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2022 (5) TMI 1131 - AT - Income TaxRevision u/s 263 - As per CIT- A source of cash deposit in savings bank account which are alleged to be more than the assessee’s business turnover - HELD THAT:- We find merit in the grounds raised by the assessee and note that the source of cash deposit in the bank account held with IDBI has been examined by the ld. AO and after being satisfied with the details has accepted the source of cash deposits. Even before ld. PCIT, the assessee has given complete details about the frequent withdrawal of cash from different bank accounts and the source of cash deposit in both the bank accounts held with IDBI Bank. Ld. PCIT failed to find any error in the details filed by the assessee. The finding of the ld. PCIT seems to be general even after the assessee has given the complete details and the source of cash deposit. It makes sense that the ld. AO was obligatory to conduct enquiries into the source of deposits by issuing notice u/s 133(6) of the Act. We do not find any merit in such finding of ld. PCIT because ld. AO issued notice u/s 133(6) of the Act, called information from the bank, perused the audited financial statements of both the sole proprietorship concerns and after being satisfied that since the assessee sells the goods to retailers in the small villages, towns and markets of Sambalpur, Jharsuguda, Rourkela, Cuttack etc., the source of cash deposit is from sale of goods and in some cases from withdrawal of cash from one bank account and deposit into another. PCIT erred in assuming jurisdiction u/s 263 of the Act and since proper enquiry have been conducted for the issue raised in the show cause notice and a permissible view has been taken by the ld. AO, the entire proceedings u/s 263 of the Act are bad in law. We, therefore, quash the impugned order passed by ld. PCIT and restore the order of the ld. AO passed u/s 143(3) of the Act dated 22.11.2016. Hence, all the grounds raised by the assessee are allowed.
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