TMI Blog2020 (4) TMI 901X X X X Extracts X X X X X X X X Extracts X X X X ..... ai and the assessee has not included the financials of its Bhilai unit in the audit financial statements prepared by it for the AY 2013-14 due to alleged dispute between the promoters. As pointed out by the CIT, the AO issued notice u/s 133 (6) of the Act for obtaining financial statements of Bhilai unit from the other promoter of the assessee company. However, no details were received by the AO. We further notice that the AO has not mentioned any reason for not making any addition in respect of Bhilai unit. As pointed out by the Ld. counsel, addition of 5% of the turnover made from the AY 2004-05 to 2007-08 and 2010-11 to 2012-13, however in the assessment year under consideration, the AO has not made any addition whereas in the assessm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r. CIT 7, Mumbai, for the assessment year 2013-14, whereby the Ld. Pr. CIT has revised the assessment order passed u/s 143 (3) of the Act (for short the Act ) by exercising jurisdiction u/s 263 of the Act 2. Brief facts of the case are that the assessee company filed its return of income for the assessment year under consideration declaring nil income after setting off of brought forward losses. The AO passed the assessment order u/s 143 (3) of the Act and determined the total income of the assessee at ₹ 14,24,69,214/- after making additions on account of unexplained cash credit u/s 68 of the Act, amounting to ₹ 13,93,23,864/-, ₹ 15,12,000/- on account of annual letting value determined in respect of two flats sold b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ials of the Bhillai Unit. b) The AO out of his wisdom and judgment did not make any addition during the said Assessment year. c) Thus it is apparent that AO has done a meaningful enquiry taken a decision not to make any addition on this account based on his judgment. d) It is the judgment of the AO and not an omission, thus cannot be termed as erroneous or prejudicial to the interest of the revenue. 5. Before us, the Ld. counsel for the assessee submitted that the impugned order passed by the Ld. Pr. CIT is bad in law as the AO has passed the assessment order after carrying out enquiries. The Ld. counsel further submitted that the Bhilai unit of the assessee company was under control of Sh. Sunil Aggarwal, you ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts were not submitted by the assessee, the Ld. A O has wrongly passed the assessment order. Hence, the Ld. Pr. CIT has rightly revised the assessment order by exercising jurisdiction u/s 263 of the Act. The Ld. DR invited our attention to para 4 of the order passed by the Ld. Pr. CIT, wherein the Ld. Pr.CIT has mentioned that even though AO had issued a notice u/s 133 (6) of the Act for obtaining financial statements of Bhilai unit from the other promoter of the assessee company no such details were received by the AO. The Ld. DR further pointed out that in the previous assessment year 2012-13 ad-hoc additions were made by the AO. The ITAT in the assessment year 2005-06 confirmed addition of 5% of the total turnover of the Bhilai unit. Howe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... profit of the Bhilai unit have not been available. Hence, in view of the decision of the CIT (A)-13, Mumbai in A.Y. 2009-10, 5% of the turnover of the Bhilai unit had been adopted as the net profit of that unit. This has been so held later during A.Yrs. 2010-11, 2011-12 and 2014-15 as well. In respect of A.Yrs 2012-13 and 2013-14 there have been no details available of even the turnover of the Bhilai unit. Admittedly, the Bhillai unit has continued to function even during the previous year relevant to A.Y. 2013-14. The assessing Officer had made lump sum addition on this count of ₹ 20 Lakhs for A.Y. 2012-13 and no addition whatsoever has been made by the assessing officer on this count for A.Y. 2013-14. Prima Facie the failu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AY 2013-14 due to alleged dispute between the promoters. As pointed out by the Ld. Pr. CIT, the AO issued notice u/s 133 (6) of the Act for obtaining financial statements of Bhilai unit from the other promoter of the assessee company. However, no details were received by the AO. We further notice that the AO has not mentioned any reason for not making any addition in respect of Bhilai unit. As pointed out by the Ld. counsel, addition of 5% of the turnover made from the AY 2004-05 to 2007-08 and 2010-11 to 2012-13, however in the assessment year under consideration, the AO has not made any addition whereas in the assessment year 2014-15 and 2015-16 the AO had made ad-hoc addition. Further, the AO has not given any reason in the assessment or ..... X X X X Extracts X X X X X X X X Extracts X X X X
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