section 263 of the I.T. Act. 8. It has been further contended that since the Assessing Officer had found the relevant purchases to have been entered in the stock register maintai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... un-examined and un-taxed, rendering the assessment order erroneous and prejudicial to the interests of the Revenue; and that in these facts and circumstances, the order passed by the ld. PCIT, exercising his revisionary jurisdiction, is well versed, not requiring any interference; and that therefore, the appeal filed by the assessee, being without merit, be ordered to be dismissed. 11. We have heard the rival parties and have gone through the material placed on record. 12. At the outset, it has not been disputed that the matter stands finally settled under the Direct Tax Vivad Se Vishwas Act, 2020. A Certificate (APB:47) in this regard has been issued in Form No.5, under Rule 7 of the Direct Tax Vivad Se Vishwas Act, 2020, on 2.4.2021, by the PCIT, Ludhiana-1, i.e., by the same PCIT, who issued the impugned order dated 25.3.2022. For ready reference, the said Form No.5 is scanned and reproduced as under : 13. Thus, the order for full and final settlement of tax arrears under section 5(2) read with section 6 of The Direct Tax Vivad Se Vishwas Act, 2020 stood passed on 2.4.2021, before issuance of the show cause notice dated 17.3.2022, under section 263 of the I.T. Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tax arrears; that such dispute cannot be re- opened once again under Section 263 of the Act; that once the assessee had opted to settle the dispute under the Direct Tax Vivad Se Vishwas Act, 2020, the proceedings initiated under Section 263 have to go; that by bringing in the Direct Tax Vivad Se Vishwas Act, 2020, the Government intended to reduce the litigation, so that the taxpayers can buy peace with the Department; that the taxpayers whose appeals were pending at any level were entitled to avail benefit of the scheme; and that therefore, there was no justification in proceeding further with the impugned proceedings initiated by the first respondent under Section 263 of the Income Act. 17. In PCIT vs. Manju Osatwal (supra), it has been held that Chapter IX of the Finance Act, 2016 is a complete code in itself; that it provides an opportunity to an assessee to offer income, which was not disclosed earlier, to tax; that Chapter IX provides for a special procedure for disclosure and charging income to tax; that it lays down the procedure for disclosure of such income, the rate of income tax and the penalty to be levied thereupon and the manner of making such payment; that und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the I.T. Act cannot be sustained. 19. In Mr. Muthusamy Madhangopa vs. PCIT (supra), cognizance of FAQ of Direct Tax was taken. Therein, it stood clarified that Section 5(3) of the Direct Tax Vivad Se Vishwas Act, 2020 restricts the rights of the Income-tax Authorities from reopening any issues under the I.T. Act; that the order passed by the designated authority is a conclusive, comprehensive and final order, in respect of matters covered by such order, including tax arrears and sums payable towards full and final settlement; that once the declarant makes payment of the amount so determined, the immunity springs into effect; that thereafter, it would not be open to the Income-tax authorities to sit over such orders and initiate any proceedings under the I.T Act. This case is also directly applicable to the facts at hand. 20. In M/s Sol India Pvt. Ltd. vs. PCIT (supra), Gopalkrishan Rajkumar vs. PCIT (supra) and PCIT vs. Manju Osatwal (supra) were followed to similarly hold invocation of revisionary proceedings to be incompetent. Again, applicability of this decision to the present case cannot be controverted. 21. The above apart, as per the provisions of section ..... X X X X Extracts X X X X X X X X Extracts X X X X
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