TMI Blog2020 (8) TMI 263X X X X Extracts X X X X X X X X Extracts X X X X ..... crutiny into a complete scrutiny by the decision of Hon ble Andhra Pradesh High court in the case of Smt. Nayana P. Dedhia [ 2004 (8) TMI 99 - ANDHRA PRADESH HIGH COURT] and Amal Kumar Ghosh [ 2014 (4) TMI 244 - CALCUTTA HIGH COURT] AO has travelled beyond his jurisdiction for converting limited scrutiny case into complete scrutiny case. Hence, we quash the assessment order as well as the order of Commissioner of Income Tax (Appeals). - Decided in favour of assessee. - ITA No. 1730/Mum/2019 - - - Dated:- 17-6-2020 - Sri Mahavir Singh, VP And Sri Manjunatha G, AM For the Appellant : Shri Chetan Karia, AR For the Respondent : Shri Akhtar Ansari, DR ORDER PER MAHAVIR SINGH, VP: This appeal of assessee is arising out of the order of the Commissioner of Income Tax (Appeals)]-8, Mumbai, [in short CIT(A)], in ITA No. CIT(A)-8/IT-153/2017-18 dated 19.02.2019. The assessment was framed by the Income Tax Officer, Ward 3(1)(4), Mumbai (in short ACIT/ITO/ AO) for the A.Y. 2015-16 vide order dated 30.11.2017 under section 143(3) of the Income-tax Act, 1961 (hereinafter the Act ). 2. The first issue raised by assessee in its appeal is as regards to the assu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n case no evidence is sought to be produced as required in Para 2 above. 4. Specific questionnaire/ show-cause notice shall be sent giving you another opportunity in case any adverse view is contemplated. 5.# The assessment proceeding in your case is proposed to be conducted through email based communication. The email provided in the said return of income shall be used for communication for this purpose. In case you wish to communicate through any other alternate email, the same may kindly be informed. A brief note regarding benefits of this facility and procedure is enclosed overleaf. In case you do not wish to participate in this tax payer friendly initiative, you may convey your refusal to the undersigned by the above mentioned date. In case, you wish to opt out from this scheme at any subsequent stage due to any technical difficulties faced by you, the same can be done with prior intimation to the undersigned. (#) applicable only in case of taxpayers whose income-tax jurisdiction falls in the citis of Ahmedabad, Bengaluru, Chennai, Delhi Hyderabad, Kolkata or Mumbai. 5. The Assessing Officer while framing the assessment under section 143(3) of the Act has n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2015 are concerned, two type of cases have been selected for scrutiny in the current Financial Year - one is 'Limited Scrutiny' and other is Complete Scrutiny'. The assessees concerned have duly been intimated about their cases falling either in 'Limited Scrutiny' or 'Complete Scrutiny' through notices issued under section 143(2) of the Income-tax Act, 1961 ('Act'). The procedure for handling 'Limited Scrutiny' cases shall be as under: a. In 'Limited Scrutiny ' cases, the reasons/issues shall be forthwith communicated to the assessee concerned. b. The Questionnaire under section 142 (1) of the Act in 'Limited Scrutiny ' cases shall remain confined only to the specific reasons/issues for which case has been picked up for scrutiny . Further, the scope of enquiry shall be restricted to the 'Limited Scrutiny ' issues. c. These cases shall be completed expeditiously in a limited number of hearings. d. During the course of assessment proceedings in ' Limited Scrutiny ' cases, if it comes to the notice of the Assessing Officer that there is potential escapement of income exceeding Rs. five lakh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essing Officer as indicated by the appellant, which might have attracted the harshest action of annulling the assessment order itself. At least, the appellant has not pointed out any such legal provisions in this regard curtailing the powers of the Assessing Officer. Nevertheless, without prejudice to the same, it is hastily added here that as per the Board s Instruction no 20, dated 29.12.15 itself, a limited scrutiny case can be converted in to complete scrutiny case, (which obviously seems to be the case here), with the previous approval of the concerned Pr. CIT / CIT. The appellant has not given any iota of evidence to suggest that such approval has not been obtained by the AO before expanding the scope of assessment. Given this situation, no fault seems to lie with the assessment order. In fact, given the fact that such a mechanism has been provided in the impugned instruction itself for converting a limited scrutiny case in to a complete scrutiny case, it seems like this is none of the concern of the appellant challenging the assessment by relying upon this instruction, as the requisite locus-standi of the appellant in this connection, is missing. Keeping in view th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rutiny case if it comes to the notice of the Assessing Officer there is potential escapement of income exceeding ₹ 5 lacs for cities other than metros but the condition of the metro is upto ₹ 10 lacs requiring substantial verification on any other issue then the case may be taken up for complete scrutiny assessment but with the prior approval of PCIT or CIT concerned. Further, condition mentioned in this circular is that such approval shall be accorded by the PCIT/ CIT in writing after being satisfied about the merits of the issue necessitating complete scrutiny in that particular case. When these fact was pointed to the learned Sr. Departmental Representative, he could not state any of the approval accorded by the CIT or PCIT in writing or there is no satisfaction of CIT/ PCIT recorded in this case. Even otherwise, the escapement pointed out in the assessment order is limited to interest of fixed deposit amounting to ₹ 1,72,158/- whereas, the circular put a limit of ₹ 10 lacs, this being a case of Metro city like Bombay. None of the above conditions are met by the Assessing Officer for converting limited scrutiny into a complete scrutiny. Now, the question ..... X X X X Extracts X X X X X X X X Extracts X X X X
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