9911796707
TMI Blog2023 (8) TMI 1502X X X X Extracts X X X X X X X X Extracts X X X X ..... the same such as purchase bill, bank statement evidencing the payment for share purchase, copy of balance sheet, contract notes qua selling 1400 equity shares mentioning the consideration and copy of bank statement reflecting payment received. AO accepted the contentions of the assessee after examination of the above evidences and also after calling for reply from the stock broker by issuing letter u/s 133(6) which was duly furnished by the broker and the AO accordingly framed the assessment accepting the claim of the assessee u/s 10(38). In our opinion, the PCIT cannot exercise the revisionary jurisdiction to set aside the assessment where the AO has conducted enquiries and taken a plausible view accepting the contentions of the assessee. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 12.12.2018 for the AY 2014-15. First we will adjudicate in ITA No. 234/Kol/2019 for AY 2014-15. 2. The only issue raised by the assessee is against the invalid exercise of jurisdiction u/s 263 of the Act by the PCIT thereby passing revisionary order u/s 263 of the Act and setting aside the assessment framed by the AO u/s 143(3) of the Act dated 27.07.2016. 3. Facts in brief are that the assessee filed return of income on 12.03.2015 declaring total income of Rs. 2,51,810/- which was processed u/s 143(1) of the Act and thereafter the case of the assessee was selected for scrutiny under CASS for suspicious long term capital gain on sale of shares and consequently assessment u/s 143(3) of the Act was framed vide order dated 27.07.2016 ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y shares. Finally after taking into account of the contentions and written submissions of the assessee dated 6.12.2018, the PCIT revised the assessment by observing that it is the fit case to add entire sale consideration of bogus penny stock shares amounting to Rs. 5,58,860/- as unexplained cash credit and the unexplained expenditure on account of commission payment to the tune of Rs. 27,443/- u/s 69C of the Act by revising the assessment and directing the AO to reassess the income. 4. The Ld. Counsel for the assessee vehemently submitted before us that the assumption of jurisdiction u/s 263 of the Act and passing of a consequent revisionary order u/s 263 of the Act by the ld PCIT is bad in law and nullity for three reasons. One that the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the jurisdiction u/s 263 of the Act is not available to the ld. PCIT where after having considered evidences/documents on record and the reply of the assessee, the AO has taken a plausible view. The Ld. A.R in defense of his arguments relied on the decision of the Hon ble Calcutta High Court in the case of PCIT vs. Kaushalya Dealers Pvt. Ltd. in ITAT/72/2022, IA No. GA/1/2022 dated 24.11.2022 and PCIT vs. M/s PG Commercial Pvt. Ltd. in ITAT/136/2022 IA No. GA/2/2022 dated 8.2.2023. The second plea taken by the Ld. Counsel for the assessee is that the jurisdiction u/s 263 of the Act has wrongly been assumed on the ground that it was initiated on the proposal moved by the AO. The Ld. A.R in defense of arguments relied on the decision of Hon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... kindly be dismissed. Besides the ld DR argued that by the exercise of jurisdiction u/s 263 of the Act, the assessee is not prejudiced in any manner as he would be afforded sufficient opportunity in the set aside proceedings. 6. After hearing the rival contentions and perusing the material on record, we find that indisputably the assessee has purchased and sold equity shares which were held to penny stock. This is also undisputed that the case of the assessee was selected for scrutiny for this reason only and the AO after calling for necessary information /evidences from the assessee and examining the same such as purchase bill, bank statement evidencing the payment for share purchase, copy of balance sheet of M/s Panchsul Marketing Ltd. whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of PCIT vs. M/s Sinhotia Metals and Minerals Pvt. Ltd. (supra). On this score also, the jurisdiction of the PCIT is not sustainable. We also note that the PCIT has relied on CBDT s circular that the AO should have disallowed long term capital gain and has not applied his mind as to how the assessment order is erroneous and prejudicial to the interest of the revenue in order to justify the exercise the revisionary powers u/s 263 of the Act. In our opinion where the PCIT was of the view that AO has not conducted enquiry to came to the conclusion on the issue, then the ld PCIT is duty bound to make an enquiry and reach a conclusion that order is erroneous and prejudicial to the interest of the revenue. The case of the assessee is squarely co ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
