9911796707
TMI Blog2012 (11) TMI 1215X X X X Extracts X X X X X X X X Extracts X X X X ..... ance Education and Training and ii) IT Associates, filed his return of income originally on 17/10/2005 for the year under consideration admitting loss of ₹ 21,80,940/-. On 22/11/2007, the assessee filed a revised return admitting a loss of ₹ 21,31,786/-. The return of income was processed u/s 143(1) on 13/07/2006 and refund of ₹ 2,41,947/- was issued. Subsequently, the return was selected for scrutiny. After issuing the statutory notices, the AO completed assessment u/s 143(3) of the Act, disallowing a sum of ₹ 2,62,825/- u/s 40A(3) of the Act and added the same to income of the assessee. 3. Thereafter, the CIT issued notice u/s 263 of the Act on 15/02/2010 holding that the assessment order dated 28/12/2007 passed b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e said loan directed the AO to examine cash deposit of ₹ 20 lakhs and if not satisfied with the Assessee's explanation to bring the same to tax. 7. Further, during the course of hearing, the CIT noticed that the assessee had started Training Centre at Mumbai and did not show any receipts from the Centre. He, therefore, directed the AO to bring to tax the receipts, if any, earned by the assessee after examination. 8. Aggrieved, by the order of the CIT, the assessee is in appeal before us on three counts, namely, i) bringing to tax the professional receipts of ₹ 7,36,555/-, ii) bringing to tax cash credit of ₹ 20 lakhs, if the explanation of the assessee is unsatisfactory, and iii) bringing to tax, receipts, if any, from M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mentioned in the show cause notice. In this connection, the jurisdictional Co-ordinate Bench in the case of AP Beverages Corporation (supra) held as follows: "It is an admitted fact that when the notice was first issued under s. 263 on 10/10/2005, it was so issued for reasons noted in para 3 above, which have nothing to do with disallowance in respect of sports privilege fee under the AP Excise Act. It was only in the further notice dated 02/02/2006 issued by the CIT u/s 263, that the assessee was called upon to offer objections, if any, against disallowance of ₹ 5.90 crores deducted below the line as prior year expenses. Thus, at the time when the CIT was perusing the records and issued notice u/s 263 of the Act, the issue relatin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the CIT himself but by some other offer on his behalf which showed that it was only a letter and not show cause notice and this mistake was not curable one as enumerated in s. 292B. The question as to whether the increase due to the exchange fluctuation was revenue in nature was not even in the of the CIT when he had issued the notice. Hence, as this issue was not part of the show-cause notice dt. 22nd Dec., 2003, it is impermissible to expand the said notice by resort to letters as herein done, for if that be so, then there would be no end to the proceeding and it will go on getting expanded and expanded which is not permissible under law. The law does not permit expanding proceedings u/s 263 after its initiation beyond what is stated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the same journal entry No. 230). It is, therefore, submitted that consequently the assessee neither offered this amount to tax for the AY 2005-06 nor shown in the balance sheet as 'receivable' and rightly so. He explained the reason for contra entry was that the above amount was received in the FY 2005-06 (AY 2006-07 as evident from the TDS certificates which are as follows: Date of TDS Certificate Amount (in Rs) 11/05/2005 27,550 04/04/2005 1,44,690 08/04/2005 1,10,160 11/04/2005 77,955 13/04/2005 1,17,120 22/04/2005 2,59,230 Total 7,36,555 15. It is submitted that as the entire sum of ₹ 736,555/- is received in FY 2005-06, the same is offered to tax in the AY 2006- 07 which was specifically examined by the AO and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arned counsel for the assessee relied upon the decision of the Hon'ble Delhi High Court in the case of Jindal Drilling and Industries Ltd. Vs. CIT [2008]301 ITR 304 (Delhi). 19. We have heard the arguments of both the parties and perused the record and gone through the orders of the authorities below. We find from the assessment order dated 09/12/2008 for AY 2006-07, a sum of ₹ 7,36,555/- was offered to tax by the assessee and assessed as such by the AO. The CIT passed the order u/s 263 directing the AO to bring to tax the said sum of ₹ 7,36,555/- for the AY 2005-06, which is the year under consideration. In this case, there is no dispute that the assessee is following mercantile accounting system and if the impugned amount of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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