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2017 (12) TMI 188 - ITAT DELHIRevision u/s 263 - Disallowance u/s 14A - Held that:- We are of the view that the AO had issued a detailed questionnaire raising various queries. The appellant had appeared from time to time and filed the detailed replies to all the queries raised. Books of account were produced along with the supporting vouchers which were examined by the AO. The confirmed copies of account with PAN numbers of the parties to whom sales and purchases were made, were filed before the AO. The explanation regarding fall in GP rate was duly given. A specific query was raised in respect of disallowance during the course of assessment proceeding to which reply was filed by the assessee that there is no exempt income and provisions of section 14A of the Act will not be applicable. The details of traveling expense and godown rent expense were duly filed before the AO. Hence it cannot be said that this is a case of no enquiry made by the AO. Merely because the ld. PCIT feels that further enquiry should have been made does not make the order of the AO erroneous. The assessee had filed various replies to the ld. PCIT in response to notice u/s of the Act 263 of the Act stating that all the issues raised by the PCIT have been examined by the AO during the course of assessment. The PCIT has ignored the replies of the assessee. He merely states that the reply has been filed by the assessee but he nowhere discusses the contentions raised by the assessee and why he does not agree with the contentions of the assessee. The ld. PCIT has merely remitted the matter back to the AO without making any enquiry himself. The ld. PCIT has mentioned that the opening stock has not been verified by the AO, whereas the total opening stock was pledged with the bank. The ld. PCIT has not considered the contentions of the assessee. Similarly, the other replies of the assessee filed during the course of assessment and in response to notice u/s 263 of the Act have been totally ignored. No enquiry has been made by the PCIT. It was incumbent for the PCIT to make some minimum independent enquiry to reach to the conclusion that the order of the AO is erroneous and prejudicial to the interest of revenue. -Decided in favour of assessee.
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