9911796707
TMI Blog2023 (11) TMI 1046X X X X Extracts X X X X X X X X Extracts X X X X ..... u/s. 143(3) of the Income Tax Act, 1961 (hereinafter the 'Act'), vide order dated 22.12.2019. 2. At the outset, it is noticed that the appeal filed by the assessee is barred by limitation by 252 days. The order of PCIT dated 22.03.2022 was communicated to the assessee on 22.03.2023 as per Form 36. The appeal has to be filed on or before 22.05.2023 but was filed only on 30.01.2023. The assessee has filed affidavit for condonation of delay along with medical certificate, stating the following reasons:- As is said misfortune never comes in single but in battalion the Managing Partner (Myself) was laid up with Jaundice for about two months from the middle of May 2022 and thereafter it was the turn of my uncle (Father's Brother) who was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i) the assessee has paid rent of shop and godown amounting to Rs. 25,43,400/- but not deducted TDS u/s. 194I of the Act, (ii) the assessee has claimed payment of interest of Rs. 4,17,654/- in the profit & loss account and deducted TDS of Rs. 1,31,821/- u/s. 194A of the Act and hence, due to short deduction or no deduction of TDS, 30% of these expenses need to be disallowed by invoking the provisions of section 40(a)(ia) of the Act and (iii) Further there is delayed remittance of employees contribution of EPF to the tune of Rs. 7,15,106/- as per Form No.3CD, Sl.No.20(b). This is also to be added to the returned income of the assessee. 5. According to PCIT, in view of the above three items to be added to the returned income of the assessee, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of ld.counsel for the assessee is that the assessee's case was selected for scrutiny for verification of high value cash withdrawals and large value of cash deposits made during demonetization period. Apart from this, the AO was not authorized to look into any other issue. Even though on merits, the assessee has a case on each of the proposed disallowance by PCIT in his revision order passed u/s. 263 of the Act. According to ld.counsel, once limited scrutiny issue is not under dispute, no revision is possible in view of the decision of Hon'ble Madras high Court in the case of CIT vs. Smt. Padmavathi in Tax Case Appeal No. 350 of 2020, order dated 06.10.2020, wherein the Hon'ble High Court has considered this issue and held as under:- 17. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he conditionalities are that during the course of assessment proceedings, in a limited scrutiny case, if it comes to notice to the AO that there is a potential escapement of income exceeding Rs. 5 lakhs for normal CIT charge and for metro CIT charge, monetary limit shall be Rs. 10 lakhs requiring substantial verification on any other issue, then the case may be taken up for complete scrutiny with the prior approval of the PCIT/CCIT concerned. The another condition put forth by the CBDT is that such approval thereof accorded by the PCIT in writing after being satisfied about imports of the issues necessitating complete scrutiny in that particular case. Further condition that such cases shall be monitored by the Range Head and procedure indic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ollowing two conditions are satisfied a) The order passed by the AO should be erroneous and b) It should be prejudicial to the interest of the Revenue. These conditions are conjective. The order of assessment passed by the AO cannot be interfered by any other reason. The object of the provisions of Sec.263 of the Act, is to correct an order which is erroneous as well as prejudicial to the interest of the Revenue. The purpose behind incorporating the said provision in the statute is to ensure that interest of the Revenue is safeguarded against erroneous order passed by the AO as the Department, has no right to file an appeal against the order of the AO. It has no power as a substitute of the power of the AO to make assessment, whereas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s that it is not open for the AO to travel beyond the reasons for selection of the scrutiny for limited scrutiny and on that aspect the assessment order completed in this case in accordance with the CBDT Instruction No. 20/2015 dated 29.12.2015. 20. In view of the above discussions, considering the instruction issued by the CBDT No. 20/2015 dated 29.12.2015 and in particular sub-clause (d) of Clause-3, we are of the view that once the AO cannot examine any other issue except the issue as selected for limited scrutiny assessment, the PCIT can examine the only issue which was before the AO during the course of scrutiny assessment and not any other issue, which has not been subject matter of the AO for the assessment in a limited scrutiny a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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