TMI Blog2023 (9) TMI 1207X X X X Extracts X X X X X X X X Extracts X X X X ..... taken and from M/s Kalyan Securities Pvt. Ltd. and qua non-deduction of TDS on the difference of expenses we find this issue is not verified by the AO and the assessment order can be said to be erroneous and prejudicial to the interest of the revenue to this extent only. Accordingly we are inclined to modify the revisionary order passed u/s 263 of the Act by relying on the decision of Hon ble Calcutta High Court in the case of Commissioner of Income-tax v. Polar Fan Industries Ltd. [ 1991 (5) TMI 24 - CALCUTTA HIGH COURT] Accordingly the revisionary order u/s 263 is modified and only treated as valid in respect of item no. (ii), (iii) (viii). Appeal of the assessee is partly allowed. - SHRI RAJESH KUMAR, ACCOUNTANT MEMBER SHRI SONJOY SARMA, JUDICIAL MEMBER For the Appellant : Shri K. M. Roy, A.R For the Respondent : Shri Subhrajyoti Bhattacharjee, CITDR ORDER PER RAJESH KUMAR, AM: This is an appeal preferred by the assessee against the order of the Ld. Principal Commissioner of Income Tax -3, Kolkata (hereinafter referred to as the Ld. Pr. CIT ] passed u/s 263 of the Income Tax Act, 1961 (hereinafter referred to as the Act) dated 10.06.202 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing in Foreign Currency US$ as found on perusal of the documents instead of share trading as claimed by the it through the broker M/s Kayan Securities Pvt. Ltd. has not been verified by the AO by conducting any enquiry whatsoever from the concerned Commodity Exchange to find out as to whether any such transactions took place in the Exchange during the course of assessment proceedings. iv) That the assessee has again claimed to have earned a profit of Rs.50,78,728.92 from Commodity Trading in cotton through the share broker M/s Kali Commodities Pvt. Ltd. has not been verified by the AO by conducting any enquiry whatsoever from the concerned Commodity Exchange to find out the genuineness of such transactions or from the broker as no margin money has been given to it for entering such huge volume of commodity resulting in the said profit during the course of assessment proceedings. v) That the assessee has apparently realized an amount of Rs.21,72,315/- from sale of scrap of fixed assets (capital assets) being redundant or unfit for use. However, it has not furnished the details of the party or parties to whom the said scrap was sold. The AO has also not made any natural e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thiness of the investors and genuineness of the transactions is against the facts on record as these are the directors of the assessee company who have sufficient sources which have been verified by the AO. The Ld. A.R. therefore submitted that the so far as this issues in para (ii) (iii) are concerned,the assessment order is neither erroneous nor prejudicial to the interest of the revenue and therefore revisionary jurisdiction exercised by the PCIT u/s 263 of the Act may be cancelled and set aside. On the second issue of non-verification of loans of Rs. 10,00,000/- from M/s Original Dealcom pvt. Ltd. and Rs. 14,95,397.82 from M/s Kalyan Securities Pvt. Ltd. The Ld. A.R candidly submitted that the AO has not examined the issue and left the issue to the wisdom of the Bench. The ld AR stated that so far as the issue in para (iv) is concerned, the ld. PCIT observed that the profit of Rs. 1,49,88,621.26 from Commodity Trading in Foreign Currency US doller, has not been verified by the AO by conducting necessary enquiry from the concerned commodity exchange to find out whether the transactions were actually carried out. The Ld. A.R submitted that the said income has been shown under t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wing the entire write-off of capital assets to the extent of Rs. 1,13,39,000/- which was strongly controverted by Ld. A.R by submitting that the issue has been discussed in the order itself in para 3 of the assessment order wherein it has been stated that the assessee has written off an amount of Rs. 1,13,38,936.16 consequent to demolition, renovation and write off account. The AO stated that the assessee was asked to furnished details in response to the copy of valuer s report and explained that there was a restaurant run there under the name of Saurav after transformation of which the restaurant-bar-night club business turned into the present one a lot of changes have to be made by writing off as the old name was scripted there. However the same when certified by a valuer which comes at Rs. 88,65,000/-. Thus the difference was disallowed and added to the income of the assessee. The Ld. A.R therefore prayed that the order is neither erroneous nor prejudice to the interest of the revenue as the AO has examined the issue and taken a possible view. The AO has taken a plausible view by relying on the decision of Hon ble Bombay High Court in the case of CIT vs. Gabreal India Ltd. i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d on our examination and analysis, we are of the considered view that the revisionary jurisdiction and order passed u/s 263 of the Act in respect of this is not correct and can not be sustained. Similarly a profit form Commodity Trading in Foreign currency US$ of Rs. 1,49,88,621.26 as stated in para(iv) has been disclosed under the head non-operating income and thus no prejudice is caused to the revenue. On this count also the jurisdiction of PCIT is not valid. Issue no. (v) i.e. profit of Rs. 50,78,728.92 from Commodity Trading in cotton and scrap sale of Rs. 21,72,315/- which have also been duly discussed in the other non-operating income and thus no prejudice is caused to the revenue and thus jurisdiction has been invalidly exercised. In respect of issue no.(vii) which is write off of fixed asset to the tune of Rs. 88,65,000/- , the same has been discussed in detail by the AO in para 3 of the assessment order on the basis of a report from the valuer and assessee s contentions, the write off has been allowed by the AO. In our view, a plausible view has been taken by the AO which cannot be questioned by PCIT by exercising the power u/s 263 of the Act. So, in respect of issue no ..... X X X X Extracts X X X X X X X X Extracts X X X X
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