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TMI Blog2023 (11) TMI 988X X X X Extracts X X X X X X X X Extracts X X X X ..... me Tax Act, 1961 as the order passed u/s 143(3) by the Ld. A.O. was neither erroneous nor prejudicial to the interests of the revenue as in the assessment order, the Ld. A.O. has already disallowed the expenditure of Rs 73,54,549/- claimed by the assessee on the issue on which the show cause notice u/s 263 was issued to the assessee. 2. On the facts of laws and in the circumstances of the case, the order w/s 263 passed by the Ld. Pr. CIT is bad in law and against the principles of natural justice as Ld. PCIT has never ever raised the issue of loans received in the show cause notice dated 04.01.2023 on the basis of no which the assessment order is treated as erroneous and prejudicial to the interest of the revenue. 2. Briefly stated fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ss amounting to Rs. 73,54,549/-. 2.2 Subsequently, the Ld. PCIT called for the assessment record and after examination observed that assessee has shown long term borrowing of Rs. 58,12,53,048/- and also shown loans given to related and other parties amounting to Rs. 80,87,69,177/- but no interest income from said loans and advances was shown as against the interest expenses of Rs. 73,18,356/- claimed in the profit and loss account. According to the Ld. PCIT said interest expenses of Rs. 73,18,356/- was required to be disallowed as no interest income was offered by the assessee against loans and advances given. Accordingly, the Ld. PCIT issued notice u/s 263 of the Act on 04.01.2023 proposing as why the assessment order passed u/s 143(3) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... while passing the assessment order, the claim of expenses of Rs. 73,18,356/- has been allowed by the then AO in the assessment order, However the A.O. has disallowed claim of deduction of Rs. 73,54,549/- including interest of Rs. 73,18,356 u/s 14A r.w.s. 8D of the Act. Further it' is seen that in respect of advance loans of Rs. 80,87,69,1771/- to related parties and other parties, the genuineness & creditworthiness of the borrowed fund has not been examined properly u/s 133(6) of the Act during the assessment proceedings though case was selected for complete scrutiny and these parties were not examined under section 133(6) of, the Act. 7. Considering the above discussed facts and circumstances, I hold that the assessment order dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... viding due opportunity to the assessee is invalid. The Ld. Counsel of the assessee in support of claim relied on the decision of the Hon'ble Supreme Court in the case of CIT v. Amitabh Bachchan [2016] 69 taxmann.com 170 (SC). 4.1 The Ld. DR on the other hand submitted that there is no requirement of issuing specific show cause notice for revising the assessment order on a particular issue. He also relied on the decision of the Hon'ble Supreme Court in the case of Amitabh Bachchan (supra). 4.2 Thus, the issue in dispute precipitated in the case is whether there was a requirement of issue of show cause notice or providing opportunity of being heard to the assessee on a particular issue for revising the assessment order. In this reference, w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Ld. PCIT is reproduced as under: "NOTICE FOR THE HEARING M/s/Mr/Ms Subject: Notice for Hearing in respect of Revision proceedings us 263 of the THE INCOME TAX ACT, 1961 - Assessment Year 2018-19. In this regard, a hearing in the matter is fixed on 12/01/2023 at 11:30 AM. You are requested to attend in person or through an authorized representative to submit your representation, if any along with 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 due date, then your personal attendance is not required. You also have the option to file your ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hy said assessment order should not be revised under section 263 of the Income Tax Act. 3. In this connection, you are hereby given an opportunity to file submission on or before 11.01.2023 through ITBA Portal, along-with all supporting documents and evidences. If you wish to avail personal hearing, you are requested to attend the hearing on 12.01.2023 at 11.30 a.m. at Room No. 515, 5th Floor, Aayakar Bhavan, Mumbai either in person or through an authorized representative. In case of noncompliance on the stipulated date and time, it will be presumed that you have no objection to the proposed revision of the assessment order passed by the Assessing Officer under section 143(3) r.w.s. 143(3A) & 143(3B) of the Income Tax Act dated 05.03.202 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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