RAMESHWAR PRASAD SHRINGI, GUMANPURA V. PR.CIT, UDAIPUR

ITA 10/JPR/2021

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 5327 (ITAT-JAIPUR)
• Duration Of Justice: 6 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-09-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2016-2017
• Appeal Filed On: 18-03-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B.K. GUPTA PR
• Keywords: Revision of order; Income from undisclosed sources; Search and seizure; Opportunity of being heard; Rule of consistency; Earning of tax free income; Source of fund; Question of law; Assessment record; Prejudicial to interest; Block assessment; Revenue expenditure; Set aside
• Section: 69; 263; 143(3); 142(1); 133A; 14A; 205; 201; 143(2); 69A; 64; 2(A); 72; 13; 119; 22; 20

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENC HES A JAIPUR JH LAANHI XKSLKBZ] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS[KK LNL; DS LE{K BEFORE: SHRI SANDEEP GOSAIN, JM & SHRI VIKRAM SING H YADAV, AM VK;DJ VIHY LA- @ ITA NO. 10/JP/2021 FU/KZKJ.K O'K Z @ ASSESSMENT YEAR :2016-17 RAMESHWAR PRASAD SHRINGI 1-B 1-B, KOTRI ROAD GUMANPURA, KOTA, RAJASTHAN CUKE VS. PR. CIT, UDAIPUR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO. AGWPS2257F VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : SH. MAHENDRA GARGIEYA (ADV.) & SH. DEVANG GARGIEYA (ADV.) JKTLO DH VKSJ LS @ REVENUE BY : SH. B. K. GUPTA (PR. CIT) LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 15/09/2021 MN?KKS'K.KK DH RKJH[ K@ DATE OF PRONOUNCEMENT: 23/09/2021 VKNS'K@ ORDER PER: VIKRAM SINGH YADAV, A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF LD. PR.CIT, UDAIPUR DATED 11.03.2021 RELEVANT FOR A.Y 2016-17 W HEREIN THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL:- 1. THE LD. PR. CIT ERRED IN LAW AS WELL AS ON THE FACTS OF THE CASE IN INVOKING THE PROVISIONS OF SEC. 263 OF THE ACT AND THEREFORE, THE IMPUGNED ORDER DATED 11.03.2021 U/S 263 OF THE ACT KINDLY BE QUASHED. 2. THE LD. PR. CIT ERRED IN LAW AS WELL AS ON THE F ACTS OF THE CASE IN ASSUMING JURISDICTION U/S 263 OF THE ACT WITHOUT RE CORDING A SPECIFIC AND CATEGORICAL FINDING THAT THE SUBJECTED ASSESSMENT O RDER PASSED U/S 143(3) DATED 10.12.2018 IS ERRONEOUS AND PREJUDICIAL TO TH E INTEREST OF THE REVENUE, IN ABSENCE OF WHICH THE ENTIRE PROCEEDINGS U/S 263 IS VITIATED. ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 2 THEREFORE, THE IMPUGNED ORDER DATED 11.03.2021 U/S 263 OF THE ACT KINDLY BE QUASHED. 3. THE LD. PR. CIT ERRED IN LAW AS WELL AS ON THE FACTS OF THE CASE IN ASSUMING JURISDICTION U/S 263 OF THE ACT BY WRONGLY AND INCORRECTLY HOLDING THAT THE AO FAILED TO EXAMINE AND VERIFY THE CLAIME D RECOVERIES MADE IN CASH FROM THE SUNDRY DEBTORS AND ERRED IN CANCELLIN G/ SETTING ASIDE THE SUBJECTED ASSESSMENT ORDER PASSED U/S 143(3) DATED 10.12.2018, WITH A DIRECTION TO THE AO TO EXAMINE THE IDENTITY & CREDI TWORTHINESS OF THE DEBTORS, GENUINENESS OF THE TRANSACTIONS W.R.T. REC OVERY OF ADVANCES OF CASH AMOUNT OF RS. 85 LAKH AND ALSO TO MAKE NECESSA RY ADDITIONS WHEREVER REQUIRED. THE ASSUMPTION OF JURISDICTION U/S 263 AND THE IMPU GNED DIRECTION, BEING CONTRARY TO THE PROVISIONS OF LAW AND FACTS ON RECO RD HENCE, THE PROCEEDINGS INITIATED U/S 263 OF THE ACT AND THE IM PUGNED ORDER DATED 11.03.2021 DESERVES TO BE QUASHED. 4. THE LD. PR. CIT ERRED IN LAW AS WELL AS ON THE FACTS OF THE CASE IN ASSUMING JURISDICTION U/S 263 OF THE ACT BY WRONGLY AND INCORRECTLY INVOKING EXPLANATION 2 TO S. 263 AS IF THE SAME CON FERRED UNBRIDLED POWER UPON THE PR. CIT EVEN THOUGH THE FACTS AND CIRCUMST ANCES OF THE CASE DID NOT JUSTIFY THE APPLICATION OF THE SAID EXPLANATION . 5. THE LD. PR. CIT ERRED IN LAW AS WELL AS ON THE F ACTS OF THE CASE IN WRONGLY SETTING ASIDE THE ASSESSMENT ORDER DATED 10 .12.2018 DESPITE THERE BEING COMPLETE APPLICATION OF MIND BY THE AO ON THE SUBJECTED ISSUES AND IT WAS NOTHING BUT A CASE OF CHANGE OF O PINION AND/OR SUSPICION, BASED ON WHICH, ASSUMPTION OF JURISDICTION U/S 263 IS NOT PERMISSIBLE. THE IMPUGNED ORDER DT. 11.03.2021 THEREFORE LACKS VALID JURISDICTION U/S 263 OF THE ACT AND HENCE, THE SAME KINDLY BE QUASHED. ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 3 2. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT T HE ASSESSEE FILED HIS RETURN OF INCOME ON 17.03.2017 DECLARING TOTAL INCOME OF RS. 5,49,620/- WHICH WAS SELECTED FOR SCRUTINY THROUGH MANUAL SCRUTINY GUIDE LINES ISSUED BY THE CBDT. THEREAFTER, NOTICES U/S 143(2) AND 142(1) WERE ISSU ED BY THE ASSESSING CALLING FOR NECESSARY INFORMATION AND DOCUMENTATION. TAKIN G INTO CONSIDERATION THE SUBMISSIONS AND INFORMATION/DOCUMENTATION FILED BY THE ASSESSEE, THE ASSESSMENT WAS COMPLETED ACCEPTING THE RETURNED INC OME VIDE ORDER PASSED U/S 143(3) DATED 10.12.2018. 3. THEREAFTER, THE LD. PR. CIT, UDAIPUR CALLED FOR THE ASSESSMENT RECORDS AND AFTER REVIEW THEREOF, ISSUED A SHOW CAUSE TO THE AS SESSEE DATED 29.01.2021 THE CONTENTS THEREOF READ AS UNDER:- ON EXAMINATION OF ASSESSMENT RECORD, IT IS SEEN TH AT IN YOUR CASE, THE ITR FOR A.Y. 2016-17 HAS BEEN FILED ON 17.03.2017 I.E. AFTER THE DATE OF DEMONETIZATION. AS A HOME WORK FOR F.Y. 2016-17 I.E . A.Y. 2017-18, YOU HAVE SHOWN RECOVERY OF SUNDRY ADVANCES OF RS. 85,00 ,000/- AS A CASH IN THE MONTH OF MARCH, 2016. BUT THE AO DURING THE COU RSE OF ASSESSMENT PROCEEDING HAS NOT MADE ANY ENQUIRY ABOUT THE PERSO NS FROM WHOM THE SUNDRY ADVANCES OF RS. 85,00,000/- ARE CLAIMED TO H AVE BEEN RECOVERED BY YOU IN CASH IN THE MONTH OF MARCH, 2016. THE NAME A ND ADDRESSES OF THE PERSONS WHO AS PER YOUR CLAIM HAVE PAID THESE AMOUN TS OF RS. 85,00,000/- TO YOU ARE NOT AVAILABLE ON RECORD. THE GENUINENESS OF THIS TRANSACTION OF RS. 85,00,000/- BEING SUNDRY ADVANCES RECOVERED FRO M THE PERSONS HAVE ALSO NOT BEEN VERIFIED BY THE AO. THUS, IT SHOWS TH AT THERE WAS LACK OF ENQUIRY ON THE PART OF AO AS HE FAILED TO MAKE ENQU IRY IN RESPECT OF THE PERSONS TO WHOM EARLIER ADVANCES OF RS. 85,00,000/- WERE CLAIMED TO HAVE BEEN GIVEN BY YOU AND FROM WHOM SUCH ADVANCES OF RS . 85,00,000/- WERE CLAIMED TO HAVE BEEN RECEIVED BY YOU IN THE MONTH O F MARCH, 2016 AND BECAUSE OF THIS LACK OF ENQUIRY, THE ASSESSMENT ORD ER IN YOUR CASE FOR A.Y. 2016-17 IS FOUND TO BE ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTEREST OF REVENUE. ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 4 4. IN RESPONSE TO THE SHOW-CAUSE, THE ASSESSEE FIL ED HIS SUBMISSIONS AND NECESSARY INFORMATION/DOCUMENTATION WHICH WERE CONS IDERED BUT NOT ACCEPTED BY THE LD PCIT AND THE ASSESSMENT ORDER PASSED U/S 143(3) WAS HELD AS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE RE VENUE AND THE ASSESSMENT ORDER WAS SET ASIDE AND THE ASSESSING OFFICER WAS D IRECTED TO EXAMINE THE MATTER AFRESH AFTER PROVIDING REASONABLE OPPORTUNIT Y TO THE ASSESSEE. AGAINST THE SAID FINDINGS AND ORDER OF THE LD PCIT, THE ASSESSE E IS IN APPEAL BEFORE US. 5. DURING THE COURSE OF HEARING, THE LD. AR RAISED VARIOUS CONTENTIONS AS ARE CONTAINED IN HIS WRITTEN SUBMISSIONS AND THE CONTEN TS THEREOF READ AS UNDER: 1. LEGAL POSITION ON SEC.263 JUDICIAL GUIDELINE: BEFORE PROCEEDING, WE MAY SUBMIT AS REGARDS THE JUDICIAL GUIDELINE, IN THE LI GHT OF WHICH, THE FACTS OF THIS CASE ARE TO BE APPRECIATED. 1.1 THE PRE-REQUISITES TO THE EXERCISE OF JURISDICTION BY THE CIT U/S 263, IS THAT THE ORDER OF THE ASSESSING OFFICER IS ESTABLISHED T O BE ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTEREST OF THE REVENUE. THE CIT HAS TO BE SATISFIED OF TWIN CONDITIONS, NAMELY (I) THE ORDER OF THE ASSESSING OFFICER SOUGHT TO BE REV ISED IS ERRONEOUS; AND (II) IT IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE. IF ANY ONE OF THEM IS ABSENT I.E. IF THE ASSESSMENT ORDER IS NOT ERRONEOUS BUT I T IS PREJUDICIAL TO THE REVENUE, SEC.263 CANNOT BE INVOKED. THIS PROVISION CANNOT BE INVOKED TO CORRECT EACH AN D EVERY TYPE OF MISTAKE OR ERROR COMMITTED BY THE ASSESSING OFFICER; IT IS ONL Y WHEN AN ORDER IS ERRONEOUS AS ALSO PREJUDICIAL TO REVENUES INTEREST, THAT THE PR OVISION WILL BE ATTRACTED. AN INCORRECT ASSUMPTION OF THE FACT OR AN INCORRECT AP PLICATION OF LAW WILL SATISFY THE REQUIREMENT OF THE ORDER BEING ERRONEOUS. THE PHRAS E 'PREJUDICIAL TO THE INTEREST OF THE REVENUE' HAS TO BE READ IN CONJUNCTION WITH AN ERRONEOUS O RDER PASSED BY THE AO. EVERY LOSS OF REVENUE AS A CONSEQUENCE OF T HE ORDER OF THE AO CANNOT BE TREATED AS PREJUDICIAL TO THE INTEREST OF THE RE VENUE. FOR EXAMPLE, IF THE AO ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 5 HAS ADOPTED ONE OF THE TWO OR MORE COURSES PERMISSI BLE IN LAW AND IT HAS RESULTED IN LOSS OF REVENUE, OR WHERE TWO VIEWS A RE POSSIBLE AND AO HAS TAKEN ONE VIEW WITH WHICH THE CIT DOES NOT AGREE, IT CANN OT BE TREATED AS AN ERRONEOUS ORDER PREJUDICIAL TO THE INTEREST OF THE REVENUE, UNLESS THE VIEW TAKEN BY THE AO IS TOTALLY UNSUSTAINABLE IN LAW. KINDLY R EFER MALABAR INDUSTRIAL CO. LTD. V/S CIT (2000) 243 ITR 83 (SC). 1.2 ALSO KINDLY REFER CIT V/S MAX INDIA LTD. (2007) 295 ITR 282 (SC) WHEREIN IT IS HELD THAT: 'THE PHRASE 'PREJUDICIAL TO THE INTERESTS OF THE RE VENUE' IN S. 263 OF THE INCOME TAX ACT, 1961, HAS TO BE READ IN CONJUNCTION WITH THE EXPRESSION 'ERRONEOUS' ORDER PASSED BY THE ASSESSING OFFICER. EVERY LOSS OF REVENUE AS A CONSEQUENCE OF AN ORDER OF THE ASSESSING OFFIC ER CANNOT BE TREATED AS PREJUDICIAL TO THE INTERESTS OF THE REVENUE. FOR EXAMPLE, WHEN THE ASSESSING OFFICER ADOPTS ONE OF TWO COURSES PERMISS IBLE IN LAW AND IT HAS RESULTED IN LOSS OF REVENUE, OR WHERE TWO VIEWS ARE POSSIBLE AND THE ASSESSING OFFICER HAS TAKEN ONE VIEW WITH WHICH THE COMMISSIONER DOES NOT AGREE, IT CANNOT BE TREATED AS AN ERRONEOUS ORD ER PREJUDICIAL TO THE REVENUE, UNLESS THE VIEW TAKEN BY THE ASSESSING OFF ICER IS UNSUSTAINABLE IN LAW.' RATIO OF THESE CASES FULLY APPLY ON THE FACTS OF TH E PRESENT CASE IN PRINCIPLE. 2. DUE APPLICATION OF MIND: 2.1 IT IS SUBMITTED THAT THE AO HAD RAISED VERY SPECIFI C AND RELEVANT QUERIES/CALLED FOR EXPLANATION AND EVIDENCES W.R.T. CASH RECOVERIES MADE FROM THE SUNDRY ADVANCES (DEBTORS), TO THE EXTENT HE WAS SUPPOSED TO ACT IN LAW. THE AO AFTER MAKING A DETAILED ENQUIRY RELATING TO THE ISSUE IN HAND AND EXAMINATION OF BOOKS OF ACCOUNT, IN PARTICULAR CASH BOOK FOR THE CURRENT YEAR (PB 23-26) AND OTHER RECORDS BEING BALANCE SHEETS STARTING RIGHT FROM A.Y. 2008-09 TO 2015-16 (PB 23-50) TOOK A POSSIBLE VIEW THAT TH E ASSESSE WAS HAVING SUFFICIENT CASH AVAILABLE IMMEDIATELY PRIOR TO THE SUBJECTED CASH DEPOSITS (I.E. 08.11.2016 AND ONWARDS) AND COMPLETED THE SUBJECTED ASSESSMENT WITHOUT ANY VARIATION. THE RELEVANT PARA OF THE ASSESSMENT ORDE R, WHEREIN THE AO HAS EXAMINED EACH ANY EVERY DOCUMENTS SUBMITTED BY A SSESSEE DURING SCRUTINY ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 6 PROCEEDINGS, IS REPRODUCED BELOW: THE CASE WAS SELECTED FOR SCRUTINY THROUGH MANUAL S CRUTINY GUIDELINES ISSUED BY THE CBDT. THE FIRST NOTICE U/S 143(2) ISSUED ON DATED 28.07.2017 BY THE DCIT, CENTRAL CIRCLE KOTA WHICH WAS SERVED UPON THE ASSESSE AND HEARING WAS FIXED ON 16.08.2017. FURTHER, NOTICE U/S 142(1) ISSUED ON 28.08.2017 AND 23.10.2017 ALONG WITH QUESTIONNAIRE/ANNEXURE-A REQUIRING CERTAIN DETAILS/INFORMATION, WHICH WAS SERVED UPON ASS ESSE. THEREAFTER, NOTICE U/S 142(1) ISSUED ON 21.12.2017. NOTICE UNDER SUB-S ECTION (1) OF SECTION 142 ISSUED ON 07.06.2018 THROUGH E-PROCEEDING. IN RESPO NSE TO THAT, SHRI P.KHANDELWAL, FCA AND AR OF THE ASSESSEE ATTENDED T HE PROCEEDING AND FILED WRITTEN SUBMISSION, WHICH IS PLACED ON RECORD. LATE R NO, NOTICE HAVE BEEN ISSUED THROUGH E-PROCEEDINGS PORTAL. AR/ASSESSE COM PLIED ON E-PROCEEDINGS PORTAL AND UPLOADED ALL THE REPLIES. 2.2 THIS IS ALSO EVIDENT FROM QUERIES RAISED AND THE RE PLIES GIVEN THERETO, REPRODUCED HEREUNDER: 2.2.1 THROUGH THE NOTICE/S U/S 142(1) DATED 07.06.2018 (P B 10) & DATED 23.10.2017 (PB 03), FOLLOWING INFORMATIONS WERE CAL LED FOR: 1. SUBMIT COPIES OF YOUR CAPITAL A/C, P & L A/C, AN D BALANCE SHEET. SIMILAR QUERIES WERE RAISED AND EXPLANATION CALLED FOR VIDE NOTICE U/S 142(1) DATED 23.10.2017 THROUGH PR. 12 2. EXPLAIN THE CREDIT ENTRIES AND ALL CASH DEPOSITS IN THE BANK ACCOUNTS. EXPLAIN THE PURPOSE OF THE DEBIT ENTRIES AND ALL CA SH WITHDRAWALS IN THE FOLLOWING FORMAT FOR ALL BANK ACCOUNTS: - NAME OF THE BANK ACCOUNT NUMBER S. NO. DATE AMOUNT OF DEBIT ENTRY/CASH WITHDRAWAL PURPOSE OF DEBIT ENTRY AMOUNT OF CREDIT ENTRY/CASH DEPOSIT EXPLANATION OF CREDIT ENTRY. SIMILAR QUERIES WERE RAISED AND EXPLANATION CALLED FOR VIDE NOTICE U/S 142(1) DATED 23.10.2017 THROUGH PR. 4. ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 7 3. KINDLY FURNISH THE DETAILS OF ADDITIONS MADE TO YOUR CAPITAL ACCOUNT. KINDLY FURNISH EVIDENCES TO SUBSTANTIATE THESE ADDI TIONS. SIMILAR QUERIES WERE RAISED AND EXPLANATION CALLED FOR VIDE NOTICE U/S 142(1) DATED 23.10.2017 THROUGH PR. 13. 4. KINDLY EXPLAIN WHETHER ANY FUNCTION/CEREMONY (MA RRIAGE, BIRTHDAY PARTY ETC.) WAS ORGANIZED IN YOUR FAMILY DURING THI S AY. IF YES, FURNISH DETAILS OF THE EXPENSES INCURRED FOR THE SAME WITH PROPER EVIDENCES AND GET THE VERIFIED WITH YOUR REGULAR BOOKS. SIMILAR QUERIES WERE RAISED AND EXPLANATION CALLED FOR VIDE NOTICE U/S 142(1) DATED 23.10.2017 THROUGH PR. 15, 16, 17& 18. X X X 7. KINDLY EXPLAIN THE SOURCE OF ALL THE MOVABLE A ND IMMOVABLE HELD BY YOU DURING THE FINANCIAL YEAR 2015-16 WITH SUPPORT ING DOCUMENTS. IF ANY OTHER IMMOVABLE PROPERTIES PURCHASED AND SOLD, KIN DLY EXPLAIN THE SAME WITH BOOKS OF ACCOUNTS. SIMILAR QUERIES WERE RAISED AND EXPLANATION CALLED FOR VIDE NOTICE U/S 142(1) DATED 23.10.2017 THROUGH PR. 8,9,10 & 11. 8. IT IS ALSO REQUESTED TO UPLOAD ALL THE PREVIOU S REPLIES ON E-PROCEEDINGS PORTAL. 9. IF YOU HAVE DEPOSITED CASH AMOUNTS IN DEMONETIZ ED CURRENCY DURING THE PERIOD BEGINNING FROM 8TH NOVEMBER, 2016 TO 30TH D ECEMBER, 2016 AND CASH IN HANDS SHOWN DURING THE FINANCIAL YEAR 2015 -16. KINDLY SUBMIT CASH LEDGER ACCOUNT OF FY 2015-16 AND 2016-17. 2.2.2 REPLY DATED 07.07.2018 FILED TO THE ABOVE NOTICE/S (PB 13), WAS AS UNDER: WITH REFERENCE TO YOU NOTICE WE HEREBY SUBMIT FOLLO WING DOCUMENTS: 1. COPY OF P&L A/C AND BALANCE SHEET ARE BEING SUBMITT ED. 2. THERE IS NO ADDITION IN CAPITAL EXCEPT INCOME EARNE D DURING THE YEAR. INCOME CAN BE VERIFIED FROM THE INCOME & EXP ENDITURE ACCOUNT. X X X X 5. UPLOADED ALL PREVIOUS REPLIES. 6. THE ASSESSE HAS DEPOSITED DEMONETIZED CURRENCY DURING 8.11.2016 ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 8 TO 30.12.2016, CASH IS VERIFIABLE FROM THE BALANCE SHEET AS AT 31.03.2016. 7. LEDGER ACCOUNT FOR EXPLANATION OF BANK ENTRIES. 2.2.3 REPLY DATED 25.10.2018 SUBMITTED TO THE ABOVE NOTICE/S (PB 14), WAS AS UNDER: 1. COMPUTATION OF INCOME-SHRI RAMESHWAR PD. SHRINGH I, M/S RP SHRINGHI & SONS AND M/S KHANDELWAL SHRINGHI & CO. FOR AY 20 16-17. X X X X 3. A SURVEY U/S 133A OF THE I.T ACT, 1961 WAS CAR RIED OUT ON 13/14.02.2008 NO INCRIMINATING DOCUMENTS RELATING TO THE ASSESSE FOUND DURING THE SURVEY. COMPUTER HARD DISK IMPOUNDED DU RING THE SURVEY CONSISTS OF REGULAR ACCOUNTING OF THE ASSESSE AND HIS FAMILY CONCERNS/MEMBERS. 2.2.4 REPLY DATED 12.11.2018 SUBMITTED TO THE ABOVE NOTI CE/S (PB 15), WAS AS UNDER: 1. SCAN COPY OF CASH BOOK FOR THE YEAR 2015-16. 2. THE ASSESSE HAS DEPOSITED SBN OF RS. 85,00,000/- WITH SBBJ GUMANPURA, KOTA ON 16.11.2016. WE FURTHER CLA RIFY THAT THE ASSESSE SURRENDERED AND DECLARED INCOME OF RS. 1,96,37,930/- DURING THE SURVEY PROCEEDINGS ON 13/02/2008. OUT OF SUCH AMOUNT, RS 1,59,00,000/- WERE IN THE NATURE OF SUNDRY ADVANCES AND INVESTMENTS. CASH REALIZATION FROM THE ADVANCES AN D INVESTMENTS WERE RECORDED IN THE CASH BOOK FOR THE YEAR 2015-16, HE NCE CASH IN HAND AS ON WAS OF RS. 85,80,796/- WHICH IS VERIFIABLE FR OM THE CASH BOOK. IN SUPPORT OF EVIDENCES, WE ARE ALSO SUBMITTING INCO ME & EXPENDITURE FOR THE YEAR 2007-08 AND BALANCE SHEET AS AT 31.03.200 8, INCOME TAX ASSTT. ORDER U/S 143(3) OF THE IT ACT, 1961 WITH NOTICE O F DEMAND, COPY OF ITR, COMPUTATION OF INCOME FOR THE AY 2008-09. ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 9 2.2.5 REPLY DATED 22.11.2018 SUBMITTED TO THE ABOVE NOTIC E/S (PB 16), WAS AS UNDER: 1. COPY OF ITR, BALANCE SHEET AND INCOME & EXPENDITURE ACCOUNT FOR F.Y. 2014-15.*A.Y. 2015-16). 2. IT IS ALREADY CLARIFIED THAT THE ASSESSE SURREND ERED AND DECLARED INCOME OF RS. 1,96,37,930/- DURING THE SURVEY PROCEEDINGS ON 13/02/2008. OUT OF SUCH AMOUNT, RS. 1,59,00,000/- WERE IN THE NATURE O F SUNDRY ADVANCES AND INVESTMENTS AS PER BALANCE SHEET AS AT 31.03.20 08. CASH HAND/SUNDRY ADVANCES/INVESTMENTS OF RS. 85.00 LAKHS OR MORE HAVE BEEN CONTINUOUSLY APPEARING ON ASSETS SIDE OF THE BALANC E SHEETS FROM F.Y. 2009 TO F.Y. 2015. COPY OF ITR, BALANCE SHEET AND I NCOME & EXPENDITURE ACCOUNT FOR A.Y. 2009-10 TO A.Y. 2015-16 ARE ENCLOS ED HEREWITH IN SUPPORT OF AVAILABILITY OF FUNDS WITH THE ASSESSE WHICH WAS DEPOSITED DURING THE F.Y. 2016-17. THE ASSESSE HAS BEEN REGUL ARLY FILING I TAX RETURNS SINCE A.Y. 2008-09. THE ASSESSE HAS ALREADY DEPOSITED TAX ON DECLARED INCOME OF RS. 1,96,37,930/- IN A.Y. 2008-09 AND CASE WAS COMPLETED/ASSESSED UNDER SCRUT INY SCHEME. COPY OF ORDER HAS ALREADY SUBMITTED WITH THE PREVIOUS LETTE R DATED 12.11.2018. THE ASSESSE WAS HAVING SUFFICIENT CASH IN HAND WITH HIM OUT OF WHICH CASH OF RS. 85,00,000/- WAS DEPOSITED IN BANK. 2.3 THE LD. AR ATTENDED TIME TO TIME, PRODUCED BOOKS O F ACCOUNT, COPIES OF ACCOUNTS OF SUNDRY ADVANCES (DEBTORS), AND FILED VA RIOUS OTHER DETAILS AS REQUIRED, STATED ABOVE AND ALSO THOSE EVEN THOUGH N OT REQUIRED, WHICH WERE DULY EXAMINED. THE AO MADE ALL THE INQUIRIES, SOUGHT CLARIFICATION S ON ALL THE RELEVANT ISSUES TO THE EXTENT HE WAS SUPPOSED LOOKING TO THE NATURE OF THE ISSUE INVOLVED, THE PAST ACCEPTED HISTORY OF THE CASE AND THE EVIDENCES AND MATERIAL ALREADY AVAILABLE THEREIN TOGETHER WITH THE MATERIAL PROVIDED DURING THE ASSESSMENT PROCEEDINGS. MOREOVER, ASSESSING OFFICER HAS RECORDED A CATEGORI CAL FINDING THAT ENTRIES IN BANK ACCOUNT WERE VERIFIABLE FROM CASH BOOK PRODUCE D BY ASSESSEE. THUS, LD. AO FRAMED THE ASSESSMENT IN ACCORDANCE WITH THE AVAILA BLE JUDICIAL GUIDELINE. ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 10 HENCE, IT CANNOT BE SAID THAT THE IMPUGNED ASSESSME NT ORDER WAS ERRONEOUS AND THEREFORE PREJUDICIAL TO THE INTEREST OF THE REVENU E, FOR WANT OF ENQUIRY BY THE AO. 3. BEYOND THE SCOPE OF ENQUIRY CONTEMPLATED U/S 263 : 3.1 IT IS SUBMITTED THAT THE AO RAISED VERY SPECIFI C AND RELEVANT QUERIES/CALLED FOR EXPLANATION AND EVIDENCES W.R.T. CASH RECOVERIE S FROM THE SUNDRY ADVANCES (DEBTORS), TO THE EXTENT HE WAS SUPPOSED TO ACT IN LAW. HENCE, THE ALLEGATION AND THE EXPECTATION OF THE LD. CIT FROM THE AO AC TING AS QUASI-JUDICIAL AUTHORITY, IS CLEARLY BEYOND THE SCOPE OF S. 263, I N AS MUCH AS HE WAS SUPPOSED, ONLY TO THE EXTENT OF EXAMINATION OF THE FACT OF AV AILABILITY OF SUFFICIENT CASH IN HAND LYING IMMEDIATELY BEFORE 08.11.2016. THE FACTS ARE NOT DENIED THAT IT WAS AN UNDISCLOSED INCOME, OFFERED AT THE TIME OF SURVEY, WHICH COULD BE AVAILABLE IN ANY FORM, BE IT CASH, SUNDRY ADVANCES (DEBTORS) OR FIXED ASSETS. THE DEPTT. NEVER DOUBTED NOR REBUTTED THE ASSERTION OF THE ASSESSE THAT SUCH UNDISCLOSED INCOME OF RS. 85.00 LACS WERE LYING WITH THE SUNDRY ADVANCES (DEBTORS) AND NO EVIDENCE WAS REQUI RED EARLIER IN SUPPORT THEREOF. NO SIMILAR REQUIREMENT OF FURNISHING NAME AND ADDRESS OF THE SUNDRY ADVANCES (DEBTORS) AND GENUINENESS OF SUCH FACT, WA S MADE IN THE PAST. ADMITTEDLY, THE SAME STATE OF AFFAIRS CONTINUED TIL L A.Y. 2015-16. THUS, THE FACT OF THE EXISTENCE OF THE SUNDRY ADVANCES (DEBTORS) O F RS. 85. 00 LACS IS WELL ESTABLISHED AND WELL ADMITTED. THEREFORE, IF NOW TH E ASSESSEE CLAIMS TO HAVE MADE RECOVERIES IN CASH FROM THOSE SUNDRY ADVANCES (DEBTORS), THE AO WAS NOT SUPPOSED TO MAKE FURTHER INVESTIGATION FOR THE SIMP LE REASON THAT EVEN ASSUMING THE ASSESSE FAILED TO FURNISH THE SAME THEN TOO THE AO COULD NOT HAVE MADE ANY ADDITION TO THE INCOME IN RELATION THERETO. THERE W AS OTHERWISE NOTHING ON RECORD RELATING TO THE PREVIOUS YEARS (AND/OR DURIN G THE SUBJECTED PREVIOUS YEAR) PROVING THAT SUCH INCOME STOOD INVESTED IN FIXED AS SETS OR STOOD UTILIZED ELSEWHERE IN SUCH A MANNER THAT IT WAS NOT POSSIBLE TO CLAIM IT AS AVAILABLE IN THE SUBJECTED YEAR. IT IS NOT THE CASE MADE OUT IN THE CAPTIONED SCN THAT DESPITE THERE BEING SOME ADVERSE EVIDENCES OR CIRCUMSTANCES AROUSING SUSPICION THEREFORE FURTHER ENQUIRY WAS CALLED FOR E.G. THE F UNDS LYING WITH THE SUNDRY ADVANCES (DEBTORS) WERE, IN FACT, STOOD BLOCKED (I. E. REMAIN INVESTED IN A FIXED ASSET OR THE LIKE) WHEREFROM, IT WAS NOT FACTUALLY POSSIBLE TO LIQUIDATE SO AS TO CREATE A SOURCE OF CASH IN HAND PRIOR TO THE CASH D EPOSITS. 3.2 REQUISITE DETAILS ALREADY AVAILABLE ALLEGATION ON FACTUALLY INCORRECT: 3.2.1 THE ALLEGATION BY THE LD. CIT THAT THE AO DID NOT E NQUIRE ABOUT THE NAME AND ADDRESSES OF VARIOUS SUNDRY ADVANCES (DEBTORS) FROM WHOM CLAIMED RECOVERIES WERE MADE AND ALSO THE GENUINENESS OF TH E TRANSACTIONS WERE NOT EXAMINED, APPEARS FACTUALLY INCORRECT, IN AS MUCH A S, ONE CANNOT PRESUME THAT ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 11 THE ASSESSING OFFICER WHILE PASSING THE SCRUTINY AS ST. ORDER, MUST NOT HAVE SEEN OR LOOKED UPON THE PAST ASST. RECORDS. IT IS PERTIN ENT TO NOTE THAT THE ASSESSE IN ITS REPLIES MADE SPECIFIC REFERENCE TO THE INCOME S URRENDERED OF RS. 1,96,37,930/- IN THE COURSE OF SURVEY CARRIED OUT U /S 133A ON 13 & 14 .02.2008 AND THE BREAKUP OF THE UNDISCLOSED INCOME SURRENDER ED TOWARDS DIFFERENT HEADS OF OUTGOINGS, INVESTMENTS, ASSETS ETC. WAS ALSO EXP LAINED THROUGH VARIOUS QUESTIONS & ANSWERS, WHILE RECORDING THE STATEMENTS OF THE ASSESSE, SUMMARIZED IN AN AT A GLANCE CHART TITLED AS STATEMENT SHOWIN G UNDISCLOSED INCOME, (PB 29) FILED BEFORE THE AO DURING THE ASST. PROCEEDING S FOR A.Y. 2008-09 AND ALSO AGAIN DURING THE SUBJECTED ASST. PROCEEDINGS FOR A. Y. 2016-17. 3.2.2 OUT OF RS. 1.96 CR. SURRENDERED AND INCLUDED IN TH E RETURN OF INCOME OF A.Y.2008-09 FILED AT TOTAL INCOME FOR RS. 1,98,65,4 80/- ON 30.07.2008, THE ASSESSE AT THE S. NO. 7 IN CHART (PB 29) EXPLAINED THE UTILIZATION. EARLIER, WHEN THE STATEMENTS OF THE APPELLANT WERE RECORDED U/S. 133A ON DATED 13/14.02.2008 WHEREIN ITSELF, THE ASSESSE HAD EXPLA INED THE AVAILABILITY OF SUCH UNDISCLOSED INCOME OF RS. 1.96 CR. BROADLY SPECIFYI NG THE FORM OF ASSETS VIZ. CASH IN HAND, CASH IN BANK OR DEBTORS, INVESTMENT ETC. V IDE ANSWER TO QUESTION NO. 35 THAT THE AMOUNT OF RS. 1.59 CR. WAS THE I MADE ADV ANCES (TO THE OUTSIDERS) FOR PURCHASE OF LANDS IN THE NAME OF UNEXPLAINED INVEST MENT IN THE NAME OF MYSELF OR MY FAMILY MEMBERS IN VARIOUS SCHEMES OF LAND/PLO T ETC. THE RELEVANT EXTRACTS BEING ANSWERED TO Q. 35 IS BE ING REPRODUCED HEREUNDER IN VERBATIM: ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 12 HOWEVER, SUCH DEBTORS (VIZ RAKESH & OTHERS NAMED IN IMPOUNDED PAPER ANN A/7 PG 23) COULD NOT PURCHASE/ INVEST HENCE, ADVANCE WE RE REALIZED WHEN NEEDED. SUCH ASSETS KEPT CHANGING ITS FORM YEAR TO YEAR IN THE BALANCE SHEET AND IT WAS DULY EXPLAINED TO THE LD. CIT. 3.2.3 THIS AMOUNT HAVING BEEN INCLUDED IN THE REGULARLY MAINTAINED BOOKS OF ACCOUNT WAS DULY INCLUDED IN THE BALANCE SHEET O F A.Y. 2008-09, UNDER THE HEAD SUNDRY ADVANCES & INVESTMENTS (PB 33). THE A SSESSMENT FOR A.Y. 2008- 09 STOOD COMPLETED VIDE ORDER DATED 31.08.2010 U/S 143(3) (PB 27). THEREAFTER, AGAIN IN THE BALANCE SHEET FOR THE YEAR ENDING 31.0 3.2009 (A.Y.2009-10), THIS AMOUNT OF RS. 1.59 CR. STOOD REDUCED TO RS. 1,04,56 ,250/-, UNDER THE HEAD SUNDRY ADVANCES & INVESTMENTS AND AGAIN THEREAFTE R IN THE BALANCE SHEET FILLED (IN THE RETURN OF INCOME) FOR THE NEXT YEAR I.E. A.Y. 2010-11 (PB 39-42) THE SUNDRY ADVANCES STOOD REDUCED TO RS. 15 LAC ONLY AN D TO ONE DEBTOR SHRI RAKESH AT RS. 59 LAC WAS SHOWN. THE REDUCTION IN THE AMOUN T OF ADVANCES WAS DUE TO THE CASH RECOVERIES MADE FROM THE SUNDRY ADVANCES ( DEBTORS). NOTABLY, THE ASSESSMENT FOR A.Y. 2010-11 ALSO STOOD COMPLETED AN D WAS NOT DISTURBED TILL THE PASSING OF THE SUBJECTED ASSESSMENT ORDER, MEANING THEREBY, THE REALIZATION FROM THE DEBTORS WAS ACCEPTED. ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 13 3.2.4 THEREAFTER, AGAIN IN THE BALANCE SHEET FILL ED (IN THE RETURN OF INCOME) FOR THE A.Y. 2011-12 THE SUNDRY ADVANCES INCREASED TO R S. 82 LACS AND THEREAFTER TO RS. 92 LACS (PB 44-47). THE ASSESSMENT FOR A.Y. 201 1-12 ALSO STOOD COMPLETED AND CONTINUES TO HOLD GOOD, MEANING THEREBY THE DEB TORS OF RS. 82 LACS AND THEREAFTER TO RS. 92 LACS STOOD ACCEPTED. EVERY TIM E, WHEN THERE IS INCREASE/DECREASE IN THE SUNDRY ADVANCES (DEBTORS) AND INCREASE IN THE CASH/BANK BALANCES IN THE INTERVENING PERIOD (I.E. A.Y. 2008-09 TO A.Y. 2016-17), THESE FACTS HAVE ITSELF ESTABLISHED THAT THERE DID EXIST THE SUNDRY ADVANCES (DEBTORS) DETAILED ABOVE, FACT OF RECOVERIES MADE F ROM THEM, THE AMOUNT RECOVERED WAS UTILIZED ONE WAY OR THE OTHER AND THE FACT THAT FINALLY AT THE END OF THE PREVIOUS YEAR RELATED TO A.Y. 2015-16, THE A SSESSE WAS HAVING CLOSING BALANCE OF CASH IN HAND OF RS. 85,80,796/- AS ON 31 .03.2016 (PB 66), AND WAS CARRIED OVER TO THE NEXT YEAR A.Y 2016-17 I.E. ON 1 .04.2016 (PB 61-66) WHICH, REMAINED AVAILABLE TILL THE FIRST DEPOSIT MADE ON 0 8.11.2016 AND THEREAFTER. 3.2.5 IT IS NOW WELL SETTLED THAT WHERE ASSESSE HAS REGUL ARLY MAINTAINED BOOKS OF ACCOUNTS IS AN ADMISSIBLE EVIDENCE UNDER INDIAN EVIDENCE ACT, 1872. THIS HOLDS GOOD MORE PARTICULARLY, WHEN THE LD. CIT DID NOT DISBELIEVE OR DID NOT DOUBT OR EVEN DID NOT REJECT THE SAME. SINCE, AVAIL ABILITY OF THE OPENING BALANCE OF THE PARTICULAR AMOUNT IN THE REGULARLY MAINTAINE D CASHBOOK, WHICH WERE DULY AND ADMITTEDLY SUBMITTED BEFORE THE AO IN THE SUBJE CTED ASSESSMENT PROCEEDINGS, HENCE, THERE WAS NO REASON AS TO WHY T HE AO SHOULD HAVE DOUBTED. 4. FAIRLY SPEAKING, FROM THE POINT OF A QUASI-JUDIC IAL AUTHORITY (THE AO), THE PAST HISTORY OF THE CASE WHICH INCLUDED THE FACT OF SURVEY, MAKING OF SURRENDER A LARGER AMOUNT OF INCOME, BEING UTILIZED IN THE DEBT ORS OR INVESTMENTS ETC., MAINTAINING BOOKS WHICH WERE AVAILABLE IN THE HARD DISK DURING SURVEY AND THEREAFTER FILED THROUGH BALANCE SHEET IN SOME OF T HE YEARS, FILING OF BALANCE SHEETS NOW, DURING ORIGINAL ASSESSMENT PROCEEDINGS OF ALL THE YEARS FROM A.Y. 2008-09 TO A.Y 2015-16, ACCOUNTS NOT REJECTED AND T HEREFORE, HAVING A BINDING ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 14 VALUE, WHICH INCLUDED CASH BOOK IN PARTICULAR, FURN ISHING OF CASH BOOK OF THE CURRENT YEAR WITH THE OPENING BALANCES AS ON 01.04. 2016, PREDECESSOR AOS HAVING ACCEPTED SIMILAR CLAIM/S OF RECOVERY FROM THE DEBTO RS IN THE PAST AS WELL, THERE BEING NO INDICATION EVEN REMOTELY TO RAISE A SUSPIC ION WARRANTING AN INQUIRY, WERE ALL THE SUFFICIENT FACTS, MATERIAL & EVIDENCES, TO TAKE A POSSIBLE DECISION OF AVAILABILITY OF CASH IN HAND. HE WAS NOT SUPPOSED TO EXAMINE WITH A MICROSCOPE TH E EXACT DATE, TIME AND PLACE OF THE RECOVERY OF CASH FROM THE DEBTORS. IF THE LD. CIT FINDS AN ERROR IN THE ASSESSMENT ORDER OF THIS YEAR, IN FACT, HE SHOULD H AVE DONE THIS IN THE EARLIER YEAR/S TO SEE THE AVAILABILITY OF THE FUNDS AND/OR THE UTILIZATION OR WHEN THE ASSESSEE CLAIMED SIMILAR REALIZATION OF CASH FROM T HE DEBTORS. THIS SHOWS A DOUBLE STANDARD ON THE PART OF THE REVENUE IN AS MUCH AS T HEY HAPPILY ACCEPTED THE TAX ON THE SURRENDERED INCOME, ON ONE HAND, BUT ONCE TH E CITIZEN WANTS TO TAKE ADVANTAGE OR UTILIZE THE INCOME SO SURRENDERED, THE REVENUE IS NOT EVEN ALLOWING THE CITIZEN PEACEFULLY, THE OTHER. THE REVENUE KEPT SILENCE ALL THESE YEARS BUT THE MOMENT THE ASSESSEE MADE A CLAIM OF AVAILABILITY OF ITS OWN TAX SUFFERED INCOME, THEY STARTED CRYING. FURTHER S. 69/ 69A REQUIRES AN EXPLANATION FROM THE ASSESSEE AND ONCE GIVEN, IT HAS TO BE OBJECTIVELY TESTED. A GOOD PROOF CANNOT B E CONVERTED INTO NO PROOF. MOREOVER, DISCRETION CONFERRED UPON THE AO HAS TO B E EXERCISED JUDICIOUSLY AS HELD IN CIT VS SMT. P.K. NOORJAHAN (1999) 237 ITR 0 570 (SC): AS POINTED OUT BY THE TRIBUNAL, IN THE CORRESPONDI NG CLAUSE IN THE BILL WHICH WAS INTRODUCED IN PARLIAMENT, THE WO RD 'SHALL' HAD BEEN USED BUT DURING THE COURSE OF CONSIDERATION OF THE BILL AND ON THE RECOMMENDATION OF THE SELECT COMMITTEE, THE SAID WORD WAS SUBSTITUTED BY THE WORD 'MAY'. THIS CLEARLY IND ICATES THAT THE INTENTION OF PARLIAMENT IN ENACTING S. 69 WAS T O CONFER A DISCRETION ON THE ITO IN THE MATTER OF TREATING THE SOURCE OF INVESTMENT WHICH HAS NOT BEEN SATISFACTORILY EXPLAI NED BY THE ASSESSEE AS THE INCOME OF THE ASSESSEE AND THE ITO IS NOT ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 15 OBLIGED TO TREAT SUCH SOURCE OF INVESTMENT AS INCOM E IN EVERY CASE WHERE THE EXPLANATION OFFERED BY THE ASSESSEE IS FOUND TO BE NOT SATISFACTORY. THE QUESTION WHETHER THE SOURC E OF THE INVESTMENT SHOULD BE TREATED AS INCOME OR NOT UNDER S. 69 HAS TO BE CONSIDERED IN THE LIGHT OF THE FACTS OF EACH C ASE. IN OTHER WORDS, A DISCRETION HAS BEEN CONFERRED ON THE ITO U NDER S. 69 TO TREAT THE SOURCE OF INVESTMENT AS THE INCOME OF THE ASSESSEE IF THE EXPLANATION OFFERED BY THE ASSESSEE IS NOT FOUN D SATISFACTORY AND THE SAID DISCRETION HAS TO BE EXER CISED KEEPING IN VIEW THE FACTS AND CIRCUMSTANCES OF THE PARTICULAR CASE. IN THE INSTANT CASE, THE TRIBUNAL HAS HELD TH AT THE DISCRETION HAD NOT BEEN PROPERLY EXERCISED BY THE I TO AND THE AAC IN TAKING INTO ACCOUNT THE CIRCUMSTANCES IN WHI CH THE ASSESSEE WAS PLACED AND THE TRIBUNAL HAS FOUND THAT THE SOURCES OF INVESTMENTS COULD NOT BE TREATED AS INCOME OF TH E ASSESSEE. THE HIGH COURT HAS AGREED WITH THE SAID VIEW OF THE TRIBUNAL. THERE IS NO ERROR IN THE SAID FINDING RECORDED BY T HE TRIBUNAL. THERE IS THUS NO MERIT IN THESE APPEALS AND THE SAM E ARE ACCORDINGLY DISMISSED. CIT VS. SMT. P.K. NOORJEHAN (1980) 15 CTR (KER) 138 : (1980) 123 ITR 3 (KER): 42R.1622, AFFIRMED. THUS, IT WAS FULLY ESTABLISHED BEYOND ALL REASONABL E DOUBTS THAT THERE WAS SUFFICIENCY OF CASH AVAILABLE AND IN ABSENCE OF ANY EVIDENCE OF UTILIZATION THEREOF ELSEWHERE, THE SAME COULD BE DEPOSITED IN THE BANK. 5. PAST ASSESSMENTS COMPLETED - NOT DISTURBED - BINDS THE PARTIES: ALL THE ASSESSMENTS OF THE PAST/INTERVENING PERIOD STARTING FROM A.Y. 2008-09 TO A.Y. 2015-16 STOOD COMPLETED EITHER UNDER SCRUTINY U/S 1 43(3) OR U/S 143(1). IF THE DEPTT. COULD NOT FIND ANY FAULT IN THE PASSING OF T HE ASSESSMENTS ORDERS OF ANY OF THE EARLIER YEARS, THERE APPEARS NO JUSTIFICATION A T ALL AS TO WHY THE DEPTT. SHOULD HAVE A SUSPICION AS TO THE FACT OF THE EXISTENCE OF THE SUNDRY ADVANCES (DEBTORS) AND THE FACT OF RECOVERY FROM THEM AND THE GENUINEN ESS OF THE TRANSACTIONS. THE ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 16 DEPTT. BY ITS OWN ADMISSIONS HAS ESTABLISHED THESE FACTS AND THEREFORE, THERE WAS NO REQUIREMENT AS TO WHY THE AO SHOULD HAVE AGA IN SPECIFICALLY REQUIRED TO PROVIDE NAME AND ADDRESSES OF THE SUNDRY ADVANCES ( DEBTORS) AND TO ESTABLISH THE FACT OF RECOVERY MADE FROM THEM. NEEDLESS TO SAY THAT ALL THESE FACTS AND FIGURES AN D THE RECORDS REFERRED TO HEREINABOVE, WERE PART OF THE ASSESSMENT RECORD OF THE EARLIER YEARS AS STATED ABOVE. S INCE THE DEPTT. HAD NO PROBLEM ON THESE ISSUES IN THE PAST THEN WHY THE DEPTT. SHOULD SUSPECT THE EXISTENCE OF TH E DEBTORS NOW. THE ONLY IRRESISTIBLE CONCLUSION IS THAT WHEN THE ASSESSEE H AS TAKEN THE ADVANTAGE TO EXPLAIN THE SOURCE OF THE SUBJECTED CASH DEPOSITS ( AND RIGHTLY SO) THE REVENUE IS SUSPECTING SAME. THIS DOUBLE STANDARD CANNOT BE P ERMITTED. 6.1 IT IS NOT THE CASE OF CIT THAT THERE WAS A CO MPLETE/TOTAL LACK OF INQUIRY. HE HIMSELF ADMITS AT MANY PLACES IN THE ASSESSMENT ORD ER AND IN PARTICULAR IN PARA 6.5 WHEN HE ADMITS THAT .MERELY ON THE BASIS OF CERTAIN DETAILS AND CASHBOOK. AND THE FURTHER FACT THAT HE DID NOT FACTUALLY DE NIED OR REBUTTED THE FACTUAL ASPECT OF THE ASSESSES CONTENTION OF FILIN G OF ROI WITH THE BALANCE SHEETS ETC. LAW IS WELL SETTLED THAT THE ASSESSMENT ORDER CANNOT BE HELD TO BE ERRONEOUS SIMPLY ON THE ALLEGATION OF INADEQUATE ENQUIRY. UNL ESS THERE IS AN ESTABLISHED CASE OF TOTAL LACK OF ENQUIRY. KINDLY REFER CIT VS. SUNBEAM AUTO LTD. (2011) 332 ITR 167 (DEL) (DPB 60-63), WHEREIN DELHI HIGH COURT WAS CONSIDERING THE ASPECT, WHEN THERE IS NO PROPER OR FULL VERIFICATION, AND I T WAS HELD THAT ONE HAS TO SEE FROM THE RECORD AS TO WHETHER THERE WAS APPLICATION OF MIND BEFORE ALLOWING THE EXPENDITURE IN QUESTION AS REVENUE EXPENDITURE. LEA RNED COUNSEL FOR THE ASSESSEE IS RIGHT IN HIS SUBMISSION THAT ONE HAS TO KEEP IN MIND THE DISTINCTION BETWEEN LACK OF INQUIRY AND INADEQUATE INQUIRY . IF THERE WAS ANY INQUIRY, EVEN INADEQUATE THAT WOULD NOT BY ITSELF GIVE OCCAS ION TO THE CIT TO PASS ORDERS UNDER SECTION 263 OF THE ACT, MERELY BECAUSE HE HAS A DIFFERENT OPINION IN THE MATTER. IT IS ONLY IN CASES OF LACK OF INQUIRY TH AT SUCH A COURSE OF ACTION WOULD BE OPEN. ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 17 6.2 IN CIT VS. CHEMSWORTH PVT. LTD. (2020) 275 TA XMAN 408 (KAR) (DPB 64- 66), IT WAS HELD THAT: REVISIONERRONEOUS AND PREJUDICIAL ORDERAO TAKING PLAUSIBLE VIEWAO COMPLETED THE ASSESSMENT WITHOUT CONSIDERING EXPEND ITURE WHICH WAS NOT ALLOWABLE UNDER S. 14ACIT HELD THAT NON-CONSIDERAT ION OF DISALLOWABLE EXPENDITURE UNDER S. 14A WAS ERRONEOUS AND IS PREJU DICIAL TO THE INTEREST OF THE REVENUENOT CORRECTCIT HAS HELD HAT THE ENQ UIRY CONDUCTED BY THE AO WAS INADEQUATE AND HAS ASSUMED THE REVISIONA L JURISDICTION ASSESSEE HAS FILED ALL THE DETAILS BEFORE THE AO AN D AO HAS ACCEPTED THE CONTENTION OF THE ASSESSEE THAT NO EXPENDITURE WAS ATTRIBUTABLE TO THE EXEMPT INCOME DURING THE RELEVANT ASSESSMENT YEART HUS, WHILE RECORDING THE SAID FINDING, THE AO HAS TAKEN ONE OF THE PLAUSIBLE VIEWS IN ALLOWING THE CLAIM OF THE ASSESSEE THEREFORE, CIT COULD NOT HAVE SET ASIDE THE ORDER OF ASSESSMENT MERELY ON THE GROUND OF INADEQUACY OF ENQUIRYORDER PASSED BY THE CIT WAS NOT SUSTAINABLE IN LAW HENCE, THE TRIBUNAL RIGHTLY SET ASIDE THE IMPUGNED ORDER OF TH E CIT. THE LD. CIT IS COMPLETELY SILENT ON THIS ASPECT. 7. SUPPORTING CASE LAWS ON AVAILABILITY OF FUNDS: THE HONBLE HIGH COURTS AND THE TRIBUNALS IN DIFFERENT FACTUAL SITUATIONS HAVE CONSIDERED THE AVAILABILITY OF THE CASH WHEN THE DEPT. FAILED TO ESTABLISH THAT SUC H CASH WHICH WAS MADE AVAILABLE IN HANDS OF THE ASSESSEE BECAUSE OF THE W ITHDRAWAL FROM THE BANKS OR SALE PROCEEDS OF THE JEWELLERY AND SO ON, UTILISED ELSEWHERE, HELD THAT NO ADDITION CAN BE MADE. IN THE INSTANT CASE, THE AO WAS HAVING REGULARLY MA INTAINED CASH BOOK ON DAY TO DAY BASIS AND OPENING CASH IN HAND SHOWING SUFFICIE NT CASH BALANCE IMMEDIATELY PRIOR TO THE SUBJECTED BANK DEPOSITS AND MORE PARTI CULARLY, WHEN ALL ALONG IN THE PAST THE AVAILABILITY OF THE CASH, BANK BALANCES, I NVESTMENTS AND DEBTORS STOOD ACCEPTED BY THE DEPT. AS STATED ABOVE, THE AO WAS NOT SUPPOSED TO DOUBT T HE EXPLANATION OF THE ASSESSEE UNTIL AND UNLESS THERE WAS SOME CONTRARY EVIDENCE AVAILABLE ON RECORD, AROUSING HIS SUSPICION . ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 18 DIRECT DECISIONS SUPPORTING THE FACTUAL MATRIX: 7.1 THE FOLLOWING DECISION IS A DIRECT AUTHORITY SU PPORTING THE ASSESSEES CASE ON SIMILAR FACTUAL MATRIX. SHIVCHARAN DASS VS. CIT (1980) 126 ITR 0263 (P&H) ( DPB 1-4) HELD: THE HUF OF WHICH THE ASSESSEE WAS THE KARTA DECLAR ED A SUM OF RS. 20,000 UNDER THE VOLUNTARY DISCLOSURE SCHEME IN OCT OBER, 1951. ACCORDING TO THE ASSESSEE, THE SAID AMOUNT REMAINED WITH HIS WIFE TILL HER DEATH IN 1956. THEREAFTER RS. 10,000 EACH WAS DEPOS ITED WITH BANK IN THE NAMES OF EACH OF HIS TWO THEN MAJOR DAUGHTERS. THE REVENUE SOUGHT TO ADD THE AMOUNT OF RS. 20,000 IN ASSESSEE'S HANDS AS INCOME FROM UNDISCLOSED SOURCES. THERE WAS NO PROVISION ANALOGO US TO THE PROVISIONS OF S. 69 OF THE IT ACT, 1961 IN THE IT ACT, 1922 WHICH GOVERNS THE PRESENT CASE. IF THE AMOUNT OF RS. 20,000 DISCLOSED UNDER T HE DISCLOSURE SCHEME HAD BEEN FOUND TO BE DEPOSITED OR UTILISED BY THE A SSESSEE OR THE HUF IN SOME OTHER MANNER, IN THAT CASE, A LEGITIMATE INFER ENCE COULD BE DRAWN THAT THE AMOUNT IN DISPUTE WAS FROM UNDISCLOSED SOU RCES AS THE AMOUNT SO DISCLOSED UNDER THE DISCLOSURE SCHEME HAD BEEN FOUN D TO BE OTHERWISE UTILISED BY THE ASSESSEE OR BY THE HUF, BUT THE FIN DING ON THIS ASPECT OF THE CASE IS OTHERWISE. THEREFORE, THE ASSESSEE PRIMA FA CIE DISCHARGED ITS INITIAL BURDEN. BEFORE THE DEPARTMENT REJECTS SUCH EVIDENCE , IT MUST EITHER SHOW AN INHERENT WEAKNESS IN THE EXPLANATION OR REBUT IT BY PUTTING TO THE ASSESSEE SOME INFORMATION OR EVIDENCE WHICH IT HAS IN ITS POSSESSION. THE DEPARTMENT CANNOT, BY MERELY REJECTING UNREASONABLY A GOOD EXPLANATION, CONVERT GOOD PROOF INTO NO PROOF.SREELEKHA BANERJE E & ORS. VS. CIT (1963) 49 ITR 112 (SC) : TC42R.1145 RELIED ON. 7.2 IN ANOTHER CASE OF PCIT VS. DILIP KUMAR SWAMI [ 2019] 106 TAXMANN.COM 59 (RAJ) (DPB 5-7) IT WAS HELD THAT ASSESSEE FILED HIS RETURN DECLARING CERTAIN TAXABLE INCOME - IN COURSE OF ASSESSMENT, ASSESSING OFFICER NOTED THAT ASSESSEE HAD DEPOSITED CERTAIN AMOUNT IN HIS BANK ACCOUNT - ON B EING ENQUIRED ABOUT SOURCE OF ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 19 SAID DEPOSIT, ASSESSEE EXPLAINED THAT IT REPRESENTE D AMOUNT RECEIVED FROM VARIOUS PURCHASERS AGAINST SALE OF GOODS I.E., TRACTORS AND ACCESSORIES THEREOF - ASSESSING OFFICER ACCEPTED ASSESSEE'S EXPLANATION AND COMPLET ED ASSESSMENT - COMMISSIONER TAKING A VIEW THAT CASH DEPOSITS NOT B EING SATISFACTORILY EXPLAINED, PASSED A REVISIONAL ORDER SETTING ASIDE ASSESSMENT - TRIBUNAL, HOWEVER, SET ASIDE REVISIONAL ORDER SO PASSED - IT WAS NOTED THAT ORDE R PASSED BY ASSESSING OFFICER THAT DEPOSITS STOOD RECONCILED WAS PRECEDED BY A PR OPER INQUIRY - IT WAS ALSO FOUND THAT ASSESSEE HAD PRODUCED STATEMENT OF BANK ACCOUNT, COPIES OF BILLS ISSUED TO PURCHASERS OF TRACTORS AS ALSO BOOKS OF A CCOUNT SHOWING ENTRIES OF DEPOSITS MADE IN BANK - MOREOVER, ASSESSING OFFICER HAD RECORDED A CATEGORICAL FINDING THAT ENTRIES IN BANK ACCOUNT WERE VERIFIABL E FROM CASH BOOK AND ALSO BILLS PRODUCED BY ASSESSEE - WHETHER IN VIEW OF AFORESAID , TRIBUNAL WAS JUSTIFIED IN SETTING ASIDE REVISIONAL ORDER PASSED BY COMMISSION ER - HELD, YES. THE PRINCIPAL PROPOUNDED IN THE ABOVE CASE DIRECTLY APPLIES IN THE PRESENT CASE. OTHER DECISIONS: 7.3 KINDLY REFER CIT V/S P.V. BHOOPATHY (2006) 205 CTR 495 (MAD) (DPB 8- 11) HELD: APPEAL (HIGH COURT)SUBSTANTIAL QUESTION OF LAWINC OME FROM UNDISCLOSED SOURCESAO DID NOT ACCEPT VARIOUS SOURCES OF INCOME EXPLAINED BY THE ASSESSEE AND MADE ADDITIONS UNDER SS. 68 AND 69 IN RESPECT OF DIFFERENCE BETWEEN THE INVESTMENTS AND THE SOURCES ACCEPTED BY HIMTRIBUNAL ACCEPTED THE EXPLANATION OF THE ASSESSEE VIS-A-VIS AVAILABILITY OF FUNDS WITH THE ASSESSEE FROM THE SALE PROCEEDS OF JEWELLERY BE LONGING TO HIS MOTHER- IN- LAW, RECEIPT FROM A PARTY AND ALSO THE AMOUNT OF OPENING BALANCE AND SAVINGS FROM EARLIER YEARS AND DELETED ALL THE ADDI TIONSFINDINGS RECORDED BY THE TRIBUNAL ARE PURELY FINDINGS OF FACTTHERE IS N O REASON TO INTERFERE WITH THE SAMENO SUBSTANTIAL QUESTION OF LAW ARISESCIT VS. PRADEEP SHANTARAMPADGAONKAR (1983) 143 ITR 785 (MP) RELIED ON 7.4 ALSO REFER CIT VS KULWANT RAI (2007) 210 CTR 38 0 (DELHI) PARA 16-17 ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 20 READ HELD SEARCH AND SEIZUREBLOCK ASSESSMENTCOMP UTATION OF UNDISCLOSED INCOMECASH FOUND DURING SEARCHASSESSE E HAD WITHDRAWN RS. 2 LAKH FROM BANK SOME TIME BACK AND THERE IS NO MATERIAL WITH THE DEPARTMENT TO SHOW THAT THIS MONEY HAD BEEN SPENT A ND WAS NOT AVAILABLE WITH THE ASSESSEETRIBUNAL HAS FOUND THAT THE WITHD RAWALS SHOWN BY THE ASSESSEE ARE FAR IN EXCESS OF CASH FOUND DURING THE COURSE OF SEARCH IN THE ABSENCE OF ANY MATERIAL TO SUPPORT THE VIEW THAT TH E ENTIRE CASH WITHDRAWALS MUST HAVE BEEN SPENT BY THE ASSESSEE, TRIBUNAL WAS JUSTIFIED IN HOLDING THAT THE ADDITION WAS NOT SUSTAINABLEORDER OF THE TRIBU NAL DOES NOT GIVE RISE TO A SUBSTANTIAL QUESTION OF LAW IN THIS CASE, CASH WAS FOUND ON SEARCH CARRIED OUT ON 04.02.2001 AND WAS EXPLAINED TO BE OUT OF THE CASH WITHDRAWAL IN DEC-2 000. 7.5 ALSO REFER ANAND PRAKASH SONI V/S DCIT (2006) 1 01 TTJ 97 (JD) PARA 5-6 SEARCH AND SEIZUREBLOCK ASSESSMENTCOMPUTATION OF UNDISCLOSED INCOMECASH FOUND DURING SEARCHASSESSEE IS ENTITLE D TO FURNISH CASH FLOW STATEMENT TO EXPLAIN THE TRANSACTIONS WHEN NO BOOKS OF ACCOUNT ARE MAINTAINEDIN SUCH CIRCUMSTANCES IT BECOMES THE DUT Y OF THE AO TO VERIFY THE BALANCE SHEET AND CASH FLOW STATEMENT WITH THE NECESSARY MATERIAL INCLUDING THE DETAILS ALREADY FILED ALONG WITH THE RETURNS IN THE PAST ASSESSEE EXPLAINED THAT THE CASH FOUND AT THE TIME OF SEARCH WAS WITHDRAWN FROM THE BANK SOME TIME BACK WHICH WAS PARTLY USED FOR PURCHASING GOLD AND PART OF THE AMOUNT WAS GIVEN BY THE ASSESSEE TO HIS WIFETHERE IS NOTHING TO SUGGEST THE UTILIZATION OF THE WITHDRAWA L AMOUNT ELSEWHERESAID WITHDRAWAL IS DULY REFLECTED IN THE CASH FLOW STATE MENT AND CLOSING CASH BALANCE IS MORE THAN THE AMOUNT FOUND AT THE TIME O F SEARCHTHUS, ADDITION CANNOT BE SUSTAINED 7.6 KINDLY REFER CIT V/S RAJASTHAN FINANCIAL CORPO RATION (1996) 134 CTR 145 (RAJ). (DPB 52-55) HELD THAT: ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 21 ONCE ASSESSING OFFICER HAS MADE ENQUIRIES DURING T HE COURSE OF ASSESSMENT PROCEEDINGS ON THE RELEVANT ISSUES AND THE ASSESSEE HAS GIVEN DETAILED EXPLANATION BY A LETTER IN WRITING AND THE ASSESSIN G OFFER ALLOWED THE CLAIM BEING SATISFIED WITH THE EXPLANATION OF ASSESSEE, T HE DECISION OF THE ASSESSING OFFICER CANNOT BE HELD TO BE ERRONEOUS SI MPLY BECAUSE IN HIS ORDER NOT MAKE AN ELABORATE DISCUSSION IN THAT REGARD. 7.7 IN CIT V/S GANPAT RAM BISHNOI (2005) 198 CTR (R AJ) 546 (DPB 56- 59) HELD THAT FROM THE RECORD OF THE PROCEEDINGS, IN THE PRE SENT CASE, NO PRESUMPTION CAN BE DRAWN THAT THE AO HAD NOT APPLIED ITS MIND TO TH E VARIOUS ASPECTS OF THE MATTER. IN SUCH CIRCUMSTANCES, WITHOUT EVEN PRIMA F ACIE LAYING FOUNDATION FOR HOLDING THAT ASSESSMENT ORDER IS ERRONEOUS AND PREJ UDICIAL TO INTEREST IN ANY MATTER MERELY ON SPACIOUS GROUND THAT THE AO WAS RE QUIRED TO MAKE AN ENQUIRY, CANNOT BE HELD TO SATISFY THE TEST OF EXISTING NECE SSARY CONDITION FOR INVOKING JURISDICTION U/S 263. JURISDICTION U/S 263 CANNOT B E INVOKED FOR MAKING SHORT ENQUIRIES OR TO GO INTO THE PROCESS OF ASSESSMENT A GAIN AND AGAIN MERELY ON THE BASIS THAT MORE ENQUIRY OUGHT TO HAVE BEEN CONDUCTE D TO FIND SOMETHING. 8. EVEN THE AMENDMENT (EXPL. 2(A)) DOES NOT CONFER BLIND POWERS: IT IS HELD THAT DESPITE THERE BEING AN AMENDMENT, ENLARGING THE SCO PE OF THE REVISIONARY POWER OF THE LD. PCIT U/S 263 TO SOME EXTENT, IT CA NNOT JUSTIFY THE INVOKING OF THE EXPL. 2(A) IN THE FACTS OF THE PRESENT CASE. BEFORE REFERRING TO THAT EXPLANATION, ONE HAS TO UNDERSTAND WHAT WAS THE TRUE MEANING O F THE EXPLANATION IN THE CONTEXT OF APPLICATION OF MIND BY A QUASI-JUDICIAL AUTHORITY. IN THE CASE OF NARAYAN TATU RANE VS. ITO ITAT, (201 3) 7 NYPTTJ 1493 (MUM) (DPB 12-21) IT WAS HELD THAT NEWLY INSERTED EXPLANA TION 2(A) TO SEC. 263 DOES NOT AUTHORIZE OR GIVE UNFETTERED POWERS TO COMMISSIONER TO REVISE EACH AND EVERY ORDER, IF IN HIS (SUBJECTIVE) OPINION, SAME HAS BEE N PASSED WITHOUT MAKING ENQUIRIES OR VERIFICATION WHICH SHOULD HAVE BEEN MA DE. AS SUBMITTED ABOVE HERE ALSO THE AO WAS NOT SUPPOSED TO HAVE REQUIRED THE NAME AND ADDRESS OF DEBTORS (BECAUSE THE SAME WERE ALREADY AVAILABLE, ESTABLISH ED OR EVEN ASSUMING NOT SO, ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 22 WAS NOT REQUIRED IN THE FACTS OF THE CASE). THE GENUINENESS OF THE TRANSACTION WAS ALREADY ESTABLISHED AND ACCEPTED BY THE DEPTT. IN THE PAST HENCE, ON THAT COUNT ALSO, THE ASSESSMENT ORDER WAS NOT ERRONEOUS. 9. BENEFIT OF TELESCOPING AVAILABLE: 9.1 ANOTHER ASPECT OF THE MATTER TO BE LOOKED INTO IS THAT EVEN ONE NEED NOT GO INTO THE FACTUAL NEXUS BETWEEN THE INCOME SURREN DERED ON ONE HAND IN A.Y. 2008-09 AND THE AVAILABILITY OF THE RESULTANT FUNDS FOR ONWARD DEPOSIT IN THE BANK, ON THE OTHER BECAUSE THE LAW OF TELESCOPING IS WELL ESTABLISHED THAT SOME UNDISCLOSED INCOME ONCE SURRENDERED AND GOT TAXED, THE BENEFIT OF THE AVAILABILITY (TELESCOPING) OF THE SAME TOWARDS THE OTHER OUTGOIN G/INVESTMENTS/EXPENDITURE ETC. MUST BE ALLOWED AS WAS HELD LONG BACK IN THE C ASE OF ANANTHARAM VEERASINGHAIAH & CO. V. CIT [1980] 123 ITR 457 (SC) (DPB 22-25) FOLLOWED BY RAJASTHAN HIGH COURT IN THE CASE OF ITO V. TYARYAMA L BALCHAND [1987] 32 TAXMAN 64 (RAJ.) (DPB 26-30), MORE PARTICULARLY IN ABSENCE OF ANY EVIDENCE OF UTILIZATION OF SUCH INCOME ELSEWHERE. 9.2 AO ACTED AS PER DECISIONS: SINCE THIS IS THE LAW LA ID DOWN BY HONBLE APEX COURT AND FOLLOWED BY HONBLE RAJASTHAN HIGH COURT AND THE RATIO LAID DOWN THEREIN IS BINDING UPON THE SUBORDINATE AUTHORITI ES, THE AO WAS FULLY JUSTIFIED IN HAVING ACCEPTED THE EXPLANATION OF THE ASSESSE TOW ARDS THE SOURCE OF THE CASH DEPOSITS IN THE BANK ACCOUNT WITH THE HELP OF THE INCOME SURRENDERED IN A.Y. 2008-09 (PB 20) (THOUGH, IN ADDITION THERE ARE PLET HORA OF EVIDENCES ALREADY AVAILABLE ON RECORD TO SUPPORT SUCH CONTENTION OTHE RWISE ON MERIT ALSO, AS SUBMITTED ABOVE). 9.3 IN THE CASE OF VINOD BHANDARI VS. PR. CIT (2020) 34 NYPTTJ 626 (INDORE) (DPB 31-51) IT WAS HELD THAT IF THERE ARE TWO FUNDS AND ONE IS ALREADY TAXED AND OTHER HAS NOT BEEN TAXED AND THERE ARE REMITTANCES DURING ACCOUNTING YEAR FOR CERTAIN SUM, SOURCE OF WHICH IS NOT INDICATED, THEN PRESUMPTION IS THAT REMITTANCES SHOULD HAVE BEEN MADE FROM FUND WHICH H AS ALREADY SUFFERED TAX - HELD, YES - ASSESSEE, A MEDICAL PRACTITIONER, SURRE NDERED INCOME OF RS. 7 CRORES IN ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 23 HIS PERSONAL CAPACITY DURING COURSE OF SURVEY PROCE EDINGS ON ACCOUNT OF VARIOUS HUNDIS FOUND AND IMPOUNDED FROM POSSESSION OF ASSES SE. FURTHER, THERE WAS A DIRECT NEXUS OF CASH SO RECEIVED ON MATURITY OF HUN DIS WITH CASH DEPOSITED IN BANK ACCOUNT - WHETHER, ON FACTS, ASSESSEE WAS ENTITLED FOR TELESCOPING BENEFIT OF INCOME SURRENDERED DURING YEAR TO CASH DEPOSITED IN BANK ACCOUNT. 10 ADVERSE OBSERVATIONS AND OBJECTIONS RAISED BY THE L D. CIT: PREAMBLE: AT THE OUTSET, THE FACTS ARE EVIDENT FROM THE RECOR D SUBMITTED BEFORE THE LD. CIT IN RESPONSE TO SCN U/S 263 IN THE SHAPE OF DETAILED WRITTEN SUBMISSIONS (PG. 1-16) AS ALSO DETAILED PAPER BOOK CONTAINING AS MANY AS 67 PAGES IN SUPPORT OF THE CONTENTIONS RAISED BEFORE T HE CIT. THE LD. CIT FIRSTLY REPRODUCED THE SUBMISSIONS FILED BEFORE HIM IN VERB ATIM AND THEREAFTER, HE SUMMARIZED ASSESSEES SUBMISSIONS AT PG. 13 PR. 6.1 ONWARDS TILL PR. 6.3 OF THE IMPUGNED ORDER. HIS FINDING STARTS FROM PG. 15 PR. 6.4 ONWARDS, WHICH ARE BEING DEALT HEREUNDER PARA-WISE. 10.1.1 PARA 6.4: THE CRUX OF THE CITS FINDINGS ARE THAT AO ERRED IN MERELY ACCEPTING THE ASSESSEES SUBMISSIONS AS STATED AND IN ALSO ACCEPTING THE CASHBOOK FURNISHED WITHOUT VERIFYING THE EXISTENCE OF THE DE BTORS AND INTO THE GENUINENESS OF THE TRANSACTIONS W.R.T RECOVERY OF THE CASH OF R S. 85,00,000/-. AT THE OUTSET IT IS SUBMITTED THAT IT IS NOT A CASE OF MERE ACCEPTANCE OF SUBMISSIONS AND CLAIMS MADE BY THE ASSESSE BUT THE SAME WAS FULLY AND ADEQUATELY SUPPORTED BY VOLUMINOUS EVIDENCES, START ING FROM THE GENERIC OR THE NUCLEUS SOURCE I.E. 1.96 CRORE (OR RS. 1.59 CR.) IN F.Y. 2007-08 (A.Y. 2008- 09) CONTINUING WITH THE ASSESSE, FINALLY CULMINATING IN TO CASH REALIZATION FROM THE DEBTORS AND APPEARING AS OPENING CASH BALANCE IN TH E CASHBOOK AS ON 01.04.2016. THE LD. CIT ADMITTED THE FACT OF FILIN G CASHBOOK AND THE APPEARANCE OF OPENING BALANCE THEREIN HOWEVER, HE DID NOT WHIS PER A SINGLE WORD IF HE COULD FIND ANY DEFECT IN THE CASHBOOK OF THIS YEAR OR IN THE BOOKS OF ACCOUNT MAINTAINED IN THE PREVIOUS YEAR/S. 10.1.2 THE AO BEING A QUASI-JUDICIAL AUTHORITY, IS ALL ENTITLED BY THE LAW TO TAKE ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 24 ITS OWN DECISIONS AND CANNOT BE GUIDED OR INSTRUCTE D BY ANY SUPERIOR AUTHORITY AS PER U/S 119 OF THE ACT. EVEN THE EXPLANATION TO S. 263 WAS NOT APPLICABLE (AS SUBMITTED LATER). THE IDENTITY, NAME & ADDRESS ETC. WERE ALREADY ESTABLISHED BY THE ASSESSEE, WHEN HE REFERRED TO THE DESTINATION O F THE INCOME SURRENDERED DURING SURVEY U/S 133A ON DATED 13/14.08.2008 AND T HE SAME IS ALSO AVAILABLE IN THE DOCUMENTS IMPOUNDED. UNFORTUNATELY, HOWEVER, DE SPITE THE REQUEST OF THE ASSESSEE TO AO VIDE LETTER DATED 02.03.2021, CERTIF IED COPIES HAVE NOT BEEN SUPPLIED ALTHOUGH EXISTENCE OF THE SAME IS NOT DENI ED. THUS, THE AO, HAVING THE PAST ASSESSMENT RECORDS INCLUDING THE SURVEY RECORD S, WAS FULLY JUSTIFIED IN TAKING A POSSIBLE VIEW. IT IS NOT THE CASE OF THE CIT THAT SOME OF DEBTOR/S HAS DENIED TAKING ANY LOAN FROM THE ASSESSE, NOR IT HIS CASE T HAT CASH SO AVAILABLE AS ON 01.04.2016 TILL THE DATE OF DEPOSIT STOOD DIVERTED/ UTILIZED ELSEWHERE BECAUSE HE NEITHER DOUBTED NOR REJECTED THE CASHBOOK NOR BROUG HT ANY CONTRARY EVIDENCE, THEREFORE, IT IS COMPLETELY FALLACIOUS TO FIND THE DEFECT IN A POSSIBLE DECISION TAKEN OR MADE BY THE QUASI-JUDICIAL AUTHORITY IN THIS CAS E. 10.1.3 IT MAY CLARIFIED THAT THE LD. CIT BY EXPECTI NG THE AO TO DOUBT THE EXISTENCE OF THE DEBTORS THIS YEAR, WANTED THE AO T O REVISIT/REVIEW THE CORRECTNESS OF THE EARLIER ASSESSMENTS YEARS STARTING FROM A.Y. 2008-09 TO 2014-15 AND SUCH ASSESSMENTS HAVING BEEN ACCEPTED AND ASSE SSED WITHOUT ANY VARIATION AT ALL, WERE BINDING UPON HIM, MEANING THEREBY THE COR RECTNESS OF THE CLAIM OF AVAILABILITY OF THE DEBTORS, INVESTMENTS AND THE GE NUINENESS OF SUCH CLAIM, STOOD FULLY ESTABLISHED, NOT WARRANTING ANY FURTHER I NVESTIGATION. YET, THE LD. CIT WANTED THE AO TO INVOKE S. 263 OR TO MAKE A REVIEW OF ITS PREDECESSORS ORDER/S THOUGH HE HAD BECOME EX-FUNCTUS OFFICIO AFTER PASSI NG THOSE ASSESSMENTS ORDER/S WHICH WAS NOT LEGALLY PERMISSIBLE. PERTINENTLY, THOSE ASSESSMENTS HAVE NOT BEEN DISTUR BED SO FAR BY THE TIME OF THE PASSING OF THE SUBJECTED ASSESSMENT ORDER DATED 10. 12.2018 U/S. 143(3), HENCE, THOSE ASSESSMENTS HELD GOOD AND HAS ALL THE BINDING VALUE UPON THE PARTIES. THE HONBLE RAJ HC IN THE CASE OF PARMESHWAR BOHRA (200 8) 301 ITR 0404 HAS HELD: ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 25 THERE IS A CLEAR FINDING AND ABOUT WHICH THERE IS N O DISPUTE THAT THE AMOUNT ADDED IN THE INCOME OF THE ASSESSEE AS UNEXP LAINED INVESTMENT OR CASH CREDIT IN THE ASST. YR. 1993-94 WAS THE SAME A MOUNT WHICH WAS CREDITED IN THE BOOKS OF ACCOUNT OF THE ASSESSEE FO R PREVIOUS YEAR ENDING ON 31ST MARCH, 1992. THE TRIBUNAL HAS CATEGORICALLY CO ME TO A FINDING, AND THAT FINDING IS NOT UNDER CHALLENGE, THAT THIS IS N OT A CASE OF CASH CREDIT ENTERED IN THE BOOKS OF ACCOUNT OF THE ASSESSEE DUR ING THE YEAR BUT IT IS A CASE IN WHICH THE ASSESSEE HAS INVESTED THE CAPITAL IN THE BUSINESS AND THIS AMOUNT WAS SHOWN AS A CLOSING CAPITAL AS ON 31ST MA RCH, 1992 AND ON 1ST APRIL, 1992 IT WAS AN OPENING BALANCE. IT DOES NOT REQUIRE ANY ELABORATE ARGUMENT THAT A CARRIED FORWARD AMOUNT OF THE PREVI OUS YEAR DOES NOT BECOME AN INVESTMENT OR CASH CREDIT GENERATED DURIN G THE RELEVANT YEAR 1993-94. THIS ALONE IS SUFFICIENT TO SUSTAIN THE OR DER OF THE TRIBUNAL IN DELETING THE AMOUNT FROM THE ASSESSMENT FOR ASST. Y R. 1993-94. 10.2 PARA 6.5 FURTHER OBJECTION OF THE LD. CIT WAS THAT EVERY YEA R IS A SEPARATE YEAR AND NOT BINDING UNLESS, THAT PARTICUL AR ASSESSMENT YEAR IS NOT SCRUTINIZED. WHAT COMES OUT IS THAT LD. CIT IS IGNO RING THE BINDING EVIDENTIARY VALUE OF THE PAST COMPLETED ASSESSMENTS BECAUSE OF THE SIMPLE FACT THAT THOSE ASSESSMENTS WERE NOT COMPLETED UNDER SCRUTINY. FIRS TLY, ON THE VERY FACE OF IT, THIS IS A MIS-CONCEPTION AND PURPORTED MIS-READING AND T HIS ARGUMENT IS COMPLETELY MIS-PLACED IN AS MUCH AS FIRSTLY, IT IS NOT THE CHO ICE OF THE ASSESSE TO GET THE ASSESSMENT COMPLETED EITHER UNDER SCRUTINY OR AS A SUMMARY ASSESSMENT U/S 143(1). THE DECISION SOLELY RESTS WITH THE DEPARTME NT ONLY AND IF THEY CHOSE TO COMPLETE THE ASSESSMENT IN A PARTICULAR MANNER THE FACT REMAINS IS THAT THE ASSESSMENTS OF EARLIER YEAR/S STOOD COMPLETED BY AC CEPTING AND ASSESSING WHAT WAS CLAIMED. SUCH ADMISSION IS NOT ONLY OF THE INCO ME DECLARED BUT ALSO OF THE OTHER FACTS AS STATED IN THE EVIDENCES ENCLOSED WIT H THE ROI. THEREFORE, THE SUBMISSION THAT THE DEPT. NOT HAVING COMPLETED THE ASSESSMENTS UNDER SCRUTINY DID NOT HAVE EVIDENTIARY VALUE IS COMPLETELY FALLAC IOUS. ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 26 SECONDLY, SUCH ARGUMENT MAY HOLD GOOD IN THE MATTER S OF ESTIMATION OF INCOME PARTICULAR FROM TRADING ETC. IN THE CASES WHERE S.1 45(3) HAS BEEN INVOKED WHERE BECAUSE OF CHANGE IN THE FACTS, AO OF THE CURRENT Y EAR IS FREE TO MAKE ESTIMATIONS WITHOUT GETTING INFLUENCED BY THE DECLARATIONS MADE IN THE PAST. THIRDLY, REST OF THE POINTS ARE NOTHING BUT REPETIT ION OF WHAT WAS ARGUED IN PR. 6.4. 10.3 PARA 6.5 & 6.6 NON-APPLICABILITY OF EXPLANATI ON 2: KINDLY REFER OUR DETAILED SUBMISSIONS UNDER PARA 3 BEYOND THE SCOPE OF ENQUIRY, 3.2 REQUISITE DETAILS ALREADY AVAILABLE AND PARA 3.5 & 6 WHEREIN, THIS PARTICULAR ASPECT HAS BEEN ELABORATELY DISCUSSED AND ANSWERED TOGETHER WI TH SOME CASE LAWS MAKING THE EXPLANATION NOT APPLICABLE. THE LD. CIT HOWEVER, DID NOT JUDICIALLY APPRECIATE THE LEGAL AND FACTUAL ASPECT. HENCE, INS TEAD OF REPEATING, WE ARE FURTHER RELYING UPON SOME MORE DECISIONS AS UNDER: 10.4 PARA 6.7 DECISIONS CITED BY LD. CIT - NOT APPLICA BLE: CERTAIN DECISIONS NOT APPLICABLE - THE LD. CIT HAS RELIED UPON THE FOLLOWING DECISIONS AGAINST THE ASSESSE HOWEVER, THOSE DECISI ONS WERE BASED UPON PECULIAR FACTS AVAILABLE IN THOSE CASES ONLY, WHICH ARE NOT AVAILABLE IN OUR CASE AND HENCE, THEY ARE COMPLETELY DISTINGUISHABLE. 10.5 PARA 6.9 IDENTITY AND THE CREDITWORTHINESS OF THE DEBTORS AND GENUINENESS OF THE TRANSACTIONS NOT FURNISHED: AT THE OUTSET, IT IS AGAIN A MISCONCEPTION ON THE P ART OF THE LD. CIT IN AS MUCH AS SUCH REQUIREMENTS IF THE AO WAS EXAMINING T HE ISSUE IN HAND U/S 68 OF THE ACT WHICH IS NOT THE CASE ARE RELEVANT ONLY HERE. THE ISSUE INVOLVED WAS ONLY CASH DEPOSITS IN THE BANK ACCOUNT WHICH COULD LEGALLY BE INVESTIGATED UNDER S. 69A BUT NOT UNDER S. 68. OTHERWISE ALSO, T HE CREDITWORTHINESS AND THE IDENTITY ARE TO BE SEEN OF THE CREDITORS AND NO T THE DEBTORS. ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 27 SINCE THE ASSESSEE HAS ALREADY FILED VOLUMINOUS DET AILS AND ASSESSMENTS OF THE PAST YEARS HAVE ALREADY BEEN COMPLETED REMAININ G UNDISTURBED, THIS IS THE BIGGEST EVIDENCE AGAINST THE DEPARTMENT AND UNLESS THE DEPT./LD. CIT COULD HAVE DEMOLISHED OR REBUTTED THESE EVIDENCES, WHAT I S ESTABLISHED IS THE OPENING CASH BALANCE AS ON 01.04 2016. EVEN THE FAC T OF RECOVERY NEED NOT TO GOT ESTABLISHED BY THE AO TO THE FOR SIMPLE REASON THAT SUCH CASH HAD ALREADY BEEN REALIZED PRIOR TO F.Y. 2015-16 AND A.Y. 2016-1 7 AND SUCH EVIDENCES NOT HAVING BEEN REBUTTED AND ASSESSMENT NOT DISTURBED, THE DEPARTMENT CANNOT GO BACKWARD TO DISBELIEVE THE CLAIMED AVAILABILITY OF CASH. THE RATIO LAID DOWN IN PARMESHWAR BOHRA (2008) 301 ITR 0404 EVEN THOUGH RENDERED IN THE CONTEXT OF S. 68, DIRECTLY SUPPORT THE ASSESSE. FURTHER ARGUMENT IN PARA 6.9 IS THAT THE LAW DOES N OT FORBID THE AO TO VERIFY DEBTORS FROM WHOM RECOVERIES WERE MADE BUT THEN ABO VE CONTENTION ADEQUATELY ANSWERS THIS OBJECTION ALSO OF THE CIT. 10.6 PARA 6.10 - THE LD. CIT AGAIN REPEATS THE SAME ARGUMENTS WHICH WE HAVE ALREADY ANSWERED HERE AND ALSO IN OUR DETAILED SUBMISSIONS. THUS, THE AO EVIDENTLY ACTED COMPLETELY IN ACCORDANCE WITH LA W, DULY AND FULLY APPLYING HIS MIND BY CALLING FOR ALL THE RELEVANT DETAILS AN D THE HAS TAKEN A POSSIBLE VIEW AND DID NOT FIND ANY CONTRARY MATERIAL OR SUSP ICIOUS OR ANYTHING RAISING HIS SUSPICION. 11. RULE OF CONSISTENCY IGNORED: AFTER GOING THROUG H THE PRINCIPLE LAID DOWN BY THE HONBLE APEX HIGH COURT AND OTHER HIGH COURTS, IT WILL BE CLEAR THAT THE CONTENTION OF THE LD. CIT WAS COMPLETELY FALLACIOUS AND IGNORING THE RULE OF CONSISTENCY. 11.1 GODREJ & BOYCE MANUFACTURING COMPANY LTD. VS. DY. COMMISSIONER OF INCOME-TAX & ANR. [CIVIL APPEAL NO. 7020 OF 2011] 38. IN THE PRESENT CASE, WE DO NOT FIND ANY MENTIO N OF THE REASONS WHICH HAD PREVAILED UPON THE ASSESSING OFFICER, WHI LE DEALING WITH THE ASSESSMENT YEAR 2002-2003, TO HOLD THAT THE CLAIMS OF THE ASSESSEE ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 28 THAT NO EXPENDITURE WAS INCURRED TO EARN THE DIVIDE ND INCOME CANNOT BE ACCEPTED AND WHY THE ORDERS OF THE TRIBUNAL FOR THE EARLIER ASSESSMENT YEARS WERE NOT ACCEPTABLE TO THE ASSESSI NG OFFICER, PARTICULARLY, IN THE ABSENCE OF ANY NEW FACT OR CHA NGE OF CIRCUMSTANCES. NEITHER ANY BASIS HAS BEEN DISCLOSED ESTABLISHING A REASONABLE NEXUS BETWEEN THE EXPENDITURE DISALLOWED AND THE DIVIDEND INCOME RECEIVED. THAT ANY PART OF THE BORROWINGS OF THE ASSESSEE HAD BEEN DIVERTED TO EARN TAX FREE INCOME DESPITE THE AVAILABILITY OF SU RPLUS OR INTEREST FREE FUNDS AVAILABLE (RS. 270.51 CRORES AS ON 1.4.2001 A ND RS. 280.64 CRORES AS ON 31.3.2002) REMAINS UNPROVED BY ANY MAT ERIAL WHATSOEVER. WHILE IT IS TRUE THAT THE PRINCIPLE OF RES JUDICATA WOULD NOT APPLY TO ASSESSMENT PROCEEDINGS UNDER THE ACT, THE NEED FOR CONSISTENCY AND CERTAINTY AND EXISTENCE OF STRONG AND COMPELLING RE ASONS FOR A DEPARTURE FROM A SETTLED POSITION HAS TO BE SPELT O UT WHICH CONSPICUOUSLY IS ABSENT IN THE PRESENT CASE. IN THI S REGARD WE MAY REMIND OURSELVES OF WHAT HAS BEEN OBSERVED BY THIS COURT IN RADHASOAMI SATSANG VS. COMMISSIONER OF INCOME-TAX[6 ]. 'WE ARE AWARE OF THE FACT THAT STRICTLY SPEAKING RE S JUDICATA DOES NOT APPLY TO INCOME TAX PROCEEDINGS. AGAIN, EACH ASSESS MENT YEAR BEING A UNIT, WHAT IS DECIDED IN ONE YEAR MAY NOT APPLY IN THE FOLLOWING YEAR BUT WHERE A FUNDAMENTAL ASPECT PERMEATING THROUGH T HE DIFFERENT ASSESSMENT YEARS HAS BEEN FOUND AS A FACT ONE WAY O R THE OTHER AND PARTIES HAVE ALLOWED THAT POSITION TO BE SUSTAINED BY NOT CHALLENGING THE ORDER, IT WOULD NOT BE AT ALL APPROPRIATE TO AL LOW THE POSITION TO BE CHANGED IN A SUBSEQUENT YEAR.' 11.2 DCIT V/S GUJARAT NARMADA VALLEY FERTILIZERS C O. LTD. (2013) 84 CCH 271 GUJHC: (2013) 215 TAXMAN 72 (GUJARAT) ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 29 PRELIMINARY EXPENSESAMORTIZATION OF CERTAIN PRELIM INARY EXPENSES ASSESSEE CLAIMED DEDUCTION U/S. 35DAO RESTRICTED D EDUCTION ON GROUND THAT ONLY ELIGIBLE EXPENSES WERE ALLOWED TO BE SPREAD OVER U/S. 35D AND THEREFORE, EXPENSES ONLY TO EXTENT THAT HAD NEXUS TO ELIGIBLE PROJECTS WERE ADMISSIBLE HOWEVER, TRIBUNAL, NOTED THAT IN LAST SEVEN YEARS, NO SUCH DISALLOWANCES WERE MADE AND DIRECTED SUCH BENEFIT TO BE GRANTEDHELD, SINCE LAST SEVERAL YEARS, AO HAD GRANTED SUCH CLAIM ON SAME CONSIDERATIONFOLLOWING RULE OF CONSISTENCY , TRIBUNAL THEREFORE, CORRECTLY HELD THAT SUCH CLAIM COULD NOT HAVE BEEN SUDDENLY DISALLOWEDREVENUES APPEAL DISMISSED 12. SUPPORTING CASE LAWS ON S. 263: 12.1 KINDLY REFER CIT V/S RAJASTHAN FINANCIAL CORPORATIO N (1996) 134 CTR 145 (RAJ). (DPB 52-55) HELD THAT: ONCE ASSESSING OFFICER HAS MADE ENQUIRIES DURING TH E COURSE OF ASSESSMENT PROCEEDINGS ON THE RELEVANT ISSUES AND T HE ASSESSEE HAS GIVEN DETAILED EXPLANATION BY A LETTER IN WRITING A ND THE ASSESSING OFFER ALLOWED THE CLAIM BEING SATISFIED WITH THE EXPLANAT ION OF ASSESSEE, THE DECISION OF THE ASSESSING OFFICER CANNOT BE HELD TO BE ERRONEOUS SIMPLY BECAUSE IN HIS ORDER NOT MAKE AN ELABORATE DISCUSSI ON IN THAT REGARD. 12.2 IN CIT V/S GANPAT RAM BISHNOI (2005) 198 CTR ( RAJ) 546 (DPB 56- 59) HELD THAT FROM THE RECORD OF THE PROCEEDINGS, IN TH E PRESENT CASE, NO PRESUMPTION CAN BE DRAWN THAT THE AO HAD NOT APPLIE D ITS MIND TO THE VARIOUS ASPECTS OF THE MATTER. IN SUCH CIRCUMSTANCES, WITHO UT EVEN PRIMA FACIE LAYING FOUNDATION FOR HOLDING THAT ASSESSMENT ORDER IS ERR ONEOUS AND PREJUDICIAL TO INTEREST IN ANY MATTER MERELY ON SPACIOUS GROUND TH AT THE AO WAS REQUIRED TO MAKE AN ENQUIRY, CANNOT BE HELD TO SATISFY THE TEST OF EXISTING NECESSARY CONDITION FOR INVOKING JURISDICTION U/S 263. JURISD ICTION U/S 263 CANNOT BE INVOKED FOR MAKING SHORT ENQUIRIES OR TO GO INTO TH E PROCESS OF ASSESSMENT AGAIN AND AGAIN MERELY ON THE BASIS THAT MORE ENQUI RY OUGHT TO HAVE BEEN ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 30 CONDUCTED TO FIND SOMETHING. 12.3 IN GABRIEL INDIA LTD. [1993] 203 ITR 108 (BOM), LAW ON THIS ASPECT WAS DISCUSSED IN THE FOLLOWING MANNER (PAGE 113): . . . FROM A RENDING OF SUB- SECTION (1) OF SECTION 263, IT IS CLEAR THAT T HE POWER OF SUOMOTU REVISION CAN BE EXERCISED BY THE COMMISSIONER ONLY IF, ON EX AMINATION OF THE RECORDS OF ANY PROCEEDINGS UNDER THIS ACT, HE CONSIDERS THA T ANY ORDER PASSED THEREIN BY THE INCOME-TAX OFFICER IS ERRONEOUS IN SO FAR A S IT IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE . IT IS NOT AN ARBITRARY OR UNCHARTERED POWER, IT CAN BE EXERCISED ONLY ON FULFILMENT OF THE REQUIREMENTS LAID DOWN IN SUB-SECTION (1). THE CONSIDERATION OF THE COMMISSIONER AS TO WH ETHER AN ORDER IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INT ERESTS OF THE REVENUE, MUST BE BASED ON MATERIALS ON THE RECORD OF THE PROCEEDINGS CALLED FOR BY HIM. IF THERE ARE NO MATERIALS ON RECORD ON THE BASIS OF WHICH IT CAN BE SAID THAT THE COMMISSIONER ACTING IN A REASONABLE MANNER COULD HA VE COME TO SUCH A CONCLUSION, THE VERY INITIATION OF PROCEEDINGS BY H IM WILL BE ILLEGAL AND WITHOUT JURISDICTION. THE COMMISSIONER CANNOT INITIATE PROC EEDINGS WITH A VIEW TO STARTING FISHING AND ROVING ENQUIRIES IN MATTERS OR ORDERS WHICH ARE ALREADY CONCLUDED. SUCH ACTION WILL BE AGAINST THE WELL-ACC EPTED POLICY OF LAW THAT THERE MUST BE A POINT OF FINALITY IN ALL LEGAL PROC EEDINGS, THAT STALE ISSUES SHOULD NOT BE REACTIVATED BEYOND A PARTICULAR STAGE AND THAT LAPSE OF TIME MUST INDUCE REPOSE IN AND SET AT REST JUDICIAL AND QUASI-JUDICIAL CONTROVERSIES AS IT MUST IN OTHER SPHERES OF HUMAN ACTIVITY. 12.4 IN ANOTHER CASE OF NARAIN SINGLA V. PCIT [2 015] 62 TAXMANN.COM 255 (CHANDIGARH - TRIB.) (DPB 67-76) IT WAS HELD THAT WHEN ASSESSING OFFICER WAS FULLY AWARE OF MATTER, HE HAD APPRAISED EVIDENC ES FILED BY ASSESSEE AND THEN HAD FORMED A VIEW TO ACCEPT SAME, COMMISSIONER WAS UNJUSTIFIED IN INVOKING JURISDICTION UNDER SECTION 263. WHETHER IF THERE WAS AN ENQUIRY, EVEN INADEQUATE, THAT WOULD NOT, BY ITSELF, GIVE OCCAS ION TO COMMISSIONER TO PASS ORDER UNDER SECTION 263, MERELY BECAUSE HE HAS A DI FFERENT OPINION IN MATTER; IT IS ONLY IN CASE OF 'LACK OF INQUIRY' THAT SUCH A CAUSE OF ACTION CAN BE OPEN. ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 31 12.5 IN ANOTHER CASE OF SANSPAREILS GREENLANDS (P .) LTD. V. CIT [2018] 99 TAXMANN.COM 222 (DELHI - TRIB.), IT WAS HELD THAT A SSESSEE-COMPANY, ENGAGED IN MANUFACTURE, PURCHASE, SALE AND EXPORT OF SPORTS GOODS, CLAIMED EXPENDITURE TOWARDS PAYMENTS MADE TO CRICKET PLAYER S UNDER HEAD 'ADVERTISEMENT AND PUBLICITY' - ASSESSING OFFICER, AFTER MAKING ENQUIRIES AND CONSIDERING EXPLANATION FURNISHED BY ASSESSEE ALLOW ED SAID EXPENDITURE - SUBSEQUENTLY, COMMISSIONER, EXERCISING POWER UNDER SECTION 263, DISALLOWED EXPENDITURE CLAIMED BY ASSESSEE ON GROUND THAT ASSE SSING OFFICER HAD FAILED TO MAKE AN INQUIRY IN THIS REGARD - IT WAS NOTED TH AT IT WAS NOT DEPARTMENT'S CASE THAT NO INFORMATION REGARDING PAYMENTS MADE TO CRICKETERS WAS CALLED FOR BY ASSESSING OFFICER - RELEVANT DETAILS AND DOCUMEN TS WERE FURNISHED BY ASSESSEE DURING ASSESSMENT PROCEEDINGS WHICH FORMED PART OF RECORD - HENCE, NO INFERENCE COULD BE DRAWN THAT ASSESSING OFFICER HAD NOT EXAMINED ISSUE ALTHOUGH HE HAD NOT EXPRESSED IT IN AS MANY TERMS A S MIGHT BE CONSIDERED APPROPRIATE BY COMMISSIONER - WHETHER SECTION 263 D OES NOT VISUALIZE A CASE OF SUBSTITUTION OF JUDGMENT OF COMMISSIONER FOR THA T OF ASSESSING OFFICER UNLESS DECISION IS HELD TO BE ERRONEOUS - HELD, YES - WHETHER, ONCE IMPUGNED ISSUE WAS CONSIDERED AND EXAMINED BY ASSESSING OFFI CER, COMMISSIONER COULD NOT SET ASIDE ORDER WITHOUT RECORDING A CONTRARY FI NDING; THEREFORE, IMPUGNED ACTION OF COMMISSIONER UNDER SECTION 263 WAS PATENT LY ILLEGAL AND WAS LIABLE TO BE QUASHED. 12.6 IN CASE OF RAJMAL KANWAR V. CIT-I [2017] 82 TAXMAN N.COM 119 (JAIPUR- TRIB.) (DPB 77-88) IT WAS HELD THAT ORDERS PREJUDIC IAL TO INTEREST OF REVENUE- ASSESSMENT YEAR 2011-12 - WHERE ASSESSING OFFICER H AD MADE SUFFICIENT ENQUIRIES, CONSIDERED SURVEY RECORDS AND SURRENDER MADE BY ASSESSEE AND AFTER CONSIDERING SUBMISSIONS OF ASSESSEE COMPLETED ASSESSMENT PROCEEDINGS UNDER SECTION 143(3), ASSESSMENT ORDER COULD NOT BE HELD TO BE AN ERRONEOUS ORDER WHICH WAS PREJUDICIAL TO INTEREST OF REVENUE. ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 32 12.7 IN THE CASE OF ABDUL HAMID V. INCOME-TAX OFFICER [2 020] 117 TAXMANN.COM 986 (GAUHATI - TRIB.) IT WAS HELD THAT ONLY PROBABILITY AND LIKELIHOOD TO FIND ERROR IN ASSESSMENT ORDER IS NOT PERMITTED U/S 263. IN VIEW OF THE ABOVE SUBMISSIONS AND THE JUDICIAL G UIDELINE, THE IMPUGNED ORDER PASSED U/S 263 DESERVES TO BE QUASHED. 5. PER CONTRA, THE LD. PR CIT/DR RELIED ON THE FIND INGS OF THE LD. PR. CIT IN THE IMPUGNED ORDER PASSED U/S 263 OF THE ACT AND OU R REFERENCE WAS DRAWN TO THE FINDINGS OF THE LD. PR. CIT AT PARA 6.4, 6.5 & 6.9 AND 6.10 OF HIS ORDER WHICH READS AS UNDER:- 6.4 THE ENTIRE SUBMISSION OF THE ASSESSEE AS DISCU SSED IN PRECEDING PARAGRAPHS OF THIS ORDER IS NOT FOUND TO BE ACCEPTA BLE AFTER CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE. FIRST OF ALL I T IS MENTIONED THAT THE CLAIM OF THE ASSESSEE IS THAT DURING THE F.Y 2015-16, REC OVERIES OF CASH AMOUNT OF RS. 85,00,000/- WERE MADE FROM THE DEBTORS TO WHOM EARLIER SUCH AMOUNTS OF ADVANCES WERE GIVEN, BUT SUCH CLAIM OR SUBMISSION O F THE ASSESSEE IS NOT SUPPORTED BY ANY EVIDENCES, FACTS AND FIGURES AND T HIS IS A MERE CLAIM WITHOUT ANY BASIS. THE AO HAS MERELY ACCEPTED THE S UBMISSION OF THE ASSESSEE WITHOUT MAKING ANY INDEPENDENT ENQUIRIES I N RESPECT OF THE DEBTORS FROM WHOM SUBSTANTIAL CASH AMOUNTS OF RS. 8 5,00,000/- ARE CLAIMED TO HAVE BEEN RECOVERED BY THE ASSESSEE WHIC H WERE EARLIER GIVEN TO THEM IN THE FORM OF ADVANCES AND THAT TO IN A.Y. 2008-09. THE MERE SUBMISSIONS OF THE ASSESSEE THAT OUT OF SURRENDERED AND DECLARED INCOME OF RS. 1,96,37,930/- DURING THE SURVEY PROCEEDINGS ON 13.02.2008, AN AMOUNT OF RS. 1,59,00,000/- WERE THE ADVANCES AND I NVESTMENT AND CASH REALIZATION FROM THE ADVANCES AND INVESTMENT WERE R ECORDED IN THE CASH BOOK FOR THE YEAR 2015-16 AND HENCE CASH IN HAND AS ON WAS OF RS. 85,80,796/- HAS MERELY BEEN ACCEPTED BY THE AO WITH OUT VERIFYING THE CORRECTNESS OF STATEMENT OF THE ASSESSEE. RATHER, T HE AO HAS MERELY ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 33 ACCEPTED THIS SUBMISSION OF THE ASSESSEE WITHOUT MA KING ANY ENQUIRY AND VERIFICATION AND HE HAS RELIED UPON THE CASH BOOK O F THE ASSESSEE. THE EXISTENCE OF THE DEBTORS FROM WHOM RECOVERY OF SUBS TANTIAL CASH AMOUNTS OF RS. 85,00,000/- ARE CLAIMED TO HAVE BEEN MADE BY THE ASSESSEE HAS NOT BEEN ENQUIRED INTO. THE DETAILS REGARDING IDENTITIE S OF THE DEBTORS I.E. THE NAME AND ADDRESSES AND ALSO THE GENUINENESS OF TRAN SACTIONS WITH REGARD TO RECOVERIES OF SUCH CASH AMOUNTS OF RS. 85,00,000 /- HAVE NEITHER BEEN OBTAINED BY THE AO FROM THE ASSESSEE DURING THE COU RSE OF ASSESSMENT PROCEEDING NOR ANY SPECIFIC QUERIES ON THIS ISSUE H AVE BEEN RAISED BY HIM. 6.5 THE FACT IS THAT THE COMPLETE DETAILS OF THE DE BTORS (I.E. THEIR NAME AND ADDRESSES) FROM WHOM RECOVERIES OF RS. 85,00,00 0/- ARE CLAIMED TO HAVE BEEN ARE NOT FOUND TO BE AVAILABLE EITHER IN T HE ASSESSMENT RECORDS OR IN THE SUBMISSION OF THE ASSESSEE AND WHICH IS V ITAL ASPECT OF THE CASE AND THIS ASPECT CANNOT BE IGNORED IN ANY WAY. THIS IS MORE PARTICULARLY IN VIEW OF THE FACT THAT EACH YEAR IS A SEPARATE ASSES SMENT YEAR AND THE CASE OF THE ASSESSEE FOR ANY PARTICULAR ASSESSMENT YEAR REQUIRED TO BE SCRUTINIZED AFTER CONSIDERING THE FACTS AND MERITS OF THE CASE FOR SUCH YEAR ONLY. MERELY ON THE BASIS OF CERTAIN DETAILS AND CA SH BOOK ETC. FILED BY THE ASSESSEE IT CANNOT BE SAID THAT THE ASSESSEE WAS HA VING CASH AMOUNT OF RS. 85,00,000/- WHICH WERE REALIZED FROM THE ADVANC ES AND INVESTMENT AND WERE RECORDED IN THE CASH BOOK FOR A.Y. 2015-16. IF MERELY BOOKS OF ACCOUNTS AND SUBMISSION OF THE ASSESSEE ARE RELIED UPON WITHOUT MAKING INDEPENDENT ENQUIRIES IN RESPECT OF THE DEBTORS AND WITHOUT VERIFYING THE GENUINENESS OF TRANSACTIONS IN RESPECT OF REALIZATI ON OF SUBSTANTIAL AMOUNTS OF CASH FROM THE DEBTORS, THEN THE VERY PURPOSE OF MAKING SCRUTINY OF THE CASE OF THE ASSESSEE FOR THE YEAR UNDER CONSIDERATI ON WILL BE DEFEATED. IT IS NOT EXAMINED BY THE AO AS TO WHETHER THE DEBTORS AR E ACTUALLY EXISTING AND THEY ARE ASSESSED TO TAX AND ARE FILING THEIR R EGULAR RETURNS OF INCOME. THE CREDIT WORTHINESS OF THE DEBTORS ARE NOT EXAMINED. THE NATURE OF ADVANCES MADE TO THE DEBTORS ARE NOT VERIFIED. ANY CONFIRMATIONS FROM THE ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 34 DEBTORS HAVE NOT BEEN OBTAINED BY THE AO EITHER FRO M THE ASSESSEE OR FROM THE DEBTORS ITSELF. ON VERIFICATION OF ASSESSMENT R ECORDS OF THE ASSESSEE, IT IS SEEN THAT THE AO HAS MERELY ACCEPTED THE SUBMISS ION AND RECORDS OF THE ASSESSEE AND HE HAS NOT APPLIED HIS MIND AND HE HAS NOT MADE ANY NECESSARY VERIFICATION WHICH SHOULD HAVE BEEN MADE AND THIS FAILURE ON THE PART OF THE AO HAS RENDERED THE ASSESSMENT ORDER NO T ONLY ERRONEOUS, BUT ALSO PREJUDICIAL TO THE INTEREST OF REVENUE. 6.9 ONE OF THE ARGUMENTS OF THE ASSESSEE IS THAT IN THE BALANCE SHEET FILLED IN THE RETURN OF INCOME FOR A.Y. 2011-12, THE SUNDRY A DVANCES INCREASED TO RS. 82 LACS AND THEREAFTER TO RS. 92 L ACS. AS PER THE ASSESSEE THE MOMENT THERE IS INCREASE/DECREASE IN THE SUNDRY ADVANCES (DEBTORS) AND INCREASE IN THE CASH/BANK BALANCES IN THE INTER VENING PERIOD (I.E. A.Y. 2008-09 TO A.Y. 2016-17), THIS FACT HAS ITSELF ESTA BLISHED THAT THERE DID EXIST THE SUNDRY ADVANCES (DEBTORS) AND RECOVERIES WERE M ADE FROM THEM. AS PER THE ASSESSEE EXISTENCE OF SUNDRY ADVANCES (DEBT ORS) OF RS. 85 LACS IS WELL ESTABLISHED. IF ARGUMENT OF THE ASSESSEE IS TH AT THERE DID EXIST THE SUNDRY ADVANCES (DEBTORS) THEN IT IS NOT UNDERSTAND ABLE AS TO WHY DETAILS I.E. IDENTITY OF SUCH DEBTORS ARE NOT DISCLOSED AND DETAILS REGARDING CREDITWORTHINESS OF SUCH DEBTORS AND GENUINENESS OF TRANSACTIONS ARE NOT FURNISHED. ANOTHER ARGUMENT OF THE ASSESSEE IS THAT THIS AMOUNT OF RS. 85 LACS WAS AN UNDISCLOSED INCOME OFFERED AT THE TIME OF SURVEY, THIS COULD BE AVAILABLE IN ANY FORM, BE IT CASH, SUNDRY ADVANCES (DEBTORS) OR FIXED ASSETS. AS PER THE ASSESSEE THE DEPARTMENT NEVER DOUBTED NO R REBUTTED THE ASSERTION OF THE ASSESSEE THAT SUCH UNDISCLOSED INC OME OF ASSESSEE IS LYING IN SUNDRY ADVANCES (DEBTORS) AND NO EVIDENCE WAS RE QUIRED EARLIER IN SUPPORT THEREOF. AS PER THE ASSESSEE THEREFORE, IF NOW THE ASSESSEE CLAIMS TO HAVE MADE RECOVERIES IN CASH FROM THOSE SUNDRY A DVANCES (DEBTORS), THE AO WAS NOT SUPPOSED TO MAKE FURTHER INVESTIGATION F OR THE SIMPLE REASON THAT EVEN ASSUMING THAT THE ASSESSEE FAILED TO FURN ISH THE SAME THEN TOO THE AO COULD NOT HAVE MADE ANY ADDITION TO THE INCO ME IN RELATION THERE TO. ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 35 BUT THIS ARGUMENT OF THE ASSESSEE IS NOT ACCEPTABLE AS THE LAW DOES NOT FORBID THE AO TO VERIFY THE DEBTORS FROM WHOM RECOV ERIES OF ADVANCES OF SUBSTANTIAL AMOUNTS OF RS. 85,00,009/- ARE CLAIMED TO HAVE BEEN MADE IN CASH AND RATHER IT WAS NECESSARY FOR THE AO TO VERI FY THIS VITAL ASPECT OF THE CASE. 6.10 IN VIEW OF THE FACTS AND LEGAL POSITION AS DIS CUSSED IN PRECEDING PARAGRAPHS OF THIS ORDER, IT IS HELD THAT THE AO HAS FAILED TO EXAMINE AND VERIFY THE CLAIM OF THE ASSESSEE WITH REGARD TO ADV ANCES MADE TO THE DEBTORS IN CASH AND THE CLAIM OF THE ASSESSEE WITH REGARD TO RECOVERIES OF SUCH SUNDRY ADVANCES OF CASH AMOUNT OF RS. 85 LACS AS MADE FROM THE DEBTORS BY WAY OF CALLING FOR RELEVANT DETAILS AND DOCUMENTS FROM THE ASSESSEE AND ALSO BY WAY OF MAKING INDEPENDENT INQU IRIES WITH SUCH DEBTORS AND THIS FAILURE ON THE PART OF THE AO HAS RENDERED THE ASSESSMENT ORDER U/S 143(3) OF THE ACT ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTEREST OF REVENUE. THUS, THE ASSESSMENT ORDER U/S 143(3) OF THE I.T. ACT FOR A.Y 2016-17 IS HEREBY CANCELLED/SET ASIDE AND T HE AO IS DIRECTED TO EXAMINE THE IDENTITY OF THE DEBTORS, GENUINENESS OF TRANSACTION WITH REGARD TO ADVANCES OF RS. 85,00,000/- MADE TO THE DEBTORS AND RECOVERY OF ADVANCES OF CASH AMOUNT OF RS. 85,00,000/- MADE FRO M SUCH DEBTORS (AS CLAIMED BY THE ASSESSEE) AND IS ALSO D IRECTED TO EXAMINE THE CREDITWORTHINESS OF THE SUCH DEBTORS. ON THE BASIS OF OUTCOME OF SUCH EXAMINATION AND VERIFICATION, THE AO IS DIRECTED TO MAKE NECESSARY ADDITION, WHEREVER REQUIRED, IN ACCORDANCE WITH THE PROVISION S OF INCOME TAX ACT, TO THE TOTAL INCOME OF THE ASSESSEE. HOWEVER, THE AO I S DIRECTED TO ENSURE THAT REASONABLE OPPORTUNITY OF BEING HEARD IS GRANTED TO THE ASSESSEE BEFORE PASSING THE ORDER. 6. FURTHER, THE LD PCIT/DR HAS PLACED RELIANCE ON T HE FOLLOWING DECISIONS:- ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 36 7. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE LEGAL PROPOSITION LAID DOWN BY VARI OUS COURTS REGARDING THE EXERCISE OF POWERS U/S 263 HAVE TO BE SEEN IN LIGHT OF FACTS AND CIRCUMSTANCES OF THE PRESENT CASE. IN THIS CASE, IT IS NOTED THA T THE ASSESSING OFFICER HAD ISSUED NOTICE U/S 142(1) DATED 23.10.2017 WHERE, INTER-ALIA , HE HAD ASKED THE ASSESSEE TO FURNISH THE DETAILS OF ALL HIS BANK ACC OUNTS EXPLAINING THE CREDIT ENTRIES AND ALL CASH DEPOSITS AS WELL AS DEBIT ENTR IES AND ALL CASH WITHDRAWALS ALONG WITH THE COPY OF THE BANK STATEMENTS. IN RESP ONSE, THE ASSESSEE VIDE HIS SUBMISSION DATED 16.11.2017 SUBMITTED THE COPIES OF ALL HIS BANK ACCOUNT STATEMENTS AS WELL AS LEDGER ACCOUNTS IN THE BOOKS OF ACCOUNTS MAINTAINED BY HIM IN RESPECT OF THREE BANK ACCOUNTS MAINTAINED BY HIM DURING THE PERIOD UNDER CONSIDERATION. IT IS FURTHER NOTED THAT THE A SSESSING OFFICER THEREAFTER ISSUED ANOTHER NOTICE U/S 142(1) DATED 07.06.2018 W HEREIN THE ASSESSEE WAS AGAIN ASKED TO EXPLAIN THE CREDIT ENTRIES AND ALL C ASH DEPOSITS IN THE BANK ACCOUNT AS WELL AS DEBIT AND ALL CASH WITHDRAWAL IN THE BANK ACCOUNT. FURTHER, THE ASSESSEE WAS ASKED SPECIFICALLY TO EXPLAIN AS T O WHETHER YOU HAVE DEPOSITED ANY CASH AMOUNT IN DEMONETIZED CURRENCY D URING THE PERIOD BEGINNING FROM 8 TH NOVEMBER, 2016 TO 30 DECEMBER, 2016 AND CASH IN HA NDS SHOWN IN THE F.Y 2015-16 AND F.Y 2016-17. IN HIS RESPONSE DATED 07.07.2018, THE ASSESSEE SUBMITTED THAT HE HAD DEPOSITED DEMONE TIZED CURRENCY DURING THE PERIOD 8.11.2016 TO 30.12.2016 WHICH WAS VERIFIABLE FROM THE BALANCE SHEET AS ON 31.03.2016 AND COPIES OF LEDGER ACCOUNT FOR EXPL ANATION OF BANK ENTRIES S. NO. DESCRIPTION OF THE CASE PAGE NO. 1 [1963] 49 ITR 112 (SC) SREELEKHA BANERJEE VS. CIT 1 - 10 2 [2012] 20 TAXMANN.COM 462 (PUNJ. & HAR.) ZAVERI DIAMONDS V. CIT, LUDHIANA 11 - 20 3 [2012] 25 TAXMANN.COM 552 (SC) ZAVERI DIAMONDS VS. CIT 21 - 22 4 [2000] 109 TAXMAN 66 (SC) MALABAR INDUSTRIAL CO. LT D. VS. CIT 23 - 28 5 DENIAL MERCHANTS P. LTD. VS. INCOME TAX OFFICER ON 29 NOVEMBER, 2017 25 - 30 ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 37 UNDERTAKEN DURING THE YEAR UNDER CONSIDERATION WAS SUBMITTED AS PER EARLIER SUBMISSIONS. THEREAFTER, THE ASSESSEE VIDE HIS SUB MISSION DATED 12.11.2018 SUBMITTED THE SCANNED COPY OF THE CASH BOOK FOR THE F.Y 2015-16 AND ALSO SUBMITTED EXPLANATION REGARDING AMOUNT OF CASH DEPO SITED ON 16.11.2016 AND THE EXPLANATION SO FURNISHED BY THE ASSESSEE READS AS UNDER:- 2. THE ASSESSEE HAS DEPOSITED SBN OF RS. 85,00,000 /- WITH SBBJ GUMANPURA, KOTA ON 16.11.2016. WE FURTHER CLARIFY T HAT THE ASSESSEE SURRENDERED AND DECLARED INCOME OF RS. 1,96,37,930/ - DURING THE SURVEY PROCEEDINGS ON 13/02/2018. OUT OF SUCH AMOUNT, RS. 1,59,00,000/- WERE IN THE NATURE OF SUNDRY ADVANCES AND INVESTMENTS. C ASH REALIZATION FROM THE ADVANCES AND INVESTMENTS WERE RECORDED IN THE C ASH BOOK FOR THE YEAR 2015-16, HENCE CASH IN HAND AS ON WAS OF RS. 8 5,80,796/- WHICH IS VERIFIABLE FROM THE CASH BOOK. IN SUPPORT OF EVIDEN CES, WE ARE ALSO SUBMITTING INCOME & EXPENDITURE FOR THE YEAR 2007-0 8 AND BALANCE SHEET AS AT 31.03.2008, INCOME TAX ASSTT. ORDER U/S 143(3) OF THE INCOME TAX ACT, 1961 WITH NOTICE OF DEMAND, COPY OF ITR, COMPUTATION OF INCOME FOR THE A.Y 2008-09. 8. IT IS NOTED THAT THE ASSESSING OFFICER AGAIN SOU GHT FURTHER DOCUMENTATION AND EXPLANATION REGARDING AVAILABILITY OF CASH IN H AND AND IN RESPONSE, THE ASSESSEE VIDE SUBMISSION DATED 22.11.2018 SUBMITTED COPY OF THE HIS ITRS AND BALANCE SHEETS AND INCOME AND EXPENDITURE ACCOUNTS RIGHT FROM F.Y 2008-09 TO F.Y 2014-15 AND THE EXPLANATION REGARDING DEPOSIT O F CASH WAS AGAIN SUBMITTED WHICH READS AS UNDER:- 2. IT IS ALREADY CLARIFIED THAT THE ASSESSEE SURRE NDERED AND DECLARED INCOME OF RS. 1,96,37,930/- DURING THE SURVEY PROCE EDINGS ON 13/02/2008. OUT OF SUCH AMOUNT, RS. 1,59,00,000/- W ERE IN THE NATURE OF SUNDRY ADVANCES AND INVESTMENTS AS PER BALANCE SHEE T AS AT 31.03.2008. CASH HAND/SUNDRY ADVANCES/INVESTMENTS O F RS. 85.00 LAKHS OR MORE HAVE BEEN CONTINUOUSLY APPEARING ON ASSETS SIDE OF THE BALANCE SHEETS FROM F.Y 2009 TO F.Y 2015. COPIES OF ITR, BA LANCE SHEET AND ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 38 INCOME & EXPENDITURE FOR A.Y 2009-10 TO A.Y 2015-16 ARE ENCLOSED HEREWITH IN SUPPORT OF AVAILABILITY OF FUNDS WITH T HE ASSESSEE WHICH WAS DEPOSITED DURING THE F.Y 2016-17. THE ASSESSEE HAS BEEN REGULARLY FILING INCOME TAX RETURNS SINCE A.Y 2008-09. THE ASSESSEE HAS ALREADY DEPOSITED TAX ON DECLARED INCOME OF RS. 1,96,37,930 /- IN A.Y 2008-09 AND CASE WAS COMPLETELY/ASSESSED UNDER SCRUTINY SCH EME. COPY OF ORDER HAS ALREADY SUBMITTED WITH THE PREVIOUS LETTER DATE D 12.11.2018. THE ASSESSEE WAS HAVING SUFFICIENT CASH IN HAND WIT H HIM OUT OF WHICH CASH OF RS. 85,00,000/- WAS DEPOSITED IN BANK. 9. WE THEREFORE FIND THAT THE ASSESSING OFFICER HA S CARRIED OUT EXHAUSTIVE ENQUIRIES AND VERIFICATIONS REGARDING SOURCE OF CAS H DEPOSITS IN THE BANK ACCOUNT DURING THE FINANCIAL YEAR RELEVANT TO IMPUG NED ASSESSMENT YEAR. THE BANK STATEMENTS, THE CASH BOOK, THE LEDGER ACCOUNTS , THE FINANCIAL STATEMENTS FOR THE YEAR UNDER CONSIDERATION AND FOR THE EARLIE R YEARS, THE TAX RETURNS FOR THE YEAR UNDER CONSIDERATION AND FOR THE EARLIER YE ARS HAVE BEEN CALLED AND EXAMINED BY THE ASSESSING OFFICER. AND WE FIND THA T IT IS NOT A CASE WHERE ALL THESE DOCUMENTATION WERE CALLED FOR AND MERELY PLAC ED ON RECORD AND THE ASSESSMENT WAS COMPLETED. RATHER, THE ASSESSING OF FICER HAS EXAMINED THESE DOCUMENTATION AND RAISED POINTED QUERIES AND SOUGHT EXPLANATION FROM TIME TO TIME REGARDING EACH AND EVERY TRANSACTION WHERE CAS H DEPOSITS HAVE BEEN MADE IN THE BANK ACCOUNTS AS TO NATURE AND SOURCE O F SUCH DEPOSITS AND SUCH ENQUIRY HAS NOT BEEN LIMITED TO TRANSACTIONS UNDERT AKEN DURING THE YEAR UNDER CONSIDERATION AND REFLECTION THEREOF IN THE BANK AN D CASH BOOK, RATHER, THE ASSESSING OFFICER HAS EXAMINED THE TRANSACTIONS PER TAINING TO CASH DEPOSITS IN THE SUBSEQUENT PERIOD I.E, FINANCIAL YEAR 2016-17 A ND HAS ASKED SPECIFIC QUESTIONS REGARDING DEPOSIT OF CASH DURING THE DEMO NIZATION PERIOD AS WELL AS EARLIER FINANCIAL YEAR AND HAS CALLED FOR CASH LEDG ER AND AVAILABILITY OF CASH IN HAND DURING THE FINANCIAL YEAR 2015-16 AND 2016-17 TO DETERMINE THE LINKAGE THEREOF WITH THE TRANSACTIONS UNDERTAKEN AND REFLEC TED DURING THE YEAR UNDER CONSIDERATION. ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 39 10. NOW COMING SPECIFICALLY TO THE EXPLANATION SUBM ITTED BY THE ASSESSEE IN SUPPORT OF THE CASH DEPOSITS AS REALIZATION FROM TH E ADVANCES AND INVESTMENTS RECORDED IN THE BOOKS OF ACCOUNTS OF THE EARLIER YE ARS, WE AGAIN FIND THAT THE ASSESSING OFFICER HAS RAISED SPECIFIC QUESTIONS AND EXAMINED THE FINANCIAL STATEMENTS AND INCOME TAX RETURNS RIGHT FROM A.Y 20 08-09 ONWARDS WHEREIN THE ASSESSEE HAS SURRENDERED AN AMOUNT OF RS 1,96,3 7,930/- TO TAX WHICH INCLUDES AN AMOUNT OF RS 1,59,00,000/- IN RESPECT O F UNEXPLAINED ADVANCES/INVESTMENT IN THE NAME OF ASSESSEE AND HIS FAMILY MEMBERS IN VARIOUS SCHEMES OF LAND/PLOT. ONCE THE SAID AMOUNT WAS SURRENDERED AND OFFERED TO TAX, THE ASSESSEE REFLECTED THE SAID AMO UNT OF RS 1,59,00,000/- UNDER THE HEAD SUNDRY ADVANCES AND INVESTMENTS IN HIS REGULAR BOOKS OF ACCOUNTS FOR THE FINANCIAL YEAR 2007-08 RELEVANT TO ASSESSMENT YEAR 2008-09. THE SAID ADVANCES WERE THEREAFTER REGULARLY REFLECT ED IN TERMS OF OUTSTANDING BALANCES NET OF RECOVERIES FROM TIME TO TIME IN THE FINANCIAL STATEMENTS AND BALANCE SHEETS FOR THE SUBSEQUENT FINANCIAL YEARS W HICH WERE ALSO PLACED ON RECORD AND EXAMINED BY THE ASSESSING OFFICER. IF W E LOOK AT THE BALANCE SHEET OF THE FINANCIAL YEAR 2014-2015 WHICH IS THE IMMEDI ATELY PRECEDING FINANCIAL YEAR, WE NOTE THAT THESE ADVANCES WERE STANDING IN THE BOOKS OF ASSESSEE AT RS 85,00,000/- WHICH AGAIN LENDS CREDENCE TO THE EX PLANATION THAT OUT OF TOTAL ADVANCES OF RS 1,59,00,000/-, THERE WERE RECOVERY T O THE EXTENT OF RS 74,00,000/- IN THE EARLIER YEARS AND THE ADVANCE S TO THE TUNE OF RS 85,00,000/- WERE OUTSTANDING AT THE BEGINNING OF THE CURRENT FINANCIAL YEAR 2015-16 OUT OF WHICH THE ADVANCES TO THE TUNE OF RS 75,00,000/- WERE RECOVERED DURING THE YEAR UNDER CONSIDERATION WITH REMAINING ADVANCES OF RS 10,00,000/- CONTINUES TO REMAIN OUTSTANDING AS O N THE CLOSE OF THE CURRENT FINANCIAL YEAR 2015-16. THE RECOVERY SO MADE FROM E ARLIER ADVANCES AS WELL AS CASH RECEIPTS FROM OTHER ACTIVITIES REPRESENT CASH IN HAND OF RS 85,80,796/- AS ON THE CLOSE OF THE CURRENT FINANCIAL YEAR WHICH HA S BEEN EXPLAINED AS SOURCE OF CASH DEPOSITS DURING THE DEMONETIZATION PERIOD IN T HE SUBSEQUENT FINANCIAL YEAR 2016-17. FURTHER, IT IS NOTED THAT THE TAX RETURNS FOR ALL THESE EARLIER ASSESSMENT YEARS INCLUDING THAT OF THE SUBSEQUENT ASSESSMENT Y EAR 2017-18 HAVE BEEN ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 40 FILED BY THE ASSESSEE AND ACCEPTED BY THE REVENUE W HICH IS AGAIN A CLEAR AFFIRMATION ON PART OF THE REVENUE THAT THE FINANCI AL STATEMENTS REPRESENT TRUE AND FAIR VIEW OF ASSESSEES AFFAIRS AND WHICH HAVE THUS NOT BEEN DISPUTED BY THE REVENUE. IN SUCH A SCENARIO, WHERE THE PAST AF FAIRS OF THE ASSESSEE AS REFLECTED IN HIS FINANCIAL STATEMENTS AND ALSO DISC LOSED IN THE TAX RETURNS HAVE NOT BEEN DISPUTED BY THE REVENUE, THE ASSESSMENTS H AVE BEEN COMPLETED AND NO ADVERSE MATERIAL IS AVAILABLE ON RECORD, IT IS B EYOND ANY REASONABLE BELIEF THAT THE ASSESSING OFFICER WILL HAVE ANY APPREHENSI ON THAT THE DEBTORS AND ADVANCES SO REFLECTED AND ACCEPTED IN THE EARLIER Y EARS ARE NOT GENUINE AND HAVE TO BE ENQUIRED AGAIN AFRESH IN TERMS OF IDENTI TY, CREDITWORTHINESS AND GENUINENESS OF THEIR INDIVIDUAL TRANSACTIONS. 11. IN SUCH A SCENARIO, WHERE THE ASSESSEE HAS SHOW N RECOVERY FROM OLD OUTSTANDING ADVANCES AND DEBTORS AND PROVIDED THE N ECESSARY FINANCIAL AND TAX FILING RECORDS AND THE ASSESSING OFFICER HAVING EXA MINED THE SAME THOROUGHLY, WE ARE OF THE CONSIDERED VIEW THAT THE NECESSARY EN QUIRIES AND EXAMINATION AS REASONABLY EXPECTED HAVE BEEN CARRIED OUT BY THE AS SESSING OFFICER IN DISCHARGE OF HIS QUASI-JUDICIAL FUNCTION AND HE HAS TAKEN A P RUDENT, JUDICIOUS AND REASONABLE VIEW IN ACCEPTING THE EXPLANATION OF THE ASSESSEE IN SUPPORT OF THE CASH DEPOSITS AFTER CONSIDERING THE ENTIRE MATERIAL AVAILABLE ON RECORD AND THE ORDER SO PASSED U/S 143(3) OF THE ACT CANNOT BE HEL D AS ERRONEOUS IN SO FAR AS PREJUDICIAL TO THE INTEREST OF REVENUE. THE IMPUGN ED ORDER PASSED BY THE LD PCIT U/S 263 IS ACCORDINGLY SET ASIDE AND THE ORDER OF THE ASSESSING OFFICER IS SUSTAINED. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOW ED. ORDER PRONOUNCED IN THE OPEN COURT ON 23/09/2021. SD/- SD/- LANHI XKSLKBZ FOE FLAG ;KNO ( SANDEEP GOSAIN ) (VIKRAM SINGH YADAV) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 41 TK;IQJ@ JAIPUR FNUKAD@ DATED:- 23/09/2021 * GANESH KR. VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- RAMESHWAR PRASAD SHRINGI, GUMANPURA, KOTA 2. IZR;FKHZ@ THE RESPONDENT- PR. CIT, UDAIPUR 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR. 6. XKMZ QKBZY@ GUARD FILE {ITA NO. 10/JP/2021} VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR ITA NO. 10-JP-2021 RAMESHWAR PRASAD SHRINGI VS. PR. CIT, UDAI PUR 42