Samir Yogendrabhai Parikh, Navsari V. The PCIT, Valsad, Valsad

ITA 102/SRT/2022

AI Insights

The case involves an appeal by Samir Yogendrabhai Parikh against the order of the Pr.CIT, Valsad, which revised the assessment order for the Assessment Year 2017-18 under Section 263 of the Income Tax Act, 1961. The original assessment had been completed under Section 143(3), where the Assessing Officer made an addition of Rs. 1.03 lakhs as unexplained cash credit from deposits made during the demonetization period. The Pr.CIT later found the assessment to be erroneous and prejudicial to the interests of the revenue, leading to a revision order. The Tribunal, however, found that the Assessing Officer had adequately examined the issues and that the revision was based on a mere change of opinion, which does not warrant a revision under Section 263.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 302065 (ITAT-SURAT)
• Duration Of Justice: 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-11-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 10-10-2022
• Assessment Year: misc
• Appeal Filed On: 03-11-2022
• Other Referred Cases: Malabar Industrial Co. Ltd. Vs. CIT, CIT Vs Nirma Chemical Works (P) Ltd., Gujarat Power Corporation Vs ACIT, Rayon Silk Mills Vs CIT, Hari Iron Trading Co. Vs CIT, CIT Vs Gabriel India Ltd., CIT Vs Vikas Polymers, CIT Vs Honda Siel Power Products, Gee Vee Enterprises Vs Addl. CIT, Ramesh Kumar Vs ITO, CIT Vs Sunbeam Auto Ltd., CIT Vs Anil Kumar Sharma, CIT Vs Vikas Polymers, CIT Vs Honda Siel Power Products, Malabar Industrial Co. Ltd. Vs. CIT, Kwality Steel Suppliers Vs CIT, CIT Vs Mehsana District Co-Op Milk Producers Union Ltd., CIT Vs D.P. Karia, CIT Vs Arvind Jewellers, Sir Dorabji Tata Trust Vs DCIT(E), Torrent Pharmaceuticals Vs DCIT, Aryan Arcade Ltd., Vs PCIT, CIT Vs Nirma Chemical Works (P) Ltd, CIT Vs Gabriel India Ltd, CIT Vs Vikas Polymers, CIT Vs Honda Siel Power Products
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Revision of order; Depreciation; Income from undisclosed sources; Earning of tax free income; Period of limitation; Difference of opinion; Change of opinion; Set aside
• Section: 68; 263; 143(3); 113; 22

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER AND DR. ARJUN LAL SAINI, ACCOUNTANT MEMBER ITA No. 102/Srt/2022 (Assessment Year: 2017-18) (Virtual hearing) Samir Yogendrabhai Parikh. Alka Society, Chhapara Road, Dist.-Navsari-396445, Gujarat. PAN No. ABGPP 6727 N Vs. The Pr.CIT, Valsad. Appellant/ assessee Respondent/ revenue Assessee represented by Sh.Tushar P. Hemani, Senior Advocate with Sh Parimalsinh B Parmar, Advocate Department represented by Shri Ritesh Mishra, CIT-DR Date of hearing 11/10/2022 Date of pronouncement 21/11/2022 Order under Section 254(1) of Income Tax Act PER: PAWAN SINGH, JUDICIAL MEMBER: 1. This appeal by the assessee is directed against the order of the learned Principal Commissioner of Income Tax, Valsad (in short, the ld. Pr.CIT) dated 30/03/2022 passed under Section 263 of the Income Tax Act, 1961 (in short, the Act) for the Assessment year (AY) 2017-18. The assessee has raised following grounds of appeal: “1. The learned Pr.CIT erred in passing an order u/s 263, when the jurisdictional conditions were not satisfied. 2. The learned Pr.CIT erred in assuming jurisdiction u/s 263 even though a detailed inquiry was carried out by the Assessing Officer on the issue pertaining to the cash deposits made by the Appellant firm during the year under consideration. 3. The learned Pr.CIT erred in assuming jurisdiction u/s 263 merely on the basis of a difference of opinion with the Assessing Officer. ITA No.102/Srt/2022 Samir Yogendrabhai Parikh Vs. Pr.CIT 2 4. On the facts and in the circumstances of the case as well as law on the subject, the learned Pr.CIT erred in invoking his powers/authority under section 263 of the Income Tax Act, 1961 and the order passed by him u/s 263 is without jurisdiction. 5. On the facts and in the circumstances of the case as well as law on the subject, the learned Pr.CIT has failed to appreciate that the assessment order passed by the ACIT, Navsari Circle, Navsari (hereinafter to as the AO) was neither “erroneous” not “prejudicial to the interest of revenue” and thus the very invocation of power under Section 263 is wholly illegal and beyond jurisdiction. 6. On the facts and in the circumstances of the case as well as law on the subject, the learned Pr.CIT has erred in invoking powers under Section 263 and passing order holding the assessment order to be “erroneous” and prejudicial” without even justifying which of the two phraseology used in Section 263 is applicable and as to how the order of assessment is “erroneous” causing “loss to the revenue”. 7. On the facts and in the circumstances of the case as well as law on the subject, the learned Pr.CIT has erred in holding that the AO has failed to make proper enquiry into the facts of the case and on that ground in further holding that the assessment order dated 27/12/2019, passed by the AO u/s 143(3), is erroneous as well as prejudicial to the interest of Revenue and in cancelling the assessment with the direction to the AO to reframe the assessment. 8. On the facts and in the circumstances of the case as well as law on the subject, the learned Pr.CIT has failed to appreciate that assessment order dated 27/12/2019, as had been passed by the AO in accordance with the law and the learned CIT could not have held the said order to be “erroneous and prejudicial to the interest of Revenue” within the meaning of Section 263. 9. On the facts and in the circumstances of the case as well as law on the subject, in any event, in response to the notice under Section 263, the appellant had made detailed submissions on the issue that had been taken up in the notice u/s 263 and for the reason that the learned Pr.CIT has failed to carry out his statutory obligation to deal with and decide such issue, the order under Section 263 stands wholly vitiated and the same deserves to be quashed. 10. For various reasons and on different grounds, the order u/s 263 passed by the Pr.CIT is bad in fact and law of the case and requires to be cancelled. 11. The above grounds of Appeal are without prejudice to and are independent of each other. ITA No.102/Srt/2022 Samir Yogendrabhai Parikh Vs. Pr.CIT 3 12. Your Appellant craves, leave to amend, alter, delete and/or add to foregoing grounds of appeal any time before the appeal is decided.” 2. Brief facts of the case are that the assessee is a Doctor by profession and is Eye Specialist, running his hospital in the name ‘Netra Jyoti Hospital’. The assessee filed his return of income for the A.Y. 2017-18 on 23/09/2017 declared income of Rs. 1.117 crores. The case of assessee was selected for scrutiny. During the assessment, the Assessing Officer noted that during demonetization period, the assessee has made cash deposit of Rs. 33,88,800/- which includes deposit of Rs. 22,62,500/- of Specified Bank Notes (in short, SBN) of Rs. 500/- and Rs. 1000/- in his bank account with IDBI bank. The Assessing Officer prepared the following summary of deposit of such SBN on different dates in the month of November, 2016: Sr. No. Denomination of notes 1000 500 Date of deposit of OHDN Amount Rs. 1. 0 460 10/11/2016 2,30,000 2. 0 244 10/11/2016 1,22,000 3. 0 21 11/11/2016 10,500 4. 1900 0 25/11/2016 19,00,000 5. Total 22,62,500 The Assessing Officer after making the above summery, called the details of source of such cash deposit during demonetization period, by issuing show cause notice. The assessee in response to such show cause notice, submitted that Rs. 33,88,800/- was received from ITA No.102/Srt/2022 Samir Yogendrabhai Parikh Vs. Pr.CIT 4 identifiable persons [received from various patients as per Form 3C, (patient register)]. The Assessing Officer again issued notice dated 18/11/2019 seeking certified copy of such patient register in Form 3C and the notification of Government of India which allowed the Private Hospital to accept SBN currency for medical treatment from patients during demonetization period. The assessee filed his reply and submitted that as on 09/11/2019, he was having cash in hand of Rs. 21,59,560/- in SBN. Thereafter, a cash of Rs. 1,03,000/- in SBN at Rs. 500 and 1000 has been accepted on humanitarian ground in emergency cases and that to only up to 11/11/2016. The assessee also submitted that medical professionals were allowed by Government of India to accept such notes till 11/11/2016. The Assessing Officer not accepted the explanation of assessee with regard to SBN received by assessee up to 11/11/2016 aggregating to Rs. 1.03 lacs. On perusal of details compiled by Assessing Officer in the aforesaid table (supra) recorded that Rs. 3,52,000/- and Rs. 1,05,000/- was deposited on 10/11/2016 and 11/11/2016. The assessee accepted SBN of Rs. 1.03 lacs between 09/11/2016 to 11/11/2016 and that the Government of India has only allowed the Government hospitals to accept cash in the form of SBN. The assesse is a private medical professional and was not allowed to accept such SBN from the patients. The Assessing Officer accordingly treated the cash deposit of Rs. 1,03,000/- as unexplained cash credit ITA No.102/Srt/2022 Samir Yogendrabhai Parikh Vs. Pr.CIT 5 and made addition under Section 68 of the Act in the assessment order dated 27/12/2019. 3. The assessment order dated 27/12/2019 passed under Section 143(3) of the Act was revised by the ld. Pr.CIT by exercising his jurisdiction under Section 263 of the Act. Before revising the assessment order, the ld. Pr.CIT issued show cause notice dated 19/03/2022 for seeking compliance on 25/3/2022. In the show cause notice, the ld. Pr.CIT recorded that the Assessing Officer completed the assessment under Section 143(3) after making addition of Rs. 1,03,000/- on account of unexplained cash credit. The assessee made deposit during demonetization period of Rs. 33,88,800/- which includes deposit of Rs. 22,62,500/-. The ld. Pr.CIT further recorded that it was imperative on the part of Assessing Officer to verify if the accounting of receipt and payment had been done properly or not. The assessee has provided bills to the patient against the various services rendered in April, 2016 which is referred by the ld. Pr.CIT in his show cause notice. The ld. Pr.CIT by making reference of bills No. 9801 to 9810 recorded that there is no bill dated 04/5/2016, thus it is highly improbable that only 10 bills were issued and not day to day basis to patient during this period. Thus, the assessee may have suppressed the bill. This issue was not considered by the Assessing Officer. The assessee produced cash register in Form-3C which show cash balanced in hand at Rs. ITA No.102/Srt/2022 Samir Yogendrabhai Parikh Vs. Pr.CIT 6 21,59,560/- and thereafter a cash of Rs. 1.03 lacs in the form of Rs. 1000/- and Rs. 500/- notes were accepted on humanitarian and emergency ground up to 11/11/2016. Cash deposit of Rs. 1,03,000/- deposited on 11/11/2016 was disallowed by the Assessing Officer. The assessee deposited Rs. 19.00 lacs being a part of SBN available with him on 09/11/2016. It shows that the order is passed without making enquiry or verification which should have been made. The Assessing Officer allowed relief without making any enquiry into the claim. The patients’ bill furnished by the assessee does not bear the address of patient. The Assessing Officer has not conducted enquiry or verification to find out the genuineness of such receipt. There was substantial time gap between the first and last cash deposit of old high denomination notes to create suspicion that the assessee has deposited SBN available with him after demonetization on 10/11/2016 and 11/11/2016 and the SBN of Rs. 19.00 lacs deposited on 25/11/2016 were received by assessee after 11/11/2016. The reasons explained by the assessee that the assessee was not able to deposit such notices due to surgery of his father, is not acceptable as the assessee was deposited the cash between the period from 12/11/2016 to 24/11/2016. The cash deposit of Rs. 19.00 lacs on 25/11/2016 should be added to the income of assessee. The assessee was directed to file his reply on or before 25.03.2022. ITA No.102/Srt/2022 Samir Yogendrabhai Parikh Vs. Pr.CIT 7 4. The assessee filed his reply on ITBA Portal on 25/03/2022. The ld. Pr.CIT has not discussed the contents of reply furnished by assessee in the impugned order. The ld. Pr.CIT held that he has gone through the submission filed by the assessee. The submissions are emotionally charged but devoid of facts. The ld. Pr.CIT recorded that it is true that during the assessment, the Assessing Officer called details from assessee, however, without going through these details, the Assessing Officer has simply kept them on record. The Assessing Officer has not even gone through the return of income alongiwth its schedules. The ld. Pr.CIT made a passing remark that there were two deprecation tables on record, in one table, the depreciation has been shown at Rs. 16,34,335/- while in the other, the amount of deprecation is claimed at Rs. 14,83,538/-. The Assessing Officer has not examined the difference between such tables. The Assessing Officer also made a remark regarding cash flow system of accounts and exempt income and the expenditure against the exempt income. Though, such issues were not the subject matter of the show cause notice nor any fresh show cause notice for seeking comment of assessee was issued by the Assessing Officer. The ld. Pr.CIT held that, from the record, it is clear that the assessee has deposited cash of SBN on many occasions then how substantial cash was available to the assesse on 25/11/2016. The assessee is charging consultation fee of Rs. 300/- and Rs. 200/- which ITA No.102/Srt/2022 Samir Yogendrabhai Parikh Vs. Pr.CIT 8 is evident from current register and how the huge quantum of such SBN was gathered. The Assessing Officer has not asked the basic question. The Assessing Officer failed to analyse the information and keeping on record in the scrutiny proceedings. The ld. Pr.CIT by referring certain case laws held that the Assessing Officer has not examined the details called for. The ld. Pr.CIT set aside the assessment order by holding that the assessment order is erroneous in so far as it is prejudicial to the interests of revenue and directed the Assessing Officer to make de novo enquiry on the issues after giving reasonable opportunity to the assessee. Aggrieved by the order of ld. Pr.CIT, the assessee has filed the present appeal before this Tribunal. 5. We have heard the submission of Shri Tushar P Hemani, learned Senior Counsel assisted by Parimalsinh B Parmar, Advocate (hereinafter called the ld. Sr. Counsel) and Shri Ritesh Mishra, the learned Commissioner of Income Tax-Departmental Representative (hereinafter called as ld. CIT-DR). The ld. Senior Counsel for the assessee submits that the assessee is an ophthalmologist and running eye hospital in the name of “Netra Jyot Hospital”. During the demonetization period, the assessee deposited Rs. 33,88,800/- in his bank accounts which includes Rs. 22,62,500/- in SBN. The case of assessee was selected for scrutiny and assessment was completed under Section 143(3) of the Act on 27/12/2019 by making addition of Rs. 1.03 lacs under Section 68 of the ITA No.102/Srt/2022 Samir Yogendrabhai Parikh Vs. Pr.CIT 9 Act. Thereafter, the ld. Pr.CIT issued show cause notice dated 19/03/2022 under Section 263 of the Act. By way of show cause notice, the ld. Pr.CIT called upon the assessee as to why the order should not be revised since cash deposit of Rs. 19.00 lacs ought to have added under Section 68 by treating the same as unexplained sum. The assessee filed his reply dated 25/03/2022. Copy of reply is placed on record in page No. 354 to 371 of the paper book. The ld. Pr.CIT thereafter directed to carry out de novo assessment without specifying as to how the order is erroneous or prejudicial to the interest of revenue. 6. The learned Senior Counsel for the assessee submits that in order to invoke his revisional jurisdiction, the twin condition that the order is erroneous and prejudicial to the interest of revenue needs to be fulfilled simultaneously/together either of above condition is not satisfied, the assessment order cannot be revised. As has been held in Malabar Industrial Co. Ld. Vs. CIT (2000) 243 ITR 83 (SC). The assessment order is not at all erroneous as the twin condition for invoking jurisdiction under Section 263 is not satisfied. The ld. Senior Counsel submits that during the assessment, the Assessing Officer deeply examined the issue. Once the issue has been examined in the original assessment, the it cannot be open to the department to invoke the revisionary jurisdiction, if the Assessing Officer has taken reasonable, ITA No.102/Srt/2022 Samir Yogendrabhai Parikh Vs. Pr.CIT 10 plausible and legally sustainable view. The ld. Senior Counsel submits that where an issue has been examined during the assessment stage, though the same does not get reflected in the final assessment order, then that, by itself, would not lead to a conclusion that the assessment order calls for interference by invoking jurisdiction under Section 263 of the Act. To support such submissions, the ld. Senior Counsel relied upon the following case laws: (i) CIT Vs Nirma Chemicals Works (P) Ltd. 309 ITR 67 (Guj) (ii) Gujarat Power Corporation Vs ACIT 350 ITR 266 (Guj) (iii) Rayon Silk Mills Vs CIT 221 ITR 155 @ 158-159 (Guj) (iv) Hari Iron Trading Co. Vs CIT (2003) 263 ITR 437 (P&H) (v) CIT Vs Gabriel India Ltd. (1993) 203 ITR 108 (Bom) (vi) CIT Vs Vikas Polymers 341 ITR 537 (Del) (vii)CIT Vs Honda Siel Power Products 333 ITR 547 @ 557-558 (Del) 7. The ld. Senior Counsel submits that the Assessing Officer issued show cause notice dated 30/01/2019 for seeking details of profession, tax audit report and annual account. The copy of said show cause notice is placed on record. The assessee vide his reply dated 19/04/2019 furnished complete details of profession, computation of total income, tax audit report and annual accounts. Copies of which are filed at page No. 3 to 30 of paper book. The assessee again vide his reply dated 03/09/2019, furnished the details of profession, ITR for A.Y. 2016-17 and 2017-18 with bank account and bank book. The copy of such details are filed on record at page No. 34 to 234 of the paper book. The ITA No.102/Srt/2022 Samir Yogendrabhai Parikh Vs. Pr.CIT 11 Assessing Officer again vide his notice dated 09/09/2019 directed the assessee to furnish details of all the bank accounts in the specified format, bank statement of all the bank accounts and narration of entries of deposit and withdrawal, cash deposits during demonetization period and reply furnished online and details regarding source of cash deposit during that period and cash amount with narration of entries for F.Y. 2015-16 and 2016-17, month-wise details to sales and purchase in specified format, month-wise cash sales and cash deposit during 01/04/2015 to 31/03/2016, month-wise cash sales and cash deposit during 01/04/2016 to 31/03/2017. The assessee vide his reply dated 23/09/2019 furnished all the details including month-wise cash sales and cash deposit during 01/04/2015 to 31/03/2016 and 01/04/2016 to 31/03/2017. The assessee on the direction of Assessing Officer again vide his reply dated 15/11/2019 furnished the details of cash book with narration of entry for F.Y. 2015-16 and 2016-17 with cash book for both the financial years and month-wise cash receipt and deposit during those period. The Assessing Officer further vide his notice dated 18/11/2019 called upon the assessee to furnish various details including certified copy of Form 3C register i.e. record of out-patient department (OPD) and inner patient department (IPD) and details of cash of Rs. 19,04,150/- received from patients during 09/11/2016 to 30/12/2016. The assessee in compliance of said show cause notice, filed his reply ITA No.102/Srt/2022 Samir Yogendrabhai Parikh Vs. Pr.CIT 12 dated 02/12/2019 and furnished copy of desired documents, consistent of certified copy of 3C register and details of cash received from patients during 09/11/2016 to 30/12/2016. 8. The learned Senior Counsel for the assessee submits that the Assessing Officer during statement, specifically asked about the cash deposit of Rs. 19.00 lacs on 25/11/2016. The assessee vide reply dated 13/12/2019 furnished explanation. Copy of which is placed on record at page No. 316 to 332 of the paper book. In the reply dated 13/12/2019, the assessee explained that being a medical practitioner, his schedule in such that he never gets time to look into the matter relating to handling of cash and bank transactions. Such work was taken care by his father Mr. Yogendra Sakarla Parikh. He also used to handle the bank transaction and used to deposit the cash periodically in bank accounts. During the period of demonetization, his father was not well and neither could attend the clinic on regular basis as he was facing severe bleeding. He was diagnosed with bladder cancer. His health was so weak that he was not strong enough health for operation/surgery. Later on when he was recovered, his operation was carried out on 08/12/2016 and he was discharged on 11/12/2016. Copy of such medical certificates were filed before the Assessing Officer as well as now filed in the form of paper book before the Bench. The father of assessee ultimately died on 11/11/2018 due to frequent health issues. ITA No.102/Srt/2022 Samir Yogendrabhai Parikh Vs. Pr.CIT 13 The ld. Senior Counsel submits that such examination of issue by the Assessing Officer and the reply furnished by the assessee clearly shows that the issue was examined extensively by the Assessing Officer. The assessee was also asked to furnish the comparative chart of professional receipt for three years. The assessee furnished such comparative chart of professional receipts for three years, copy of which is placed on record at page No. 342 of paper book. The ld. Senior Counsel for the assessee invited our attention that the assessee received cash amount of Rs. 1,39,07,450/- in A.Y. 2014-15, Rs. 1,53,53,850/- in A.Y. 2015-16 and Rs. 1,54,70,150 in A.Y. 2016-17. By showing such figure, the ld. Sr. Counsel for the assessee submits that there is no inordinate jump in the income of assessee. The Assessing Officer after considering all the evidences, information and material placed on record, framed the assessment order on 27/12/2019 and made addition of Rs. 1.03 lacs only as the assessee could not prove the nature of such minor receipt in the form of SBN. No appeal was filed by the assessee against such addition and the assessee accepted the same to avoid litigation. 9. The ld. Sr. Counsel for the assessee submits that it is a settled law that if two views are possible as regards a particular issue and the Assessing Officer adopts either of two such views, which is legally sustainable, then CIT cannot invoke jurisdiction to revise the assessment order. To ITA No.102/Srt/2022 Samir Yogendrabhai Parikh Vs. Pr.CIT 14 support his submission, the ld. Sr. Counsel has relied upon the following decisions: (i) Malabar Industrial Co Ltd. Vs CIT 243 ITR 83 (SC) (ii) Kwality Steel Suppliers Vs CIT 395 ITR 1 (SC) (iii) CIT Vs Mehsana District Co-Op Milk Producers Union Ltd. 263 ITR 645 (Guj) (iv) CIT Vs D.P. Karia 266 ITR 113 (Guj) (v) CIT Vs Arvind Jewellers 259 ITR 502 (Guj) (vi) Sir Dorabji Tata Trust Vs DCIT(E) (2021) 188 ITD 38 (Mum) (vii)Torrent Pharmaceuticals Vs DCIT (2021) 173 ITD 130 (Ahd.) 10. The ld. Senior Counsel submits that inadequacy of enquiry cannot be a ground for proceedings under Section 263 of the Act, otherwise it will be an endless process. To support his view, the ld. Sr. Counsel relied upon the following case laws: (i) CIT Vs Sunbeam Auto Ltd. 332 ITR 167 (Delhi) (ii) CIT Vs Anil Kumar Sharma 335 ITR 83 (Delhi) (iii) CIT Vs Vikas Polymers 341 ITR 537 (Delhi) 11. The ld. Senior Counsel for the assessee submits that even on merit, no addition is called for on account of cash deposit of Rs. 19.00 lacs. Such cash deposits were out of opening cash balance at the time of beginning of demonetization period which, in turn was on account of professional receipt received in cash. To support the professional receipts, the assessee has already placed on record sufficient evidence to substantiate that the assessee was having sufficient cash balance on the date of demonetization. The ld. Senior Counsel submits that the ITA No.102/Srt/2022 Samir Yogendrabhai Parikh Vs. Pr.CIT 15 professional receipts of assessee was more than Rs. 2.10 crores in a year. The assessee has shown receipts and offered returned income of more than Rs. 1.10 crores and net profit of Rs. 1.08 crore. The ld. Pr.CIT has not brought any cogent material even to remotely demonstrate that the cash deposits in question were not out of cash balance on account of professional cash receipts. There is also no cogent material on record to even remotely demonstrate that the assessee had any other source of income from which, cash deposits in question could have been made. Even on merits, no case is made out to treat the source of cash deposits as unexplained for making addition under Section 68 of the Act. The ld. Senior Counsel submits that the ld. Pr.CIT has only considered the details of bills of April, 2016 which is recorded on page No. 4 of the impugned order which contains details of only IPD (Indoor Patients Department). OPD (Outdoor Patients Department) patients have not been considered by the ld. Pr.CIT. The ld. Senior Counsel vehemently submitted that the order of the Assessing Officer in not at all erroneous or prejudicial to the interest of revenue. The assessing officer passed the assessment order rafter considering all the material called during the assessee as a result of his investigation. In a concluding remarks the ld Senior Counsel for the assessee submits that the assessee is one of the descendent of Late Mohandas Karam Chand Gandhi (Father of Nation) and maintains high ITA No.102/Srt/2022 Samir Yogendrabhai Parikh Vs. Pr.CIT 16 moral value, ethics and follower of rule of law. The assessee maintains all record, whatever is required by medical professional. The ld Senior Counsel also invited our attention on the pedigree/ family tree of Father of Nation. The ld. Senior Counsel prayed for allowing the appeal of assessee. 12. On the other hand, the ld. CIT-DR for the revenue supported the order of ld. Pr.CIT. The ld. CIT-DR submits that the assessee has deposited cash in form of SBN on many occasions then how come substantial cash in the form of SBN was available with him which was deposited on 25/11/2016. The ld. CIT-DR submits that the consultation fees of the assessee is only Rs. 300/- and Rs. 200/- then how the assessee gathered SBN in such a huge quantum. The ld. CIT-DR submits that the job of an Assessing Officer is not complete after calling for the information and keeping the same on record rather it is much more than that. Even though, the Assessing Officer called for information but did not bother even to examine the same and therefore, the assessment order is erroneous in so far as it is not based on proper appreciation of facts. To support his submission, the ld. CIT-DR supported the following case laws: (i) Gee Vee Enterprises Vs Addl. CIT 99 ITR 375. (ii) Ramesh Kumar ITA No. 1982/Del/2018 13. The ld CIT-DR for the revenue prayed to uphold the order of ld Pr.CIT by dismissing the appeal of assessee. ITA No.102/Srt/2022 Samir Yogendrabhai Parikh Vs. Pr.CIT 17 14. We have considered the rival submissions of both the parties and perused the orders of lower authorities carefully. We have also deliberated upon the case laws relied upon by the both the parties as well as relied by the lower authorities in their respective orders. We find that the ld Pr CIT in his show cause notice under section 263 identified the issue of cash deposits of SBN during demonetisation period. Though, the ld Pr CIT made certain remakes in para 7 and 7.1 of his order about the depreciation table available on record and as such the alleged difference between two tables was not examined and further assessee following cash system of accounting, the assessee has paid Rs. 33.69 lacs, no details regarding the asset created or any entry as disclosed in the balance sheet on 31/03/2017 as it was disclosed in balance sheet as on 31/03/2016. We find that these two observations made in para 7 and 7.1 was neither the subject matter of so cause notice nor any opportunity was given to assessee to explain such discrepancies if really existed there. Therefore, these observations are treated as passing remarks and could not be considered as subject matter of revision order. Now coming to the main issue identified by the ld. Pr.CIT in his show cause notice under Section 263 of Rs. 19.00 lacs deposited on 25/11/2016. We find that during the assessment proceedings, the assessing officer examined the issue in detail and called details vide his show cause notice dated 09/09/2019 to furnish ITA No.102/Srt/2022 Samir Yogendrabhai Parikh Vs. Pr.CIT 18 details of all the bank accounts in the specified format, bank statement of all the bank accounts and narration of entries of deposit and withdrawal, cash deposits during demonetization period. The assessee was also directed to furnish reply online and details regarding source of cash deposit during that period and cash amount with narration of entries for F.Y. 2015-16 and 2016-17, month-wise details to sales and purchase in specified format, month-wise cash sales and cash deposit during 01/04/2015 to 31/03/2016, month-wise cash sales and cash deposit during 01/04/2016 to 31/03/2017. The assessee vide his reply dated 23/09/2019 furnished complete month-wise details of cash sales and cash deposit during 01/04/2015 to 31/03/2016 and 01/04/2016 to 31/03/2017. The assessee further on the direction of Assessing Officer again vide his reply dated 15/11/2019 furnished the details of cash book with narration of entry for F.Y. 2015-16 and 2016-17 with cash book for both the financial years and month-wise cash receipt and deposit during those period. We find that the Assessing Officer further vide his notice dated 18/11/2019 called upon the assessee to furnish various details including certified copy of Form 3C register of OPD and IPD with details of cash of Rs. 19,04,150/- received from patients during 09/11/2016 to 30/12/2016. The assessee in his reply dated 02/12/2019 furnished copy of desired documents, consisted of certified copy of 3C register and details of cash received from patients during ITA No.102/Srt/2022 Samir Yogendrabhai Parikh Vs. Pr.CIT 19 09/11/2016 to 30/12/2016. It was also explained before the Assessing Officer that the assessee being medical practitioner and in his schedule, he never gets time to look into the matter relating to handling of cash and bank transactions and such work was looking after by his father Mr. Yogendra Sakarla Parikh, who was not well and was diagnosed with bladder cancer and ultimately died. Due to such facts, the assessee could not deposit the entire cash balance in the form of SBN immediately on prohibition of such currency notes. We find that the Assessing Officer deeply examined the issue and made addition of Rs. 1.03 lacs. We have also examined the facts and evidence placed before us. Before us, the ld. Senior Counsel furnished the details of cash receipt, receipt by way of cheque in respect of OPD, operations and other hospital visiting fees which is placed on record at page No. 342 of the paper book, such details were also furnished before assessing officer vide reply dated 23.12.2019, in the following manner: Year Particular Receipt in cash Receipt in cheque Total 2014-15 OPD Operation Other Hospital Visiting Fees 3,078,200 10,829,250 - 423,000 494,957 3,078,200 11,252,250 494,957 Total 13,907,450 917,957 14,825,407 2015-16 OPD Operation Other Hospital Visiting Fees 4,074,600 11,279,250 - 247,300 419,819 4,074,600 11,526,550 419,819 Total 15,353,850 667,119 16,020,969 2016-17 OPD Operation Other Hospital Visiting Fees 5,191,400 10,278,750 - 5,388,700 185,827 5,191,400 15,667,450 185,827 Total 15,470,150 5,574,527 21,44,677 ITA No.102/Srt/2022 Samir Yogendrabhai Parikh Vs. Pr.CIT 20 On perusal of aforesaid details, we find that there is no abnormal cash receipt during the specific demonetization period. We further find that assessee has shown gross receipt of Rs. 2.10 crores and has shown returned income of Rs. 1.117 crore. On the basis of aforesaid figure and the details called for Assessing Officer, we find that the Assessing Officer after calling the details of cash deposit, while accepting the plea of assessee of cash deposit of Rs. 19.00 lacs have taken a reasonable plausible and legally sustainable view, which cannot be branded as erroneous. 15. The Supreme Court in case of Malabar Industrial Co. Ltd. v. CIT [2000] 243 ITR 832 (SC), held that the prerequisite for the exercise of jurisdiction by the Commissioner suo-motu is that the order of the Income-tax Officer is erroneous in so far as it is prejudicial to the interests of the revenue. The Commissioner has to be satisfied of twin conditions, namely, (i) the order of the Assessing Officer sought to be revised is erroneous; and (ii) it is prejudicial to the interests of the revenue. If one of them is absent - if the order of the Income-tax Officer is erroneous but is not prejudicial to the revenue or if it is not erroneous but is prejudicial to the revenue - recourse cannot be had to section 263(1) of the Act. It can be exercised only when an order is erroneous, the section 263 will be attracted. ITA No.102/Srt/2022 Samir Yogendrabhai Parikh Vs. Pr.CIT 21 16. Further, Hon’ble Bombay High Court in CIT Vs Gabriel India Ltd (233 ITR 108 Bom /71 Taxman 585) held that the power of suo-motu revision under sub-section (1) of section 263 is in the nature of supervisory jurisdiction and the same can be exercised only if the circumstances specified therein exist. Two circumstances must exist to enable the Commissioner to exercise power of revision under this sub- section, viz., (i) the order is erroneous; and (ii) by virtue of the order being erroneous prejudice has been caused to the interests of the revenue. It has, therefore, to be considered firstly as to when an order can be said to be erroneous. One finds that the expressions 'erroneous', 'erroneous assessment' and 'erroneous judgment' have been defined in Black's Law Dictionary. According to the definition, 'erroneous' means 'involving error; deviating from the law'. 'Erroneous assessment' refers to an assessment that deviates from the law and is, therefore, invalid, and is a defect that is jurisdictional in its nature, and does not refer to the judgment of the Assessing Officer in fixing the amount of valuation of the property. Similarly, 'erroneous judgment' means 'one rendered according to course and practice of Court, but contrary to law, upon mistaken view of law, or upon erroneous application of legal principles. The Hon’ble High Court also held that from the definitions it is clear that an order cannot be termed as erroneous unless it is not in accordance with law. If an assessing officer acting in accordance with law makes a ITA No.102/Srt/2022 Samir Yogendrabhai Parikh Vs. Pr.CIT 22 certain assessment, the same cannot be branded as erroneous by the Commissioner simply because, according to him, the order should have been written more elaborately. This section does not visualize a case of substitution of the judgment of the Commissioner for that of the ITO, who passed the order, unless the decision is held to be erroneous. Cases may be visualized where the ITO while making an assessment examines the accounts, makes enquiries, applies his mind to the facts and circumstances of the case and determines the income either by accepting the accounts or by making some estimate himself. The Commissioner, on perusal of the records, may be of the opinion that the estimate made by the officer concerned was on the lower side and left to the Commissioner he would have estimated the income at a figure higher than the one determined by the ITO. That would not vest the Commissioner with power to re-examine the accounts and determine the income himself at a higher figure. It is because the ITO has exercised the quasi-judicial power vested in him in accordance with law and arrived at a conclusion and such a conclusion cannot be termed to be erroneous simply because the Commissioner does not feel satisfied with the conclusion. It may be said in such a case that in the opinion of the Commissioner the order in question is prejudicial to the interests of the revenue. But that by itself will not be enough to vest the Commissioner with the power of suo-motu revision because the first ITA No.102/Srt/2022 Samir Yogendrabhai Parikh Vs. Pr.CIT 23 requirement, viz., that the order is erroneous, is absent. Similarly, if an order is erroneous but not prejudicial to the interests of the revenue, then also the power of suo-motu revision cannot be exercised. Every erroneous order cannot be the subject-matter of revision because the second requirement also must be fulfilled. There must be some prima facie material on record to show that tax which was lawfully exigible has not been imposed or that by the application of the relevant statute on an incorrect or incomplete interpretation a lesser tax than what was just has been imposed. Therefore, in order to exercise power under section 263(1) there must be material before the Commissioner to consider that the order passed by the ITO was erroneous insofar as it is prejudicial to the interests of the revenue and that it must be an order which is not in accordance with the law or which has been passed by the ITO without making any enquiry in undue haste. An order can be said to be prejudicial to the interests of the revenue if it is not in accordance with the law in consequence whereof the lawful revenue due to the State has not been realized or cannot be realized. There must be material available on the record called for by the Commissioner to satisfy him prima facie that the aforesaid two requisites are present. If not, he has no authority to initiate proceedings for revision. Exercise of power of suo-motu revision under such circumstances will amount to arbitrary exercise of power. It is well-settled that when exercise of ITA No.102/Srt/2022 Samir Yogendrabhai Parikh Vs. Pr.CIT 24 statutory power is dependent upon the existence of certain objective facts, the authority before exercising such power must have materials on record to satisfy it in that regard. If the action of the authority is challenged before the Court, it would be open to the Courts to examine whether the relevant objectives were available from the records called for and examined by such authority. The decision of the ITO could not be held to be 'erroneous' simply because in his order he did not make an elaborate discussion in that regard. Moreover, the Commissioner himself, even after initiating proceedings for revision and hearing the assessee, could not say that the allowance of the claim of the assessee was erroneous, he simply asked the ITO to re-examine the matter, which was not permissible. 17. The Hon'ble Jurisdictional High Court in Aryan Arcade Ltd., Vs PCIT (2019) 412 ITR 277 (Gujarat) held that merely because Commissioner held a different belief that would not permit him to take the order in revision, it if further held that when Assessing Officer made full enquiry, he made up his mind, the notice of revision is not valid. 18. In CIT Vs Nirma Chemical Works (P) Ltd (supra), the Hon’ble High Court also held that when assessing officer after making due inquiries had adopted one of the view and granted partial relief, merely because Commissioner took a different view of the matter, it would not be sufficient to permit commissioner to exercise his powers under section ITA No.102/Srt/2022 Samir Yogendrabhai Parikh Vs. Pr.CIT 25 263. The Hon’ble Court in para 22 of its order on the objection of the revenue that there is no discussion of the issue in the assessment order held that the contention on behalf of the revenue that the assessment order does not reflect any application of mind as to the eligibility or otherwise under section 80-I of the Act requires to be noted to be rejected. An assessment order cannot incorporate reasons for making/granting a claim of deduction. If it does so, an assessment order would cease to be an order and become an epic some. The reasons are not far to seek. Firstly, it would cast an almost impossible burden on the Assessing Officer, considering the workload that he carries and the period of limitation within which an order is required to be made; and, secondly, the order is an appealable order. An appeal lies, would be filed, only against disallowances which an assessee feels aggrieved with. 19. Now again adverting to the issue under consideration, which was subject matter of notice of revision under Section 263 of the Act that Assessing officer passed the assessment order without making enquiry or verification on the issue, which ought to have been made. As we have already held that Assessing Officer passed the assessment order after considering the material brought on record and made addition of Rs. 1.03 lacs as an unaccounted income. No doubt, there is no express finding of Assessing Officer about accepting the plea of assessee about ITA No.102/Srt/2022 Samir Yogendrabhai Parikh Vs. Pr.CIT 26 deposit of Rs. 19.00 lacs in the form of NBC of 25/11/2016. Yet, we find that such plea of assessee was impliedly accepted by the Assessing Officer, which was coupled with evidence; the assessing officer may not have thought to pass detailed order on the issue examined by him. In our view, once the contention of the assessee on a particular issue is accepted by assessing officer, the order is not appealable order and no appeal would be filed, against such accepted position as an assessee will not feel aggrieved with it, it is not necessary to give reasons of acceptance of such pleas. So far as the observation of ld PCIT that the assessing officer ought to have made further enquiry is concerned, we find that the assessing officer made requisite investigation before allowing relief to the assessee. The investigation conducted and the view adopted by the assessing officer in the present case, if not accepted by the Ld. PCIT, is nothing but change of opinion. It is settled position in law that no revision of assessment order is permissible on mere change of opinion. 20. Therefore, in view of the above discussions, we are of the view that on the basis of material before the assessing officer, he took reasonable, plausible and legally sustainable view, which cannot be branded as erroneous. There is no doubt that while accepting the claim in the assessment, there may be some loss of revenue, tax can be levied only with the authority of law, and every loss of revenue as a consequence ITA No.102/Srt/2022 Samir Yogendrabhai Parikh Vs. Pr.CIT 27 of an order of the Assessing Officer, cannot be treated as prejudicial to the interests of the revenue unless the view adopted by assessing officer permissible in law. Once the assessing officer has taken one view with which the Commissioner does not agree, it cannot be treated as an erroneous order prejudicial to the interests of the revenue unless the view taken by the assessing officer is unsustainable in law. 21. So far as reliance in case Gee Vee Enterprises Vs Addl. CIT (supra) is concerned, relied by the ld. CIT-DR for the revenue is concerned, the facts of that case is at variance. In the said case, the assessing officer has not made the basic inquiry, which ought to have made. However, in the case in hand the assessing officer made full-fledged inquiry. Further, the facts in other case law relied by ld CIT-DR in Ramesh Kumar Vs ITO (supra) is also not applicable on the facts of present case. In said case, information was passed to the assessing officer about the share transaction on which the assessee claimed long term capital gain, such transaction was not examined by the assessing officer, failure on the part of assessing officer rendered the assessment order erroneous and prejudicial to the interest of revenue. However, the facts of case in hand was extensively examined by the assessing officer. Thus, the ratio in both the decisions are not helpful to the revenue. Hence, the grounds of appeal raised by the assessee are allowed 22. In the result, this appeal of assessee is allowed. No order as to cost. ITA No.102/Srt/2022 Samir Yogendrabhai Parikh Vs. Pr.CIT 28 Order pronounced in the open court on 21 st November, 2022 and the result was also placed on the Notice Board. Sd/- Sd/- (Dr. ARJUN LAL SAINI) (PAWAN SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER Surat, Dated: 21/11/2022 *Ranjan Copy to: 1. Assessee – 2. Revenue - 3. CIT(A) 4. CIT 5. DR 6. Guard File By order Sr.Private Secretary, ITAT, Surat