TMI Blog2017 (9) TMI 1238X X X X Extracts X X X X X X X X Extracts X X X X ..... is a unique conception which is to be understood in the context of and in the interests of the Revenue. - non-genuine commission payment and no expenditure was incurred by the Assessee to receive the above commission - Held that:- The order of the CIT does not conform to the legal requirements of Section 263 of the Act. It was not enough for the CIT to reproduce the SCN, the reply thereto and give the conclusion. The impugned order of the CIT gives no reasons for the conclusion that the assessment order of the AO was erroneous and prejudicial to the interests of the Revenue. The CIT appears to have proceeded under the misconception that the AO could be directed to provide the details of the facts on the basis of which 263 proceeding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 289/- which was exempt from tax. The Assessee had not made any disallowance in relation to such income under Section 14A of the Act. 4. After picking up the Assessee s return for scrutiny, the AO completed the assessment under Section 143 (3) of the Act making a disallowance of ₹ 3,23,475/- under Section 14A of the Act. 5. Thereafter, a proposal was sent by the AO to the CIT for invoking Section 263 of the Act and to revise the assessment order. A show-cause notice ( SCN ) was issued to the Assessee by the CIT on 30th January 2014. The SCN inter alia stated that information had been received from the Deputy Director of Income Tax (Investigation)-Unit-II (2), Pune that during a search and seizure operation carried out on the Walc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the I.T. Act is set aside u/s 263 of the I.T. Act with the specific direction to the A.O to provide the basis/reasons for initiations of proceedings u/s:263 of the I. T Act to the assessee, to verify the submission of the assessee on the issue and also the details of receipt declared by the assessee, to examine the details of service rendered and expenditure incurred to earn particular commission incomes and then decide the issues accordingly after giving reasonable opportunity of being heard to the assessee company. 7. The above order has been set aside by the ITAT by the impugned order in the appeal filed by the Assessee on the ground that Section 263 of the Act is to be invoked not as a jurisdictional corrective or as a review of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d then verify the reply of the assessee on the same issue. The exercise under Section 263 of the Act could not have been outsourced by the CIT to the AO. The CIT had himself to undertake a minimal enquiry and give reasons for coming to the conclusion that the assessment order was erroneous and prejudicial to the interest of the Revenue. This legal position has been explained in a number of decisions including Income Tax Officer v. DG Housing Projects Limited [2012] 343 ITR 329 (Del) and DIT v. Jyoti Foundation [2013] 357 ITR 388 (Del). This was reiterated by this Court recently in its decision dated 5th September 2017 in ITA No. 705 of 2017 (Pr. Commissioner of Income Tax-3, New Delhi v. Delhi Airport Metro Express Pvt. Ltd). 11. Cons ..... X X X X Extracts X X X X X X X X Extracts X X X X
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