TMI Blog2022 (9) TMI 925X X X X Extracts X X X X X X X X Extracts X X X X ..... t has held in the case of Parashuram Pottery Works Co. Ltd. [ 1976 (11) TMI 1 - SUPREME COURT] that there must be a point of finality in all legal proceedings and the stale issues should not be reactivated beyond a particular stage and the lapse of time must induce repose in and set at rest judicial and quasi-judicial controversies as it must in other spheres of human activity. what is relevant for clause (a) of Explanation 2 to sec. 263 is whether the AO has passed the order after carrying our enquiries or verification, which a reasonable and prudent officer would have carried out or not. It does not authorise or give unfettered powers to the Ld. PCIT to revise each and every order, if in his opinion, the same has been passed without making enquiries or verification which should have been made. In our view, it is the responsibility of the Ld. PCIT to show that the enquiries or verification conducted by the AO was not in accordance with the enquiries or verification that would have been carried out by a prudent officer. During the notice u/s 142(1) the assessee submitted the relevant documents before the revenue authorities. On basis of these documents the order was passed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .2018, which was processed u/s 143(3) of the Income Tax Act, 1961. Later on, the case of the assessee was picked up for 'Limited' scrutiny under CASS on the reason of Large value of cash deposits during demonetization period as compared to returned income''. Accordingly, statuary notices u/s 143(2)/142(1) were issued, served and complied with, electronically on the ITBA portal. During the year, the main source of income of assessee is income from house property. 2 in response to statutory notices, the assessee furnished the requisite information as called for on ITBA portal, which is placed on record. The information filed, supporting documents produced and submissions made by the assessee have been considered and issues arising from the return of income as compared to reasons for selection under CASS have been examined. Reply w.r.t. reasons for CASS selection have been obtained, supporting documents were test checked and found to be satisfactory. 3 After examination and due consideration of written submissions filed by the assessee, returned income is accepted. Assessed. Issue requisite documents. 5. Further we rely on the observation of the ld. PCI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r husband and son from whom she had claimed the cash gifts of Rs 2,60,000/- and Rs 2,50,000/-. Similarly, the date of payment of the advance rent had not been mentioned in the confirmation filed. The asessee was asked to file copy of Rent Deed executed by her with her son Sh Ravi Gupta from whom she had claimed receipt of Rs. 2,10,000/- as rent in advance in cash . (As per the reply of the asessee, rent was being received @ Rs 70,000/- per month). 6. The ld. CIT DR vehemently argued and relied on the order of the ld. PCIT. He further argued that the order which was passed by the ld. AO is a very cryptic order. The verification was not done completely. The source of cash deposited was not verified. So, the entire order of the ld. AO is erroneous and prejudicial to the interest of the revenue. 7. We heard the submission and considered the orders of both the authorities. But the assessing authority was satisfied on basis of his verification and documents which was produced by the assessee during the assessment proceeding. The scrutiny was started on basis of CASS forlarge number of cash deposit. The issue was delt by the AO considered the explanation of assessee. The entire ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... judgment in Black's Law Dictionary and accordingly held that an order cannot be termed as erroneous unless it is not in accordance with law. An order can be termed as erroneous only if it is not in accordance with the law. 7.2. The Hon'ble Delhi High Court has also followed the above said view in the case of Sunbeam Auto Ltd. [2011] 332 ITR 167/[2010] 189 Taxman 436 (Delhi) . The Hon'ble Delhi High Court has also extracted following observations made by the Tribunal: - 38. Still further, the Hon'ble Supreme Court in Malabar Industrial Co. (2000) 243 ITR 83 has held that when two views are possible and the Assessing Officer has taken one of the possible view, then the order cannot be held to be prejudicial to the interest of the Revenue. Since the Commissioner of Income tax could not come to a definite finding that the expenditure in question was a capital expenditure in the proceedings under section 263, in our opinion, the order of the assessing officer could not be held to be erroneous. 7.3. In the case of CIT v. Nagesh Knitwears (P.) Ltd. [2012] 345 ITR 135/210 Taxman 145/22 taxmann.com 309 (Delhi) , the Hon'ble Delhi High Court has elucid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hould have shown that the view taken by the AO is unsustainable in law. In the instant case, the Ld PCIT has failed to do so and has simply expressed the view that the assessing officer should have conducted enquiry in a particular manner as desired by him. Such a course of action of the Ld. PCIT is not in accordance with the mandate of the provisions of sec. 263 of the Act. The Ld Pr. CIT has taken support of the newly inserted Explanation 2(a) to sec. 263 of the Act. The said explanationwas inserted by Finance Act 2015 w.e.f. 1.4.2015. If that be the case, then the Ld. PCIT can find fault with each and every assessment order, without conducting any enquiry or verification in order to establish that the assessment order is not sustainable in law and order for revision. He can also force the AO to conduct the enquiries in the manner preferred by Ld. PCIT, thus prejudicing the independent application of mind of the AO. Definitely, that could not be the intention of the legislature in inserting Explanation 2 to sec. 263 of the Act, since it would lead to unending litigations and there would not be any point of finality in the legal proceedings. The Hon'ble Supreme Court has held ..... X X X X Extracts X X X X X X X X Extracts X X X X
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