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2021 (5) TMI 795 - ITAT SURATRevision u/s 263 by CIT - receipt of unaccounted income of the firm in the form of on-money - PCIT has rejected the contention of the assessee and held that in respect of either non-applicability of sections 68, 69, 69A to 69D or in respect of allowance of claim of expenses u/s 40(b) of the Act is not found to be acceptable and are accordingly rejected, therefore, the assessment order u/s 143(3) was found to be erroneous in so far as it is prejudicial to the interest of Revenue - HELD THAT:- It is undisputed fact in this case that a survey u/s 133A of the Act was carried out at the business premises of the assessee on 04.12.2014. During the survey, certain facts were discovered and statement of Shri Odhavjibhai Shamjibhai Pagdar, one the partners of the firm, was recorded on oath u/s 131 of the Act. In the statement so recorded, an amount was disclosed as 'income over and above regular income of the assessee firm' ( for F.Y. 2014-15 relevant to AY 2015-16). It is also undisputed in this case that the said amount has been disclosed in the profit and loss account under the head 'income disclosed'. However, after claiming deduction u/s 40(b) of the Act towards interest paid to partners net income in the return was declared by the assessee, which was accepted by the AO in the impugned assessment order passed u/s 143(3) of the Act on 11.12.2017. Thus, it is abundantly clear from the order of assessing officer, as noted above, that assessing officer has examined the issue of ‘on-money’ and applied his mind, therefore, his order should not be subjected to revision proceedings under section 263. As during the assessment stage, the assessee submitted the books of accounts and other documents.. The books of accounts of the assessee are audited by a chartered accountant. The assessing officer examined the books of accounts, survey documents and evidences submitted by the assessee and applied his mind. The assessing officer conducted sufficient inquiry. To gather more information and then prove the claim of the assessee wrong is not the object of section 263 of the Act. The object of section 263 is to examine whether order passed by the AO is erroneous as well as prejudicial to the interest of revenue. Therefore, based on this factual position, the order passed by the AO under section 143(3) should not be erroneous. As decided in the case of Plastic Concern [1997 (6) TMI 44 - ITAT CALCUTTA-E] mere possibility of gathering more material to prove the claim of the assessee wrong would not make the concluded assessment erroneous so long as the ld. A.O. had acted judiciously and conducted enquiries in the course of assessment proceedings. Therefore, based on the factual position narrated above, we quash the order of ld PCIT under section 263. Appeal of the assessee is allowed.
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