Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2023 (11) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2023 (11) TMI 234 - AT - Income TaxValidity of Revision u/s 263 - assessee has filed appeal against the assessment order before CIT(Appeals), which is pending adjudication - whether the said assessment order cannot be subject matter of 263 proceedings? - HELD THAT:- In the case of Amritlal Bhogilal & Co [1958 (4) TMI 3 - SUPREME COURT] the Hon'ble Supreme Court held that it would be open to the Commissioner to revise an assessment while an appeal against it is still pending before the CIT(A), because the AO's order must be regarded as subsisting and effective in law, despite the pendency of the appeal. In the case of EIMCO K.C.P. Ltd [2000 (2) TMI 7 - SUPREME COURT] the Hon'ble Supreme Court held that Commissioner could interfere, acting under section 263, with order of ITO on point which was directly in appeal before AAC. In view of the direct decisions on this issue by the Honourable Supreme Court of India, we are of the considered view that in respect of matters which are pending before Ld. CIT(Appeals) and on which no final order has been passed by Ld. CIT(Appeals), they can be revised by recourse to proceedings under 263 of the Act. Whether Principal CIT erred in not invoking Explanation 2 of section 263(1) of the Act in the notice issued to the assessee and such Explanation was invoked only in the body of the order? - In the instant case, it is not the contention of the assessee that there was evident lack of opportunity having been provided to the assessee in the 263 proceedings. The assessee was given due opportunity of hearing and the reasons for initiating revisionary proceedings under 263 of the Act were made available to the assessee. The objections of the assessee were taken on record and after due consideration of the same, the Principal CIT passed order in accordance with law. Accordingly, in our considered view an order passed by Principal CIT under 263 of the Act cannot be set aside merely by taking recourse to decisions without analysing whether the facts in such decision are applicable to the assessee’s in set of facts. Whether the issues on the basis of which proceedings u/s 263 have been initiated against assessee had already been examined by the assessing officer during the course of assessment proceedings? - In the instant facts, even though the relevant facts were examined by the assessing officer during the course of assessment proceedings, however, on perusal of the order passed by Principal CIT, it is seen that the conclusion/analysis of the assessing officer and the basis of arriving at the taxable income did in fact cause prejudice to the interests of the Revenue. Accordingly, we are unable to agree with the contention put forth by the assessee on this issue. Assessment order is not on the basis of provisions of section 44AD of the Act and only a reference has been made to the aforesaid provision to determine the taxable profits @8% - From a perusal of order passed by Principal CIT, it is evident that the aforesaid transactions have been made by the assessee with M/s. National Shroff who is an Angadia therefore there was no scope to treat the said transactions as trading turnover but to treat as cash transactions only and therefore, there was no question of applying any GP or NP rate on above financial transactions. Even if it were to be accepted that the assessment has been completed by mere reference to the provisions of section 44AD by the AO, even then, in our view Principal CIT was correct in observing that reference could not have been drawn to the said provisions as the total quantum of transaction was exceeding Rs. 60 lacs in the year under consideration. Therefore, there was incorrect application of the provisions of law by the AO while completing the assessment. Decided against assessee.
|