New User   Login      
Tax Management India .com TMI - Tax Management India. Com
Extracts
Home List
← Previous Next →

2015 (6) TMI 554 - ITAT HYDERABAD

2015 (6) TMI 554 - ITAT HYDERABAD - TMI - Revision u/s 263 - CIT(A) upheld the rejection of books of account, however, reduced the estimation of gross income of assessee from 1% to 0.7% of the turnover - Held that:- The directions of ITAT make it clear that the entire issue is open before AO as he has been directed to make a fresh assessment. In these circumstances, when the assessment order has been restored back by ITAT to the file of AO with a direction to make a fresh assessment after examin .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ed u/s 263 of the IT Act, 1961 (Act) by ld. CIT-II, Hyderabad for the AY 2009-10. 2. Briefly the facts are, assessee a company is engaged in the business of trading in steel products. For the AY under consideration, it filed its return of income on 31/03/2010 declaring income of ₹ 11,87,302. Subsequently, assessee filed a revised return on 26/08/2010 declaring total income of ₹ 11,87,302. In course of assessment proceeding, AO after verifying the books of account and other informatio .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

3,36,064 in the assessment order passed on 30/12/2011. Being aggrieved of the assessment order so passed, assessee preferred appeal before ld. CIT(A). 3. As it appears from record, before ld. CIT(A), assessee specifically challenged rejection of books of account and estimation of gross profit at 1%. Ld. CIT(A) after considering the submissions of assessee, though, upheld the rejection of books of account, however, reduced the estimation of gross income of assessee from 1% to 0.7% of the turnover .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

essment order shall not be revised due to the following errors: "3. On verification of asst. record, it is seen that while completing the assessment, the books of account were rejected on the ground that there were some discrepancies and the income was estimated @ 1% on the gross sales of ₹ 648,80,66,096 and the total income was determined at ₹ 3,83,36,064 after allowing preliminary expenses, selling and administrative expenses and salaries to employees and depreciation amountin .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

diture of ₹ 2,65,44,596 separately is not in order." In response to the show cause notice, assessee appeared before ld. CIT and made elaborate submissions challenging not only the jurisdiction invoked u/s 263, but, also the issue on merit. The specific plea taken by assessee before ld. CIT was assessment order passed having merged with the order of ld. CIT(A) and in further appeal before ITAT, exercise of power u/s 263 is invalid. The other contention of assessee was since AO has take .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

since allowability of expenditure was not an issue before ld. CIT(A) invoking of jurisdiction u/s 263 is in accordance with law. He further observed that once books of account are rejected and income is estimated, AO cannot rely on the same books of account for allowing expenses from the estimated income. For coming to such conclusion, he relied upon certain judicial precedents. On the aforesaid reasoning, ld. CIT finally concluded that assessment order passed being erroneous and prejudicial to .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ubject matter of appeal before ld. CIT(A) and having been considered and decided by ld. CIT(A), exercise of jurisdiction u/s 263 is contrary to the statutory mandate as provided in Explanation (c) to section 263(1) of the Act. Ld. AR submitted, in fact, while considering the appeals preferred by assessee as well as revenue against the order of ld. CIT(A), ITAT has remitted the matter back to the file of AO with a direction to examine assessee s books of account and other documents and thereafter .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

and prejudicial to the interests of revenue due to the fact that once income is estimated no further allowance of expenditure can be given. 7. Having considered the submissions of the parties, we are unable to accept the contention of ld. DR. It is manifest from the facts and materials on record, AO after rejecting the books of account estimated the gross income of assessee from steel trading business and from such estimated gross income allowed certain expenditure. Assessee preferred appeal aga .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version