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Babubhai Jesangbhai Desai Versus The CIT-III Ahmedabad

2015 (8) TMI 1157 - ITAT AHMEDABAD

Revision u/s.263 - sufficient opportunity non granted - Held that:- U/s.263 CIT is empowered to call for and examine the record of any proceeding under this Act, and if he considers that any order passed therein by the AO is erroneous in so far as it is prejudicial to the interests of the revenue, he may, after giving the assessee an opportunity of being heard and after making or causing to be made such inquiry as he deems necessary, pass such order thereon as the circumstances of the case justi .....

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In the case in hand, the assessee was given two opportunities of seven days each including the period taken for service of notice/letter. Under these facts, we are of the considered view that the assessee was not granted sufficient opportunity to defend his case. It is settled principle of law that revisionary power is required to be exercised with a great caution because it affects the taxpayer’s rights and it is not expected that the concluding assessment proceedings be reopened on t .....

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eby set aside and the ld.CIT is directed to consider the explanation of the assessee and decide the matter afresh in accordance with law. - Decided in favour of assessee for statistical purposes. - I.T.A. No.1119/Ahd/2013 - Dated:- 7-8-2015 - SHRI G.D. AGARWAL AND SHRI KUL BHARAT, JJ. For The Appellant : Shri S.N. Divatia, AR For The Respondent : Smt.Nidhi Srivastava, CIT-DR ORDER PER SHRI KUL BHARAT, JUDICIAL MEMBER : This appeal by the Assessee is directed against the order of the Ld.Commissio .....

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vously erred in law and or on facts in not allowing sufficient and specific opportunity of hearing before passing the impugned order. The CIT had allowed very short time to comply with the notices which the appellant was unable due to his political and other assignments. Hence the appellant should be allowed to produce additional evidence during the appeal proceedings. 2.1 The Ld.CIT has grievously erred in law and on facts in holding that the original assessment made by AO was erroneous and pre .....

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, therefore, prayed that the impugned order passed u/s 263 by CIT may kindly be cancelled and original asstt order be restored. 2. Briefly stated facts are that the assessment u/s.143(3) of the Income Tax Act,1961 (hereinafter referred to as the Act ) was framed by the Assessing Officer (AO in short) vide order dated 28/05/2010. Subsequently, the ld.CIT issued a notice u/s.263 of the Act and passed the impugned order; whereby the ld.CIT set aside the assessment order dated 28/05/2010 and directe .....

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t opportunity to defend his case. He submitted that the ingredients for invoking the provisions of section 263 of the Act were not satisfied. He pointed out that the ld.CIT has recorded in his order that a show cause notice was issued on 01/12/2012 but none attended on 04/12/2012. He further recorded in his order that opportunity of hearing was given to the assessee vide letter dated 22/01/2013 to be complied on 29/01/2013. The ld.counsel for the assessee submitted that on the first occasion whe .....

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he order of the ld.CIT be set aside. He also filed written synopsis dated 25/02/2015. He reiterated the submissions made in synopsis and submitted that there is gross violation of principles of natural justice. 3.1. On the contrary, ld.CIT-DR supported the order of the ld.CIT and submitted that there is no illegality in the order passed by the ld.CIT. The ld.CIT-DR submitted that opportunity of being heard was duly granted to the assessee. 3.2. In rejoinder, the ld.counsel for the assessee submi .....

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ed by issuing show-cause notice dated 27/11/2012 and by that show-cause notice, the assessee was required to attend office of the ld.CIT on 04/12/2012. It is recorded by the ld.CIT that the notice was served upon the assessee on 01/12/2012, however, none attended on 04/12/2012. It is recorded by the ld.CIT that another opportunity was given vide letter dated 22/01/2013, whereby the assessee was called upon to attend the hearing on 29/01/2013 and on this date also, none appeared on behalf of asse .....

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. However, the ld.counsel for the assessee has placed on record notices dated 16/10/2009 and 24/12/2009 issued u/s.142(1) of the Act. The notice dated 24/12/2009 is in form of questionnaire and has exhaustive information in the form of 25 items. In response thereto, the assessee also filed reply dated 9th January-2010 giving item-wise reply to the notice of the AO. There is another letter on behalf of assessee placed at Page Nos.34 & 35 of the paper-book addressed to AO; whereby the assessee .....

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, he is also engaged in agricultural activity. He had filed his return of income for A.Y.208-09 on 31.03.2009 declaring total income of ₹ 1,73,70,120/- which included multiple sources of income such as salary as MLA, rent of property, share of profits, capital gains, sale of lands, etc. 2.1 During the course of asstt. proceedings, the AO issued initially notice dt. 16-10-2009 to furnish documents and accounts in support of the return of income and claims made there under. The appellant by .....

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aggregating to ₹ 3,05,903/-. 2.2 Thereafter, the proceedings u/s 263 were initiated by CIT-A'bad-III vide notice dt. 27-11-2012 in respect of the following items of income: (i) Cash deposits of ₹ 28 lakhs in Canara Bank a/c. (ii) Income from sale of immovable property for ₹ 58 lacs. (iii) Sale of land shown as capital gains instead of business income. (iv) Claim of deduction of ₹ 76 lacs not examined. (v) Rental income as per IDS certificates was ₹ 19,11,016 but .....

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g was heard from CIT and the impugned order was passed on 21-2-2013 ex-parte directing AO to re-examine all the eight issue and pass order afresh. 2.4 The appellant submits that the impugned order passed by AO was neither erroneous nor prejudicial to the interest of the revenue because the AO had after having called for the necessary details and on verification being satisfied with the same taken the view partly in favour of the appellant and partly to the extent of agricultural income, capital .....

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ddition on this count in fresh order passed u/s.143(3) r.w.s. 263 dt. 11-2-2014. 3 Sale of land & Bldg as Capital gains Item No.16 of notice dt 24-12-2009. The sale as dealer in land shown separately in P&L a/c (P-9) 4 Profit as confirming party Details as per page 54 of paper book and details given as per (p-56). There cannot be a business to deal in Banakhat rights by the assessee. 5 Lease Rent Item No.18 of notice dt 24-12-2009 (See details given as per page-50). There was no discrepa .....

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ee years given (P-33) 9 Form No.16A-Shortfall in income Item No.19 Case Laws relied upon: 1 Malabar Industrial Co Ltd. - 243 ITR 83(SC) 2. Gabriel India Ltd. - 203 ITR 108 (Bom) 3. Sunbeam Auto Ltd. - 332 ITR 167 (Del) 4. Max India Ltd. - 295 ITR 283 (SC) 5. M/S Bhagat Marketing Corpn.- ITA No.1292/A/06 dt 19-12-08 6. Abhishek Eng P Ltd. - ITA No.754/Ahd/2012 dt.22-6-12 4.1. U/s.263 of the Act, the ld.CIT is empowered to call for and examine the record of any proceeding under this Act, and if he .....

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