TMI Blog2016 (1) TMI 1469X X X X Extracts X X X X X X X X Extracts X X X X ..... bad [ 2016 (1) TMI 176 - ITAT HYDERABAD ] wherein held that except for some cosmetic charges, the reasons are adopted verbatim by the CIT. In these circumstances, revision orders passed by the Ld. CIT are not maintainable for want of valid initiation of the proceedings under section 263 - we thus hold that the revision proceedings under section 263 of the I.T. Act are not sustainable - Decided in favour of assessee. - ITA. No. 901/H/2014, 902/H/2014, 903/H/2014, 905/H/2014, 906/H/2014, 907/H/2014, 908/H/2014, 909/H/2014, 912/H/2014 - - - Dated:- 20-1-2016 - SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI S. RIAFAUR RAHMAN, ACCOUNTANT MEMBER For the Assessee : Mr. P. Muralimohan Rao For the Revenue : Mr. Konda Ramesh ORDER PER BENCH : All these appeals are by a group of individuals who have been assessed under section 143(3) read with section 153C of the I.T. Act, 1961, pursuant to a search operation in the case of M/s. MBS Jewelers P. Ltd., on 11.03.2010. 2. Brief facts of the case are that there was a search and seizure operation under section 132 of the I.T. Act in the case of M/s. MBS Jewellers P. Ltd., and its group on 11.03.2010. During t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. CIT under section 263 of the I.T. Act examined the assessment records of the respective assessees and noticed that the assessees had sold two pieces of land at Hydernagar and different rates were adopted in both the sales though there was not much of time gap between the two dates of sale. He observed that the first sale took place on 23.04.2008, the value of which was taken at ₹ 5 crore per acre whereas in the second sale which took place on 25.07.2008, the value of the land was taken at ₹ 1.3 crore per acre and thus there is a huge variation in the market value of the land though the lands are situated in the same locality and no reason for such variation is forthcoming from the assessment order. He observed that the A.O. has not verified this issue while passing the assessment order under section 143(3) read with section 153C of the I.T. Act dated 26.12.2011 and hence, held that the assessment order is both erroneous in so far as it is prejudicial to the interests of the Revenue. He therefore, directed the A.O. to re-examine the entire issue of capital gains on the sale of land by respective assessees and the computation of capital gain on the same. Against this o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the revision proceedings have been initiated at the behest of the A.O. and therefore, according to him, the Ld. CIT has not applied his mind before initiating revisionary proceedings and therefore, the revision orders are not sustainable. In support of these contentions, the Ld. Counsel has relied upon the following judgments and has also filed copies of the following orders before us: 1. M/s. Aashi Plywood Industries Ltd., Hyderabad vs. ACIT, Circle (3), Hyderabad in ITA.Nos.1041 to 1045/Hyd/2014 dated 13.11.2015 2. M/s. Trinity Infra Ventures Ltd., New Delhi vs. DCIT, C.C.2(1), Hyderabad in ITA.Nos.584 to 589/H/2015 dated 04.12.2015 3. Dharmendra Kumar Bansal vs. CIT (2014) 48 taxmann.com 53 (Jaipur-Trib) 5.1. Further, the assessee has also taken an additional ground of appeal No.20 that the Ld. CIT ought to have appreciated the fact that the order passed with prior approval of JCIT under section 153D cannot be subject to revisional proceedings under section 263 of the I.T. Act. In support of this contention also, the Ld. Counsel for the assessee submitted that this Tribunal in the group cases of the assessee i.e., M/s. Trinity Infra Ventures Ltd., New Delhi vs. DCIT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to 1045/Hyd/2014 dated 13.11.2015, consequent to the same search i.e., search in the case of M/s. MBS Jewellers P. ltd., and its group on 11.03.2010, (to which both of us are signatories) and at para-5 of the order, the Tribunal has held as under: 5. Having regard to the rival contentions and the material on record, we find that in the case of Dharmendra Kumar Bansal vs. CIT (supra), the A.O. therein had proposed the action under section 263 vide letter dated 02.09.2011 and the Ld. CIT had issued notice under section 263 on 09.01.2013 and thereafter, passed the order under section 263 of the I.T. Act by holding that the assessment order passed by the A.O. under section 143(3) of the Act without due and proper enquiry was erroneous and prejudicial to the interests of revenue. On appeal, the Tribunal considered the issue at length and at para 9 of its order has held as under : 9. We have considered the submissions of both the parties and carefully gone through the material available on record. In the present case, it is abundantly clear from para-2-of the impugned order that the ITO, Ward-3, Sawai Madhopur vide letter No. 3737, dt. 2nd Sept., 2001 proposed action under s. 26 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is clear that the Ld. CIT has accepted the proposal of the A.O. without any further application of mind on his part. The Ld. D.R s contention that the proposals are accompanied by the assessment records and therefore, it is to be presumed that the Ld. CIT has independently applied his mind to the said proposal may be acceptable, if the Ld. CIT has taken time to go through the proposals and has also verified from the assessment records to independently to come to the conclusion that the assessment order is erroneous in so far as it is prejudicial to the interests of Revenue. For the sake of convenience and brevity, we reproduce the recommendations of the A.O. for A.Y. 2008-09 and also notice under section 263 of the I.T. Act to demonstrate that the Ld. CIT has not applied his mind but has blindly accepted the recommendations of the A.O. Office of the Commissioner of Income-tax (Central) 7th Floor, Aayakar Bhavan, Basheerbagh Hyderabad - 500 004. F No.CIT(C)/Hyd/263/2013-14 Dated: 14-03-2014 To M/s. Aashi Plywood Industries, Plot No. 5,6,7,18,19 20, IDA, Patancheru, Hyderabad. Sir, Sub: Income tax assessment - Your own - Asst Year 2008-09 - Revi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... PA No./Asst. Year/Status AADFP9625M/2008-09/FIRM 3. Ward/Circle/Range Central Circle-8, Hyderabad. 4. Order u/s. Date of the order sought for revision Order u/s.143(3) r.w.s.153C dated 25-12-2011. 5. Limitation date for revision Dt. 31-03-2014. 6. The quantum of income which has erroneous and prejudicial to the interests of the revenue. Not quantified. Reasons for initiation of proceedings u/s. 263 of the IT Act (1) As per balance sheet there is a minus balance of ₹ 1,56,77,454/- in the Partners' Capital account. As per deed of partnership, interest @12% was payable by the Firm on the credit balance in the partner's capital account. Similarly when there is debit balance i.e., minus balance in partners' capital account, interest needs to be charged and offered as income of the Firm. (2) As per Trading a/c were no sales but assessee firm debited ₹ 32,18,144/- towards sales tax and no supporting challan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... C became erroneous in so far as it was prejudicial to the Interest of revenue. Therefore, a proposal for revision u/s 263 of the order passed earlier u/s 143(3) r.w.s. 153C was submitted to the CIT(C), Hyderabad on 26/07/2013. Order u/s 263 was passed by the CIT(C), Hyderabad setting aside the assessment order passed by the Assessing officer u/s 143(3) r.w.s. 153C dated 30-12-2011 with a direction to quantify the actual capital gains arising in the hands of the assessee in respect of the land transactions noted above after making necessary verification of the above issues. It was further directed to look into the aspect of pricing of the land while computing the capital gains. 8.1. Therefore, respectfully following the decision of this Tribunal in similar circumstances, we hold that the revision proceedings under section 263 of the I.T. Act are not sustainable. In view of allowing of the additional grounds of appeal No. 21 and 22 and holding that the orders under section 263 are not sustainable, the other grounds of appeal need no adjudication as such adjudication would result in an academic exercise. 9. In the result, the appeals of the assessee are partly allowed. Order ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
