TMI Blog2016 (10) TMI 428X X X X Extracts X X X X X X X X Extracts X X X X ..... ferred to as the Act ) vide M.No. CIT,Kol-I,Kol/263/2013-14/10847-49 dated 28.03.2013. Assessment was framed by JCIT(OSD). CIT-1, Kolkata u/s 143(3) of the Act vide his order dated 28.12.2011 for assessment year 2009-10. The grounds raised by the assessee per its appeal are as under:- 1) That the learned Commissioner of Income Tax, Kolkata - I, Kolkata erred in arbitrarily initiating the impugned proceedings under section 263 of the Income Tax Act, 1961, in the instant case of the Appellant Company herein, in respect of the assessment year 2009-10, through the Notices dated 9th January, 2014 and 3rd March, 2014. 2) That, on the facts and in the circumstances of the case, the Ld. Commissioner of Income-tax erred in alleging that the assessment order dated 28th December, 2011 passed under section 143(3) was erroneous in so far as it was prejudicial to the interest of the Revenue, and on the basis of such misconceived allegation he further erred in assuming jurisdiction under section 263 of the Act, and passing the impugned order dated 26th March, 2014 under the said Section, which is wholly perverse and invalid in limine. 3) That without prejudice to the above, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tances of the case, the Ld. Commissioner of Income Tax erred in setting aside the order dated 28th December, 2011 passed by the Assessing Officer under section 143(3) of the Act after making scrutiny and enquiry on all matters and issues raised in the show cause notices issued by him. 8) That the appellant craves leave to take additional grounds, and/or to amend or withdraw any of the foregoing grounds before, or at the time of hearing of this appeal. Smt. Nilima Joshi, Ld. Authorized Representative appeared on behalf of assessee and Shri Sachchidananda Srivastava, Ld. Departmental Representative appeared on behalf of Revenue. 2. Grounds No. 1 to 7 are inter-related and therefore being taken up together for the passing of consolidated order for sake of convenience. The common issue raised in all the grounds of appeal is that the ld. CIT(A) erred in holding the order of the AO and prejudicial to the interest of revenue u/s 263 of the Act. 3. The facts in brief are that assessee is a Private Limited Company and filed its return of income declaring total income of ₹ 5,58,03,750/- which is comprising of house property income, business and professional income and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s list of the assessee in the name of M/s Dango Dienthal (India) Pvt. Ltd. Besides the above there were also advances shown by the assessee to others of ₹ 7.62 crores. The ld. CIT under section 263 of the Act that the above stated facts have not been verified by the AO at the time of assessment. 7. The amount of sales, service charges for installation and the expenses for travelling, exhibition etc. were not verified by the AO. The ld. CIT u/s 263 of the Act after giving the opportunity to the assessee held that order passed by the AO is erroneous and prejudicial to the interest of the Revenue and accordingly directed to pass de-novo assessment as per law. Being aggrieved by the order of ld. CIT u/s 263 of the Act, the assessee is in appeal before us. 4. Before us Ld. AR submitted paper book which is running pages from 1 to 76 and stated that all the details in relation to assessment was furnished at the time of original assessment. Ld AR submitted that as reported in the clause 21(B)(b) of TAR, liability of leave salary amount to ₹ 21,90,943/- which has to be added back. Amount added back as per the assessment order was ₹ 11,69,505/-. This is due ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n this connection we rely in the judgment of Hon ble Delhi High Court in the case of Gee Vee Enterprises Vs. ACIT (1975) 1975 CTR 0061 (DEL) : (1975) 99 ITR 0375 The position and function of the ITO is very different from that of a civil Court. The statements made in a pleading proved by the minimum amount of evidence may be accepted by a civil Court in the absence of any rebuttal. The civil Court is neutral. It simply gives decision on the basis of the pleading and evidence which comes before it. The ITO is not only an adjudicator but also an investigator. He cannot remain passive in the face of a return which is apparently in order but calls 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. The meaning to be given to the word erroneous'' in s. 263 emerges out of this context. It is because it is incumbent on the ITO to further investigate the facts stated in the return when circumstances would make such an inquiry prudent that the word erroneous'' in s. 263 includes the failure to make such an inquiry. The order becomes erroneous because such a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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