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TMI Blog2024 (9) TMI 1311X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 1961(hereinafter referred to as "The Act"), wherein the orders passed by the Assessing Officer (hereinafter referred to as "AO") u/s 143(3) read with section 147 of the Act were set aside with directions to make fresh assessments. 2. The assessee has also filed an application for condonation of delay in filing these appeals. Condonation of Delay 3. The appeals were filed with a delay of 131 days. The assessee submitted that the delay was caused due to the disruptions arising from the COVID-19 pandemic, which affected the timely filing of appeals. The assessee referred to the order of the Hon'ble Supreme Court in In Re: Cognizance for Extension of Limitation (Miscellaneous Application No. 21 Of 2022 in Miscellaneous Application ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owever, the AO received information that the assessee had made a total payment of Rs. 33,85,000/- Rs. 10,85,000/- by cheque and Rs. 23,00,000/- in cash) for the purchase of an immovable property during FY 2011-12. The source of these payments was not disclosed in the return, leading the AO to believe that the income chargeable to tax had escaped assessment. The AO reopened the assessment u/s 147, issued a notice u/s 148, and completed the reassessment u/s 143(3) r.w.s. 147 of the Act on 28.11.2018, making an addition of Rs. 23,00,000/- for unexplained cash payments. 6. Later for A.Y. 2011-12, the PCIT invoked jurisdiction u/s 263, holding that the AO's order was erroneous and prejudicial to the interests of the revenue. The PCIT observed t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s believed to have escaped assessment. In absence of any addition made in respect of such item, no further addition to income could have been made. Thus the Ld. Pr. CIT has exceeded his powers in setting aside the assessment order dated 30.11.2018 and examine the issues which are other than the item of income believed to have escaped assessment as such item of income is not assessed to tax. The order of the Ld. Pr. CIT is prayed to be cancelled being bad in law and in facts. 3. The Ld. Pr. CIT is erred in law and in facts in ignoring the fact that the Ld. A.O. had examined the various items of income now held by him as assessable to income though examined in the course of assessment. 4. Your appellant craves liberty to add, alter, amend ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al in case of Smt. Daya Rani vs. Pr. CIT (ITA No. 402/Del/2021), wherein it was held that if no addition is made on the issue for which the assessment was reopened, the reassessment proceedings should be dropped, and any revision u/s 263 is unsustainable. 8.1 In case of A.Y. 2012-13 the AR stated that, the addition of Rs. 23,00,000/- made by the AO was deleted by the CIT(A). The AR placed the copy of the order of CIT(A) on records. 9. The Departmental Representative (DR) on the other hand relied on the order of PCIT. 10. We have heard the parties and perused the material available on record. We note that the assessee was issued notices u/s 143(2) and 142(1) of the Act during the course of assessment proceedings in case of both A.Y. 2011- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s 69 of the Act. The assessee replied to the said notice and denied the same with a request to provide evidence and opportunity to cross examine the party. The assessee placed reliance on many judicial precedents while replying to said show cause notice. 10.2 We also note that the reasons recorded for reopening the assessments were specifically related to the investments made in immovable property, which were adequately explained by the assessee to the satisfaction of the AO. The PCIT's concerns in the notice under section 263, which focused on credit entries in the bank accounts, were already addressed by the AO during the reassessment proceedings. Given that the AO had conducted detailed inquiries and made a conscious decision based ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t, 1961, are not required to be exercised in the instant case. 10.4 It is also pertinent to note that the addition of Rs.23,00,000/- made by the AO during the reassessment proceedings for A.Y. 2012-13 was subsequently challenged by the assessee before the Commissioner of Income-tax (Appeals) [CIT(A)]. The CIT(A), after a thorough examination of the facts and the evidence presented, deleted the addition. The CIT(A) observed that the addition made by the AO lacked sufficient corroborative evidence and that the explanation provided by the assessee regarding the source of the funds was satisfactory. This deletion by the CIT(A) further underscores the fact that the AO had conducted a proper and adequate inquiry during the reassessment proceedin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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