TMI Blog2023 (11) TMI 392X X X X Extracts X X X X X X X X Extracts X X X X ..... arding approval u/s 153D and its validity depends upon verifications of such facts, also the contention raised before us was never raised before the departmental authorities, under such facts and circumstances, in the interest of natural justice, on careful perusal of the material available on record, case laws pressed into and report of the department, we find it appropriate to restore this issue to the file of AO for fresh adjudication of the same on the basis of facts and law, the assessee shall remain at liberty to raise such issues before the revenue authorities and to furnish necessary information/ evidences and submissions in support of his contentions. Consequently, the additional ground of the assessee regarding noncompliance of provisions of section 153D in granting the approval to draft order by Ld JCIT, is partly allowed. Appeal pertaining to non-abated assessment year wherein no incriminating material was found during the course of search - Nothing is apparent or emanating pertaining to incriminating material in the relevant AY 2014-15, therefore, in absence of information pertaining to incriminating material on record, we are unable to comprehend that whether the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee s contention that proper opportunity of hearing was not granted cannot not accepted while 3 responses by the assessee were considered by the Ld PCIT, and the issue is remitted back to the files of AO for fresh adjudication without any binding conclusion to be followed by the AO, the assessee is also at liberty to submit all his explanations and contentions before the AO. In the course of hearing to substantiate the questions raised by Ld. PCIT, certain additional evidence under a request application to grant leave to furnish such evidence dated 07/06/2023 have been submitted by the Ld. AR, which are allowed to be admitted and on perusal of such details which contains affidavit from M/s Adhiraj Developers, Flow chart explaining the Flow of consideration received from M/s Adhiraj Developers w.r.t. sale deed executed and relevant part of Bank Statement of M/s Adhiraj Developers. On perusal of such additional evidence, it is amicably realized that all these information, which were never submitted before the revenue authorities, are crucial in deciding the issues in hand, at the same time these needs further examination, analysis and verification of its veracity to arrive ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessment order passed by AO is neither erroneous nor prejudicial to the interest of Revenue. Ld. Pr. CIT erred in invoking the provisions of section 263 and in setting aside the assessment order for fresh enquiry. Order passed without properly appreciating the facts evidences. 3. On the facts and circumstances of the case, the Ld. Pr. CIT has erred both on facts and in law in ignoring the fact that the issue raised by him in notice u/s 263 was before the AO and as such the jurisdiction on this issue u/s 263 cannot be assumed by him. 4. On the facts and circumstances of the case, the order passed by the learned Pr. CIT assuming jurisdiction under section 263 is bad in law having been initiated at the instance of audit objection only. 5. On the facts and circumstances of the case, the learned Pr. CIT has erred both on facts and in law in ignoring the fact that the proceeding under Section 263 cannot be used for substituting opinion of the A.O. by that of the Pr. CIT. 6. On the facts and circumstances of the case, the order passed by Pr. CIT under section 263 of the Income Tax Act is unsustainable as power to revise can be invoked in the case of no/lack of enquir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mstances of the case, of the case, Pr. CIT has erred both on facts and in law in setting aside the issue of section 43CA to the file of the AO without properly appreciating the explanation of assessee given during the assessment proceedings brought on record to prove that there is no violation of provisions of section 43CA by the appellant. 8. Without prejudice to above grounds, on the facts and circumstances of the case and law, Ld. Pr. CIT erred in branding assessment order, as erroneous/prejudicial on an issue which itself was not covered by ambit of search assessment. Order passed u/s 263 is illegal and is liable to be quashed. 9. The appellant reserves the right to add, amend or modify any of the ground/s of appeal. AY 2016-17 1. The order passed by Ld. Pr. CIT is illegal, ab initio void unsustainable as the same has been passed without giving any opportunity of hearing to assessee, contrary to mandatory requirement of law. Consequent revision order is illegal is liable to be quashed/annulled. 2. The assessment order passed by AO is neither erroneous nor prejudicial to the interest of Revenue. Ld. Pr. CIT erred in invoking the provisions of sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der passed without properly appreciating the facts evidences. 3. On the facts and circumstances of the case, the Ld. Pr. CIT has erred both on facts and in law in ignoring the fact that the issue raised by him in notice u/s 263 was before the AO and as such the jurisdiction on this issue u/s 263 cannot be assumed by him. 4. On the facts and circumstances of the case, the order passed by the learned Pr. CIT assuming jurisdiction under section 263 is bad in law having been initiated at the instance of audit objection only. 5. On the facts and circumstances of the case, the learned Pr. CIT has erred both on facts and in law in ignoring the fact that the proceeding under Section 263 cannot be used for substituting opinion of the A.O. by that of the Pr. CIT. 6. On the facts and circumstances of the case, the order passed by Pr. CIT under section 263 of the Income Tax Act is unsustainable as power to revise can be invoked in the case of no/lack of enquiry, not in the case of inadequate enquiry. 7. On the facts and circumstances of the case, of the case, Pr. CIT has erred both on facts and in law in setting aside the issue of section 43CA to the file of the AO w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Nil NA 5,69,210 5,69,210 2016-17 153A/143(3) 6,42,220 Nil NA 6,42,220 6,42,220 2017-18 143(3) 12,85,700/- Nil NA 12,85,700 12,85,700 4. The order of the Assessing Officer dated 21.12.2018 was subsequently selected by Learned PCIT for revisionary proceedings by exercising powers under Section 263 of the Act and an order was passed by setting aside the assessment order with the directions to verify the sale deed for the year under consideration and to pass the assessment order afresh by giving adequate opportunity to the assessee. Order of Learned PCIT dated 31.03.2021 was challenged by the assessee before the Co-ordinate Bench of ITAT, Raipur in ITA No.41 to 44/RPR/2021. ITAT considering the facts of the case have restored the matter back to the files of Learned PCIT, since the response filed by the assessee was not recorded by the PCIT in the order under Section 263 of the Act, thus, without goi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed all the appeals together and accordingly a combined written submission with respect to common grounds of appeals is presented herewith before your honours. 3. The grounds of the appeal are: i. The order passed by Ld. Pr. CIT is illegal, ab initio void unsustainable as the same has been passed without giving any opportunity of hearing to assessee, contrary to mandatory requirement of law. Consequent revision order is illegal is liable to be quashed/annulled. ii. The assessment order passed by AO is neither erroneous nor prejudicial to the interest of Revenue. Ld. Pr. CIT erred in invoking the provisions of section 263 and in setting aside the assessment order for fresh enquiry. Order passed without properly appreciating the facts evidences. iii. On the facts and circumstances of the case, the Ld. Pr. CIT has erred both on facts and in law in ignoring the fact that the issue raised by him in notice u/s 263 was before the AO and as such the jurisdiction on this issue u/s 263 cannot be assumed by him. iv. On the facts and circumstances of the case, the order passed by the learned Pr. CIT assuming jurisdiction under section 263 is bad in law having be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6 that they have seized cash of Rs. 1,50,51,981/- from Shri Sohan Lal Nishad, driver of vehicle Innova having registration number MP09BD4729 at Saraipalli, Dist- Mahasamund, Chhattisgarh. The police officer reported that on enquiry the above named person has stated that the cash belongs to Shri Mukesh Golchha of Raipur. The appellant vide his submission dated 19.12.2018 before Ld. AO (refer page no. 120 of paper book) explained that during search operation u/s 132 of the IT Act, the position of cash found and seized was Rs. 1,50,51,980/- and vide statement u/s 131 of the IT Act, recorded on 25.07.2016 where the appellant has admitted that cash seized by the police belongs to his personal cash and declared as his undisclosed income for FY 2016-17. The appellant included the above referred seized cash in declaration made under Pradhan Mantri Gareeb Kalyan Yojna, 2016 (PMGKY, 2016). The appellant further explained that he has offered cash of Rs. 3,00,00,000/- for taxation under PMGKY, 2016 which includes cash of Rs. 1,50,51,980/- found during search u/s 132 conducted in the case of appellant on 25.07.2016. Except cash of Rs. 1,50,51,980/- which was seized no other documents and m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... daben B. Patel v/s Pr.CIT [(2020) 180 ITD 328 (Ahd.Trib.)]; (refer page no. 146 to 159 of paper book) Wherein it was held by the coordinate bench at Ahmadabad that granting of effective opportunity is a sin qua non in Section 263 of the Act for unsettling a statutory order. It is the duty of the Revisional Commissioner to provide the Assessee an effective opportunity to enable it to disengage the truth from wrongs instead of taking an easy course of rejecting the reply in its entirety, solely on the ground that same is not acceptable [relevant para-2 at page no.156 of paper book]. C. Tata Chemicals Limited vs. DCIT [ITA No.3127/Mum/20101: Wherein it was held by the coordinate bench at Mumbai that in any case it is one of the fundamental principles of Natural Justice that no person can be condemned unheard i.e., audi alteram partem and the impugned revision order was thus passed in violation of the principles of natural justice as the Assessee had no opportunity on the ground which is ultimately decided against him . D. Assotech Realty Private Limited v/s National E-Assessment Centre Delhi ANR [W.P. (C) 6183/2021 CM APPL, 19582/20211: Wherein it was h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ering the overall legal provisions as held in various case laws as enumerated in the order and concluded that No enquiry on the issues or non-application of mind for reaching any conclusion would lead to held the order erroneous so far as prejudicial to the interest of revenue. On the basis of assessment records of Ld. AO and submissions made before Ld. PCIT, conclusion drawn of No enquiry and non-application of mind by the Ld. AO is not factually correct. 2.2 The issue with respect to applicability of section 43CA and 50C was raised by the Ld. AO vide notice date 20.08.2018. (Refer page No. 109 of paper book). Reply to the said notice was submitted before Ld. AO on 04.10.2018 26.11.2018 along with relevant documentary evidences. (Refer page no. 116 of paper book). On further discussions with respect to applicability of section 43CA during the course of hearing of assessment proceedings, the appellant has submitted documents of Sale agreement of property with M/s Adhiraj Developers, approved layout of the plots for residential purposes by the authority and copy of ledger account of M/s Adhiraj Developers (Advance Account under current liabilities head) through submissio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, and if he considers that any order passed therein by the Assessing Officer is erroneous in so far as it is prejudicial to the interests of the revenue, he may, after giving the assessee an opportunity of being heard and after making or causing to be made such inquiry as he deems necessary, pass such order thereon as the circumstances of the case justify, including an order enhancing or modifying the assessment, or cancelling the assessment and directing a fresh assessment. Explanation 2.-For the purposes of this section, it is hereby declared that an order passed by the Assessing Officer shall be deemed to be erroneous in so far as it is prejudicial to the interests of the revenue, if, in the opinion of the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner- (a) The order is passed without making inquiries or verification which should have been made; (b) The order is passed allowing any relief without inquiring into the claim; (c) The order has not been made in accordance with any order, direction or Instruction issued by the Board under section 119; or (d) The order has not been passed in accordance with any d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... facts of the case of the appellant. Conclusion that the order of the Ld. AO is prejudicial to the interest of the Revenue must be backed by some minimal inquiry. If the PCIT is of the view that the AO did not undertake any inquiry, it becomes incumbent on the PCIT to conduct such inquiry. If he does not do then the Ld. PCIT is not justified in setting aside the order of the Ld. AO, From the above analysis it is abundantly clear that Explanation - 2 of Section 263 of the Income Tax Act, 1961 smells of some degree of discretion given to higher authorities to exercise their revisionary powers, but the same are not to be used arbitrarily and in an irrational manner. 2.10. The Ld. PCIT has stated that he is no longer required to cause any enquiries in case he finds the order of the Ld. AO prejudicial to the revenue. If this is the case that is taken, then that would lead to needless proceedings of each and every assessee and will not lead to finality of the outcomes in legal proceedings. A literal reading of the explanation 2 of section 263 would mean that the Ld. PCIT has powers to revise any proceedings as he may deem fit without any material on record. However the intention of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2.14. The appellant relies on the following judicial pronouncements in support of his case: A. CIT v/s Sunbeam Auto [332 ITR 167 (Del.)]: Wherein it was held by the Hon'ble Delhi High court that It is because the Income-tax Officer has exercised the quasi-judicial power vested in him in accordance with law and arrived at conclusion and such a conclusion cannot be termed to be erroneous simply because the Commissioner does not feel satisfied with the conclusion. There must be some prima facie material on record to show that tax which was lawfully eligible has not been imposed or that by the application of the relevant statute on an incorrect or incomplete interpretation a lesser tax than what was just has been imposed. Thus, even the Commissioner conceded the position that the Assessing Officer made the inquiries, elicited replies and thereafter passed the assessment order. The grievance of the Commissioner was that the Assessing Officer should have made further inquiries rather than accepting the explanation. Therefore, it cannot be said that it is a case of lack of inquiry B. CIT. v. Gabriel India Ltd [[1993] 203 ITR 108 (Bombay)]; Wherein it was he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has mentioned that the fresh loans have not been examined by the AO. The learned Principal CIT has not considered the contentions of the assessee that there is no fresh loan. Similarly, the other replies of the assessee filed during the course of assessment and in response to notice under s. 263 of the Act have been totally ignored. No enquiry has been made by the learned Principal CIT. It was incumbent for the learned Principal CIT to make some minimum independent enquiry to reach to the conclusion that the order of the AO is erroneous and prejudicial to the interest of revenue. The reliance is rightly placed on the decisions of Delhi High Court in learned Principal CIT vs. Delhi Airport Metro Express (P) Ltd. (supra) and ITO vs. DG Housing Projects Ltd. (supra). The Hon'ble Delhi High Court in Delhi Airport Metro Express (P) Ltd. (supra) has made the following observation: 10. For the purposes of exercising jurisdiction under s. 263 of the Act, the conclusion that the order of the AO is erroneous and prejudicial to the interests of Revenue had to be preceded by some minimal inquiry. In fact, if the learned Principal CIT is of the view that the AO did not undertake any inquir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id Explanation cannot be said to have overridden the liability as interpreted by Hon'ble Delhi High Court, according to which the Commissioner has to conduct the inquiry and verification to establish and show that the assessment order was unsustainable in law. The ITAT Mumbai Bench has further held that the intention of the legislature could not have been to enable the CIT to find fault with each and every assessment order without conducting any inquiry or verification in order to establish that the assessment order is not sustainable in law, since such an interpretation will lead to unending litigation and there would not be any point of finality in the legal proceedings. The ITAT Mumbai Bench of the Tribunal went on to hold that the opinion of the Commissioner referred to in section 263 of the Act has to be understood as legal and judicious opinion and not arbitrary opinion [relevant para-2 at page no. 208 of paper book]. G. Raigul Credit Invest P. Ltd. Vs. PCIT, [I.T.A. No. 2519/DEL/2019, dt. 19.09.2019] (refer page no. 211 to 222 of paper book) The relevant extracts of the case law are presented as under for your ready reference: We further note that Explan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was not correct in law in holding that the impugned assessment orders were erroneous. 5.4.1 In view of above, we note that notice u/s. 263 of the Act issued by the Pr. CIT is vague and only for making deeper enquiry and reconsidering the evidences already on record duly considered during assessment proceedings based on purported proposal that fresh facts have been emerged subsequent to the order of assessment which is factually incorrect and untenable and the conditions or the factors enabling the Ld. Pr. CIT to invoke his jurisdiction u/s 263 have not been satisfied [relevant para-1 2 at page no.220 221 of paper book]. H. PI Industries Limited v/s PCIT [ITA No. 04/JODH/20211: [(2021)63CCH0156(Jodh.Trib] (refer page no. 223 to 233 of paper book) Wherein it was held that the assessee has furnished all information as asked for by AO during the course of assessment proceedings and which have been duly considered by him as evident from the assessment order. The AO had issued detailed questionnaire raising various issues which were also replied by the assessee from time to time. The assessee had also appeared personally and filed the detailed replies to all the quer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s not violated provisions of section 43CA of the Income Tax Act. Copy of Agreement with M/s Adhiraj Developers was filed on 7 December, 2018 during the course of assessment proceeding vide reply letter dated 05.12.2018 is enclosed. (Refer page no.118 of paper book) 4.3 The aforesaid audit objection of the Revenue Audit Department goes to prove that the Revenue Audit Department apparently had not agreed with the view taken by the Id. AO. Hence there exists two views on the same subject within the Income Tax Department itself. There is absolutely no incorrect assumption of fact or incorrect application of law by the Id. AO. Hence it could be safely concluded that the Id. AO had taken one of the possible view. Once a possible view has been taken by the Id. AO, his order cannot be termed as erroneous warranting revision proceedings u/s 263 of the Act. In any case, we find that there is no dispute that the Revenue Audit Party had indeed raised an objection on the very same subject under assessment of income u/s 43CA of the Act and that the Id. AO had not accepted the same. This is evident from the detailed reply given by the Id. AO to the Revenue Audit Party vide his letter dated 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inder Singh Vs. CIT, followed. Conclusion: For purpose of taking up case for revision, PCIT had to apply his mind, but not to initiate proceedings only based on audit objection. As regards Ground No. 7: 7.1. With reference to the provisions of Section 43CA of the Income Tax Act, 1961, the appellant has duly complied with the provisions of the section 43CA of the Income Tax Act, 1961 with regards to the facts of the case. The appellant had entered into a sale agreement with M/s Adhiraj developers with respect to sale of plots during previous year 2012-2013 on 17th August, 2012 and part consideration of Rs. 10,00,000/- has been received by account payee cheque (Cheque No.: 9400025 of Union bank of India dated on 11.08.2012) from M/s Adhiraj developers as mentioned in the agreement. According to the sale agreement executed between the appellant and M/s Adhiraj developers, the plots will be transferred to various parties according to the directions and instructions of M/s Adhiraj developers. The appellant reserved the right to transfer the plots i.e. the appellant did not transfer the right to transfer of such plots to M/s Adhiraj developers. This sale ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 17(1A) of the Registration Act, 1908 in the year 2001 in such a manner that the documents containing contracts totransfer for consideration of any immovable property for the purpose of section 53A of Transfer of Property Act, 1882 shall be registered if they have been executed on or after the commencement of Registration and other Related Laws (Amendment Act, 2001 and if such documents are not registered on or after such commencement then they shall have no effect for the purpose of section 53A of Transfer of Property Act, 1882 subject to one safe-guard that unregistered agreement of sale executed earlier would be taken as a tool to enforce part performance of the contract by other part and hence we may partially conclude that General Power of Attorney for sale, agreement to sale, contract to sale etc. should be compulsorily registered as per the amended provisions of the Registration Act otherwise as per the transferee would not get clear title on the property involved therein. (refer page no. 11 of Ld. PCIT Order para-3) However the Ld. PCIT has misunderstood the facts of the case and the contention. of the Ld. PCIT is incorrect. On the facts of the case, the Section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Date of filing of return u/s 139 Due date for issuing notice u/s 143(2) Date of filing of return against notice u/s 153A Returned Income Rs. Income declared u/s 153A Rs. 2011-12 Not filed - 16.01.2017 NA 1,30,810/- 2012-13 31.03.2014 30.09.2014 17.01.2017 2,40,580/- 4,66,020/- 2013-14 31.03.2014 30.09.2014 17.01.2017 3,12,060/- 3,04,150/- 2014-15 31.03.2015 30.09.2015 17.01.2017 5,39,510/- 7,24,970/- 2015-16 31.03.2016 30.09.2016 17.01.2017 5,32,170/- 5,69,210/- 2016-17 Not filed - 17.01.2017 NA 6,42,220/- 2017-18 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r page no. 264 to 279 of paper book) Conclusion:[relevant para at page no.265 of paper book]. If there is no incriminating material found during the course of search AO cannot make any addition on the basis of information called during assessment proceeding. DEPUTY COMMISSIONER OF INCOME TAX ANR. vs, R. R. ENERGY LTD, ANR.IN THE ITAT RAIPUR [(2018) 52 CCH 00 521] (refer page no. 280 to 300 of paper book) Conclusion:[relevant para at page no.282 of paper book]. In the absence of seized material found during search, addition made in an order passed u/s 153A of the Act is not sustainable. 9. Learned AR apart from original grounds in appeal have further submitted additional grounds challenging the approval granted by the Learned JCIT under Section 153D of the Act when the assessment u/s 153A r.w.s 143(3) of the Act for A.Ys. 2011-12 to 2016-17 was completed. The additional grounds raised by the assessee along with application to grant leave to raise additional ground is extracted as under: Hon'ble Sirs, 1. The appellant is in appeal before your honour against order of the learned PCIT, Raipur-I dated 31.03.2022 passed u/s 263 of the Incom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r AY 2011- 12 to 2016-17 and u/s 143(3) for AY 2017-18 of the Act, may please be quashed and cancelled. 2. That, the separate orders passed by the Ld. Pr. CIT u/s 263 of the Act dated 31.03.2022 for relevant assessment years, setting aside the combined order passed by the Ld. AO dated 21.12.2018 u/s 153A/143(3) of the Act, is illegal, bad in law, and without Jurisdiction as the Original combined assessment order passed by the Ld. AO itself is void ab-initio which is based on non-est approval u/s 153D of the Act. 4. A copy of request letter dated 15.12.2018 issued by the Ld. AO seeking approval u/s 153D of the Act and a copy of approval letter by the Ld. JCIT dated 20.12.2018 u/s 1530 of the act is enclosed herewith. 5. In view of the above, since the additional ground of appeal raised goes to the root of the matter having a vital bearing on the tax liability of the appellant, it is prayed that the additional grounds of appeal raised may kindly be admitted exercising the plenary powers vested in your honours under Rule 11 of the Appellate Tribunal Rules, 1963 r.w.s. 254 of the Income Tax Act, 1961. 10. With respect to additional ground raised by the assessee perta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see was on 19/12/2018 the draft orders were sent for approval by the Ld. AO on 15/12/2018. Therefore, the draft order were put up before the Ld. JCIT without considering all the replies of the assessee. Hence, the approval granted by the Ld. JCIT u/s 153D of the Act, was illusory, ritualistic and Pre-functionary with complete neglect to the provisions of section 153D. Ld. AR placed his reliance on various case laws, as under: A. Akshata Realtors Pvt. Ltd v/ s ACIT, Central Circle-2, Raipur f (2023) IT(SS) A No. 09/RPR/2018 27.03.2023 (ITAT-RAIPUR), AY: 2013-14): It was concluded by the Hon'ble Tribunal as follows: The JCIT, Range-Central Raipur has granted approval on the presumption basis, which in our opinion is not permissible. When the approval is not valid, then the assessment framed u/s.153A r.w.s. 143(3) of the Act in the case of the assessee is not sustainable. Where approval was granted by the Ld. JCIT himself but on the basis of certain presumptions without verifying the seized material by himself, even the responsibility of satisfaction was placed on shoulders of the AO. In view of the above discussion and observations, respectfully followin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty means that it should appraise the material before it so as to appreciate on factual and legal aspects to ascertain that the entire material has been examined by the Assessing Authority before preparing the draft assessment order. It is trite in law that the approval must be granted only on the basis of material available on record and the approval must reflect the application of mind to the facts of the case. The requirement of approval under Section 153D is pre-requisite to pass an order of assessment or reassessment. Section 153D requires that the Assessing Officer shall obtain prior approval of the Joint Commissioner in respect of each assessment year referred to in Clause (b) of sub-section (1) of Section 153A which provides for assessment in case of search under Section 132. Section 153A(1)(a) requires that the assessee on a notice issued to him by the Assessing Officer would be required to furnish the return of income in respect of each assessment year falling within six assessment years (and for the relevant assessment year or years), referred to in Clause (b) of subsection (1) of Section 153A. The proviso to Section 153A further provides for assessment of the to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Assessing Officer are not open to agitate within the scope of the present appeals being in the nature of second appeal. No substantial question of law arises for consideration before us. The Appeals are dismissed being devoid of merit. F. Ritanjali Khatai Ors. v. ACIT, cc-I, Bhubaneswar in IT(SS) A.No.51 to 53/CTK/2019 (Date of Order: 08.04.2022) (ITAT Cuttack), wherein the Tribunal has held that the assessment framed u/s.153A/143(3) of the Act is not sustainable without proper approval u/s.153D of the Act. 12. Ld. AR further submitted that the assessment order passed u/s 153A/143(3) by the Ld. AO is invalid and void ab initio and under non-est approval u/s 153D of the Act, therefore, the Pr. CIT in absence of valid order passed by the AO cannot revised the same u/s 263 of the Act. Submission of the Ld. AR towards additional ground no. 2 is as under: 6. As regards Additional Ground No.2: 2.1. That Assessment order passed u/s 153A/143(3) for relevant assessment years by the Ld. AO is invalid and void ab initio under non-est approval u/s 153D of the Act, therefore, the Pr. CIT in absence of a valid order passed by the AO cannot revise the same u/s 263 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ull void in the eyes of law as the same was passed upon a non-existing entity and, therefore, the Ld. CIT could not have assumed jurisdiction under the law to make revision of a non-est order and, therefore, the impugned order passed u/s 263 by the Ld. CIT is also nullity in the eyes of law and therefore the same is hereby quashed. C. Hari Mohan Das Tandon (HUF) vs PCIT 91 TAXMANN.COM 199 Date of order 08.01.20181: wherein held as under: When assessment order itself is null and void based on non-est revised return, the Ld. CIT could not have exercise jurisdiction under section 263 of the I. T. Act. D. CIT vs Gitsons Enqineerinq co. 90 CCH 0353 Date of order 16.09.20141: wherein held as under: In the instant case, even though a plea was taken by the learned counsel for the Revenue that the objection in relation to non-service of notice contemplated under Section 143(2) of the Act was not an issue before the Assessing Officer and the Commissioner of Income Tax (Appeals) and the same was raised for the first time before the Tribunal, it was found that it was a legal plea which goes to the root of the matter and, therefore, the assessee was entitled to raise such ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onal ground raised by the assessee stating that, the approval granted u/s 153D was of mechanical nature and without application of mind which leads to invalidating the assessment order framed u/s 153A r.w.s. 143(3) , was found to be supported with the evidences showing the interaction between the AO and the Range Head, who had approved the questionnaire issued by the AO and who was fully informed of each and every action of the AO in completing the assessment. Accordingly, it cannot be inferred that there was no application of mind by Ld. JCIT in approving the draft order submitted by the Ld. AO. Contrary to the arguments and to distinguish with the case laws relied upon by the Ld AR, in present case the revenue has submitted a report of the AO to substantiate that there was deliberations between the AO and JCIT, also certain additional evidence in the form of communications between the departmental authorities were furnished before us, which were further strengthened by producing the assessment case records maintained by the department. Since the issue regarding approval u/s 153D and its validity depends upon verifications of such facts, also the contention raised before us was n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the entire six years period/block assessment period. The intention does not seem to be to re-open the completed/unabated assessments, unless any incriminating material is found with respect to concerned assessment year falling within last six years preceding the search. Therefore, on true interpretation of Section 153A of the Act, 1961, in case of a search under Section 132 or requisition under Section 132A and during the search any incriminating material is found, even in case of unabated/completed assessment, the AO would have the jurisdiction to assess or reassess the total income taking into consideration the incriminating material collected during the search and other material which would include income declared in the returns, if any, furnished by the assessee as well as the undisclosed income. However, in case during the search no incriminating material is found, in case of completed/unabated assessment, the only remedy available to the Revenue would be to initiate the reassessment proceedings under sections 147/48 of the Act, subject to fulfilment of the conditions mentioned in sections 147/148, as in such a situation, the Revenue cannot be left with no remedy. Ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s the jurisdiction for block assessment under section 153A; ii) all pending assessments/reassessments shall stand abated; iii) in case any incriminating material is found/unearthed, even, in case of unabated/completed assessments, the AO would assume the jurisdiction to assess or reassess the total income taking into consideration the incriminating material unearthed during the search and the other material available with the AO including the income declared in the returns; and iv) in case no incriminating material is unearthed during the search, the AO cannot assess or reassess taking into consideration the other material in respect of completed assessments/unabated assessments. Meaning thereby, in respect of completed/unabated assessments, no addition can be made by the AO in absence of any incriminating material found during the course of search under Section 132 or requisition under Section 132A of the Act, 1961. However, the completed/unabated assessments can be re-opened by the AO in exercise of powers under Sections 147/148 of the Act, subject to fulfilment of the conditions as envisaged/mentioned under sections 147/148 of the Act and those powers are saved. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l is not prevented to consider the questions of law arising in assessment proceedings though not raised earlier, but the relevant facts should be available on records. Such guiding interpretation by the Hon ble Apex Court suggests that the tribunal has the power to consider question of law which are based on relevant facts and material available on records, but without involving itself in the issue as an investigator to unearth the relevant facts. The relevant findings of the Apex Court in the case of NTPC (supra) are extracted as under: Under Section 254 of the Income-tax Act, the Appellate Tribunal may, after giving both the parties to the appeal an opportunity of being heard, pass such orders thereon as it thinks fit. The power of the Tribunal in dealing with appeals is thus expressed in the widest possible terms. The purpose of the assessment proceedings before the taxing authorities is to assess correctly the tax liability of an assessee in accordance with law. If, for example, as a result of a judicial decision given while the appeal is pending before the Tribunal, it is found that a non-taxable item is taxed or a permissible deduction is denied, we do not see any reason ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... could not be substantiated by showing any reference of such agreement in the sale deed. Ld. PCIT also observed that the fact explained by the assessee that the purchasers were arranged by M/s Adhiraj Developers and the part considerations of sale was made to the Adhiraj Developer could not be established with corroborative evidences or any mention in the Sale Deed. Ld. PCIT has discussed amendments made in section 17(1A) of the registration act, 1908 in the year 2001, wherein the documents containing contracts to transfer of consideration of any immovable property for the purpose of transfer u/s 53A of Transfer of Property Act, 1882, accordingly, agreement to sale or contract to sale should be compulsorily registered, which such observations Ld. PCIT has concluded that there was a violation on the part of the assessee in compliance of provisions of Sections 43CA of the I.T. Act during the year. 22. The contention of the assessee that the issue raised in initiating the proceedings u/s 263 was based on objection by the revenue audit department proves that the revisionary proceedings have been invoked by the Ld. PCIT based on audit objection which is nothing but borrowed satisfact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s erroneous so far as prejudicial to the interest of revenue, then the PCIT has to decide and to consider the matter to exercise the powers u/s 263, so as to remove the error in the order of AO by initiating the revisionary assessment proceedings. Under such scenario, it cannot be construed that, if an issue is surfaced by the audit team, the Ld. PCIT has no powers to touch the said issue by way of invoking the provisions of section 263, rather with effect from 01-06-2015 after introduction of explanation 2 in section 263, the Ld. PCIT s powers are further strengthen and widened to exercise the same, in the circumstances, wherein in the opinion of the PCIT, (a) the order passed by the AO was without making inquiries or verifications which should have been made; (b) allowing any relief without enquiry into claim, the order has not been made in accordance with any order; (c) direction or instruction by the board u/s 119 or (d) the order has not been passed in accordance with any decision which is prejudicial to the assessee, rendered by the Jurisdictional High Court or Supreme Court in the case of the assessee or any other person. Our conviction to this position further fortified in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ave to furnish such evidence dated 07/06/2023 have been submitted by the Ld. AR, which are allowed to be admitted and on perusal of such details which contains affidavit from M/s Adhiraj Developers, Flow chart explaining the Flow of consideration received from M/s Adhiraj Developers w.r.t. sale deed executed and relevant part of Bank Statement of M/s Adhiraj Developers. On perusal of such additional evidence, it is amicably realized that all these information, which were never submitted before the revenue authorities, are crucial in deciding the issues in hand, at the same time these needs further examination, analysis and verification of its veracity to arrive at the conclusion that whether they support the contentions raised by assessee or not, thus should be restored back to the file of AO. This itself shows that the Ld AO, who have never enquired for all such information, was failed in performing his duties in examining the facts in light of applicable provisions of law. Under such facts and circumstances, thoughtfully considering the material available on records and judicial pronouncement relied upon by the parties hereto, we are of the considered view that the order of Ld. P ..... X X X X Extracts X X X X X X X X Extracts X X X X
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