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2021 (11) TMI 498 - AT - Income TaxRevision u/s 263 by CIT - Addition u/s 68 - verification of loan transactions - HELD THAT:- An independent and new proceeding sets in motion on receipt of new material coming on record post assessment in terms of Explanation 1 to S. 263 of the Act and hence the responsibility of revisional authority towards observance of principles of natural justice, in such situation, would be akin to that of AO. PCIT can not merrily set aside the assessment on the basis of new material coming on record without exerting himself and confronting such material to the Assessee. PCIT is under bounden duty to take into account the perspective of the Assessee on such fresh material and is required to pass a speaking order thereon. PCIT thus could not merely sit solely in the capacity of a revisional authority qua the new material but was required to perform the task of AO in tandem and discharge quasi-judicial function independently. PCIT has failed to do so. Neither the purported evidence collected from SEBI were confronted nor the cross examination of adversarial statement was provided. The opportunity contemplated under S. 263 is thus rendered illusory and merely an empty formality resulting in miscarriage of justice in contravention of expresses intendment of law. Looking from any angle, the directions towards verification of loan transactions are unsustainable in law and deserve to be quashed. The directions no. 1-4 are thus set aside. Applicability of Section 43CA in respect of sale deed alleged to be executed below stamp duty value - We are unable to see any error in the action of the AO to accept the transactions outside the ambit of Section 43CA where the variations in actual consideration qua assessable value for the purposes of stamp duty does not exceed 10%. Consequently, the directions of the PCIT to this extent are thus nullified. However, the difference up to 10% only is saved by the amendments carried out in the Finance Act and therefore, the enquiry directed by the PCIT in respect of transactions covered under Section 43CA where the difference exceeds 10% appear justified. Thus, to this limited extent, the directions of the PCIT to direct enquiries for applicability of S. 43CA for transactions showing breach of safe harbour limit of 10% require to be upheld. It is thus open to the AO to enquire into applicability of S. 43CA where the difference between the stamp duty value and actual consideration exceeds 10% in accordance with the directions of PCIT and in accordance with law. The issue is thus allowed in part. Applicability of Section 40(a)(ia) [wrongly mentioned as Section 40A(3) through inadvertence] in respect of commission payment on purchase of land - It is the case of the Assessee that ledger account of parties namely Leeladhar Sharma and Bajrang Lal Karnany and TDS challan towards commission payments would show that the satisfaction of the PCIT is contrary to the facts on record. It was contended that both Tax audit report and as well as verification of AO vouches the stand of the Assessee. We find that the assessee has adequately demonstrated on facts that the TDS was properly deducted from the commission and other payments pointed out in the order of the PCIT and, therefore, the action of the Assessing Officer cannot be held to be erroneous or in contravention of law. In the absence any default as wrongly perceived by the PCIT, the action of the PCIT, being unjustified, is set aside on this score. Appeal of assessee is partly allowed.
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