Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2018 (1) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2018 (1) TMI 241 - AT - Income TaxRevision u/s 263 - Exemption u/s 10(2A) denial - Held that:- We are of the view that where an enquiry is conducted by the AO and he is satisfied with a reply given on a query raised, then the CIT cannot intervene through revision for coming to a conclusion that the assessment order passed by the AO was erroneous and prejudicial to the interests of the Revenue for lack of or inadequate enquiry. The CIT in the impugned order has merely pointed out that the Assessee has claimed exemption u/s.10(2A) on a sum of ₹ 4,84,89,051 as his share of profits from the firm whereas the firm has declared total income of only ₹ 3,88,780/-. This aspect is clear from the records produced by the Assessee before the AO. The AO has mentioned in the order that all issues and documents were perused and discussed with the AR. The CIT on examination of the Assessment records has invoked his powers u/s.263 of the Act. He has not spelt out in the impugned order as to what was the kind of enquiry that the AO ought to have made and which he failed to make. In the decision of the Hon’ble Bombay High Court in the case of CIT Vs. Gabriel (1993 (4) TMI 55 - BOMBAY High Court) has been laid down that the consideration of the Commissioner as to whether an order is erroneous insofar as it is prejudicial to the interests of the Revenue, must be based on materials on the record of the proceedings called for by him. If there are no materials on record on the basis of which it can be said that the Commissioner acting in a reasonable manner could have come to such a conclusion, the very initiation of proceedings by him will be illegal and without jurisdiction. The Commissioner cannot initiate proceedings with a view to starting fishing and roving enquiries in matters or orders which are already concluded. Such action will be against the well-accepted policy of law that there must be a point of finality in all legal proceedings, that stale issues should not be reactivated beyond a particular stage and that lapse of time must induce repose in and set at rest judicial and quasi-judicial controversies as it must in other spheres of human activity. The above decision is applicable to the facts of the present case. We therefore hold that orders u/s.263 of the Act cannot be sustained as the conditions for exercise of jurisdiction under the said provisions are absent in the present case. We therefore quash the impugned orders u/s.263 of the Act - Decided in favour of assessee.
|