TMI Blog2023 (3) TMI 1225X X X X Extracts X X X X X X X X Extracts X X X X ..... d only reconciliation statement but no external documents/evidences fled and we also noted that the CIT observed that there is a difference in the turnover declared but the assessee submitted that difference due to inclusive of VAT tax. As submitted reconciliation but no details regarding proof of payments of tax etc. were submitted during the course of proceedings. AO should have examined all these things with the supporting/external documents but he did not do so. We found substance on the submissions of the DR and also on the order of CIT, hence, the order passed by the AO is erroneous prejudicial to the interest of revenue. Appeal filed by the assessee is dismissed. - ITA No. 393/Bang/2021 - - - Dated:- 13-3-2023 - Smt. Beena Pillai , JM And Shri Laxmi Prasad Sahu , AM For the Appellant : Sri Madhusudhan.U.A, Advocate for Sri V.Chandrashekar, Advocate and Sri. Ravishankar S.V, Advocate For the Respondent : Sri. Manjunath Karkihalli, CIT-DR ORDER Per Laxmi Prasad Sahu , AM This is an appeal filed by the assessee against the order passed by the Principal Commissioner of Income Tax-1, Bengaluru order dated 18.03.2022, DIN No. ITBA/COM/F/17/2019-2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ned Pr.Commissioner of Income tax has not shown how the same leads to the order of the Assessing Officer being erroneous or prejducial to the interest of the revenue. 8. The learned Pr.Commissioner of Inocme tax is not justified in law in directing the Assessing Officer to verify to mismatch in income under the income from other sources when the details for the same were furnished and the learned Pr.Commissioner of Income Tax has not shown how the same leads to the order of the Assessing Officer being erroneous or prejudicial to the interest of the revenue. 9. The learned Pr.Commissioner of Income tax is not justified in law in directing the Assessing Officer to verify to mismatch in turnover when the details for the same were furnished and the learned Pr.CIT has not shown how the same leads to the order of the AO being erroneous or prejudicial to the interest of the revenue. 10. The learned Pr.Commissioner of Income Tax is not justified in invoking the provisions of Explanation 2(a) to section 263 of the Act for the impugned assessment year on the facts and circumstances of the case. 11. The appellant craves leave of this Hon ble Tribunal, to add, alter, de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y that a deduction of Rs.2,82,93,661/- u/s 24(b) of the Act is towards interest on borrowed capital and a sum of Rs.2,66,89,424/- is towards preconstruction interest. It is seen that assessee had taken a loan of Rs.90 crores from HDFC Bank on 31.12.2013. As per the provisions of section 24(b) of the Act, prior period shall be allowed in five equal installments. However, no details of pre-construction interest expense for the period from 31.13.2013 till 31.03.2014 has been furnished. Hence, the claim of interest of Rs.2,66,89,424/- needs to be verified. b. Mismatch in interest income offered to tax: In the audited financial statements, assessee has shown interest income of Rs.1,52,46,538/- under the head other income in P L a/c. However, in the computation of income, the assessee has reduced interest income of Rs.1,52,46,538/- from income from business and profession and offered only Rs.1,12,77,875/- as income from other sources. However, the total receipts as per 26AS statement is Rs.4,82,50,329/-, whereas in computation of income, assessee has considered only Rs.4,04,07,580/-. The short declaration of interest receipts needs to be verified. c. Mismatch in Turnover: It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a confirmation letter from the concern party was produced. Further, he submitted in respect of miss-match in turnover, it was a difference for VAT tax. The VAT tax has been paid separately. He further submitted that after reconciling VAT tax difference, how the order passed by the AO is erroneous and prejudicial to the interest of the revenue. Every details were filed before the revenue authorities, therefore, the ld.Pr.CIT was not justified in exercising his powers as per section 263 of the Act. 7. On the other hand, the ld. DR relied on the order of the ld.Pr.CIT and he submitted that the AO has passed order without verifying the documents and no further details were called for. He has simply accepted the written submissions filed during the course of assessment proceedings and the interest paid during the pre construction period has also not been verified by the AO and even the difference in the turnover interest income as observed by the ld.Pr.CIT has also not verified by the AO. The assessment order passed by the AO is very vague. Even in the case of sundry creditors, no confirmation etc., were produced verified by the AO. Firstly, the AO is an investigating officer, th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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