TMI Blog2020 (3) TMI 538X X X X Extracts X X X X X X X X Extracts X X X X ..... t to re-appreciate the evidences already considered by the AO during the scrutiny assessment as it would amount to review of its own order. AO has travelled beyond the jurisdiction and scope of Section 154 - Instead of sending a proposal for revision of the order u/s 263 of the Act, the AO has assumed the powers and jurisdiction u/s 154 of the Act to review the earlier order in the garb of rectification of mistake. Even otherwise, if there is an error in the earlier order for allowing deduction u/s 54 of the Act, this is a mistake of question of law and facts. The ascertainment of facts requires a proper investigation and verification of the record as well as reality on the ground. Therefore, such an exercise of investigation and examination cannot be undertaken u/s 154 - Decided in favour of assessee. - ITA No. 1052/JP/2017 - - - Dated:- 3-3-2020 - Shri Vijay Pal Rao, JM And Shri Vikram Singh Yadav, AM For the Assessee : Shri Mahendra Gargieya, Advocate For the Revenue : Smt. Runi Paul, JCIT-DR ORDER PER VIJAY PAL RAO, JM This appeal by the assessee is directed against the order of ld. CIT(A)-3, Jaipur dated 01-11-2017 for the Assessment Year 2011- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that during the year under consideration, the assessee sold the plot bearing No. B-277, Vigyan Nagar,Jaipur for a sale consideration of ₹ 15.21 lacs vide sale deed dated 24-11-2010 against which the assessee claimed indexed cost of acquisition/ indexed cost of improvement/ construction total amounting to ₹ 2,17,526/- and thereby computed Long Term Capital Gain of ₹ 13,03,474/-. The assessee claimed exemption u/s 54 of the Act of ₹ 5,25,700/- on account of construction of first floor on the existing house property bearing 8/138, Vidhyadhar Nagar, Jaipur . The ld.AR of the assessee submitted that the assessee had produced the evidence in support of the construction of first floor during the assessment proceeding which includes agreement dated 25-10-2010 with the contractor Shri Lokesh Shah Prop: M/s. Ritu Construction. The AO after verification of the documents produced by the assessee in support of claim of deduction u/s 54 of the Act accepted the claim while passing the scrutiny assessment u/s 143(3) of the Act. Thereafter the successor AO issued notice u/s 154 of the Act on 19-01-2015 whereby he proposed to withdraw the claim of deduction u/s 54 of the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds that deduction u/s 54 of the Act was wrongly allowed then proper remedy was to initiate proceedings u/s 263 of the Act and not to initiate proceedings u/s 154 of the Act. Thus the ld.AR of the assessee submitted that the impugned order passed u/s 154 of the Act is not sustainable in law as it is beyond the scope and jurisdiction conferred u/s 154 of the Act. 2.3 On the other hand, the ld. DR has submitted that there is an apparent mistake on record as the AO found that what was sold by the assessee was not a residential house but a plain plot of land and therefore, the deduction u/s 54 of the Act is not allowable. Further the assessee has neither purchased nor constructed a new house but claimed to have invested in building the first floor of the existing house occupied by the assessee. Even in support of that claim, the assessee filed so called agreement with Contractor on a plain paper which is not verifiable. The ld. DR thus relied on the orders of the lower authorities. 2.4 We have considered the rival submissions as well as relevant materials available on record. The AO while passing the scrutiny assessment u/s 143(3) of the Act on 30-12-2013 accepted the returned inc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the case if the immovable property sold by the assessee bearing No. B-277, Vigyan Nagar, Jaipur is only a plot of land and not residential house, however, in such a situation, the deduction u/s 54F of the Act would be allowable and quantum of deduction may be less than the deduction claimed u/s 54 of the Act. Even if it is presumed that the AO while passing the scrutiny assessment has wrongly allowed the claim u/s 54 of the Act then the same would not fall in the ambit of apparent, patent and manifest mistake on the face of record. It may be a mistake of decision on the part of the AO. The remedy for such erroneous order passed by the AO lies u/s 263 of the Act and not u/s 154 of the Act. The AO is not empowered to review its own order or predecessor order even if such order suffers from error and mistake but those errors and mistakes are the errors of judgement and decision and not an apparent and patent error on the face of it. A mistake apparent on record must be an obvious and patent mistake and not something which could be established by a long drawn process of reasoning on the point of issue involved on which there may conceivably be two opinions. A decision on debatable poin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd, it can be a matter of lack of enquiry or lack of proper enquiry on the part of the AO while passing scrutiny assessment order u/s 143(3) of the Act but the decision taken by the AO after considering the facts and evidences produced by the assessee cannot be held as a mistake apparent and patent on the face of the record. The AO while passing the order u/s 154 of the Act has stated that on perusal of the record of the assessee and specifically on perusal of the sale deed dated 24-11-2010 whereby the assessee sold the immovable property bearing No. B-277, Vigyan Nagar, Jaipur, there was nowhere mentioned about the construction of the said property. Therefore, the AO in proceedings u/s 154 of the Act has re-appreciated the evidences which was already available on record and considered by the AO while passing the scrutiny assessment order u/s 143(3) of the Act. The AO has no jurisdiction u/s 154 of the Act to re-appreciate the evidences already considered by the AO during the scrutiny assessment as it would amount to review of its own order. The AO has travelled beyond the jurisdiction and scope of Section 154 of the Act while passing the impugned order. It is a gross misuse of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
