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2023 (2) TMI 21 - AT - Income TaxRevision u/s 263 - failure of assessee to substantiate the source of deposit - short assessment by AO HELD THAT:- Here in the present case on limited question of fact Ld. PCIT exercised its jurisdiction u/s 263 of the Act as Ld. PCIT found that the cash deposits in bank account of assessee with ICICI Bank Ld. AO has wrongly taken the figure at Rs.3,00,74,620/- and which even assessee admitted in its reply to the show-cause notice that cash deposit was Rs.3,05,73,196/-. Thus, the short assessment to the extent of Rs.4,98,576/- has been taken into consideration as difference which Ld. AO failed to consider. Certainly as far as the facts are concerned, in spite of having the material information in the form of bank account statement available with him, the Ld. AO had fallen in error in not taking into account the correct figure. The failure of Ld. AO to examine the bank statement in correct perspective had led to under assessment of income - That, certainly makes the assessment order erroneous and prejudicial to the interest of assessee to the extent of amount ignored by Ld.AO. If any observations have been made by Ld. PCIT with regard to failure of assessee to substantiate the source of deposits are superfluous and have no binding effect on Ld. AO as Ld. AO is expected to only comply with the operative part of the order of the Ld. PCIT which merely directs the Ld. AO to add short amount Rs.4,98,576/- to the addition made by Ld. AO u/s 69A of the Act. The enquiry and verification only to the extent of this amount has been directed by the Ld. PCIT and to that extent there is no illegality in the exercise of powers of Section 263 of the Act by Ld. PCIT. Whatever contentions have been raised on behalf of the assessee as to the nature of its business leading to deposit of cash throughout the year or that there was no disproportionate or exceptional high deposit in the period of demonetization are not issues covered and examined by the Ld. PCIT and assessee has already availed the remedy to challenge the addition on merits by preferring appeal against the order dated 10.12.2019. The judgments relied are quite distinguishable on facts as in the present case the admitted state of affairs is that there was factual error committed by Ld. AO and same apparently caused loss of revenue. Thus, the grounds raised have no substance. Consequently, the appeal is dismissed.
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