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TMI Blog2023 (8) TMI 673X X X X Extracts X X X X X X X X Extracts X X X X ..... ower u/s 263 cannot be initiated on the basis of audit objection. Hence, we set aside the order passed by the ld. Pr.CIT on this issue. Disallowance of statutory dues not paid before the due date of return - We find that ld. Counsel has fairly conceded that he will not be contesting this aspect. Hence, revision order is sustained on this issue. Appeal filed by the assessee is partly allowed. - Shri Shamim Yahya, Accountant Member And Ms. Astha Chandra, Judicial Member For the Assessee : Dr. Rakesh Gupta, Advocate, Shri Somil Aggarwal, Advocate For the Revenue : Shri Subhra Jyoti Chakraborty, CIT DR ORDER PER SHAMIM YAHYA, ACCOUNTANT MEMBER : This appeal by the assessee is directed against the order of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 44AB within the specified date, the penalty proceedings u/s 271B should have been initiated in the assessment order passed by AO which was not done, leading to passing of an erroneous order in so far as it was prejudicial to the interest of Revenue. (ii) It was further observed that as per para 21 (a) of the tax audit report filed by the assessee, a capital expenditure of Rs. 80,69,180/- on account of loss on sale of tower at Jaipur, has been debited to Profit and Loss a/c for A.Y. 2013-14. However, the said amount of capital loss has not been disallowed by the AO while framing the assessment u/s 143(3) completed on 30.03.2016. The capital expenditure- of Rs. 80,69,180/- cannot be allowed u/s 37 of the Act and is liable to be disallowed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot be said to be any error in the assessment order as it has been held in various judicial pronouncements that penalty u/s 271B need not be initiated during the course of assessment proceedings and such penalty is de hors the assessment order. Therefore, he submitted that there cannot be an error in the assessment order on this score much less for any revision by ld. Pr.CIT. In this regard, ld. Counsel for the assessee relied upon several case laws as under :- (i) Assam State Warehousing Corporation vs. CIT 288 ITR 25 (Gau); (ii) Manohar Lal vs. DCIT 53 TTJ 105 (JP); and (iii) ACIT vs. Madan Roller Flour Mills Ltd. 71 ITD 274 (ASR). 6.1 Ld. Counsel further submitted that 271B does not postulates any satisfaction of AO, hence rev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1B of the Act, we find that submissions of the ld. Counsel of the assessee in this regard are cogent. The case laws cited duly establish that no issue of satisfaction by the AO is required for initiating this penalty. Hence, this plank of revision is not sustainable and we set aside the order of ld. Pr.CIT in this regard. 8.1 As regards the issue of non-disallowance of loss on sale of tower, it is duly emanating that this aspect was raised on the basis of audit objection. The case laws cited by the ld. Counsel of the assessee duly establish that revisionary power u/s 263 cannot be initiated on the basis of audit objection. Hence, we set aside the order passed by the ld. Pr.CIT on this issue. 8.2 As regards last issue of disallowance o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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