9911796707
TMI Blog2023 (3) TMI 1416X X X X Extracts X X X X X X X X Extracts X X X X ..... also filed additional ground vide letter dated 2.09.2021 challenging the jurisdiction of AO to make addition in respect of those items which was not subject matter of limited scrutiny u/s 143(2) of the Act. Since the assessee has raised the jurisdictional and legal issue in the additional grounds and therefore we are first adjudicating the admissibility of the additional ground. The additional ground raised by the assessee is reproduced as under: "5. That on the facts and circumstances of the case, the action of Ld. CIT(A) in confirming the action of AO in making additions in respect of issues not mentioned in limited scrutiny were beyond jurisdiction of Assessing Officer, as the scrutiny assessment was selected for limited scrutiny u/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... documents as required by the AO. The Ld. Counsel therefore submitted that the notice u/s 142(1) of the Act was issued on 25.04.2017 calling upon the assessee as to furnish the various details which were also replied by the assesse on 18.12.2017 submitting the requisite details. The Ld. A.R submitted that the assessment was framed by the AO vide order dated 22.12.2017 framed u/s 143(3) of the Act wherein the AO has rejected the set off and carry forward loss and unabsorbed depreciation on the ground that 97.5% of the share of the assessee company was held by Weilburger Lacke Handelsgessellshaft MbH (WLHM) which was transferred to Weilburger Asia on 19.11.2010 and therefore on the last day of the previous year i.e. on 31.03.2015 shares of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... prayed that the assessment order may be quashed. 7. The Ld. D.R on the other hand relied on the order of authorities below by submitting that the AO rightly disallowed the claim of the assessee qua the setting off and carry forward of losses and unabsorbed depreciation on the ground that there was a change in share holdings of the assessee company and therefore the beneficial ownership of shares was not same i.e the predecessor company (WLHM) and subsidiary company Weilburger Asiaare distinct entities and the fact that there are subsidiaries of the ultimate holding company Grebe GmbH & Co. did not mean that there was no change in the beneficial ownership. 8. We have heard rival submissions and perusing the material on record, and also not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Scrutiny', the Assessing Officer ('AO') shall be required to form a reasonable view that there is possibility of under assessment of income if the case is not examined under 'Complete Scrutiny'. In this regard, the monetary limits and requirement of administrative approval from Pr. CIT/CIT/Pr. DIT/DIT, as prescribed in Para 3(d) of earlier Instruction dated 29.12.2015, shall continue to remain applicable. 3. Further, while forming the reasonable view, the Assessing Officer would ensure that: a. there exists credible material or information available on record for forming such view; b. this reasonable view should not be based on mere suspicion, conjecture or unreliable source; and c. there must be a direct nexus b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd any reason to make any addition in respect of issue for which the limited scrutiny was done. However, the Assessing officer made the certain other additions for which the Assessing Officer did not have any jurisdiction. 4. The Ld. D.R has been fair enough to admit that the impugned additions have been made by the Assessing Officer on certain other issues, whereas, the case of the assessee was selected for the purpose of limited scrutiny relating to security transactions." Considering the facts of the assessee's case and also the ratio laid down drawn in the above decisions and also the CBDT Instruction No. 5/2016, we are of the considered view that the AO has exceeded his jurisdiction in enquiring into those issues beyond the scope of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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