TMI Blog2023 (4) TMI 86X X X X Extracts X X X X X X X X Extracts X X X X ..... atus of the farmer earning Rs. 30.00 Lacs per annum and the payments for expenses thereof and hence, the assessment order cannot be deemed to be erroneous in so far as it is prejudice to the interest of the revenue. We hold that the impugned order passed by the PCIT is perverse to facts on record in holding assessment order erroneous and prejudice to the interest of revenue on account of lack of enquiry. Accordingly, the order passed by the PCIT -1, Jalandhar u/s 263, is cancelled being bad in law. Decided in favour of assessee. - I.T. A. No. 71/Asr/2022 - - - Dated:- 20-3-2023 - DR. M. L. MEENA , ACCOUNTANT MEMBER AND SH. ANIKESH BANERJEE , JUDICIAL MEMBER For the Appellant : Sh. P. N. Arora , Adv. For the Respondent by : Sh. S. M. Surendranath , Sr. DR ORDER Per Dr. M. L. Meena , AM : The present appeal has been filed by the assessee against the order of the Ld. Pr. Commissioner of Income Tax, Jalandhar-1 dated 30.03.2022 in respect of Assessment Year 2017-18. 2. The assessee has raised the following grounds of appeal: 1. That the order passed by the Principal Commissioner of Income Tax, Jalandhar-1 u/s 263 of the Income Tax Act, 1961 date ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iscrepancies in the assessment order issued. A showcause notice was, therefore, issued to the assessee u/s 263 of the Act, vide letter No. 1708 dated 06.10.2021 as follows:- ..The perusal of cash flow statement shows that you have claimed each and every withdrawal made from the banks as cash in hand. Even the petty withdrawals of Rs.2000 claimed as cash in hand which has been claimed to be deposited during the demonetization time. Further, the assessee claimed agricultural income as inflow in cash flow statement. No withdrawals on account of agricultural expenses such as on sowing of crop, fertilizer pesticides /insecticides, labour expenses. Further, no withdrawals on account of household withdrawals have been reflected as outflow in the cash flow statement No query in this regard has been raised/made by the AO during the assessment proceedings. (ii). You have maintained following bank accounts during the year under assessment: (a) SB A/C N0.31695362038 and (b) PNB A/e No. 3497000100442475. You frequently used your both bank accounts making withdrawals and deposits therein. (iii). Perusal of cash flow statement shows that you claimed inflow o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , 1961. 5. The Ld. Counsel for the assesse submitted that the Ld. PCIT has not appreciated the facts discussed in the assessment order and even the reply filed by the appellant in compliance to show cause notice during the 263 proceedings. The Ld.AR argued that the PCIT has not taken cognizance of the facts that all questions and queries have already been examined by the A.O. during the course of assessment proceedings and that it was not a case where the enquiry has not been made by the AO. Therefore, this case does not fall within the mischief of section 263 and accordingly, he pleaded that the order passed u/s 263 may be cancelled. In support, he filed a brief synopsis which reads as under: In response to your above said notice, it is submitted that the case of the assessee was selected under CASS Limited Scrutiny with the reasons Cash deposit for demonetization period . As the case was selected for limited scrutiny, the assessee has furnished each and every document through e- Assessment proceedings. All the documents were duly checked and discussed at length during hearing with my counsel by the then Assessing Officer. The point wise reply of your notice is as follo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has huge drawings after November, 2016. All these payments are through account payee cheques and the A.O. has duly discussed with the counsel of the assessee during the assessment proceedings. Most of the payments have been mentioned in the bank passbook itself. The complete detail of which is as follows:- 1. Punjab National Bank, A/c No. 3497000100442475 Date Amount Remarks 04.04.2016 47824.00 Bhag Singh (Seed) 06.04.2016 50274.00 Aman Deep Singh (Seed) 27.04.2016 48706.00 Davinder Pal Singh (Seed) 24.05.2016 29000.00 Pankaj Arora (Cash for self) 25.05.2016 28616.00 Bhag Singh (Seed) 06.07.2016 54000.00 Sahil Kaushal (Cash for self) 21.12.2016 51490.00 Jaspreet Singh (Pesticides) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from the certificate as neither any cheque was issued nor the same find place in the bank statements. Further assessee also used to receive cash from M/s Rama Sugar Limited. The necessary confirmation from the said party could not be collected on account of old record pertaining to more than 4-5 years old. 4. That as regard the opening cash in hand of Rs. One Lac on 01.04.2016 is concerned, it is submitted that this is the normal feature in every family to ' have some cash in hand to meet any emergency. The amount of Rs. One Lac is quite reasonable and genuine. Keeping in view, the gross agriculture income of around Rs. Thirty Lacs per annum. The said income has not been doubted rather accepted by the department during all the previous as well as subsequent years. Thus, the amount of Rs. One Lac is quite reasonable and the Assessing Officer has rightly accepted the same after discussion with the counsel of the assessee. 5. That as regards, your submission that the A.O. has accepted the cash flow statement without making adequate enquiries, it is submitted that the A.O. has fully satisfied himself about the cash flow statement which is based on the bank incoming and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pugned order, and written submission filed. Admittedly, the appellant assesse is an agriculturist. He has maintained following bank accounts during the assessment year under consideration: (a) SB A/C N0.31695362038 and (b) PNB A/e No. 3497000100442475. 8. That the Ld. PCIT has observed on perusal of appellant bank account that he has received Rs. 15,69,206/- on various dates from M/s Rana Sugars Limited through NEFT and of course not in cash. This fact categorical establishes that the appellant was an agriculturist with sufficient agriculture income being earned from sale of agricultural produce including sugarcane. 9. Considering the appellants claim of the gross agriculture income of around Rs. 30 Lacs per annum, the question of reasonableness of the opening cash in hand of Rs. 1.0 Lac on 01.04.2016 may not be suspected as it is the normal feature in every such agriculture family to ' have some cash in hand to meet any contingency expenditure. Over and above, the said income has not been doubted rather accepted by the department during all the previous as well as subsequent years and thus, the Assessing Officer has rightly accepted the same. The another quer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... quence of the order of the Assessing Officer cannot be treated as prejudicial to the interest of revenue. It was further held that whereto views are possible and the Income Tax Officer has taken one view with which the Commissioner does not agree, the order passed by the Assessing Officer cannot be treated as erroneous order prejudicial to the interest of the revenue. The principles laid down in the aforesaid decision were reiterated by the Supreme Court in CIT Vs. Max India Ltd, 295 ITR 282 (SC) and recently in Ultratech Cement Ltd vs State of Rajasthan Ors, Civil Appeal No. 2773/202 decided on 17.07.2020. Further in the case of PCIT vs. V. Dhana Reddy Co. - [2018] 100 taxmann.com 358 (SC) it has been held that If AO had adopted a plausible view, revision u/s 263 not sustainable. 13. We have to understand that lack of enquiry/no enquiry is different from inadequate enquiry and it is only in case of no enquiry by the AO, Pr. CIT/C1T can exercise jurisdiction u/s 263 of the Act and not in case where the AO has made enquiries as seems appropriate in the facts and circumstances of the case. In the instance case inquiry on relevant issue has been made by AO, hence no action invi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e as to the matter stated therein and no matter covered by such order reopened in any proceedings under the Income -tax Act. Attention in this regard is invited to the case of Uma Corporation v. ACIT Ors. (2006) 204 CTR 282 / 284 ITR 67 (Bom.) (HC) the Court held that Income disclosed under VDIS for which certificate is issued by the authority. Reassessment proceeding in respect of such disclosed income is not valid. And also to the case of Killick Nixon Ltd. v. Dy. CIT (2002) 258 ITR 627/178 CTR 387(SC) wherein the Honourable Apex Court held that once declaration is accepted reassessment is not permissible. Accordingly, after issue of certificate in respect of tax in dispute revision u/s 263 is not permissible. Thus on this account also the action of the PCIT u/s 263 is bad and deserves to be cancelled. 15. In the above view, we hold that the impugned order passed by the PCIT is perverse to facts on record in holding assessment order erroneous and prejudice to the interest of revenue on account of lack of enquiry. Accordingly, the order passed by the PCIT -1, Jalandhar u/s 263, is cancelled being bad in law. 16. In the result, appeal of the assessee is allowed. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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