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2022 (4) TMI 1076 - AT - Income TaxRevision u/s 263 - unsecured loans u/s 68 - HELD THAT:- The Parliament had conferred the power of revision on the Commissioner of Income Tax u/s 263 of the Act in case the assessment order passed is erroneous and prejudicial to the interests of revenue. To invoke the power of revision, the above two conditions are required to be satisfied cumulatively. References in this regard can be made to the decision in the case of Malabar Industrial Co. Ltd. [2000 (2) TMI 10 - SUPREME COURT] and in the case of CIT vs. Max India Ltd.[2007 (11) TMI 12 - SUPREME COURT]. The error in the assessment order should be one that it is not debatable or plausible view. In a case where the AO examined the claim took one of the plausible views, the assessment order cannot be termed as an “erroneous”. The issue i.e. required to be examined by us is whether or not the AO carried out any enquiry and verification on the issue of source of cash deposits as well as genuineness of the loans creditors and the assessment of gains arising on sale of shops should be under the head of “business” or “capital gains”. Source of cash deposit - The fact that the AO had examined the source of cash deposits is evident from the very impugned order as the ld. PCIT has reproduced the cash flow statements furnished before the AO. Further, it is an admitted position that the ld. PCIT had mistaken the cash withdrawals from banks as the cash deposits. PCIT had initiated the revision proceedings on wrong assumption of facts. PCIT was justified in exercising the powers of revision on the issue of source of cash deposits. Thus, the revision is not maintainable on the issue of sources of cash deposits into bank. As regards, the unsecured loan creditors, AO during the course of assessment proceedings had called for the details of loan creditors in order to satisfy himself as to the genuineness of the loan creditors. The appellant also furnished the full details before the AO by filing the ledger extract, particular of PAN of the loan creditors in whose names the loan is outstanding in the books of account. The said ledger extract was certified to be true by respective sundry creditors. AO having considered the information filed before him chosen not to make any addition. No doubt, the assessment order is silent on this issue. Merely because the assessment order is silent on this issue, it cannot be said that the Assessing Officer had not examined the issue. Once a query has been raised by the AO during the assessment proceedings and the assessee has responded to that query, it would necessarily follow, that the AO has accepted the assessee's submissions, so as to not deal with that issue in the assessment order. Hon’ble Bombay High Court in the case of GKN Sinter Metals Ltd. vs. Ms. Ramapriya Raghavan, Asstt. CIT [2015 (1) TMI 832 - BOMBAY HIGH COURT] had occasion to deal with the identical situations, wherein, after referring to its earlier decision in the case of Idea Cellular Ltd. [2008 (2) TMI 146 - BOMBAY HIGH COURT] and in the case of Aroni Commercials Ltd. [2014 (8) TMI 390 - BOMBAY HIGH COURT] It cannot be said that there is total lack of enquiry on the part of the Assessing Officer, nor was it the case of the ld. PCIT that the Assessing Officer should have conducted further enquiry. We are of the considered opinion that the power of revision cannot be exercised in respect of credits of loan creditors. As regards to the issue of assessment of gains arising on sale of shops. This issue was subject-matter of appeal before the CIT(A) as well as before the ITAT in assessment year 2011-12 in assessee’s own case wherein, both the CIT(A) as well as the Tribunal had concurrently held that the gains arising from sale of shops should be assessable under the head of “business”. The fact that this issue was subject-matter of appeal before the CIT(A) who confirmed the stand of appellant. On further appeal before the ITAT stand of appellant was upheld it goes to prove that the issue is debatable. It can thus be seen that the view taken by Assessing Officer that gains arising on sale of shops can be assessed under the head “business” is plausible view. Therefore, it is not open to ld. PCIT to exercise the power of revision on this, in view of settled position of law, if after proper enquiries, the Assessing Officer adopted a view which is a plausible view, such view could not be open to revision by Commissioner. We are of the considered opinion that the ld. PCIT was not justified in exercising the power of revision u/s 263 in respect of above three items. Therefore, we hereby quash the order passed u/s 263 - Thus, the grounds of appeal raised by the assessee in all the above three appeals stand allowed.
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