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TMI Blog2004 (2) TMI 270X X X X Extracts X X X X X X X X Extracts X X X X ..... d at some stage. It is for the AO to decide to end the enquiry. The CIT cannot transgress the jurisdiction u/s 263 by mentioning that no proper enquiry was made. Hence, we cancel the order passed by CIT u/s 263 of the IT Act. In the result, the appeal of the assessee is allowed. - HON'BLE N.K. KARHAIL, MEMBER (J) AND M.L. GUSIA, MEMBER (A) For the Appellant : Rakesh Kumar Gupta For the Respondent : A.R. Gautam ORDER: N.K. Karhall, Member (J) 1. This appeal of the assessee is directed against the order passed by CIT-I, Agra, on 31st March, 2003, under s. 263 of the IT Act, for asst. yr. 1998-99. 2. The grounds of appeal are as under: That having regard to the facts and circumstances of the case, learned CIT has erred in law and on facts in assuming jurisdiction under s. 263, more so when assessment order passed was neither erroneous nor prejudicial to the interest of Revenue and has accordingly, erred in setting aside assessment order to the file of learned AO with the direction to frame it de novo. That having regard to the facts and circumstances of the case, learned CIT has erred in law and on facts in holding that assessment order passed was erroneous and prejudicial to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mission fee charged. According to the CIT, the AO did not make proper enquiry regarding the admission fee charged from the students during the accounting period relevant to asst. yr. 1998-99. Further, the AO also failed to conduct proper enquiries regarding total number of students, tuition fee received from them, expenditure incurred and income earned by the assessee, while on the contrary it was established during the survey itself that the assessee was not showing admission fee used to be received in lumpsum from the students. It is further mentioned in the order passed under s. 263 that the AO did not make proper enquiries to find out the income by way of admission fee from the students. Even if some enquiries were initiated, the same were not taken to logical conclusion. However, assessment was completed after making ad hoc additions of small amounts. Consequently, assessment order was set aside to be made de novo with the directions that the AO should finalise the assessment after making necessary enquiries about the admission fee and tuition fee charged from students during the relevant accounting period, deposits in bank account, investments, expenditures incurred during th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1999-2000, the returned income has been accepted and was not set aside under s. 263 of the IT Act, 1961. Therefore, only for asst. yr. 1998-99, the CIT has wrongly and illegally assumed jurisdiction under s. 263 of the Act. 9. The learned counsel also invited our attention to p. 2 of the paper book, which is a photocopy of notice dt. 5th Oct., 1999, wherein the assessee was required to produce all books of account, registers, receipt books, enrolment forms and register, bills, vouchers, bank pass book, justify expenses, etc. etc. Thereafter, he invited our attention to pp. 3 to 7, which is assessee's reply dt. 1st Nov., 1999 to prove that the AO made all types of enquiries, which were duly explained and after his complete satisfaction, the assessment was completed. Therefore, it is wrong to mention by the CIT that no proper enquiry was made. It is further submitted that assessment proceedings were initiated on 5th Oct., 1999 and assessment was completed on 8th Jan., 2001 which itself suggests that complete enquiries were made by the AO and after satisfying himself the assessment was completed. 10. The learned counsel for the assessee further drew our attention to pp. 8 to 19 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g with their addresses and special fee charged was required to be furnished. Page 19 of the paper book is photocopy of order sheet dt. 15th Feb., 2000, wherein it was explained that in the year under consideration, two students were enrolled to special coaching, eight students for 1998-99 and 11 students were enrolled for special coaching in the year 1999-2000. 11. From the above, the learned counsel for the assessee tried to explain that the AO has thoroughly examined the entire issue before completing the assessment order. Inspite of above details, required by the AO and furnished by the assessee, the CIT has wrongly mentioned that no proper enquiry was conducted before completing the assessment order. 12. On the other hand, the learned Departmental Representative furnished a paper book containing total 46 pages. These are the photocopies of various admission forms found during the course of survey and other papers. From the above photocopies, the learned Departmental Representative argued that no enquiry was carried out in the light of above documents found during the course of survey. 13. We noted that when the AO proceeded to make the assessment order, he was fully aware of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... observations of the CIT were in the nature of conjectures. Thus, the assessments in the present case were in accordance with law and were not erroneous as to be prejudicial to the Revenue. The CIT, therefore, had no jurisdiction to make the impugned order. 14. The Tribunal, Calcutta Bench 'E' in the case of Ashoke Kumar Parasramka vs. Asstt. CIT (1998) 61 TTJ (Cal) 156 : (1998) 65 ITD 1 (Cal) has held as under: Under the circumstances, therefore, it was impossible to accept the view taken by the CIT that there was no enquiry by the AO or that the AO had failed miserably to apply his mind to the case in all its perspectives. It had not been suggested either by the CIT or by the Revenue that the AO was not entitled to draw the inference, which he drew from the enquiry, which he had conducted. If that be so, the mere fact that the CIT did not approve of the inference did not authorise him to substitute his opinion for that of the AO. In his order, the CIT had not referred to any material from which it could be said that the acceptance of assessee's version by the AO was not warranted either in law or on facts. One would have expected the CIT, under such circumstances, to a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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