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2024 (2) TMI 487 - ITAT AHMEDABADRevision u/s 263 - sale of preferential shares - as per CIT AO had failed to make proper inquires with respect to assessee’s claim of loss on sale of preferential shares as the records revealed an anomaly/difference in the value of shares sold by the assessee as reflected in the balance sheet/profit & loss account as opposed to that reflected in the computation of income HELD THAT:- As from all the aspects of the matter, it is noted that the assessee had clearly demonstrated that there was no variance in the figure of unlisted preference shares sold during the year as reflected in the balance sheet and that reflected in the computation of income, CIT had noted the difference making improper comparison, comparing the cost of acquisition of these shares reflected in the balance sheet to the sale consideration of these shares reflected in the computation of income and the assessee had gone on to explain even this difference between sale consideration and cost of acquisition to have been duly considered and accounted for in the return of income. We completely agree with assessee that there was no error in the assessment order on account of non-inquiry/inadequate inquiry relating to the issue of preferential shares sold during the year. CIT’s found the assessment order erroneous for the reason that the assessee did not furnish evidence regarding sale of shares, whether they were sold to the related parties or not, and whether intimation was made to the ROC for the sale of such shares. This was not the anomaly which was noted by him, while exercising jurisdiction under section 263 of the Act, nor do we find, that was ever confronted to the assessee during the revisionary proceedings. Even otherwise no reasoning in CIT’s order, as to how the inquiry on the aspect of the shares being sold to the related parties, and/or the intimation of the shares having sent to ROC, would have in any way resulted in the assessment order being erroneous causing prejudice to the Revenue. There is nothing in the ld.Pr.CIT’s order pointing out the adverse impact of non-explanation of these two aspects of the sale of unlisted preferential shares on the computation of income of the assessee. Therefore, we hold that there is no error as such in the assessment order on the issue of the sale of preferential shares as found by the Ld.PCIT, and the ld.Pr.CIT’s order on this issue is set aside. Dividend received from foreign company though taxable under the Act but apparently not returned to tax by the assessee and claimed as exempt - When the assessee had returned the dividend earned from foreign company to tax, there can be no question of any error in the assessment for non-examining or inadequate inquiry on this issue. CIT appears to have casually stated that the assessee failed to produce with supportive evidence before him during the hearing. But we fail to understand what supportive evidence is required in this case, when these facts were coming out clearly from the computation of income itself, which was part of the assessment record before the ld.Pr.CIT and could have been cross-checked himself. We hold that the assessment order is not erroneous, even on the aspect of non-examination of the issue of taxability of dividend income earned from foreign company. Assessee appeal allowed.
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