ARIZONA GLOBAL SERVICES PRIVATE LIMITED,NEW DELHI V. ITO WARD 3(1), NEW DELHI

ITA 668/DEL/2024

AI Insights

The case involves Arizona Global Services Private Limited appealing against the order of the PCIT, which revised the assessment order for the Assessment Year 2013-14 under section 263 of the Income Tax Act. The PCIT directed the Assessing Officer (AO) to consider an unsecured loan from Starpoint Suppliers Pvt. Ltd. as Rs. 2 crores instead of Rs. 1 crore, as initially assessed. The assessee contested this revision, arguing that the matter was already under appeal regarding the addition made under section 68 for unsecured loans, including the loan from Starpoint Suppliers Pvt. Ltd. The ITAT agreed with the assessee on this point, noting that the CIT(Appeals) has the power to correct mistakes and enhance income, thus the PCIT's invocation of section 263 was inappropriate in this context. The ITAT did not address the other two issues raised by the PCIT due to lack of discussion during the hearing.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 712012 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-07-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Assessment Year: 2013-2014
• Laws Referred To: Income Tax Act
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: JITENDER SINGH
• Assessee Lawyers: SUDEEP VIJAYAN
• Keywords: Unexplained cash credit; Revision of order
• Section: 147; 143(3); 263; 68

Judgement Text

"ITA Nos.668/Del/2024 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “A” NEW DELHI BEFORE SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER AND SHRI S RIFAUR RAHMAN, ACCOUNTANT MEMBER ITA No. 668/Del/2024 िनधा\u0005रणवष\u0005/Assessment Year: 2013-14 ARIZONA GLOBAL SERVICES PRIVATE LIMITED, 211, 2nd Floor, Hemkunt Chambers, 89, Nehru Place, New Delhi. बनाम Vs. ITO, Ward 3(1), New Delhi. PAN No.AADCD7117M अपीलाथ\u0011 Appellant \u0013\u0014यथ\u0011/Respondent Assessee by Shri Sudeep Vijayan, Adv. Revenue by Shri Jitender Singh, CIT DR सुनवाईक\bतारीख/ Date of hearing: 28.05.2025 उ\u000eोषणाक\bतारीख/Pronouncement on 23.07.2025 आदेश /O R D E R PER C.N. PRASAD, J.M. This appeal is filed by the Assessee against the order of the Ld. PCIT, Delhi dated 20.12.2023 passed u/s 263 of the Act for the AY 2013-14. 2. Ld. Counsel for the assessee, at the outset, submitted that the Ld. PCIT directed the Assessing Officer to consider unsecured loan received from Starpoint Suppliers Pvt. Ltd. at Rs.2 crores as against Printed from counselvise.com ITA Nos.668/Del/2024 2 Rs.1 crore adopted by the AO in the original assessment which was completed u/s 147 r.w.s. 144B of the Act. Ld. Counsel for the assessee submitted that the addition made u/s 68 in respect of unsecured loans was already subject matter of appeal before the Ld. CIT(Appeals) and therefore the Ld. PCIT could not have invoked the provisions of section 263 of the Act and revise the assessment order directing the AO to consider the unsecured loan amount from Starpoint Suppliers Pvt. Ltd. at Rs.2 crores. 3. On the other hand, the Ld. DR strongly supported the orders of the Ld. PCIT. 4. Heard rival contentions and perused the materials placed before us. In this case assessment was reopened u/s 147 and reassessment was completed on 29.03.2022 u/s 144B r.w.s. 147 of the Act determining the total income at Rs.30,90,00,000/-. The AO while completing the assessment added an amount of Rs.30,90,00,000/- as an unexplained cash credit u/s 68 in respect of unsecured loans from 7 parties as referred to at page 2 of the assessment order. 5. The Ld. PCIT issued show-cause notice to the assessee requiring the Assessee to explanation as to why the assessment order passed Printed from counselvise.com ITA Nos.668/Del/2024 3 u/s 144B r.w.s. 147 of the Act could not be held as erroneous and prejudicial to the interest of the Revenue for the following: a) The AO while completing the assessment considered only an amount of Rs.1 crore as unexplained cash credit in respect of loan received from M/s Starpoint Suppliers Pvt. Ltd. as against Rs. 2 crores during the relevant assessment year. b) Assessing Officer inadvertently not considered Rs.78,18,870/- as income from other sources which was offered by the assessee in its return of income. c) The AO wrongly charged tax at normal rate instead of special rate u/s 115BBE of the Act. 6. In response to the show-cause notice the assessee submitted that the AO while completing the original assessment u/s 143(3) examined the unsecured loans received from Starpoint Supplier Pvt. Ltd. Further the AO even while completing the reassessment u/s 144B r.w.s. 147 the transaction between the assessee and the Starpoint Supplier Pvt. Ltd. has already been examined in detail by the AO and therefore the same transaction cannot be re-visited at third time in the revision proceedings u/s 263 of the Act. Before us the contention of the Ld. Counsel for the assessee was that since the assessee is in appeal before the Ld. CIT(A) in respect of unsecured loans which was treated as unexplained cash credit u/s 68 including the unsecured loan from Starpoint Supplier Pvt. Ltd. Printed from counselvise.com ITA Nos.668/Del/2024 4 the Ld. PCIT could not have invoked the provisions of section 263 of the Act to revise the assessment order. 7. We have perused the appeal filed by the assessee on 18.04.2022 before the Ld. CIT(Appeals) for the AY 2013-14 against the assessment order passed u/s 144B r.w.s. 147 of the Act, wherein the assessee contested the addition of Rs.30,90,00,000/- u/s 68 of the Act/- made by the AO. We observe that the said amount of Rs.30,90,00,000/- which was treated as unexplained cash credit u/s 68 by the AO includes the unsecured loan from Starpoint Supplier Pvt. Ltd. Thus, since the transaction of loan between the assessee and Starpoint Supplier Pvt. Ltd. for the AY 2013-14 was subject matter of appeal before the Ld. CIT(Appeals) the Ld. PCIT could not have exercised the jurisdiction u/s 263 of the Act. The Ld. CIT(Appeals) having coterminous powers as that of the AO has all the powers to correct the mistakes, if any, made by the AO and also enhance the income. Therefore, since the transaction between the assessee and Starpoint Supplier Pvt. Ltd. in respect of unsecured loan during the FY 2012-13 relevant to the AY 2013-14 was already subject matter before the Ld. CIT(Appeals), we hold that invoking the provisions u/s 263 of the Act by the Ld. PCIT is against the law. Printed from counselvise.com ITA Nos.668/Del/2024 5 Therefore, to this extent, we hold that the order of the Ld. PCIT is neither erroneous nor prejudicial to the interest of the Revenue. 8. In respect of other two issues on which the revision order was passed by the Ld. PCIT is concerned, the assessee has neither raised any ground nor there was any argument advanced by the Ld. Counsel in the course of hearing. Therefore, we are not expressing our opinion on these issues. 9. In the result, appeal of the assessee is partly allowed as indicated above. Order pronounced in the open court on 23/07/2025 Sd/- Sd/- (S RIFAUR RAHMAN) (C.N. PRASAD) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 23.07.2025 *Kavita Arora, Sr. P.S. Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI Printed from counselvise.com "