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2020 (5) TMI 106 - AT - Income TaxRevision u/s 263 - disallowance of 5% of the total purchases - Reopening of assessment - HELD THAT:- The issue on the basis which reopening has been done, has been examined by the A.O and after verifying the evidences, a conscious decision has been taken by the A.O when passing the assessment order on 11-3-2016. A perusal of the order u/s 263 passed by the CIT shows that in the show cause notice, Pr. CIT has mentioned that the disallowance of 5% of the total of such purchases is erroneous and prejudicial to the interest of revenue within the meaning of sec. 263 of the Act. However, when it came to the order passed u/s 263 he does not say as to how the said assessment order passed u/s 143(3) read with sec. 147 for the A.Y. 2010-11 dated 11-2-2016 is erroneous insofar as it is prejudicial to the interest of revenue. CIT also fails to answer the very primary question that if the purchases are going to be treated as bogus and the addition is going to be made of the entirety of the purchases what happens to the sales that have been disclosed, as also the stocks by treating the said purchases as bogus. Sales which have been disclosed cannot be touched. The stock statement of the assessee would also stands disturbed. A perusal of the assessment order however, shows that these have been examined by the A.O and after considering the facts the estimated addition of 5% of purchases have been made by the A.O. The issues have been examined by the A.O and just because the opinion as arrived by the A.O is at a variation of the opinion of the learned Pr. CIT, would not grant the learned Pr. CIT the powers of revision u/s 263 - Decided in favour of assessee.
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