Subscription   Feedback   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Articles Highlights TMI Notes SMS News Newsletters Calendar Imp. Links Database Experts Contact us More....
Extracts
Home List
← Previous Next →

Krushnasinh Dilubha Vaghela Versus The Pr. Commissioner-3, Ahmedabad.

2016 (5) TMI 213 - ITAT AHMEDABAD

Revision u/s 263 - whether revision was under influence of auditors’ objection? - Held that:- If the ld.Commissioner initiated the proceedings under influence of audit objection and took such objection as gospel truth, then, probably, the ld.counsel for the assessee may be justified to raise this plea that on the basis of auditors’ objection proceeding under section 263 ought not to be initiated, but in case where, the role of auditors’ objection is only assumption of a information, which has be .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

n 263 was under the influence of auditors’ objection. The ld.Commissioner has recorded his individual satisfaction before taking action against the assessee. Therefore, we do not find any error in the order of the ld.Commissioner. - Decided against assessee - ITA. No. 1249/Ahd/2015 - Dated:- 2-5-2016 - Shri Rajpal Yadav, Judicial Member And Shri Manish Borad, Accountant Member For the Petitioner : Shri S.N. Divetia, AR For the Respondent : Shri Jagdish, CIT-DR ORDER Per Rajpal Yadav, Judicial Me .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

₹ 1,58,010/-. The assessee has revised this return on 29.3.2012 declaring income of ₹ 5,82,800/-. The case of the assessee was selected for scrutiny assessment and notice under section 143(2) of the Act was issued on 1.8.2012, which was served upon the assessee. The ld.AO has passed an assessment order running into half-page. The order read as under: In this case, the assessee has filed his original return of income for A.Y. 2010-11 on 02/05/2011 declaring income of ₹ 1,58,010/ .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

In response to the notices issued 143(2) & 142(1) of the Act, Shri Laxman Kalwani & authorized representative of the assessee attended from time to time and furnished the details as called for the same is verified on test check basis. The assessee has income from retail sale of agriculture products. He has shown income from Salary of ₹ 75,000/- and other sources ₹ 35,650/- and total income of business of ₹ 5,82,800/-after calming deduction under chapter VI-A of ₹ .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ome as per Original return of Income ₹ 1,58,010/- Add: difference Income as per revised return of income Rs.4,24,790/- Total income assessed Rs.5,82,800/- Agriculture Income for rate purpose Rs.3,90,555/- 5. Assessed u/s. 143(3) of the Act. Issued demand notice and challan after giving credit of prepaid taxes, if any, after due verification. Charged interest u/s. 234A, 234B & - 234C as applicable. 4. On perusal of the record, ld.Commissioner formed an opinion that the assessment order .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

rse of assessment proceedings. He has accepted the return as it is, without any deliberation, and therefore, an erroneous order has been passed, which has caused prejudice to the interest of the Revenue. 5. Before us, the ld.counsel for the assessee, while impugning the order of the ld.Commissioner contended that the AO has issued show cause notice under section 142 of the Act. Copy of the notice is available at page no.85 of the paper book no.2. He took us through this show cause notice. On the .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

action under section 263 of the Income Tax Act. 6. The ld.DR, on the other hand, relied upon the order of the ld.Commissioner. 7. At this stage, before considering the multi-fold contentions of the ld. Representatives, we deem it pertinent to take note of the fundamental tests propounded in various judgments relevant for judging the action of the CIT taken u/s 263. The ITAT in the case of Mrs. Khatiza S. Oomerbhoy Vs. ITO, Mumbai, 101 TTJ 1095, analyzed in detail various authoritative pronouncem .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

rroneous that the section will be attracted. (iii) An incorrect assumption of facts or an incorrect application of law will suffice the requirement of order being erroneous. (iv) If the order is passed without application of mind, such order will fall under the category of erroneous order. (v) Every loss of revenue cannot be treated as prejudicial to the interests of the Revenue and if the AO has adopted one of the courses permissible under law or where two views are possible and the 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

al power vested in his and if he exercises such power in accordance with law and arrive at a conclusion, such conclusion cannot be termed to be erroneous simply because the CIT does not fee stratified with the conclusion. (viii) The CIT, before exercising his jurisdiction under s. 263 must have material on record to arrive at a satisfaction. (ix) If the AO has made enquiries during the course of assessment proceedings on the relevant issues and the assessee has given detailed explanation by a le .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ITR 375). In the case of Sun Beam Auto, the Hon'ble High Court has pointed out a distinction between lack of inquiry and inadequate inquiry. If there is a lack of enquiry, then the assessment order can be branded as erroneous. The following observations of the Hon'ble Delhi High Court are worth to note: 12. We have considered the rival submissions of the counsel on the other side and have gone through the records. The first issue that arises for our consideration is about the exercise of .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

itself would not be indicative of the fact that the Assessing Officer had not applied his mind on the issue. There are judgments galore laying down the principle that the Assessing Officer in the assessment order is not required to give detailed reason in respect of each and every item of deduction, etc. Therefore, one has to see from the record as to whether there was application of mind before allowing the expenditure in question as revenue expenditure. Learned counsel for the assessee is righ .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

the Hon ble court has expounded the approach of ld. Assessing Officer while passing assessment order. The observation of the Hon ble court on pages 386 of journal read as under:- … it is not necessary for the Commissioner to make further inquiries before cancelling the assessment order of the Income-tax Officer. The Commissioner can regard the order as erroneous on the ground that in the circumstances of the case the Income-tax Officer should have made further inquiries before accepting t .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

. He cannot remain passive in the face of the return which is apparently in order but called for further inquiry. It is his duty to ascertain the truth of the facts stated in the return when the circumstances of the case are such as to provoke an inquiry… It is because it is incumbent on the Income-tax Officer to further investigate the facts stated in the return when circumstances would made such an inquiry prudent that the word erroneous in section 263 includes the failure to make such .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

e impugned order has been passed on 9.3.2015. According to the ld.counsel for the assessee, in the first show cause notice, ld.Commissioner has observed that the assessee has not filed tax audit report along with return, and therefore, the AO ought to have initiated penalty proceedings under section 271B of the Income Tax Act. According to the assessee, in the relevant assessment year, no audit report was required to be attached with the income-tax return. The assessee has got audit report well .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

led loan given account . The assessee has received cash and the AO has not enquired to this account nor initiated proceedings under section 271D for violation of section 269SS of the Act. We find that on these aspects, neither the AO has made any inquiry nor in the assessment proceedings even issued a show cause notice. Thus, the ld.Commissioner is justified to take this aspect, as a reason for initiation proceedings under section 263. Similarly, in the show-cause notice under section 263, the l .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 

what is new what is new
  ↓     bird's eye view     ↓  


|| 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