TMI Blog2022 (6) TMI 523X X X X Extracts X X X X X X X X Extracts X X X X ..... shtiyaque Ahmed, CIT-DR ORDER Per N.K. Billaiya, Accountant Member With this appeal, the assessee has challenged the assumption of jurisdiction by the PCIT-10, Delhi u/s. 263 of the Income-tax Act, 1961 [hereinafter referred to as 'The Act'] wherein the PCIT has held that the assessment order dated 14.12.2019 framed u/s. 143(3) of the Act is erroneous and prejudicial to the interest of the Revenue. 2. Before us, the ld. counsel for the assessee vehemently stated that the Assessing Officer, during the course of assessment proceedings u/s. 143(3) of the Act, has raised specific queries relating to the cash deposit after demonetization and has made detailed enquiries, for which the assessee has submitted detailed reply alongwith supporting documentary evidences. 3. It is the say of the ld. counsel for the assessee that not only the Assessing Officer had made enquiries but has also considered the relevant documentary evidences submitted by the assessee for verification and after due verification/examination, the Assessing Officer did not take any adverse view and therefore, the assessment order is neither erroneous and prejudicial to the interest of the Revenu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o The ACIT Circle 51(1), New Delhi Reg : M/s. APC Books 1002, Faiz Road Karoi Bagh, New Delhi-110005. PAN : AAMFA1936D Sub : Assessment proceedings for the Asst. Year 2017-18 Madam, In connection with the Assessment Proceedings of the above mentioned assessee, as required, it is respectfully submitted as under:- The assessee deposited a total cash of demonetized currency amounting to Rs. 1,08,82,500/- between 09.11.16 to 30.12.16 in its Bank A/c with Indian Bank, Karol Bagh, New Delhi A/c No. 715751693 The details of the same have already been given in our written submissions vide letter dated 25.11.2019 29.11.2019 In this connection, it may please be mentioned that the assessee has two more A/cs - another A/c with Indian Bank (A/c No. 6282332973) and one with SBI (No. 30959030894). The details of both the A/cs have already been submitted for your kind perusal No cash was deposited in these two A/cs during the said period For your kind perusal, the Bank Statements of all the three Banks for the period from 01.11.16 to 31.12.16 are appended. In these statements, cash deposited in demonetized currency are highlighted A date wise summary ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as laid down the following ratio: A bare reading of section 263 of the Income-tax Act, 1961, makes it clear that the prerequisite for the exercise of jurisdiction by the Commissioner suo motu under it, is that the order of the Income-tax Officer is erroneous in so far as it is prejudicial to the interests of the Revenue. The Commissioner has to be satisfied of twin conditions, namely, (i) the order of the Assessing Officer sought to be revised is erroneous; and (ii) it is prejudicial to the interests of the Revenue. If one of them is absent--if the order of the Income-tax Officer is erroneous but is not prejudicial to the Revenue or if it is not erroneous but is prejudicial to the Revenue-- recourse cannot be had to section 263(1) of the Act. The provision cannot be invoked to correct each and every type of mistake or error committed by the Assessing Officer, it is only when an order is erroneous that the section will be attracted. An incorrect assumption of facts or an incorrect application of law will satisfy the requirement of the order being erroneous . 14. We find that the Hon'ble Delhi High Court in the case of CIT Vs. Anil Kumar reported in 335 ITR 83 has held ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessment. Assuming it to be so, in our opinion, this does not justify the conclusion arrived at by the CIT that the AO had shirked his responsibility of examining and investigating the case. More so, in view of the fact that the assessee explained that the capital investment made by the partners, which had been called into question by the CIT was duly reflected in the respective assessments of the partners who were I.T. assessees and the unsecured loan taken from M/s. Stutee Chit Finance (P) Ltd. was duly reflected in the assessment order of the said chit fund which was also an assessee. 64. Since in the instant case the A.O after considering the various submissions made by the assessee from time to time and has taken a possible view, therefore, merely because the DIT does not agree with the opinion of the A.O, he cannot invoke the provisions of section 263 to substitute his own opinion. It has further been held in several decisions that when the A.O has made enquiry to his satisfaction and it is not a case of no enquiry and the DIT/CIT wants that the case could have been investigated/probed in a particular manner, he cannot assume jurisdiction u/s. 263 of the Act. In view ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he records, may be of the opinion that the estimate made by the officer concerned was on the lower side and left to the Commissioner he would have estimated the income at a figure higher than the one determined by the Income-tax Officer. That would not vest the Commissioner with power to re-examine the accounts and determine the income himself at a higher figure. It is because the Income-tax Officer has exercised the quasi-judicial power vested in him in accordance with law and arrived at conclusion and such a conclusion cannot be termed to be erroneous simply because the Commissioner does not feel satisfied with the conclusion. It may be said in such a case that in the opinion of the Commissioner the order in question is prejudicial to the interests of the Revenue. But that by itself will not be enough to vest the Commissioner with the power of suo motu revision because the first requirement, viz., that the order is erroneous, is absent. Similarly, if an order is erroneous but not prejudicial to the interests of the Revenue, then also the power of suo motu revision cannot be exercised. Any and every erroneous order cannot be the subject-matter of revision because the second requir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mmissioner himself, even after initiating proceedings for revision and hearing the assessee, could not say that the allowance of the claim of the assessee was erroneous and that the expenditure was not revenue expenditure but an expenditure of capital nature. He simply asked the Income-tax Officer to re-examine the matter. That, in our opinion, is not permissible. Hence the provisions of section 263 of the Act were not applicable to the instant case and, therefore, the commissioner was not justified in setting aside the assessment order. 17. Considering the facts of the case in hand, as discussed elsewhere, and in light of the judicial decisions discussed hereinabove, we are of the considered opinion that the assessment order dated 14.12.2019 framed u/s. 143(3) of the Act is neither erroneous nor prejudicial to the interest of the Revenue. Therefore, the assumption of jurisdiction u/s. 263 of the Act by the ld. CIT is bad in law. We, accordingly, set aside the order of the ld. CIT dated 23.12.2011 and restore that of the Assessing Officer dated 14.12.2019. 18. In the result, the appeal of the assessee in ITA No. 138/DEL/2022 is allowed. The order is pronounced in the ope ..... X X X X Extracts X X X X X X X X Extracts X X X X
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