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2024 (12) TMI 1274
Reopening of assessment u/s 147 beyond period of limitation - validity of order passed after the expiry of the period of limitation as prescribed u/s 153 - Time limit for completion of assessment, reassessment and recomputation - HELD THAT:- the expression “direction” and “in consequence of” or “to give effect to” are the key words which are common expressions used in the second proviso to Section 34 (3) of the IT Act, as it stood at the relevant time, and presently as falling under clause (i) of sub-section (6) of Section 153 of the IT Act.
The Supreme Court in Murlidhar Bhagwan Das [1964 (1) TMI 5 - SUPREME COURT] interpreting the said expressions held that the expression “finding” has not been defined in the IT At. Referring to Order XX Rule 5 of the Code of Civil Procedure, it was observed that a finding is, therefore, a decision on an issue framed in a suit and a finding shall be one which by its own force or in combination with findings on other issues should lead to the decision of the suit itself. It was observed that this was to say, the finding shall be one which is necessary for the disposal of the suit. It was held that a "finding", therefore, can only be that which is necessary for the disposal of an appeal in respect of an assessment of a particular year as the Appellate Assistant Commissioner may hold in the facts, that the income shown by the assessee is not the income for the relevant year and thereby exclude that income from the assessment of the year under appeal.
Thus, applying the principles of law as laid down in the decisions in Income Tax Officer vs. Murlidhar Bhagwan Das [1964 (1) TMI 5 - SUPREME COURT], Rajinder Nath vs. Commissioner of Income Tax, Delhi [1979 (8) TMI 3 - SUPREME COURT] and Tally India Pvt. Ltd. [2021 (4) TMI 547 - KARNATAKA HIGH COURT] it is clear that the order dated 21 September 2021 passed by the Division Bench (supra) does not contain any findings necessary for disposal of the writ petition in a particular manner, so as to govern the issues which would be decided by the Assessing Officer. As observed that the words "in consequence of or to give effect to" do not create any difficulty, for they have to be collated with, and cannot enlarge, the scope of the finding or direction under the proviso. It was further observed that if the scope is limited in such event, the said words also must be related to the scope of the findings and directions.
As as rightly contended on behalf of the petitioner, applying the provisions of clause (ii) below Explanation 1 read with the first proviso below Explanation 1, certainly the limitation for the Assessing Officer to pass the Assessment Order had come to an end on 20 November 2021 i.e. sixty days from 21 September 2021 (orders passed by the High Court) by applying the extended period as per the first proviso below Explanation 1, whereas the impugned assessment order has been passed almost ten months after the limitation expired. Thus, the case of the Revenue in regard to applicability of the extended period under sub-section (6) (i) of Section 153 cannot be accepted. WP allowed.
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2024 (12) TMI 1273
Jurisdiction of the AO u/s 143 (2) - JAO's assumption of jurisdiction - notice was issued to the petitioner u/s 143 (2) for the AY:2023-24 by the Jurisdictional Assessing Officer (JAO), ITO Ward Sunam, whereas the said notice was to be issued in terms of section 144B (1) (iii) of the Act by the NFAC - HELD THAT:- As notice under section 143 (2) for assessment u/s 144B would be issued through the NFAC, and the assessee would file a response to such notice within the date specified therein.
After the Faceless Assessment Scheme was introduced by amendment in the Act through new regime, the jurisdiction has been ceased for the purpose of issue of notice under section 148, and it is only in special circumstances as provided u/s 144B(7) and (8) that the concerned Principal Commissioner of Income Tax may direct for issuance of notice.
The circumstances as mentioned in section 144B (7) and (8) would only be where a notice u/s 148 has already been issued. CBDT Guidelines with respect to the power of issuance of notice by the JAO would arise only in terms thereto.
On perusal of para 2 (4) (i) of the Circular dated 03.05.2024, it is apparent that the proceedings for scrutiny by the JAO can be picked up, and notice can be issued u/s 143 (2) only in cases where notice under section 148 has been issued for that particular assessment year. It is an admitted position from the reply filed by the respondent that notice under section 148 was issued for AYs: 2020-21, 2021-22 and 2022-23, and was not issued for the AY: 2023-24. In view thereto, the JAO would not have jurisdiction to issue notice under section 143 (2) of the Act, and it would be only the NFAC as per section 144B (1) (iii) to have jurisdiction to initiate proceedings under section 143 (2) of the Act.
The notice issued under section 143 (2) of the Act is therefore found to be without jurisdiction. Merely taking approval from the concerned Principal Commissioner would not be sufficient to grant jurisdiction to the JAO.
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2024 (12) TMI 1272
Validity of Reassessment u/s 147 - applicability of Section 151 as the sanction has not been granted by the appropriate authority as specified - HELD THAT:- Once the petitioner has availed of an alternate remedy as provided under the Income Tax Act, namely of a substantive appeal being filed, and if the assessment order as also the notices issued to the petitioner prior thereto u/s 148A and u/s 148 are contrary to the substantive provisions of Section 151A and Section 151 of the Act, as interpreted by this Court in Hexaware [2024 (5) TMI 302 - BOMBAY HIGH COURT] the Appellate Authority as also the Revisionary Authority being bound by the said decisions of the jurisdictional High Court, need to consider such legal position.
Thus, the petitioner is not precluded from raising all such contentions, as raised before us in the present proceedings, before the said authority.
Accordingly, we are of the opinion that the proceedings which are pending before the CIT(A) as also the Revisionary proceedings, be decided considering the contentions of the petitioner namely as to whether the impugned assessment order as also the notice under Section 148 of the Act is illegal when tested on the law as declared by this Court in the aforesaid decisions.
ORDER:- The petitioner shall pursue the proceedings before the CIT(A) against the impugned assessment order as also the proceedings before the Revisionary Authority. It is open to the petitioner to raise contentions in regard to the illegality of the notice issued to the petitioner under Section 148, in the light of the decisions of this Court in Hexaware case (supra).
Till the proceeding before the Appellate Authority or Revisionary Authority are decided, the impugned assessment order shall remain stayed.
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2024 (12) TMI 1271
Revision u/s 264 - SRO values prevailing as on the date of agreement and the date of registration - HELD THAT:- Even if, an error is committed by an Assessee, it can be gone into in exercise of power conferred u/s 264 of the Act, which was held to be “very wide”. Considering the aforesaid, the first reason for not exercising power under Section 264 cannot sustain judicial scrutiny. Even if details about SRO value is not disclosed in the Return, revision u/s 264 of the Act is indeed maintainable.
It is another aspect, where after considering the matter, the revision authority may take a different view on merits, but, it cannot decline consideration, when the Assessee commits a mistake/error. Secondly, as rightly highlighted by learned counsel for the petitioner, the application under Section 264 was rejected by stating that the application under Section 264 is filed, just to get advantage of reduction in SRO values.
No iota of reason is mentioned in the impugned order as to why the Annexure-II showing SRO rates mentioned in para No.4 of the impugned order was not applicable or trustworthy. No other SRO value, which is held to be ‘reduced’ one, is also mentioned.
We are convinced that both the reasons for not entertaining the application u/s 264 of the Act are unjustifiable.
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2024 (12) TMI 1270
Deduction u/s 10A - assessee to receive the foreign exchange beyond a period of six months from the end of the previous year - HELD THAT:- Admittedly, the Reserve Bank of India is competent authority under Foreign Exchange Management Act, 1999, which regulates the payments and dealings in foreign exchange. Section 10A(3) of the Act provides that the benefits under Section 10A(1) of the Act is available to the assessee, if export proceeds are realized within the time prescribed by the competent authority under the Foreign Exchange Management Act, 1999. In the instant case, the competent authority under the Foreign Exchange Management Act, 1999, namely the Reserve Bank of India has granted approval in respect of export proceeds realized by the assessee.
Therefore, the approval granted by the Reserve Bank of India meets the requirement of Section 10A(3). Income Tax Appellate Tribunal ought to have appreciated that the assessee had fulfilled the requirement contained in Section 10A(3) of the Act and therefore was entitled to exemption u/s 10A of the Act.
We are in respectful agreement with the view taken in Morgan Stanley Advantage Services P. Ltd. [2011 (8) TMI 279 - BOMBAY HIGH COURT] - Decided against revenue.
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2024 (12) TMI 1269
Reopening of assessment u/s 147 - Legality of the order passed u/s 148A(d) and notice u/s 148 - Writ Court interference at the stage of notice u/s 148 when the assessment/reassessment is pending u/s 147 of the Act - scope of notices issued under Section 148 of the new regime between July and September 2022 - Application of TOLA to the Income Tax Act after 1 April 2021 -HELD THAT:- As decided in RAJEEV BANSAL [2024 (10) TMI 264 - SUPREME COURT (LB)] a notice could be issued under Section 148 of the new regime for assessment year 2021-2022 and before only if the time limit for issuance of such notice continued to exist under Section 149(1)(b) of the old regime.
Without the proviso to Section 149(1)(b) of the new regime, the Revenue could have had the power to reopen assessments for the year 2012-2013 if the escaped assessment amounted to Rupees fifty lakhs or more. The proviso limits the retrospective operation of Section 149(1)(b) to protect the interests of the assesses.
In view of the above, the present petition is allowed. The impugned order under Section 148A (d) of the Act dated 23 July 2022 and consequential notice referable to Section 148 of even date are hereby quashed and set aside.
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2024 (12) TMI 1268
Validity of reopening of assessment - non addressing fresh objections raised by the Petitioner - HELD THAT:- Fresh objections as raised by the Petitioner have not been dealt / disposed of despite a specific order to that effect passed by this court, much less in the manner according to law. In fact the impugned order in our opinion shows gross non application of mind to the detailed case which was put up by the petitioner before the Assessing Officer.
It was a legal obligation of the respondents to dispose of the objections, in accordance with law and more particularly when there was a mandate of the orders passed by this court which was staring at the respondents, namely, the order passed on the earlier writ petition filed by the petitioner.
Without taking a serious view which this matter certainly deserved, we are of the opinion that the concerned officers would be better advised and a wiser sense prevails on these officers of the Assessment Unit so as to pass an appropriate order in accordance with law, by one more opportunity being granted to them.
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2024 (12) TMI 1267
Validity of orders passed by Settlement Commissioner to the extent that it has granted immunity from prosecution as well as the penalty to the Respondents - Maintainability of review petition - HELD THAT:- Mere recording of satisfaction, by itself, would not be sufficient to satisfy the conditions u/s 245H (1) of the IT Act
Firstly, the Assessee has to be honest and fairly disclose all the facts at the outset itself. The Assessee cannot make disclosures in instalments in a settlement proceeding.
For a disclosure to be considered full and true, the Assessee ought to have disclosed the complete undisclosed income in the first instance before the Settlement Commission.
This Court had in its order observed that there is no foundation for the finding of the Settlement Commission that there was full and fair disclosure. Hence the matter was remanded for reconsideration as to whether immunity from penalty and prosecution ought to be granted or not.
The Court is of the opinion that there is no error apparent on the face of the record or any other grounds that merit consideration for reviewing the order.
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2024 (12) TMI 1266
Validity of reopening of assessment - During the course of search, certain hard disk drives were seized and the statement of the managing director was recorded which indicated that there were certain transactions (including cash sales and purchases) - HELD THAT:- Petitioner had paid consideration for supplies in cash. The cash entries are thus reflected as credit entries and not debit entries. Revenue’s contention that the ledger account that the petitioner had received cash is erroneous. The ledger account in question reflects that the petitioner had paid cash.
It is the petitioner’s case that the entries which are reflected as cash payments made by the petitioner are in fact the payments made through banking channel and have been incorrectly reflected as cash receipts in the books maintained of VKC Group.
It does not appear that the AO had made any specific allegation that the petitioner had paid money through banking channel and received back the cash against those payments.
We consider it apposite to set aside the impugned order dated 31.08.2024 passed u/s 148A (d) as well as the notice issued u/s 148 and remand the matter to the AO to consider afresh in light of the averments made in the present petition and the replies furnished by the petitioner on 14.08.2024 and 30.08.2024.
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2024 (12) TMI 1265
Reopening of assessment beyond period of limitation - notice beyond period of six years - HELD THAT:- A notice for reopening assessment for AY 2014-15 could not be issued beyond the period of six years from the said date. However, since the initiation of reassessment proceedings are premised on material containing information allegedly pertaining to the petitioner, the assessments/reassessment could be initiated u/s 153C of the Act
Uploading of information by the investigation wing of the Income Tax department would not be a substitute for recording of a satisfaction note by the AO of a searched person and handing over the assets, books of accounts or other material to the AO of the person other than the searched person for the purpose of initiation of proceedings u/s 153C of the Act.
There is no reference of an asset representing income escaping assessment. Thus, reopening the assessments for a period of ten years as contemplated u/s 153A of the ACT may not be applicable. In the present case, a notice has been issued beyond the period of six years from the end of the AY 2014-15 and therefore, the notice is clearly beyond the period of limitation.
The petition is allowed and the impugned notices issued u/s 148A (b) and 148 of the Act, are set aside. Decided in favour of assessee.
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2024 (12) TMI 1264
Reopening of assessment - reason to believe - disallowance in accordance with Rule 8D r/w Section 14A as well as the depreciation claimed by the petitioner on various assets - HELD THAT:- AO has issued the notice for re-opening only on the basis of perusal of the assessment records for the year under consideration and in absence of any new tangible material available with him. It is therefore apparent that it is the case of mere change of opinion.
AO during the regular course of assessment has called for the details of depreciation as well as the dis-allowance to be made u/s 14A - assessee has also dis-allowed the interest qua MSME in the return of income which is also stated in the objections raised by the petitioners. Therefore, AO had no jurisdiction to re-open the assessment on the basis of the above details which were already scrutinised during the course of the regular assessment.
The impugned notice is issued beyond the period of four years for the Assessment Year under consideration and in absence of any allegation to the effect that the assessee has failed to disclose truly and fully all material facts relevant for the assessment, as per the provisio to Section 147 AO would not have jurisdiction to re-open the assessment.
See M/S. Kelvinator of India Ltd [2010 (1) TMI 11 - SUPREME COURT] AO has no power to review; he has the power to re-assess. But reassessment has to be based on fulfillment of certain pre-condition and if the concept of "change of opinion" is removed, as contended on behalf of the Department, then, in the garb of re-opening the assessment, review would take place. One must treat the concept of "change of opinion" as an in-built test to check abuse of power by the AO. Hence, after 1st April, 1989, AO has power to re-open, provided there is "tangible material" to come to the conclusion that there is escapement of income from assessment. Reasons must have a live link with the formation of the belief.
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2024 (12) TMI 1263
Revision u/s 263 - assessee has not shown the cash deposit in the bank account of the assessee and in PPF account of his minor son - HELD THAT:- We are of the considered view that the assessing officer had made specific enquiries during the assessment proceedings to which specific reply was furnished by the assessee along with supporting documentary evidences and all such evidences were duly examine and considered by the assessing officer before completing the assessment proceedings u/s 143(3) of the Act.
The power of revision can be exercised where no enquiry, as required under the law is done. Admittedly the AO asked the assessee to furnish the necessary details from time to time which were duly furnished by the assessee and after considering the same the assessing officer has completed the assessment.
We find that in the case of CIT vs Sunbeam Auto [2009 (9) TMI 633 - DELHI HIGH COURT] has held that the AO in the assessment order is not required to give detailed reason in respect of each and every item of deduction, etc. Whether there was application of mind before allowing the expenditure in question has to be seen. If there was any inquiry, even inadequate, that would not by itself give occasion to the CIT to pass orders u/s 263 of the Act, merely because he has different opinion in the matter.
Hon’ble Delhi High Court in the case of Anil Kumar Sharma [2010 (2) TMI 75 - DELHI HIGH COURT] has held that there is a distinction between “lack of enquiry and inadequate enquiry. If there was any enquiry, even inadequate, that would not by itself give occasion to the commissioner to pass orders u/s 263 of the Act.
Considering the facts of the case in hand, in the light of the judicial decision discussed above, we set aside the assessment order of the PCIT and restore the assessment order of the assessing officer dated 21-12-2017 framed u/s 143(3) of the Act - Appeal of the assessee is allowed.
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2024 (12) TMI 1262
Denial of exemptions on transfer of leasehold rights in respect of land and building - based on the valuation undertaken by the DVO, the AO opined that the Assessee has undervalued the assets and made addition under the head of ‘Business Income’ and held that the said transfer of the lease hold right was not exempt u/s 47(iv) on the ground that ‘the Assessee has not been able to explain that the share holding pattern is not exactly same in the case of the subsidiary company.’ - AO has also invoked the provision of Section 56(2)(x) of the Act in the hands of the recipient
HELD THAT:- As per Section 47(iv) of the Act if the transfer of a capital asset by a company made to its subsidiary company cannot be regarded as transfer and nothing contained on Section 45 of the Act shall apply if the parent company or its nominee holds entire share capital in the transferee subsidiary company; and the subsidiary company is an Indian Company.
Considering the fact that InterGlobal Education Services Ltd. is a subsidiary of the Assessee and the Assessee including its nominees holds the entire share capital in InterGlobal Education Services Ltd. and the said InterGlobal Education Services Ltd. being an Indian Company meets all requirements of Section 47(iv) of the Act. Thus, the transfer of lease hold right in respect of the subject property for Assessment Year 2017-18 is not liable to tax. In the absence of any contrary material brought to our notice by the Department to dispute or disprove the factual aspects mentioned in the order of the Ld. CIT(A), we find no error or infirmity in the order of the Ld. CIT(A). Accordingly, we find no merit in the Grounds of Appeal of the Department of Revenue.
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2024 (12) TMI 1261
Power of CIT(A) to change the provision of law qua the item of which the assessment was made - Addition u/s 69A - cash received from the members of the society - HELD THAT:- As per section 251(1)(a) of the Act, in appeal against an order of assessment, the CIT(A) may confirm, reduce, enhance or annul the assessment, but there is no such power provided by the law that the Ld. CIT(A) could change the provision of law qua the item of which the assessment was made. Thus, in the absence of such power, Ld. CIT(A) could not have treated the addition made in the assessment order u/s 69A of the Act. Thus, confirmation by CIT(A) is set aside.
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2024 (12) TMI 1260
Denial of exemption u/s 11 - Assessee had not filed Form No. 10 and had not filed the income tax return within the due date prescribed u/s 139(1) - HELD THAT:- In the instant case, both the return of income as well as Form 10B audit report were filed together on 25-1-2019 which is well within the due date prescribed u/s139(4) of the Act. This is evident. Hence Assessee would be entitled for deduction u/s 11 of the Act.
With regard to the grants received by the assessee, it is pertinent to note that those are specific grants received by the Assessee and cannot be used for any other purpose other than the purpose for which grant was given. The disbursement letters issued by the competent authorities proving the fact that the monies were paid only for specific purposes. In our considered opinion, they do not partake the character of income of the Assessee.
We hold that the Assessee would be entitled for deduction u/s 11 - Decided in favour of assessee.
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2024 (12) TMI 1259
Penalty order u/s. 271(1)(c) - assessee had earned LTCG exempt u/s.10(38) - exempt LTCG shall be taken into account in computing the book profit u/s.115JB - HELD THAT:- Notice was for furnishing of inaccurate particulars of income as recorded by the AO in the assessment order. However, the penalty u/s. 271(1)(c) of the Act was imposed for concealment of income. The facts of the present case are, thus, found to be identical to the facts as discussed in the above referred decisions.
We, therefore, hold that the order imposing penalty in this case for concealment of income when the penalty proceeding was initiated for furnishing of inaccurate particulars of income, was invalid. Therefore, the penalty imposed u/s. 271(1)(c) of the Act for concealment of income is cancelled. The legal ground taken by the assessee is allowed.
On merit also, we do not find any reason to impose the penalty. The fact that the assessee had earned LTCG exempt u/s.10(38) of the Act, was duly disclosed in the return of income, in the tax audit report and also in the annual accounts.
No penalty u/s. 271(1)(c) of the Act could have been imposed for concealment of income. The question of concealment would arise only if the relevant fact regarding earning of exempt LTCG was not disclosed by the assessee in the return of income. There could have been a case for furnishing of inaccurate particulars of income, for which the penalty proceeding was rightly initiated by the AO. However, considering the fact that there was amendment in this year in the provision of Section 10(38) of the Act, which stipulated that the exempt LTCG shall be taken into account in computing the book profit u/s.115JB of the Act, but there was no such corresponding amendment in Section 115JB of the Act; no motive can be imputed to the assessee.
Explanation of the assessee that there was a bona-fide mistake on its part, is found acceptable. The technical glitch explained by the assessee in the first year of e-filing wherein the details relating to MAT was required to be auto filled and Form 29B could not be filled until there was liability under MAT, has not been controverted by the Revenue. Obviously these technical glitches had led to misreporting of the book profit under MAT. In the e-filing scheme of return filing, when the assessee has reported its exempt income u/s 10(38) of the Act, the book profit for MAT should have been automatically computed by the Systems by including this exempt income. The assessee alone can’t be blamed for such misreporting which was also due to technical glitch in the system. Therefore, on merit also there was no case for imposition of penalty u/s. 271(1)(c).
Penalty imposed u/s. 271(1)(c) of the Act in respect of concealment of book profit is cancelled and the ground as taken by the assessee is allowed. Appeal of the assessee is allowed.
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2024 (12) TMI 1258
TP adjustment - international transactions undertaken by the assessee with its Associate Enterprise (AE) - HELD THAT:- We hold that the Special Bench in the case of Instrumentarium [2018 (8) TMI 1192 - ITAT KOLKATA] has laid down principle of law to the effect that there is no base erosion by ALP adjustment in the income of the non-resident in respect of its transactions with the Indian AEs.
In view of the above we reject this argument of assessee that the decision of the Special Bench in the case of Instrumentarium (supra) rejecting the base erosion argument of the assessee would not apply in the facts of the present case.
Assessee, thereafter pointed out that in the preceding year, it had raised an argument, regarding Benefit of Treaty (DTAA) against applicability of TP provisions in reference to Article 9(1) of the India Netherlands Tax Treaty .Assessee fairly conceded that this argument of the assessee had been rejected by the ITAT in its order in the case of the assessee for Asst.Year 2007-08 to 2010-11.This argument of the assessee, therefore, is also dismissed.
Principle of mirror ALP - argument of the assessee was that, if the ALP of a transaction with one of the AE’s to an international transaction is determined, the same ALP is to be applied with respect to other AE also - HELD THAT:- No merit in the contentions of the ld.counsel that the ALP adjustment should be deleted by applying the principle of mirror ALP. We have gone through the order of the ITAT in the case of the assessee for Asst.Year 2011-12 to 13-14 and have noted that it had referred to the decision of Filtrex Technologies P.Ltd. [2018 (4) TMI 1957 - ITAT BANGALORE] has categorically held that in terms of provision of law relating to TP, there could not be any case of mirror ALP at all.
Income received by the assessee on account of rendering of services was taxable in the source country only on receipt basis - We restore the issue back to the AO with the direction to apply the decision of the Special Bench in Ampacet Cyprus Ltd [2020 (9) TMI 25 - ITAT MUMBAI] on the issue of applicability of ALP adjustment to receipts which are otherwise not taxable in terms of provisions of DTAA as argued by the assessee before us. He shall consider the facts of the case and give due opportunity of hearing to the assessee while doing so.
Income from software treated as royalty in nature - The above issue is covered in favour of the assessee by the decision of the ITAT on the identical issue for Asst.Year 2011-12 [2023 (10) TMI 771 - ITAT AHMEDABAD] the addition made to the income of the assessee by treating the receipts on account of supply of software licence, as royalty is deleted.
Income from rendering Global P&T Functional Services treated as fees for technical services - Since admittedly the above issue is covered in favour of the assessee by the decision of the ITAT on the issue for Asst.Year 2012-13, addition made to the income of the assessee by treating the receipts on account of service rendered by the assessee to its subsidiary “SIMPL” for providing Global P&T Functional services as fee for technical services u/s 9(1)(vii) is deleted.
Addition on account of receipt from HLPL as fees for technical services made to the income of the assessee is deleted.
Addition made on account of income received from L&T services, as fee for technical services under section 9(1)(vii) is deleted.
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2024 (12) TMI 1257
Validity of reopening of assessment - notice u/s. 143(2) was not issued on the return of income filed by the assessee in response to the notice u/s. 148 - HELD THAT:- Notices u/s. 143(2) was issued to the assessee, but is not based on examining the return of income filed by assessee that was picked up for scrutiny in the reassessment proceedings. Reassessment order can be passed without compliance with the mandatory requirement of a notice being issued by Ld.AO u/s. 143(2) of the act pursuant to filing of return of income, cannot be treated to be the correct procedure in the eyes of law as observed in case of Hotel Blue Moon [2010 (2) TMI 1 - SUPREME COURT]. Issuance of notice u/s. 143(2) of the act after filing of return of income cannot be said to be mere procedural irregularity and the same is not curable.
The basic requirement under the act for issuance of notice u/s. 143(2) cannot be dispensed as held in Shree Jay Shivshakar Pvt. Ltd [2015 (10) TMI 1765 - DELHI HIGH COURT]
Thus reassessment orders passed for the years under consideration deserves to be quashed as no notice u/s.143(2) was issued for both years under consideration to the assessee post response filed by the assessee to treat its original return in response to the notice u/s. 148 - Decided in favour of assesee.
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2024 (12) TMI 1256
Addition u/s 68 - unexplained bank deposits - AO has mentioned that the Circular Trading resorted relating to various sales bills which were issued and circulated amongst these fictitious concerns - CIT(A) deleted addition Partly (@0.30%) - HELD THAT:- The fact remains that these entities are paper concerns and engaged in providing accommodation to the various unrelated concerns. That was never disputed by the Revenue at any point of time, but in assessee’s case, the Revenue’s stand/contention that the expenses of circular purchases, being intermediately charges not for the purpose of business, appears to be not tenable as the assessee has clearly given the records showing as to how the Circular Trading has been conducted, and the CIT(A) has rightly made the observation that 0.30% of Circular Trading transactions have to be charged to inter-mediatory not for the purpose of business as mentioned in the case of M/s. Pradip Overseas Ltd and, therefore, deleted the remaining addition and sustained 0.30%.
There is no need to interfere with the same. Besides, the Revenue’s contention that the Settlement Commission Order is relied upon, but the fact remains that the ld. CIT(A) has given independent finding relating to the assessee’s case and, therefore, there is no need to interfere with the findings of the ld. CIT(A). Appeal of the Revenue is dismissed.
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2024 (12) TMI 1255
Revision u/s 263 - approval proceeding granted by the ld Addl. CIT u/s 153D to be erroneous and prejudicial to the interest of the revenue - HELD THAT:- As relying on Devender Kumar Gupta [2024 (9) TMI 210 - ITAT DELHI] wherein held PCIT has not taken account of the fact that the assessments were completed after prior approval of the competent authority. Thus, we are of the considered view that at the time of examining the issue as to if the assessment order is erroneous so far as prejudicial to the interest of the Revenue, the Id. revisional authority is not only supposed to see the assessment record of AO, but also the record of the approval which as far as the revisional authority is concerned becomes "record" of the quasi judicial authority whose order is being examined by invoking the revisional jurisdiction.
Therefore, without giving a finding that the prior approval u/s 153D was vitiated and was also erroneous so far as prejudicial to the interest of the Revenue, the assessment order independently cannot be held to be erroneous so far as prejudicial to the interest of the Revenue.
Thus, we hold that the revision order passed u/s 263 of the Act by the ld PCIT deserves to be quashed and is hereby quashed. Accordingly, grounds raised by the assessee are allowed.
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9911796707
