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TMI Blog2024 (7) TMI 706X X X X Extracts X X X X X X X X Extracts X X X X ..... e observation of the AO as canvassed by the AR is found to be factually incorrect, then the proper recourse would be available to the assessee only in the course of the set-aside proceedings by seeking weeding out of the said incorrect observation and substitution of the same by the correct figure. As regards the contention of the Ld. AR that the Pr. CIT had failed to carry out any independent verification on the aforesaid aspect, we are unable to persuade ourselves to subscribe to the same. We, say so, for the reason that the Pr. CIT had categorically referred to the aforesaid conflicting figures of sales as are clearly discernible from the assessment order and, in the backdrop of the same, had set-aside the order of the A.O with a direction to readjudicate the same. Also, we are unable to concur with the claim of the Ld. AR that the aforesaid variance in the figures of sales would have no bearing on the assessment order. In case, the aggregate sales of the assessee firm as observed by the A.O are found to be Rs. 4,24,67,351/- (as per chart ), then, the same would clearly render the order passed by the A.O as erroneous and prejudicial to the interest of the revenue u/s. 263 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the assessee and therefore, the inference drawn is contrary to the records which is unsustainable and bad- in-law. (b) The Learned PCIT-1, Raipur has erred in drawing the inference based on perusal of assessment order instead of drawing the inference based on the records in the assessment folder. (c) The Learned PCIT-1, Raipur has erred in drawing the inference without conducting enquiry or verification which he ought to have made. (d) The Learned PCIT-1, Raipur has erred in holding the assessment order to be erroneous stating that this is the case of the Learned A.O conducting inadequate enquiries and further erred in invoking Explanation-2 introduced in Section 263 w.e.f. 01.06.2015. 2. Without prejudice to the above, on the facts and in the circumstances of the case and in law, the Learned PCIT-1, Raipur has erred in holding that the order dated 30.12.2019 passed by the Learned A.O. u/s. 143(3) of the Income Tax Act, 1961 was erroneous and prejudicial to the interests of revenue and thereby setting aside the same. 3. Without prejudice to the above, on the facts and in the circumstances of the case and in law, notwithstanding the above grounds of appeal the order passed by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of 20.50 % of the assessee firm, therein, determined its suppressed profit at Rs. 35,53,840/-. Accordingly, the Pr. CIT on the basis of his aforesaid observations vide Show Cause Notice (SCN) dated 24.01.2022 called upon the assessee firm to explain as to why the order passed by the A.O being erroneous in so far as it was prejudicial to the interest of the revenue may not be revised u/s. 263 of the Act. As the reply filed by the assessee did not find favour with the Pr. CIT, therefore, he vide his order passed u/s. 263 of the Act dated 30.03.2022 set-aside the assessment order passed by the A.O u/s. 143(3) dated 30.12.2019 with a direction to examine the aforesaid issue and accordingly, pass a fresh assessment order as per the provisions of the Income Tax Act, 1961. 5. Aggrieved, the assessee firm has assailed the order passed by the Pr. CIT u/s. 263 of the Act dated 30.03.2022 in appeal before us. 6. We have heard the ld. Authorized representatives of both the parties, perused the orders of the lower authorities and the material available on record, as well as considered the judicial pronouncements that have been pressed into service by the Ld. AR to drive home his contentions. 7. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Pr. CIT, and rightly so, the A.O in the assessment order had categorically observed that the total sales of the assessee firm worked out at Rs. 4,24,67,351/-, viz. (i) sales through cheque payments: Rs. 2,33,09,609/-; and (ii) cash sales (including card payments) : Rs. 1,91,57,742/-. In fact, the A.O had given bifurcated details of the aforesaid cash/cheque sales, which details as stated by him were compiled on the basis of cash book of the assessee firm that was produced before him. Apart from that, a perusal of the assessment order reveals that based on the aforesaid bifurcated monthly sales figures the A.O had taken note of the fact that as against average cash sales of Rs. 3 lacs over the period April, 2016 to September, 2016, there was an abrupt rise in the sales for the period October, 2016 to December, 2016. Further, the aforesaid figures were acted upon by the A.O to arrive at a finding that the cash sales of the assessee firm had witnessed a progressive decline during January, 2017 to March, 2017. It was, thus, based on the aforesaid facts that the A.O had concluded that the cash sales projected by the assessee in October, November and December, 2016 did not repres ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the A.O u/s. 143(3) dated 30.12.2019 may not in light of the aforesaid admitted mistake be revised u/s. 263 of the Act that the assessee firm had for the first time claimed that the said figures of monthly sales were incorrect. 12. Be that as it may, in our considered view, now when the A.O had himself in the assessment order observed that the aggregate sales of the assessee firm for the year under consideration (as per the chart ) worked out at Rs. 4,24,67,351/-, therefore, the Pr. CIT remained well within his jurisdiction to set-aside the said assessment order with a direction to the A.O to re-adjudicate the aforesaid aspect afresh after affording a reasonable opportunity of being heard to the assessee firm. In so far the claim of the Ld. AR that though the observation of the A.O that the aggregate sales of the assessee firm worked out at Rs. 4,24,67,351/- (as per chart ) was a factually incorrect observation, but the same would by no means lead to any prejudice to the revenue, we are unable to concur with the same. As nothing is either discernible from the record nor placed before us by the Ld. AR which would reveal that the aforesaid observation of the A.O that the aggrega ..... X X X X Extracts X X X X X X X X Extracts X X X X
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