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TMI Blog2025 (4) TMI 906X X X X Extracts X X X X X X X X Extracts X X X X ..... ee filed Return of Income (ROI) on 31/03/2018 and selected for scrutiny in CASS and the assessment was completed U/s 143(3) on 24/12/2018 with some additions. The Assessee filed an Appeal on the Assessment Order before the CIT(Appeals) but withdrawn later on by opting to pay tax under V.V.S Scheme and paid taxes thereon. Later on the case was re-opened U/s 148 on 29/03/2021 and completed on 22/03/2022 by Faceless Assessment Centre by accepting the income assessed U/s 143(3). After 2 years i.e on 25/03/2024 Hon'ble Principal Commissioner of Income Tax, Tirupati revised the Assessment Order U/s 263, on the Assessment Order passed by NFAC on 22/03/2022, for Re-adjudication, which is highly arbitrary and change of opinion. 3. The revision of assessment without any fresh/new evidence showing escapement of income for tax, is totally wrong and it is merely change of opinion." 2. Shri M. Uday Teja, Ld. Authorized Representative (for short 'AR') for the assessee, at the threshold of hearing, submitted that the captioned appeal involves a delay of 54 days. Elaborating on the reasons leading to the delay, the Ld. AR submitted that the same was caused due to ill-health of the assessee f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment proceedings u/s 147 of the Act. Reassessment order u/s 147 r.w.s. 144B of the Act, dated 22.03.2022 was thereafter passed by the A.O, wherein the income of the assessee as was originally assessed was accepted as such. 7. The Principal Commissioner of Income Tax (for short, "Pr. CIT") after culmination of the assessment proceedings, called for the assessment record. The Pr. CIT observing that the AO, while framing the reassessment, had failed to properly verify the assessee's claim for exemption under Section 54 of the Act, thus, vide his "Show-Cause Notice" (SCN), dated 20.02.2024 called upon him to put forth an explanation that as to why the order of reassessment passed by the AO u/s 147 r.w.s. 144B of the Act, dated 22.03.2022 may not be set-aside under Section 263 of the Act. 8. Although the assessee objected to the exercise of the revisional jurisdiction by the Pr. CIT for two-fold reasons, viz. (i) that the capital gain disclosed by the assessee was examined twice by the Assessing Officer; and (ii) that the purported revision of the assessment order based on an audit objection was not permitted under law; but neither of the same found favor with the revisional aut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Thereafter, the Pr. CIT, referring to the scope and domain of Section 263 of the Act, read with Clause (a) of "Explanation 2" to Sec.263(1) of the Act, observed that the failure on the part of the AO to make any examination/verification/enquiries, which were required to have been made qua the assessee's claim for exemption under Section 54F of the Act, had rendered his order as erroneous insofar as it was prejudicial to the interest of the revenue under Section 263 of the Act. Accordingly, the Pr. CIT, based on his aforesaid observations set-aside the reassessment order passed by the AO under Section 147 r.w.s. 144B of the Act, dated 22-03-2022 with a direction to him to redo the same afresh after affording a reasonable opportunity of being heard to the assessee. 10. The assessee being aggrieved with the order passed by the Pr. CIT under Section 263 of the Act, dated 25-03-2022 has carried the matter in appeal before us. 11. We have heard the learned Authorized Representatives of both the parties, perused the orders of the lower authorities and the material available on record as well as considered the judicial pronouncements that have been pressed into service by the Ld. AR ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clude and shall be deemed always to have included all records relating to any proceeding under this Act available at the time of examination by the Principal [Chief Commissioner or Chief Commissioner or Principal] Commissioner or Commissioner; (c) where any order referred to in this sub-section and passed by the Assessing Officer 92[or the Transfer Pricing Officer, as the case may be,] had been the subject matter of any appeal filed on or before or after the 1st day of June, 1988, the powers of the* Principal Commissioner or Commissioner under this sub-section shall extend and shall be deemed always to have extended to such matters as had not been considered and decided in such appeal. Explanation 2.-For the purposes of this section, it is hereby declared that an order passed by the Assessing Officer [or the Transfer Pricing Officer, as the case may be,] 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 orde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urse of the revisional proceedings come up with a new claim, i.e due to certain internal problems he was allotted Villa No.4 (supra). Also, it transpires that Villa No.4 (supra) that was allotted to the assessee and claimed to be in his possession was not backed by any registered deed/agreement. Although it was, inter alia, the assessee's claim that as pursuant to the "agreement to purchase", dated 18-04-2016, he was put into possession of the subject property i.e Villa No. 4 (supra), therefore, the said purchase transaction would fall within the meaning of "transfer" as contemplated under Section 2(47) of the Act, but we concur with the Pr. CIT that the same is not supported by the mandate of law. Although Section 2(47)(v) of the Act, contemplates that any transaction involving the allowing of the possession of any immovable property to be taken or retained in part performance of a contract of the nature referred to in Section 53A of the Transfer of Property Act, 1882, (Act No. IV OF 1882) will fall within the meaning of "transfer", but the same, we are afraid, does not come to the rescue of the assessee before us. We, say so, for the reason that, as per the post-amended Secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by which do not exceed five years and the annual rents reserved by which do not exceed fifty rupees. [(1-A) The documents containing contracts to transfer for consideration, any immovable property for the purpose of section 53-A of the Transfer of Property Act, 1882, shall be registered if they have been executed on or after the commencement of the 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 purposes of the said section 53-A.] [Inserted by Act 48 of 2001, Section 3 (w.e.f. 24.9.2001).] (emphasis supplied by us) 17. As the "agreement to purchase", dated 18-04-2016 (supra) is an unregistered document, therefore, as observed by the Pr. CIT, and rightly so, the assessee cannot claim to have purchased the subject property i.e Villa No. 4 (supra) as required per the mandate of law. 18. Be that as it may, as the AO had failed to carry out necessary verifications, which he was required to make while framing the reassessment vide his order passed under Section 147 r.w.s. 144B of the Act, dated 22-03-2022, therefore, we are of a firm conviction that no infirmity ..... X X X X Extracts X X X X X X X X Extracts X X X X
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