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2020 (2) TMI 1229 - ITAT MUMBAIRevision u/s 263 - CIT Jurisdiction to invoke revision - Penalty u/s 271E imposed - HELD THAT:- So long as the twin conditions as envisaged by Sec.263 are fulfilled by conducting minimal enquiry, the jurisdiction would certainly be valid notwithstanding the fact that the same were triggered at the behest of Ld.AO. Therefore, the revisional jurisdiction could not be termed as bad in law simply because the same was triggered at the instance of another officer. We do not find any substance in the same and reject the said plea. Computation of capital gain on slump sale - business of the assessee was transferred to another entity vide Business Transfer Agreement dated 02/08/2013 on slump sale basis without individual values being assigned to the assets and liabilities, was well appreciated by Ld. AO since the body of assessment order passed u/s 143(3) record this fact. Therefore, to say that the said fact was omitted to be considered by Ld. AO, would not be correct. In fact, the assessee had duly disclosed the facts of transfer of business in Schedule-N of its financial statements. The computation of capital gain on slump sale was placed on record. The assessee had bifurcated the Balance Sheet reflecting financial position before transfer of business and subsequent to transfer of business. The copy of Business Transfer Agreement was also submitted to Ld. AO vide submissions dated 21/12/2016. Upon perusal of the same, we find that all the issues connected with transfer of business were under due consideration of Ld.AO during regular assessment proceedings. Another aspect to be noted is that as per the provisions of Sec. 271E, no satisfaction is required to be recorded in the quantum assessment order before levying penalty u/s 271E. Therefore, we are unable to accept the validity of revisional jurisdiction on this point. Claim of interest on TDS and customs penalty - AR asserted that the case of the assessee was selected under limited scrutiny which was never converted into full scrutiny. The issue of TDS and custom penalty were none of the reasons for which the case was selected for limited scrutiny assessment. The Ld. AR drew attention to the CBDT Instruction No.7/2014 dated 26/09/2014 which provide that in case of scrutiny cases selected under CASS, the scope of inquiry should be limited to verification of particular aspects only. We have duly considered the same. The perusal of documents on record would reveal that this issue was never raised by Ld.AO and therefore, there could be no occasion for the assessee to make any submissions in this regard. This being the case, prima facie, this issue was raised by Ld. revisional authority without conducting any minimal inquiry that the said expenditure was not admissible under law. The conclusion was drawn on mere allegation that the said expenditure was inadmissible expenditure. It is settled legal position that the revision jurisdiction could not be exercised to make fishing or roving inquiry without establishing the fact that the order was erroneous as well as prejudicial to the interest of the revenue. Therefore, we are not convinced with exercise of revision jurisdictions on this issue. Applicability of Sec. 94(7) / 94(8) - assessee, vide submissions dated 29/03/2019, had submitted that the dividend was not earned on the units of Sundaram Mutual Fund and in support of the same, ledger extract of dividend income as well as statement of respective mutual funds which gave rise to dividend income was furnished which clearly established that no dividend was earned on Sundaram Mutual Fund. In the said background, it was submitted that the provisions of Sec. 94(7) were not applicable. Similarly, the units of Sundaram Mutual Fund were stated to be purchased on 05/09/2013 whereas record dated was 23/12/2013 when the bonus units were allotted to the assessee. Therefore, there was a gap of more than 3 months between the purchase of units and record date and therefore, the provisions of Sec. 94(8) were stated to be not applicable. The supporting documents, to substantiate the said fact, were also furnished. However, we find the Ld. Pr.CIT-32 did not consider assessee’s submissions and termed the order as erroneous and prejudicial without conducting any minimal inquiry. Therefore, the action, on this issue, could not be upheld. No directions have been issued with respect to last issue i.e. non-filing of Form 3CEA and therefore, the same need not be delved into - Revisional jurisdiction as exercised by Ld. Pr. CIT-32 could not be upheld in the eyes of law. - Decided in favour of assessee.
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