2022 (11) TMI 1130 - AT - Income Tax
Revision u/s 263 by CIT - Assessee claim of transaction pertaining to the shares and the resultant gain/profit/loss is not verifiable - HELD THAT:- The gain or loss is attributed/allocated to different clients who had made trade in equity through the assessee with the main broker of Bombay. Thus non speculative loss as well as speculative profit were allocated and belonging to different clients/customers. The assessee has no right to have profit or loss on this equity trading account for the year under consideration.
AO vide notice requested the assessee to furnish the source of investment with proper evidences. In the absence of any evidence why the same should not be added as the total income of the assessee as unexplained investment u/s. 69 and also requested to submit all the details mentioned in the trading statement provided by the assessee.
The assessee responded stating that the total payments to the main broker was of Rs. 1,76,83,099/-. In the same account there is total receipt of Rs. 1,20,75,801/-. Thus the net payment was of Rs. 56,07,298/- for which the assessee was sending confirmatory contra accounts duly signed by the clients, their full address and Pan Number details and further the summery list shown clients name address Pan Number Aadhar Card Copy etc.
As seen from the revision order that the Ld. PCIT after perusal of the material available on record and found that the issues pointed out in the show cause needs verification. PCIT held that the assessee’s claim with regard to the transaction pertaining to the shares and the resultant gain/profit/loss is not verifiable. During the course of original assessment proceedings, the assessee failed to furnish the said details and evidences. That’s why the assessee himself offered 8% of difference amount of bank credits and debits as presumptive income and entire amount was required to be treated as unexplained income and added to the total income of the assessee.
Therefore invoking Explanation 2(a) of Section 263(1) PCIT set aside the assessment order passed by the Assessing Officer as erroneous and prejudicial to the interest of revenue. PCIT pointed out the issues mentioned in the show cause notice needs verification but it is seen from the Paper Book that all the details were filed by the assessee before the AO during the assessment proceedings and after detailed enquiry and verification of records, the assessing officer completed the assessment order.
PCIT has not demonstrated in his order how the order passed by the AO as erroneous order. The Assessing Officer has adopted one of the courses permissible in law, if it has resulted in loss of revenue, the same cannot be treated as an erroneous order which requires revision u/s. 263 - Therefore in our considered view, the invocation of Revision proceedings u/s. 263 itself unjustifiable, against the provisions of law and therefore, the same is hereby quashed. Appeal of assessee allowed.