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TMI Blog2023 (12) TMI 1415X X X X Extracts X X X X X X X X Extracts X X X X ..... ed scrutiny, the A.O. could not have ventured to an issue that did not form the basis for taking up the case for scrutiny assessment - ITAT, Mumbai in the case of Su-Raj Diamond Dealers (P) Ltd. [2019 (12) TMI 26 - ITAT MUMBAI] had observed that since the assessee's case was selected for "limited scrutiny" under CASS with respect to certain specific issues, the jurisdiction of the A.O in the absence of getting the said case converted into complete scrutiny as per the CBDT Instruction No.20 of 2015 dated 29.12.2015, was confined only to the specific reason/issue based on which the case of the assessee was picked up for scrutiny. Accordingly, addition made by the A.O is liable to be quashed for want of valid assumption of jurisdiction by the A.O while framing the "limited scrutiny" assessment vide his order u/s. 143(3) of the Act dated 13.12.2018.
Assessee appeal partly allowed. X X X X Extracts X X X X X X X X Extracts X X X X ..... ) of the Act dated 07.11.2016, specifically in the backdrop of the fact that the same was not in parity with that shown in its return of income for the preceding year. 3. During the assessment proceedings, the AO had afforded several opportunities to the assessee firm to furnish the requisite information/details, but it failed to comply with the same. However, the assessee firm, in reply to the notice u/s. 142(1) of the Act dated 13.11.2018, i.e. at the fag end of the assessment proceedings filed with the A.O certain documents, viz. copy of the income-tax return, computation of total income, copy of balance sheet and profit and loss account, copy of statement of bank account No.61270111005000 with UBI, copy of statement of bank account No.935220110000035 with bank of India and copy of the statement of bank account No.5020004006537 of HDFC Bank. Apart from that, the assessee firm, in its reply to the "Show Cause Notice" (SCN) dated 27.11.2018, furnished its reply, which reads as follows: 1. "Reply to point No.3- The assessee is a builder and during the year under consideration his building project was under construction. In civil construction activity various payments are re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A.O. vide his order passed u/s. 143(3) dated 13.12.2018 assessed the income of the assessee firm at Rs.31,90,190/-. 5. Aggrieved the assessee carried the matter in appeal before the CIT(Appeals). During proceedings before the CIT(Appeals), the assessee firm, in order to impress upon him that the closing cash in hand of Rs.29.64 lacs (supra) on 31.03.2016 as disclosed in its return of income was sourced out of duly explained sources, inter alia, had filed with him a copy of the "cash book" for the year under consideration. Although the CIT(Appeals) had culled out the reply filed/uploaded by the assessee firm on the ITBA portal on 16.02.2023 but I find that he had neither taken any cognizance of the cash flow statement nor the "cash book" that was filed before him. 6. The assessee firm, vide its letter dated 04.11.2023 filed before me, had requested for admission of certain documents as "additional evidence", viz., (i) copy of day-to-day cash book for the FY 2015-16; (ii) copy of the cash flow statement/abstract of cash book for the F.Y.2015-16; and (iii) cash book receipts side (i.e., debit entries) of F.Y.2015-16. As the assessee firm, in the course of the assessment proceedings, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it to substantiate to the hilt its said claim on the basis of irrefutable documentary evidence to the satisfaction of the A.O. However, I find that the assessee firm had adopted an evasive approach and, instead of placing on record supporting documents that would prove to the hilt the authenticity of its aforesaid claim, only produced the copy of the relevant extract of its cash book as of 31.03.2016 wherein the cash-in-hand was shown at Rs.29.64 lacs (supra). I am unable to comprehend what the assessee firm intended by placing on record a copy of the relevant extract of its cash book as of 31.03.2016. As the assessee firm had grossly failed in substantiating both the "nature" and "source" of cash in hand of Rs.29.64 lacs (supra) as was claimed to be available with it on 31.03.2016, therefore, I find no infirmity in the view taken by the A.O who had rightly held the same as having been sourced out of its undisclosed income for the year under consideration. 10. Apropos the observations of the CIT(Appeals), I find that nothing has been filed before him by the assessee firm that would dislodge the view taken by the A.O. On the contrary, the documents that the assessee firm had filed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of 2015 dated 29.12.2015, was confined only to the specific reason/issue based on which the case of the assessee was picked up for scrutiny. Accordingly, on the basis of my aforesaid observations, I am of the considered view that the addition of Rs.1,28,386/- (supra) made by the A.O is liable to be quashed for want of valid assumption of jurisdiction by the A.O while framing the "limited scrutiny" assessment vide his order u/s. 143(3) of the Act dated 13.12.2018. Thus, the addition of Rs.1,28,386/- made by the A.O. is vacated. 13. Apropos the reliance placed by the Ld. AR on the orders of the ITAT, Kolkata in the case of Panjit Basak vs. ITO, Ward-2(4), Raiganj, ITA No.358/Kol/2023 dated 18.07.2023 and ITAT, Delhi in the case of Urban Improvement Co. (P) Ltd. Vs. ITO, Ward-27(2), New Delhi, ITA No.7496/Del/2019 dated 07.02.2020, I find that the same being distinguishable on facts would not assist the case of the assessee before me. I say so for the reason that a perusal of the aforesaid orders reveals that the Tribunal had quashed the assessments framed by the A.O for the reason that additions were made on the issues which did not form part of the reasons for which the case the as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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