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2022 (8) TMI 254 - Income Tax
Revision u/s 263 - case was selected for limited scrutiny under CASS - CIT-A power to enlarge scope of limited scrutiny assessment - AR submitted that the case of the assessee was initially selected for limited scrutiny under CASS for verification of introduction of capital during the year under consideration and during the course of assessment proceedings, the AO carried out necessary verification and has given a finding that there was no such introduction of capital during the year under consideration - HELD THAT:- It is an undisputed fact that the case of the assessee was selected for limited scrutiny to verify the introduction of capital during the year under consideration and the AO has taken due note of the same and has given a specific finding after verification of record that since there is no fresh capital introduced during the year, the issue for which the matter was selected for limited scrutiny does not exists and no adverse view can be taken, therefore, taking into consideration the submissions of the assessee, the assessment proceedings were completed.
In the show cause notice issued by the ld. Pr. CIT, it is noted that he has raised issues relating to non-reporting of contract receipts and secondly, regarding discrepancy in the sundry creditors accounts as shown in the balance sheet dated 31.03.2013, the sundry creditors shown in the preceding assessment year and the purchases made during the year under consideration. Further, besides these two issues, the ld. Pr. CIT has noticed certain discrepancies/shortcomings in the assessment order, which find mention in Point No. 13 of the impugned order and basis the same, it was held that the assessment order passed by the AO is not only erroneous but also prejudicial to the interest of the Revenue. We therefore find that two issues on which show cause notice has been issued as well as the other issues as contained in Para 13 of the impugned order, are not subject matter of limited scrutiny and therefore, it is a case where these issues have been raised for the first time by the ld. Pr. CIT by enlarging the scope of the assessment.
It is a consistent stand across various Benches of the Tribunal that where the case of the assessee has been selected for limited scrutiny, the ld. Pr. CIT cannot enlarge the scope of the said assessment.
Thus the impugned order passed by the ld. Pr. CIT, which travel beyond the subject matter of limited scrutiny cannot be sustained in the eyes of law and the same is hereby set aside and the order passed by the AO is sustained. Appeal of assessee allowed.