TMI Blog2022 (4) TMI 458X X X X Extracts X X X X X X X X Extracts X X X X ..... in the case of M/s. Su-Raj Diamond Dealers Pvt Ltd vs. CIT [ 2019 (12) TMI 26 - ITAT MUMBAI ] has quashed the order passed U/s. 263 of the Act in the case of limited scrutiny assessment, holding that the Ld. Pr. CIT under the garb of section 263 of the Act, cannot exceed his jurisdiction. Admittedly, the case of the assessee was selected for limited scrutiny under CASS for the reason to verify whether the cash deposit has been made from disclosed sources. However, the Ld. Pr. CIT by exercising his jurisdiction u/s. 263 of the Act, directed the Ld. AO to make a fresh assessment on the issues which were not the subject matter of the limited scrutiny. Considering all since the issue raised by the assessee in the present case has alrea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ngaged in selling fertilizers, diesel, granting loans against mortgage of Gold ornaments, accepting deposits and granting loans for agricultural operation to its members and running the activities in the name and style of M/s. Sri Venu Gopala Primary Agricultural Cooperative Credit Society Limited. The case was selected for limited scrutiny for the reason to examine whether the cash deposit has been made from disclosed sources . Subsequently, notices u/s. 143(2) and 142(1) of the Act were issued and in response to the notices the AR of the assessee appeared and produced information and relevant documents. The Ld. AO after examining these documents submitted during the course of scrutiny proceedings, finalized the assessment accepting the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... outside the scope of limited scrutiny that was taken up by the Assessing Officer to examine the issue whether the cash deposit has been made from disclosed sources. 4. Without prejudice to the above, the Ld. Pr. CIT erred in observing that the sale of diesel and PDS commodities is not related to the activity of the appellant in providing banking and credit facilities to its members and hence not eligible for deduction u/s. 80P of the Act. 5. Any other ground that may be urged at the time of appeal hearing. 4. The Ld. AR argued that the assessee was subjected only to the limited purpose of scrutiny for verification of cash deposits from disclosed sources. He also argued that the Ld. Pr. CIT has exceeded his powers and h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r. CIT under Sec. 263. As observed by us hereinabove, the Pr. CIT had held the order passed by the A.O under Sec. 143(3), dated 08.12.2016 as erroneous, in so far it was prejudicial to the interest of the revenue, for the reason, that he had failed to carry out proper investigation as regards the issue of valuation of the 'closing stock' as reflected in the audited accounts of the assessee. We are of a strong conviction that now when the case of the assessee was selected for limited scrutiny for the reasons viz. (i). Large other expenses claimed in the P L A/c; and (ii). Low income in comparison to High Loans/advance /Investment in shares, therefore, no infirmity could be attributed to the assessment framed by the A.O on the ground ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Id. A.R on the merits of the case, which thus are left open. 7. As well, in the case of R H Property Developers vs. CIT ITA (supra) the D Bench of the Tribunal has set aside the order passed by the Ld. Pr. CIT u/s 263 of the Act, in a limited scrutiny assessment case holding that the Ld. Pr. CIT has wrongly assumed the jurisdiction u/s 263 of the Act. 8. Further, In the case of Nayek Paper Converters vs. ACIT the Kolkata Bench of the Tribunal has held that where the case was selected for limited scrutiny under section 143(2)(i) of the Act, the AO cannot be expected to make an enquiry of the issues pointed out by the Ld. CIT in his order u/s 263 of the Act, and directing the AO to make enquiry of the said issues was beyond th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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