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2023 (3) TMI 1416 - AT - Income TaxScope of Limited scrutiny assessment - AO jurisdiction in enquiring into issues beyond the scope of limited scrutiny - CIT(A) in confirming the action of AO in making additions in respect of issues not mentioned in limited scrutiny - HELD THAT:- As notice u/s 143(2) issued for limited scrutiny covering four issues namely Receipt of large values foreign remittance, Mismatch in amount paid to related persons u/s 40A(2)(b), Unsecured loans from persons who have not filed their return of income and Loss from currency fluctuations and also subsequent notice issued u/s 142(1) called for further information. In our view this is incomplete disregard of the Instruction No. 5/2016 issued by CBDT on 14.07.2016 which provides that while proposing to take up complete scrutiny which was fixed for limited scrutiny, the AO shall form a reasonable view that there is a possibility of under-assessment of income if the case is not examined under complete scrutiny and that plea has to be on the existence of the credible material not merely on suspicion and conjecture or unreliable sources. We note that the instruction provide that there has to be a direct nexus between the available material and formation of such view. AO has exceeded his jurisdiction in enquiring into those issues beyond the scope of limited scrutiny which is in clear violation of mandate given by CBDT in the said Circular and has been held by the Co-ordinate Bench in the case of Shri Vijay Kumar [2019 (10) TMI 13 - ITAT CHANDIGARH] to be bad in law.
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