9911796707
TMI Blog2023 (11) TMI 1046X X X X Extracts X X X X X X X X Extracts X X X X ..... gh on merits, the assessee has a case on each of the proposed disallowance by PCIT in his revision order passed u/s. 263 of the Act. Thus PCIT want to enlarge the scope of limited scrutiny for which power is not available with the PCIT u/s. 263 of the Act, for the reasons stated in Co-ordinate Bench decision in the case of Duckwoo Autoind Pvt [ 2023 (1) TMI 361 - ITAT CHENNAI ] Appeal filed by the assessee is allowed. - SHRI MAHAVIR SINGH, VICE PRESIDENT AND SHRI MANJUNATHA.G, ACCOUNTANT MEMBER For the Appellant : Shri N. Quadir Hoseyn, Advocate Dr. L. Natrajan, CA For the Respondent : Shri N.B. Som, CIT ORDER PER MAHAVIR SINGH, VICE PRESIDENT: This appeal by the assessee is arising out of the Revision order passed by the Principal Commissioner of Income Tax (Central), Chennai-2 in Order No. ITBA/REV/F/REV5/2021-22/104139271(1) dated 23.03.2022. The assessment was framed by the DCIT, Circle 1(1), Trichy for the assessment year 2017-18 u/s. 143(3) of the Income Tax Act, 1961 (hereinafter the Act ), vide order dated 22.12.2019. 2. At the outset, it is noticed that the appeal filed by the assessee is barred by limitation by 252 days. The or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xpenses need to be disallowed by invoking the provisions of section 40(a)(ia) of the Act and (iii) Further there is delayed remittance of employees contribution of EPF to the tune of Rs. 7,15,106/- as per Form No.3CD, Sl.No.20(b). This is also to be added to the returned income of the assessee. 5. According to PCIT, in view of the above three items to be added to the returned income of the assessee, the AO framed assessment without examining the same and hence, he issued show-cause notice proposing revision of assessment. 6. The assessee before PCIT contended that out of total rent paid of shop and godown of Rs. 25,43,400/- a sum of Rs. 24,00,000/- is paid to H.H. The Prince Arcot Endowments and Department has issued Nil TDS certificate and therefore, no TDS was deducted but on the balance amount of Rs. 1,43,400/- being different small amounts for different godowns no TDS is applicable. Further, as regards to interest payment, the assessee has already deducted correct TDS of Rs. 1,31,821/- on the interest payment of Rs. 4,17,654/- and hence, no disallowance can be made by invoking the provisions of section 40(a)(ia) of the Act. Further, it was explained that the delayed pay ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 17. Combined reading of instructions issued by CBDT and particularly, the CBDT Instruction No.20/2015 dated 29.12.2015, sub-clause (b) of Clause (3) categorically states that questionnaire issued u/s. 142(1) of the Act, in a limited scrutiny case, shall remain confine only to the specific reasons/issues for which case has been picked up for scrutiny. Further, the scope of enquiry shall be restricted to the limited scrutiny issues. Sub clause (d) of Clause-3 further reads the expansion of the scope of limited scrutiny and there are certain conditionality. The conditionalities are that during the course of assessment proceedings, in a limited scrutiny case, if it comes to notice to the AO that there is a potential escapement of income exceeding Rs. 5 lakhs for normal CIT charge and for metro CIT charge, monetary limit shall be Rs. 10 lakhs requiring substantial verification on any other issue, then the case may be taken up for complete scrutiny with the prior approval of the PCIT/CCIT concerned. The another condition put forth by the CBDT is that such approval thereof accorded by the PCIT in writing after being satisfied about imports of the issues necessitating complete scrutin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 263 of the Act, is certainly available where the order of the AO is erroneous as well as prejudicial to the interest of the Revenue. But, according to us, there is no straight jacket formula for categorizing an order to be erroneous as well as prejudicial to the interest of the Revenue, but depends upon the facts of each case. 19. In the present case, now whether the AO has power to examine in other aspect in a limited scrutiny or not is vital question. The CBDT Instruction No. 20/2015 dated 29.12.2015 sub-clause (b) to Clause (3) categorically limits the power in limited scrutiny case and which confines only to the specific reasons/issues for which case has been picked up for scrutiny and further, the scope of enquiry shall be restricted to limited scrutiny issues only. This is the clear intention of the CBDT. Further, going through the above said instructions, we noted that the limited scrutiny can be enlarged to complete scrutiny, but subject to certain conditions that during the course of assessment proceedings, if it comes to the notice of the AO that there is a potential escapement of income exceeding Rs. 5 lakhs in normal CIT charge and in metro CIT charge Rs. 10 lakhs ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
