9911796707
TMI Blog2023 (11) TMI 234X X X X Extracts X X X X X X X X Extracts X X X X ..... n the facts and circumstances of the case and in law, the order passed u/s 263 of the Act by the Principal Commissioner of Income-tax (PCIT) Rajkot-1 is void ab-initio and without jurisdiction because the same issue as raised in assessment framed u/s 143(3) r.w.s 147 of the Act is pending with the CIT(Appeals). 2.0 That on the facts and circumstances of the case and in law, the Principal Commissioner of Income-tax (PCIT) Rajkot-1 erred in exercising jurisdiction u/s 263 by setting aside the issue of transactions of Rs. 2,82,08,000/- with M/s National Shroff even though the same had been discussed and scrutinized by the Assessing Officer in detail while framing the assessment u/s 143(3) r.w.s. 147 of the Act. 2.1 That on the facts and circumstances of the case and in law, the Principal Commissioner of Income-tax (PCIT) Rajkot-1 erred in setting aside the order by stating that the assessing officer has not conducted any inquiries or applied his mind correctly on finalizing the order by estimating the profit @8% on the total transactions of Rs. 2,82,08,000/- with M/s National Shroff. 2.2 That on the facts and circumstances of the case and in law, the Principal Commissioner of In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of the GP rate / NP rate treating the transactions with Anagadiaas commodity transactions without any basis and on the other side no evidences from assessee or AO have brought on record to show the transactions with Angadiaas commodity transactions. Further, Principal CIT observed that the AO has made the addition @ 8% of the total financial transactions of Rs. 2,82,08,000/-. Since these transactions have been made with M/s. National Shroff who is an Angadia therefore there was no scope to treat the said transactions as trading turnover but were required to be treated as cash transactions only. So there was no question of applying any GP or NP rate on above financial transactions. Neither the assessee has proved that those were not the financial transactions but some commodity trade transactions nor AO has examined the nature of transaction and simply accepted the commodity trade turnover when there was nothing on record to assume so. Moreover, the assessment has been completed under the provisions of section 44AD of the IT Act by the AO but the said provisions are not applicable as the total quantum of transaction was exceeding Rs. 60 lacs in the year under consideration. So th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng officer had only made reference to the provisions of section 44AD of the Act for computing the taxable income of the assessee. Accordingly, in light of the above observations, it was submitted that the order passed under section 263 of the Act was neither erroneous nor prejudicial to the interest of Revenue. 5. In response, the Ld. DR placed reliance on the observations made by Principal CIT in the 263 order. 6. We have heard the rival contentions and perused the material on record. 6.1 Firstly, we shall deal with the contention that the assessee has filed appeal against the assessment order before Ld. CIT(Appeals), which is pending adjudication and therefore, the said assessment order cannot be subject matter of 263 proceedings. In the case of Amritlal Bhogilal & Co.34 ITR 130 (SC), the Hon'ble Supreme Court held that it would be open to the Commissioner to revise an assessment while an appeal against it is still pending before the CIT(A), because the AO's order must be regarded as subsisting and effective in law, despite the pendency of the appeal. In the case of EIMCO K.C.P. Ltd.242 ITR 659 (SC), the Hon'ble Supreme Court held that Commissioner could interfere, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng an opportunity of being heard to the assessee is not appropriate and sustainable in law. Therefore, in our considered view, the aforesaid decision cannot be applied in cases where due opportunity of being heard was granted to the assessee during the course of 263 proceedings. Accordingly, we are unable to agree with the contention/argument put forth by the assessee on this point. 6.3 The third argument by the assessee before us was that the issues on the basis of which proceedings under section 263 of the Act have been initiated against assessee had already been examined by the assessing officer during the course of assessment proceedings. However, what also has to be seen is whether after due enquiry, the conclusion drawn by the assessing officer is in accordance with law and would not cause any evident prejudice to the interests of the Revenue. If, on the basis of conclusions drawn by the assessing officer, it is seen that such conclusion would cause evident prejudice to the interests of the Revenue, in our considered view, the Department can take recourse to 263 proceedings to set aside such assessment order. In the instant facts, even though the relevant facts were examined ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
