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TMI Blog2023 (11) TMI 1273X X X X Extracts X X X X X X X X Extracts X X X X ..... infirmity in the assessment order which could make it erroneous and prejudicial to the interest of the Revenue. Therefore, we set aside the order of the PCIT and restore that of the AO - Decided in favour of assessee. - Shri N.K. Billaiya, Accountant Member, And Ms Astha Chandra, Judicial Member For the Assessee : Dr. Rakesh Gupta, Adv. Shri Somil Agarwal, Adv. For the Department : Shri P.N. Barnwal, CIT-DR. ORDER PER N.K. BILLAIYA, ACCOUNTANT MEMBER:- This appeal by the assessee is preferred against the order of the ld. PCIT, Faridabad dated 25.03.2022 framed u/s 263 of the Income tax Act, 1961 [the Act, for short] pertaining to A.Y. 2017-18. 2. The sum and substance of the grievance of the assessee is that the PCIT erred in assuming jurisdiction u/s 263 of the Act and further erred in holding the assessment order dated 29.12.2019 as erroneous and prejudicial to the interest of the Revenue. 3. Representatives of both the sides were heard at length. Case records carefully perused. Relevant documentary evidence brought on record duly considered in light of Rule 18(6) of the ITAT Rules. 4. Briefly stated the facts of the case are that the assessee filed its return of income electro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y: 1. Please give a brief note indicating the nature of financial activities of the assessee alongwith copies of computation statement, complete copies of the bank accounts with narration thereof, form no 16/16A, Copies of the Form No. 26AS having complete details of Name TAN of Deductors, total amount paid amount of TDS deducted. Reconciliation of 26AS vis a vis detail filed in return of income may be furnished. 2. Please furnish the complete documentary evidence of the source of investment in purchase of property and income relating to property and also give details of exempt income also reconcile the figure of sale as in ITR vis- -vis 26QB. 3 Please furnish the complete details of the Capital Loss/Gain on the sale of property alongwith documentary evidences and also give complete details of exempt income with proof. 4. Please furnish the complete details of the deduction/exemption claimed u/s 11(1A), other than 11(A), 54B, 54C, 54D, 54G, 54GA etc. with documentary evidence. 12. Second notice u/s 142(1) of the Act was issued on 17.07.2019 with the following query: You are requested to file the complete reply with supporting documents etc as per Questionnaire by 22.07.19 failing w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... F/142(11/2019- 20/1018985688(1) dated 16-10-2019, I submit as under, 1. That copy of Income Tax return alongwith Computation of Income showing complete details of income are enclosed herewith. 2. That Copy of Form 26AS showing TDS deducted during the year is enclosed herewith. 3. That partly details of Investment and sources of investment are enclosed herewith. 4. That regarding capital gain/loss, computation of income is enclosed herewith and copy of sale deed has already been submitted. 5. That for details of exemption claimed u/s 54B and u/s 54F of the Income Tax Act, 1961 during the said assessment year, copy of computation of income is enclosed herewith. In view of above, your honour are requested to kindly provide the copy of reasons. Thanking You, (RAGHUVIR SINGH) Dated: 21-10-2019 18. Third reply reads as under: Sub.: Reply to Notice u/s 142(1) of the Income Tax Act, 1961 Ref. No. : ITBA/AST/F/142(1)/2019-20/1019854836(1) dated 06-11- 2019 Respected Sir, With reference to above captioned subject matter, I submit as under: 1. That I had sold agriculture lands during the FY 2016-17, details of sale consideration are as under: Copies of Sale deeds are already submitted for you ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ur family member since last 10 year. But finally, we have decided to resolve this issue and agreed to sell our agriculture land to M/s M3M India Pvt. Ltd, Rohsni Builders Pvt. Ltd. and High Rise Propbild Private Ltd (Buyer). That our family members agreed with said buyer company to take some payment received immediately and mostly as PDC. 2. That a summary showing investment made with supporting evidence along with sources of payment from bank (FY-2016-17, FY-2017-18 and FY-2018-19) is enclosed herewith. (Annexure 1 2) 3. That query regarding property have been purchased in the name of wife, submission are as under: That I had made payment to purchase the agriculture land and residential property out of sale consideration received/receivable on sale of agriculture land of Rs. 17,77,40,000/- ii. That out of total investments, some property had been registered in the name of my wife Bishembari Devi. That my wife Smt. Bishembari Devi is depended upon me and she had not claimed any exemption benefit against the said purchases under the income tax. iv. That I had also relied on below judgments: HON'BLE HIGH COURT OF RAJASTHAN in case of Laxmi Narayan vs Commissioner of Income-tax, J ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roneous prejudice has been caused to the interests of the Revenue. It has, therefore, to be considered firstly as to when an order can be said to be erroneous. We find that the expressions erroneous , erroneous assessment and erroneous judgment have been defined in Black's Law Dictionary. According to the definition, erroneous means involving error; deviating from the law . Erroneous assessment refers to an assessment that deviates from the law and is, therefore, invalid, and is a defect that is jurisdictional in its nature, and does not refer to the judgment of the Assessing Officer in fixing the amount of valuation of the property. Similarly, erroneous judgment means one rendered according to course and 8 practice of court, but contrary to law, upon mistaken view of law; or upon erroneous application of legal principles . 12. From the aforesaid definitions it is clear that an order cannot be termed as erroneous unless it is not in accordance with law. If an Income-tax Officer acting in accordance with law makes a certain assessment, the same cannot be branded as erroneous by the Commissioner simply because, according to him, the order should have been written more elaborately ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assed by the Income-tax Officer without making any enquiry in undue haste. We have also held as to what is prejudicial to the interests of the Revenue. An order can be said to be prejudicial to the interests of the Revenue if it is not in accordance with the law in consequence whereof the lawful revenue due to the State has not been realised or cannot be realised. There must be material available on the 10 record called for by the Commissioner to satisfy him prima facie that the aforesaid two requisites are present. If not, he has no authority to initiate proceedings for revision. Exercise of power of suo motu revision under such circumstances will amount to arbitrary exercise of power. It is well-settled that when exercise of statutory power is dependent upon the existence of certain objective facts, the authority before exercising such power must have materials on record to satisfy it in that regard. If the action of the authority is challenged before the court it would be open to the courts to examine whether the relevant objective factors were available from the records called for and examined by such authority. The Income-tax Officer in this case had made enquiries in regard t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proceedings for both the Assessment Years, the Assessing . A.Y. 2009-10 Officer issued a query memo to the assessee, calling upon him to justify the genuineness of the gifts. The Respondent Assessee responded to the same by giving evidence of the communications received from his father and his sister i.e. the donors of the gifts along with the statement of their Bank accounts. On perusal, the Assessing Officer was satisfied about the creditworthiness/capacity of the donors, the source from where these funds have come and also the creditworthiness/ capacity of the donor. Once the Assessing Officer was satisfied with regard to the same, there was no further requirement on the part of the Assessing Officer to disclose his satisfaction in the Assessment Order passed thereon. Thus, this objection on the part of the Revenue cannot be accepted. 26. We find that the Hon'ble Delhi High Court in the case of CIT Vs Sunbeam Auto reported in 332 ITR 167 has held as held as under: 12. We have considered the rival submissions of the counsel on the other side and have gone through the records. The first issue that arises for our consideration is about the exercise of power by the CIT under s. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eements for purchase of land submitted by the assessee. The assessee has also purchase a plot on 09.09.2016 vide sale deed No. 2103 registered on 09.09.2016 by Joint sub-registrar, Manesar in the name of Smt. Bishamvari Devi wife of the assessee. The land purchased by the assessee is within the M.C. Area of Manesar. Therefore the deduction claimed u/s 54B of the Income Tax Act of Rs. 50,75,000/-(including Stamp duty of Rs. 2,75,000/-) invested in plot in the name of wife is not allowable and is to be disallowed. The assessee has also claimed deduction u/s 54F of the Income Tax Act of Rs. 1,79,00,000/- including renovation expenses of Rs. 85,00,000/- for the house purchased on 15.09.2016 vide sale deed No. 2726 in the name of Smit. Bishamvari Devi wife of the assessee situated at Village Bhondsi Tehsil Sohna registered by Sub-Registrar, Sohna. This deduction is not allowable as the plot/house is not purchased in the name of the assessee and is to be disallowed. Out of the total sale consideration of Rs 3,82,22 600/- received on 30.07.2016 an amount of Rs. 1,35,47,000/- is to be disallowed as the same is a not invested with in a period of two-years from the date of transfer required ..... X X X X Extracts X X X X X X X X Extracts X X X X
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