TMI Blog2022 (11) TMI 310X X X X Extracts X X X X X X X X Extracts X X X X ..... rest of the revenue. In the instant case, the Commissioner reopened the case u/s 263 of the Act based on the proposal sent by the AO and not on his own volition. We are therefore, of the considered view that reopening is bad in law and hence, we quash the order of the Ld.Pr.CIT. Appeals of the assessees are allowed. - I.T.A.No.135/Viz/2019 I.T.A.No.110/Viz/2019 - - - Dated:- 19-10-2022 - SHRI DUVVURU RL REDDY , HON BLE JUDICIAL MEMBER And SHRI S BALAKRISHNAN , HON BLE ACCOUNTANT MEMBER Appellant by : Shri I Kama Sastry , AR Respondent by : Shri MN Murthy Naik , CIT ( DR ) ORDER Per Shri Duvvuru RL Reddy , Judicial Member : These appeals are filed by the assessees against the orders of the Principal Commissioner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he above grounds of appeal. Brief facts of the case are that the assessee is a firm. During the course of search seizure operation in the case of Sri Gunda Sambasiva Rao on 15.10.2014, some incriminating material was found and seized in the case of the assessee. Assessment was completed u/s 143(3) r.w.s. 153C of the Income Tax Act, 1961 (in short Act ) dated 29.12.2016, determining total income at Rs.2,26,550/- by disallowing brokerage of Rs.1,34,500/- u/s 40(a)(ia) of the Act. Subsequently, the Ld.Pr.CIT has called for the case records of the assessee firm for the A.Y.2012-13 and examined by virtue of powers vested u/s 263 of the Act. On verification of the assessment record, it is observed that the assessee has made cash payments ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... scrutiny proceedings is not a valid argument and only an afterthought. The assessee could not produce any evidentiary material / documents towards his claim for non-disallowance u/s 40A(3) of the Act on payments made in cash in excess of Rs.20,000/- towards purchase of land from farmer and the assessee could not explain satisfactorily how the payments made to farmers were expediency of business. The Ld.Pr.CIT observed that the AO failed to make any analysis of the information available on record, having not examined the same properly and completing the assessment makes the assessment erroneous as well as prejudicial to the interest of the revenue. Hence, directed the AO to disallow the entire amount of Rs.1,21,33,000/- u/s 40A(3) of the Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... propriate to quote section 263 of the Act which reads as follows : 263. (1) The 88[Principal Chief Commissioner or Chief Commissioner or Principal Commissioner] or Commissioner may call for and examine the record of any proceeding under this Act, and if he considers that any order passed therein by the Assessing Officer 89[or the Transfer Pricing Officer, as the case may be,] is erroneous in so far as it is prejudicial to the interests of the revenue, he may, after giving the assessee an opportunity of being heard and after making or causing to be made such inquiry as he deems necessary, pass such order thereon as the circumstances of the case justify, 90[including,- (i) an order enhancing or modifying the assessment or cancelling ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ief Commissioner or Principal] Commissioner or Commissioner; (c) where any order referred to in this sub-section and passed by the Assessing Officer 92[or the Transfer Pricing Officer, as the case may be,] had been the subject matter of any appeal filed on or before or after the 1st day of June, 1988, the powers of the* Principal Commissioner or Commissioner under this sub section shall extend and shall be deemed always to have extended to such matters as had not been considered and decided in such appeal. Explanation 2.-For the purposes of this section, it is hereby declared that an order passed by the Assessing Officer 94[or the Transfer Pricing Officer, as the case may be,] shall be deemed to be erroneous in so far as it is p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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