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TMI Blog2023 (11) TMI 1319X X X X Extracts X X X X X X X X Extracts X X X X ..... ring the course of assessment proceedings, which comes to the notice of the AO that the potential escapement of income exceeding Rs.5 lakhs for normal CIT charge and exceeding Rs.10 lakhs for monetary limits for metro CIT charge. The case can be taken up for complete scrutiny with the approval of the PCIT / CCIT concerned, which means that the AO is empowered to enlarge the scope of limited scrutiny case to the complete scrutiny assessment in view of the above condition only and that also through quasi-judicial powers. Thus as per uncontroverted facts relating to limited scrutiny assessment on the sole issue of business expenses, we are of the view that once the AO cannot examine any other issue except the issue as selected for limited scrutiny assessment, the Ld. Pr CIT can examine only that issue which was before the Ld. AO during the course of scrutiny assessment and not any other issue which has not been subject matter of the assessment in a limited scrutiny assessment. Hence, we quash the revisionary order and allow the appeal of the assessee. - SHRI RAJPAL YADAV, VICE PRESIDENT AND SHRI GIRISH AGRAWAL, ACCOUNTANT MEMBER For the Appellant : Shri Miraj D. Shah, FCA For the Re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Form 26AS is Rs.2,65,68,076/-. According to him, assessee has suppressed its taxable income to the tune of Rs.1,52,75,076/- and the aforesaid amount has not been taken into account while computing the total income in the year under consideration. He thus, drew a consideration that assessment order is erroneous in sofar as it is prejudicial to the interest of revenue and thus, it requires a revision. 3.3. A show cause notice dated 15.12.2022 was issued u/s. 263 against which the assessee furnished a detailed reply explaining its case. Ld. Pr. CIT has acknowledged the submissions made by the assessee on the issue raised by him in respect of receipts reported in Form 26AS. Despite this, he observed that the claim of the assessee requires verification since the assessment order was passed without making necessary enquiries or verification as to how the receipt has been accounted for and how the same has been taken into account while computing the total income for AY 2018-19. According to him, claim of the assessee in this respect should have been verified by the Ld. AO at the time of assessment and accordingly, the assessment order is erroneous in sofar as it is prejudicial to the inte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3 of the Act was justified. The learned Tribunal has analysed the factual position and found that the case of the assessee was selected for limited scrutiny under CASS and the issue which the Commissioner sought to reopen namely, the issue of disallowance under Section 14A of the Act, read with Rule 8D in respect of the exempt income was not one of the issues which was selected for scrutiny. The learned Tribunal in paragraph 2 of its order has set out the three items which have been selected for scrutiny namely, i) Introduction of capital in NBFC/investment company; ii) large deduction claimed u/s. 57 of the Act; and iii) Mismatch of amount paid to related persons u/s. 40A(2)(b) reported in audit report and ITR. If that is the undisputed factual position, we find the reasoning given by the learned Tribunal is fully justified. That apart, the learned Tribunal has rightly pointed out that the CBDT has issued instructions as to the manner in which the limited scrutiny should be carried out. In CBDT Instruction No.7 of 2014, dated 26th September, 2014, the relevant portion of the said Instruction reads as follows :- 3. The reason(s) for selection of cases under CASS are displayed to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Pr. CIT has directed the Ld. AO to examine the issue and pass the assessment order accordingly. 6. We have heard the rival contentions and perused the material available on record. In the present facts of the case, we note that case of the assessee was selected for limited scrutiny assessment under the e-Assessment Scheme, 2019 on the sole issue of business expenses as evident from the assessment order passed u/s. 143(3) of the Act. From the perusal of the said assessment order, we note that there is no whisper in the said order for expanding the scope of limited scrutiny after obtaining the permission from the competent authority. Further, Ld. CIT, DR has not brought anything on record contrary to the arguments and submission made by the Ld. Counsel for the assessee. 6.1. Before delving on the issue, we take note of the CBDT Instruction referred by the Ld. Counsel. 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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