TMI Blog2023 (2) TMI 26X X X X Extracts X X X X X X X X Extracts X X X X ..... Rajkumar [ 2022 (5) TMI 1388 - MADRAS HIGH COURT ] as followed by the decision of Shri Pavan Kandkur [ 2022 (11) TMI 1312 - ITAT BENGALURU] - Respectfully following these decisions, we hold that the PCIT is not justified in initiating the proceedings u/s. 263 when the impugned proceedings are already declared under DTVSV scheme. Accordingly, the order of the PCIT is quashed. Assessee appeal allowed. - ITA No. 380/Bang/2022 - - - Dated:- 24-1-2023 - Shri George George K, Judicial Member And Ms. Padmavathy S, Accountant Member For the Assessee : Ms. Sunaina Bhatia, CA For the Revenue : Ms. Neera Malhotra, CIT-DR ORDER PER PADMAVATHY S, ACCOUNTANT MEMBER This appeal is filed against the order of the Principal Commissioner of Income Tax, Bangalore passed u/s. 263 of the Income Tax Act ( the Act ) dated 22.03.2022 for the A.Y. 2012-13. 2. The assessee raised the following grounds of appeal: 1. The order of the learned PCIT in so far as it is against the assessee is opposed to law, equity, weight of evidence, probabilities, facts and circumstances of the case. 2. The learned PCIT is not justified in law and on facts in exercising his revisional j ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aised in the assessment has since been paid. On the basis of information received from Kolkata Investigation Directorate, the case was re- opened by issue of notice u/s 148 of the Act on 29/03/2019. Thereafter, a Survey U/s 133A was also conducted in the assessee's case on 29/08/2019. During the course of survey, a statement of Shri Lalit Kumar Purva one of the Directors of the assessee Company was recorded u/s 133A of the Act in which the he has stated that the total share premium of Rs.9,71,04,000/ - was received by the assessee for the assessment year 201213 for the year under appeal. Considering the aforesaid findings of survey, the reassessment proceedings were completed by the order passed u/s.143[3] r.w.s. 147 of the Act dated 27/12/2019 assessing the assessee on a total income of Rs. 11,35,18,210/- by making a solitary addition of Rs. 9,71,04,000/- in respect of Share Premium regarded as Unexplained cash credit u/s 68 of the Act. 4. Aggrieved by the aforesaid order of assessment passed u/s. 143[3] r.w.s. 147 of the Act, the assessee had filed an appeal before the Commissioner of Income-tax[Appeals], Bengaluru on 07/01/2020. During the pendency of the above appeal bef ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at there was no error prejudicial to the interest of revenue as the learned A.O. has examined the entire transaction and had applied his mind while making the addition of Rs. 9,71,04,000/ - in respect of share premium and therefore, none of the conditions of Explanation 2 to section 263 of the Act was attracted to consider the order passed as erroneous. The P.C.I.T. has proceeded to pass the impugned order u/s. 263 of the Act, rejecting the objections raised by the assessee with the following observations: 7. I have considered the assessee's submissions and have gone through the assessment records. It is a fact apparent from record and submission made by the assessee that an amount of Rs. 10,11,50,000/- was claimed to be received by the assessee for issue of 404600 shares of face value of Rs. 10 each at a premium of Rs. 2401- per share. It is also a fact that the AO made an addition of Rs. 9,71,04,000/- to the total income of the assessee on account of share premium received from shell companies the genuineness of which was not proved by the assessee, however the AO did not make any addition of the amount of Rs. 40,46,000/- claimed to be received on account of share capital ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t make any enquiry or verification on the receipt of Rs. 40,46,000/- in the books of accounts, which should have been made. 11. In view of the above facts, I, the Principal CIT [Central], Bengaluru, by virtue of powers conferred on me U/s 263 of the Act, am satisfied that the assessment order passed by the Assessing Officer is erroneous in so far as it is prejudicial to the interest of revenue within the meaning of the clause (a) of Explanation 2 to the section 263 of the Income Tax Act, 1961, as the AO failed to examine the genuineness of receipt of share capital of Rs. 40,46,000/- as discussed above. Therefore, the assessment order passed u/s 143[3] rws 147 of IT Act dated 27/12/2019 is hereby partly set-aside to the file of the Assessing Officer for passing a fresh assessment order after making verification and enquiry with regard to receipt of share capital of Rs.40,46,000/- in the books of accounts and after making in depth enquiry of genuineness and creditworthiness of the investors. 7. Being aggrieved by the order so passed u/s. 263 of the Act, the assessee is instituting this appeal before the Hon'ble Tribunal. 8. The Ld.AR reiterated the submissions made befor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee has opted for DTVSV. We notice that the Hon'ble Madras High Court while considering a similar issue in the case of Gopalakrishnan Rajkumar (supra) has held that 39 . The question therefore that arises for consideration is whether the impugned proceedings initiated after the petitioners opted to settle the dispute under the Direct Tax Vivad Se Vishwas Act, 2020 are sustainable or not? 40. The expression disputed tax has been denied in Section 27 of the Direct Tax Vivad Se Vishwas Act, 2020 reads as under: (j) disputed tax , in relation to an assessment year or financial year, as the case may be, means the income-tax, including surcharge and cess (hereafter in this clause referred to as the amount of tax) payable by the assessee under the provisions of the Income-tax Act, 1961, as computed hereunder:- (A) in a case where any appeal, writ petition or special leave petition is pending before the appellate forum as on the specified date, the amount of tax that is payable by the assessee if such appeal or writ petition or special leave petition was to be decided against him; (B) in a case where an order in an appeal or in writ petition has been passed b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns prescribed by rules made under this Act; (c) specified date means the 31st day of January, 2020; (d) tax arrear means,- (i) the aggregate amount of disputed tax, interest chargeable or charged on such disputed tax, and penalty leviable or levied on such disputed tax; or (ii) disputed interest; or (iii) disputed penalty; or (iv) disputed fee, as determined under the provisions of the Income-tax Act. 41. As per section 3 of the the Direct Tax Vivad Se Vishwas Act, 2020, notwithstanding anything contained in the Income-tax Act or any other law for the time inforce the amount payable by a declarant shall be as specified in the table to the said section. 42. As per section 4(6) of the Direct Tax Vivad Se Vishwas Act, 2020, the declarations filed under Section(1) shall be presumed to have never been made if:- (a) Any material particular furnished in the declaration is found to be false at any stage; (b) The declarant violates any of the conditions referred to in this Act; (e) The declarant acts in any manner which is not in accordance with the undertaking given by him under sub-section(5) And in such cases, all the proceedings and claims whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat in assessee s case the issue of cash deposits during the demonetisation period have been considered by the AO in original assessment proceedings under Section 143(3) of the Act and the assessee has opted for DTVSV scheme for the additions made in this regard. Section 8 of DTVSV Act as quoted by the PCIT, clearly mentions that the immunity is not available for any proceedings other than those in relation to which the declaration has been made . In the given case however the PCIT has initiated the revision proceedings u/s.263 on the same issue for which the assessee has already opted for DTVSV. It is also noticed the assessee has filed the necessary forms under the DTVSV scheme which have been accepted and therefore in our considered view the decision of the Hon'ble Madras High Court is clearly applicable to the assessee s case. Accordingly we hold that the PCIT is not justified in initiating the impugned proceedings under Section 263 of the Act when the assessee has opted to settle the dispute under DTVSV scheme. We therefore quash the order of PCIT and allow the appeal in favour of the assessee. 11. It is also noticed that the decision of the Hon ble Madras High Court ..... X X X X Extracts X X X X X X X X Extracts X X X X
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