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2018 (3) TMI 1782 - ITAT JAIPURRevision u/s 263 - unexplained cash credit - whether a case of lack of enquiry or a lack of adequate and proper enquiry on the part of the Assessing officer? - HELD THAT:- We find that it is clearly a case whether the AO has failed to examine the basic and fundamental requirements to determine the identity, creditworthiness and genuineness of these transactions. If the AO has carried out the verifications of the documents as has been done by the ld PCIT, it would have surely put him on guard and prompted him to carry out further independent examination of these investor companies and there would not have been an occasion for the latter to invoke his revisionary jurisdiction. AO has failed to adhere to the basic standard operating procedures of examining such transactions especially in light of glaring concerns so noticed and the assessment so completed is therefore clearly without due application of mind. Here, we refer to a recent communication issued by the CBDT dated 10.1.2018 wherein the CBDT has reiterated the standard operating procedure for examining the transactions in the context of section 68. To our mind, the said communication doesn't lay down any new standard operating procedure rather it emphasise and basically bring out a well down procedure for examination of transactions in context of section 68 of the Act and which should be followed by the Assessing officers and duly monitored and supervised by the Higher authorities. In the instant case, the AO has clearly not appreciated the issue at hand and thus has not applied his mind and carried out the necessary examination and investigation which any officer with a reasonable intellect faced with a similar situation would have carried out. In our view, it is not a case of inadequate enquiry rather it is a case of no enquiry. Where the AO shuts his eyes and the ld PCIT discovers the glaring discrepancies leading to non-satisfaction of cardinal test of identity, creditworthiness and genuineness of the transactions during the course of his examination of records, we donot think there is any infirmity or illegality in him exercising his revisionary jurisdiction u/s 263 of the Act. It is not a case where the Pr. CIT has set-aside the assessment rather he has examined these transactions and has carried out broad analysis of the documentation so submitted by the assessee company and has come to a conclusion, that the AO has failed to carry out adequate enquiries which he should have conducted especially in light of glaring discrepancies in the documentation so submitted by the assessee company which raises a question mark on the genuineness of the whole transactions and also in light of information received from Directorate of Income Tax (Investigation), Mumbai that the assessee company has taken accommodation entries from Praveen Jain, an entry operator - upheld the order passed by the ld Pr CIT u/s 263 of the Act setting aside the assessment order passed by the Assessing officer being erroneous and prejudicial to the interests of the Revenue - Decided against assessee.
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