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2014 (10) TMI 315 - AT - Income TaxRevision u/s 263 Reopening of assessment u/s 147 New issues can be introduced or not Held that:- Income chargeable to tax, in terms of bogus gift has escaped assessment as per provisions of s.147 of the I.T. Act, 61 - Therefore action u/s 147 is being initiated and notice u/s 148 is being issued and any addition made beyond the issue covered by the said "reasons recorded" or any other issue incidental to the same is wholly illegal - the assessee's contention that scope of revision under section 263 in relation to an assessment made under section 147 is circumscribed by issues directly arising out of "reasons recorded" and assessment made in pursuance thereof - New issues cannot be roped-in in the proceedings u/s 263. Addition of gifts and expenses Held that:- In relation to the said gifts aggregating ₹ 6,00,000/- and also earlier gifts of ₹ 4,00,000/- , which had already been included in the revised return filed on 28.03.2003, the AO had added further sums aggregating ₹ 50,000 - It is stated that first of all the gifts were genuine and not managed and in any case, no material has been brought on record to justify the addition. Disallowance out of telephone expenses Held that:- Assessee has debited ₹ 58,360/- on account of Telephone Expenses - the expenses in this respect were not open to full verification and log book was being maintained in respect of these expenses - a disallowance is being made to cover up for any personal use of Telephone. Ad hoc addition of low withdrawals for house hold expenses Held that:- Without bringing on record any material or information in support of the estimate of household expenses made by the AO, no such addition can be made as it amounts to raising a "fiction" to the "fiction" which is not permissible following the decision in Raj Kumar Jain vs. Asstt. CIT [1994 (5) TMI 234 - ITAT ALLAHABAD] - once the entire assessment is open before the AO after validly reopening the assessment, then the jurisdiction of the CIT u/s 263 of the Act would extend to entire assessment order and cannot be confined to the items which formed part of reasons recorded for reopening of assessment Decided against assessee. Suppressed sales Held that:- CIT(A) rightly was of the view that the sale is consignment sale and the commission income of such consignment business is recorded in the books of the assessee which has not been questioned and this is continuing from year to year - the reconciliation furnished by the assessee seems to be valid and there is no adverse finding in respect of the explanation of the assessee on this issue given by the AO. Interest paid on unsecured loan Applicability of section 40A(2) Held that:- The assessee has made total sales of ₹ 239.81 lac to M/s Shiva Tea Company and the entire outstanding debit balance in the account of the firm is against sales made during the year under consideration the order of the CIT(A) is upheld Decided against revenue.
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