Dimple Murarka, Cuttack V. CIT, Cuttack

ITA 187/CTK/2015

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 6125 (ITAT-CUTTACK)
• Duration Of Justice: 5 year(s) 5 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-09-2020
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Appeal Filed On: 21-04-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: M K GAUTAM
• Assessee Lawyers: S N SAHUSOMNATH SAHOO ADVS
• Keywords: Revision of order; Opportunity of being heard; Assessment record; Set aside
• Section: 143(3); 201; 44AB; 13; 119; 263

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL CUTTACK BENCH CUTTACK BEFORE SHRI C.M. GARG, JM & SHRI L.P. SAHU, AM . / ITA NO. 187 /CTK/20 1 5 ( / A SSESSMENT Y EAR : 20 1 0 - 201 1 ) SMT. DIMPLE MURARKA, PROP - M/S PARIVARTAN, PLOT NO.1263, SECTOR - 6, CDA, CUTTACK VS. THE PR.CIT, CUTTACK PAN NO. : A E A PM 1555 N ( / APPELLANT ) .. ( / RESPONDENT ) /ASSESSEE BY : SHRI S.N.SAHU/SOMNATH SAHOO, ADVS /REVENUE BY : SH RI M.K.GAUTAM, CIT DR / DATE OF HEARING : 0 9 / 0 9 /20 20 / DATE OF PRONOUNCEMENT : 25 / 0 9 /20 20 / O R D E R PER L.P.SAHU, AM : TH IS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER DATED 12.03.2015 , PASSED BY THE LD. PR. CIT, CUTTACK FOR THE ASSESSMENT YEAR 20 1 0 - 20 1 1 , ON THE FOLLOWING GROUNDS OF APPEAL : - 1. THAT THE ORDER OF THE LEARNED CIT PASSED U/S. 263 IS ILLEGAL, ARBITRARY, AGAINST THE FACTS ON RECORD AND THEREFORE LIABLE TO BE QUASHED. 2. THAT THE LEARNE D CIT IS NOT JUSTIFIED IN LAW IN DIRECTING THE ASSESSING OFFICER FOR REEXAMINATION OF THE AUDITED ACCOUNTS RELATING TO THE FINANCIAL YEAR 2009 - 10 AND EXAMINE THE GENUINENESS OF UNSECURED LOAN OF RS. 3,24,069/ - , SUNDRY CREDITORS OF RS. 18,39,100/ - / DETAILS OF PAYABLE OF RS. 3,33,474/ - AND ALSO SUNDRY DEBTORS OF RS. 2,32,495/ - SHOWN UNDER CURRENT ASSETS OF THE BALANCE SHEET. 3. THAT THE LEARNED CIT IS ALSO NOT JUSTIFIED TO DIRECT THE ASSESSING OFFICER TO REEXAMINE THE VALUATION OF STOCK RECORDED IN THE BOO KS OF ACCOUNT OF THE ASSESSEE WHICH HAS REPORTED TO THE BANK. ITA NO. 187 /CTK/201 5 2 4. THAT LEARNED AO AFTER DUE VERIFICATION OF EACH AND EVERY POINTS OF BALANCE SHEET HAD COMPLETED THE ASSESSMENT AND NOW DIRECTING THE ASSESSING OFFICER TO REDO THE ASSESSMENT AND START ROVIN G ENQUIRIES AND THEREFORE, THE ORDER U/S. 263 IS NOT JUSTIFIED UNDER LAW. 5. THAT OTHER GROUNDS IF ANY WILL BE URGED AT THE TIME OF HEARING OF APPEAL. 2. OUT OF THE ABOVE FIVE GROUNDS, GROUND NO.5 IS RESIDUARY GROUND AND REST OF THE GROUNDS ARE EFFECTI VE TO BE DECIDED IN THE FOLLOWING PARAGRAPHS. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE FILED HIS RETURN OF INCOME FOR THE ASSESSMENT YEAR 2010 - 2011 ON 30.09.2010 DISCLOSING TOTAL INCOME OF RS.1,92,052/ - . THE ASSESSEE IS AN INDIVIDUAL DERIVES INCOME FROM SALE OF ZUARI FURNITURE EARNING UNDER NAME AND STYLE OF M/S PARIVARTAN. THE ASSESSEE WAS COMPLETED U/S.143(3) OF THE ACT ON 19.12.2012 BY THE ITO WARD - 2(1), CUTTACK DETERMINING THE TOTAL INCOME AT RS.9,96,780/ - . LATER ON BY VIRTUE OF POWER VESTED U/S .263(1) OF THE ACT, THE PR.CIT CALLED THE ASSESSMENT RECORDS AND AFTER VERIFICATION OF THE RECORDS IT WAS NOTICED BY HIM THAT THE AO HAS NOT DONE PROPER ENQUIRY WHICH OUGHT TO HAVE BEEN DONE DURING THE COURSE OF ASSESSMENT PROCEEDINGS ON THE DIFFERENT ISSU ES. FURTHER IT HAS BEEN OBSERVED BY HIM THAT THE ASSESSEE PRODUCED THE AUDIT REPORT IN THE PRESCRIBED FORM NO.3CB AND 3CD WHICH WERE DULY AUDITED BY A QUALIFIED CA IN WHICH HE HAS MENTIONED THAT THE ASSESSEE HAD MAINTAINED CASH BOOK LEDGER, PURCHASE AND SA LE REGISTER, STOCK BOOK ITA NO. 187 /CTK/201 5 3 ETC. BUT THE DURING THE COURSE OF ASSESSMENT PROCEEDINGS MANY OPPORTUNITIES WERE GIVEN TO THE ASSESSEE FOR PRODUCTION OF BOOKS OF ACCOUNTS AS WELL AS THE SHOW CAUSE NOTICE WAS ALSO ISSUED TO THE ASSESSEE IN THIS REGARD BUT HE DID NO T PRODUCE THE BOOKS OF ACCOUNTS BEFORE THE AO. THE AO COMPLETED THE ASSESSMENT ONLY ON THE BASIS OF TRADING PROFIT AND LOSS ACCOUNT, BALANCE SHEET AND COPY OF LEDGER AND BANK ACCOUNTS. THE AO MADE ADDITION ON ADHOC BASIS OF RS.30,000/ - ON DIFFERENT HEAD OF EXPENSES AND UNEXPLAINED STOCK OF RS.3,55,832/ - OF DIFFERENCE IN STOCK FOUND DURING THE COURSE OF SURVEY U/S.133A OF THE ACT BUT HE DID NOT VERIFY THE SUNDRY CREDITORS, UNSECURED LOAN WHICH OUGHT TO HAVE BEEN VERIFIED AS PER THE PROVISIONS OF THE INCOME T AX ACT, 1961 AND IT WAS ALSO OBSERVED FROM THE ASSESSMENT RECORDS THAT THE ASSESSEE HAD SUBMITTED STOCK STATEMENT TO THE PUNJAB NATIONAL BANK IN RESPECT OF CASH CREDIT LIMITS AS ON 28.02.2010, WHICH WERE RS.55,93,112/ - BUT ON THAT DATE THE STOCK WAS ONLY R S.27,62,047/ - . THEREFORE, THE DIFFERENCE SHOULD BE ADDED TO THE TOTAL INCOME OF THE ASSESSEE. AFTER OBSERVING THE ABOVE, THE LD. PR.CIT HELD THAT THE ORDER PASSED BY THE AO DATED 19.12.2012 FOR THE ASSESSMENT YEAR 2010 - 2011 WAS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE AND OPPORTUNITY WAS ALSO GRANTED TO THE ASSESSEE BY ISSUING SHOW CAUSE NOTICE DATED 15.01.2015. THE LD. PR.CIT PASSED ORDER U/S.263 OF THE ACT AFTER RELYING MANY JUDGMENTS WHICH HAS BEEN QUOTED IN THE REVISONARY ITA NO. 187 /CTK/201 5 4 ORDER AND SET ASIDE T HE ORDER PASSED BY THE AO U/S.143(3) OF THE ACT FOR FRESH ASSESSMENT PROCEEDINGS. THE RELEVANT OBSERVATIONS OF THE LD. PR.CIT READ AS UNDER : - THE SUBMISSIONS PUT FORTH BY THE A/R OF THE ASSESSEE HAVE BEEN CAREFULLY CONSIDERED VIS - A - VIS THE MATERIALS AVAI LABLE ON THE RECORD. AT THE OUT SET IT MAY BE POINTED OUT HERE THE CONTENTION OF THE ASSESSEE THAT INVOKING THE PROCEEDING U/S.263 IS NOT CORRECT, IS NOT ACCEPTABLE BECAUSE AN INCORRECT ASSUMPTION OF FACTS OR AN INCORRECT APPLICATION OF LAW WILL SATISFY TH E REQUIREMENT OF THE ORDER BEING ERRONEOUS. REFERENCE IS MADE TO THE RULINGS GIVEN BY THE HON'BLE SUPREME COURT IN THE CASE OF RAMAPYARI DEVI SAROGI VRS. CIT (1968) 67 ITR 84 (SC) AND SMT. TARA DEVI AGGARWAL VRS. CIT REPORTED IN 88 ITR 323 (SC) (1973) IN WHICH THE HON'BLE APEX COURT HAS HELD THAT LACK OF ENQUIRY OR VERIFICATION AT THE RELEVANT TIME BY THE ASSESSING OFFICER WOULD CONSTITUTE PREJUDICE TO THE INTEREST OF REVENUE AND WOULD INVOLVE ERROR OF FACTS AND LAW. IT WAS HELD BY THE JURISDICTIONAL HIGH COURT IN THE CASE OF UMASH'ANKAR RICE MILLS VS. CIT REPORTED IN 187 ITR 638(ORI)THAT, WHERE THE COMMISSIONER FELT THAT PROPER ENQUIRY WAS NOT MADE BY THE AO DURING ASSESSMENT PROCEEDINGS, HE WAS JUSTIFIED IN INVOKING PROVISIONS OF SECTION 263 IN RESPECT OF THE ORDER PASSED BY THE AO. SIMILARLY, IN THE CASE OF GEE VEE ENTERPRISES VS. ADDL. CIT REPORT IN 99 ITR 375(DEL), THE HON'BLE COURT HAS HELD THAT THE COMMISSIONER CAN REGARD THE ORDER OF THE AO AS ERRONEOUS ON THE GROUND THAT, IN THE * CIRCUMSTANCES OF T HE CASE, THE AO SHOULD HAVE MADE FURTHER ENQUIRIES BEFORE ACCEPTING THE STATEMENT FILED BY THE ASSESSEE. IN THE INSTANT CASE, ON THE ISSUE POINTED OUT IN SHOW CAUSE NOTICE PROPER ENQUIRIES AND VERIFICATIONS WERE NOT MADE BY THE AO. DURING THE COURSE OF S CRUTINY PROCEEDINGS, ASSESSEE EXPRESSED HER INABILITY TO PRODUCE THE BOOKS OF ACCOUNT AND DOCUMENTS AS CALLED FOR BY THE AO FOR WHICH AO HAS IMPOSED PENALTY U/S.271(L)(B). BECAUSE OF SUCH FAILURE ON THE PART OF THE AO, THE ORDER PASSED BY HIM IS CONSI DERED TO BE ERRONEOUS AS WELL AS PREJUDICIAL TO THE INTERESTS OF REVENUE. ASHELD BY VARIOUS COURTS IN THE CASES MENTIONED ABOVE, THE PR.COMMISSIONER CAN REGARD AN ORDER AS ERRONEOUS ON THE GROUND THAT IN THE CIRCUMSTANCES OF THE CASE, THE AO SHOULD HAV E MADE FURTHER ENQUIRES BEFORE ACCEPTING THE STATEMENTS GIVENBY THE ASSESSEE IN HER RETURN. REGARDING THE VALUATION OF STOCK, ASSESSEE REPORTED STOCK OF RS.55,43,112 TO THE PUNJAB NATIONAL BANK ON 28.02.2010, WHERE AS ACTUAL STOCK POSITION ON THAT DATE WA S RS.27,62,047. ASSESSING OFFICER WHEN FRAMING THE ASSESSMENT ORDER HAS ADDED THE UNEXPLAINED STOCK OF RS.3,55,832 AGAINST WHICH ASSESSEE IS NOW IN APPEAL BEFORE THE CIT(A),CUTTACK. ITA NO. 187 /CTK/201 5 5 IT IS TO BE CONSIDERED THAT THE QUANTITATIVE VALUATION OF STOCK SHOWN AS O N 28.02.2010 HAS NOT BEEN PROPERLY VALUED AND THE ASSESSEE HAS SHOWN EXCESS STOCK TO THE BANK AS PER STOCK STATEMENT SUBMITTED TO THE BANK. THE CONCERNED BANK HAD NOT MERELY SANCTIONED THE CASH CREDIT LIMIT WITHOUT VERIFYING THE STOCK POSITION AS REQUIRED AGAINST SECURITY OF COMMODITIES AND DEBT TO THAT EXTENT OF CC LIMIT. AS PER NORMS OF THE BANKER'S BOOK EVIDENCE ACT,1981, THE BANK HAS TO WORK ACCORDINGLY AND SANCTIONED CC LIMIT. IN NO CASE THE BANK IS INTERESTED TO SUSTAIN LOSS IN TERM OF NPA PROVIDING CC LOAN AMOUNT ON THE BASIS OF LOWER VALUE OF STOCK IN TRADE BEING HYPOTHECATED TO BE RECOVERED FROM THE ASSESSEE IN CASE OF FAILURE TO REALIZE THE LOAN AMOUNT. THEREFORE IT CAN BE CONSIDERED THAT THE ASSESSE HAS SUFFICIENT STOCK OUTSIDE THE BOOKS, SO AS T O AVAIL THE CC LIMIT FROM THE BANK. SO THE EXCESS UNDISCLOSED STOCK OF RS.27,81,065 HAS NOT BEEN BROUGHT TO TAX BY THE ASSESSEE IN HER ACCOUNTS. THE UNFAIR INTENTION IN FURNISHING FABRICATED FALSE STOCK STATEMENT TO THE BANK IN ORDER TO GET HIGHER LOAN S ANCTION AMOUNT FROM THE BANK HAS NOT BEEN APPRECIATED BY VARIOUS DECISIONS OF THE DIFFERENT HIGH COURTS IN THIS ISSUE PARTICULARLY THE APEX COURT HAS CONTENDED THE ABOVE UNHEALTHY PRACTICE FOLLOWED BY THE BUSINESS MAN. AS PER DECISION OF THE HON'BLE MADRA S HIGH COURT IN THE CASE OF COIMBATORE SPINNING AND WEAVING CO LTD CIT[1974] 95 ITR 375 HELD THAT NO SUCH PRACTICE OF DECLARING LARGER SOCKS TO THE BANKS FOR THE PURPOSE OF GETTING HIGHER LOAN WAS RECOGNIZED BY THE COURT AND NO JUDICIAL NOTICE CAN BE TAKEN OF SUCH SUB - STANDARD MORALITY ON THE PART OF THE ASSESSEE SO AS TO ENABLE THEM TO GO BACK ON THEIR OWN SWORN STATEMENT GIVEN TO THE BANK AS TO THE STOCK HELD AND HYPOTHECATED TO THE BANK. WHILE DISPOSING OFF THE SLP IN THE CASE OF DHANSIRAM AGRAWAL VRS. C IT SLP CIVIL NO:9244 OF 1995, THE APEX COURT HAS SUPPORTED THE ABOVE VIEWS OF THE HIGH COURT AND ADMITTED THAT - ASSESSE HAD OVERVALUED THE STOCK FOR THE PURPOSE OF OBTAINING A LARGER CREDIT FROM THE BANK THEREFORE, AO HAS NOT PROPERLY EXAMINED THE VALUAT ION OF STOCK DURING THE COURSE OF SCRUTINY PROCEEDINGS APPARENTLY NOT CONSIDERED THE DIFFERENCE OF STOCK VALUATION AS UNACCOUNTED SALES OF THE ASSESSEE WHICH WAS NOT RECORDED IN THE BOOKS OF THE ASSESSEE FOR THE FINANCIAL YEAR:2009 - 10. IN VIEW OF THE ABOV E, THE ASSESSMENT ORDER FRAMED U/S. 143(3) OF THE I.T.ACT,1961 ON 19.12.2012 IS HEREBY SET ASIDE TO THE ASSESSING OFFICER FOR FRESH ADJUDICATION OF FACTS AND PROPER APPLICATION OF LAW IN FRESH ASSESSMENT PROCEEDING AFTER GIVING PROPER OPPORTUNITIES TO THE ASSESSES IN THE FOLLOWING LINES: I. THE ASSESSING OFFICER HAS TO CALL FOR AUDITED BOOKS OF ACCOUNT RELATING TO THE FINANCIAL YEAR:2009 - 10 AND TO EXAMINE THE GENUINENESS OF LIABILITIES SHOWN IN THE BALANCE SHEET AS ON ITA NO. 187 /CTK/201 5 6 31.03.2010 SUCH AS UNSECURED LOAN OF RS.3,24,069/ SUNDRY CREDITORS OF RS.18,39,100/DETAILS OF PAYABLE OF RS.3,33,474 AND ALSO SUNDRY DEBTORS OF RS.2,32,495 SHOWN UNDER 'CURRENT ASSETS' OF THE BALANCE SHEET. II. AO HAS TO EXAMINE THE VALUATION OF STOCK RECORDED IN THE BOOKS OF THE ASSESSEE WITH THE STOCK REPORTED TO THE BANK AND IF DIFFERENCE OF VALUE OF STOCK FOUND IF, ANY IS REQUIRED TO BE ADDED AS UNACCOUNTED SALES OF THE ASSESSEE. ON THE BASIS OF SUCH EXAMINATION OF FACTS, FRESH FINDING HAS TO BE RECORDED ON ACCOUNT OF THE ABOVE ISSUES WHETHER ADDITIONS CAN BE MADE IN COMPUTATION OF TAXABLE INCOME OF THE ASSESSEE FOR THE A/Y. - 2010 - 11. 4. FEELING AGGRIEVED FROM THE ORDER OF THE LD. PR.CIT, THE ASSESSEE FILED APPEAL BEFORE THE INCOME TAX APPELLATE TRIBUNAL. 5. LD. AR BEFORE US FILED THREE PAPER BOOKS OUT OF WHICH ONE CONTAINS FROM PAGES 1 TO 47, SECOND CONTAINS ANNEXURES NAMED AS ABC AND THIRD PAPER BOOK CONTAINS FROM PAGES 1 TO 50. IN THE PAPER BOOK, THE ASSESSEE HAS FILED WRITTEN SUBMISSIONS CONTAINING PAGES 1 TO 3. WHICH READ AS UNDER : - THIS APPEAL HAS BEEN FILED AGAINST ORDER U/S. 263 DATED. 12.03.2015 SETTING ASIDE THE ORDER OF AO LEGALLY FRAMED AFTER DUE VERIFICATION / EXAMINATION OF THE AUDITED ACCOUNTS U/S. 143(3) OF THE I.T. ACT, 1961. THE FACT OF THE CASE IS AS UNDER : - THE ASSES SEE DERIVES INCOME FROM SALE OF ZUARI MADE FURNITURE AND MAINTAINS PROPER ACCOUNTS AUDITED U/S. 44AB OF THE I.T. ACT. 1961. THERE WAS SURVEY OPERATION U/S.133A OF THE I.T. ACT, 1961 ON 09.03.2010 IN THE BUSINESS PREMISES OF M/S. PARIVARTAN, SHRIKUNJA APART MENT, KHAN NAGAR, CUTTACK. THE BOOKS OF ACCOUNT FOR THE ASSESSMENT YEAR - 2010 - 11 HAS BEEN AUDITED BY DAS MOHANTY & ASSOCIATES, CHARTERED ACCOUNTANTS, ARUNDAYA NAGAR, LINK ROAD, CUTTACK - 12 AND THEY HAVE CERTIFIED IN THEIR REPORT THAT THE BALANCE SHEET, PROF IT & LOSS ACCOUNT ARE IN AGREEMENT WITH THE BOOKS OF ACCOUNTS MAINTAINED AND PROPER BOOKS OF ACCOUNTS HAVE BEEN KEPT. THAT EVEN THOUGH IN COURSE OF ASSESSMENT PROCEEDING THE ASSESSEE WAS REPRESENTED BY SRI AMIYA KU SAHOO, ADVOCATE APPEARED FROM TIME TO TI ME AND EVEN THOUGH HE FILED THE AUDITED REPORT IN FORM - 3CD & 3CB ALONG WITH LEDGER COPY OF BANK ACCOUNT, BUT HE HAS NOT BEEN ABLE TO ITA NO. 187 /CTK/201 5 7 PRODUCE THE CASH BOOK AND LEDGER MAINTAINED IN TALLY SYSTEM. THE AUDITOR HAS CERTIFIED THAT THE ASSESSEE MAINTAINS CASH BOO K, LEDGER, STOCK REGISTER, PURCHASE AND SALES REGISTER ETC WHICH WERE DULY VERIFIED BY THE AUDITOR. THAT THE COPY OF CASH BOOK MAINTAINED IN TALLY SYSTEM AND LEDGER MAINTAINED BY THE ASSESSEE IS VERY MUCH AVAILABLE AND CAN BE PRODUCED IF REQUIRED. THE RELEVANT ASSESSMENT YEAR - 2010 - 11 (YEAR ENDING ON 31.03.2010). AND THE SURVEY OPERATION WAS CONDUCTED U/S.133A ON 09.03.2010 WHICH IS ALMOST TOWARDS THE FAG END OF THE ASSESSMENT YEAR. BECAUSE IT WAS A CASE OF SURVEY OPERATION, THEREFORE THE AO HAS METICULOUSLY AND CAREFULLY GONE THROUGH THE CASE AND PASSED ORDER U/S. 143(3) OF THE IT. ACT, 1961 ON 19.12.2012 IN ACCORDANCE WITH LAW. IN THE BALANCE SHEET AS ON 31.03.2010 ASSESSEE HAS SHOWN SUNDRY CREDITORS OF RS. 18,39,100/ - SUNDRY DEBTORS R S. 2,32,495/ - UNSECURED LOAN OF RS. 3,24,069/ - AND DETAILS OF CURRENT LIABILITIES AND PROVISIONS PAYABLE OF RS. 3,33,474 RESPECTIVELY. THE ABOVE DETAILS WERE DULY EXPLAINED TO THE ASSESSING OFFICER BY THE ASSESSEE IN COURSE OF ASSESSMENT PROCEEDING, WHICH IS THE COMMISSIONER IN PROCEEDING U/S. 263 DOES NOT AGREE. AFTER ALL THIS WAS AN ASSESSMENT CONSEQUENT UPON SURVEY OPERATION U/S. 133(A). THEREFORE, THE A.O. HAS TAKEN SPECIAL CARE WHILE SCRUTINISING THE ASSESSMENT. FURTHER THE ASSESSEE HAS DISCLOSED STO CK VALUE AS PER BOOKS OF ACCOUNTS DULY AUDITED AT 27,62,047/ - . FOR OBTAINING LOAN THE ASSESSEE HAS GIVEN AN INFLATED FIGURE OF STOCK TO PUNJAB NATIONAL BANK AT RS. 55,43,112/ - . FOR THE ABOVE REASON THE CIT ISSUED NOTICE U/S 263 WHICH WAS DULY COMPLIED. TH E CIT HAS ALSO MENTIONED THE SAME IN HIS ORDER U/S 263 DATED 12.03.2015. WITHOUT APPRECIATING THE EXPLANATION JUDICIALLY, THE LEARNED CIT HAS SET - A - SIDE THE ORDER OF THE A.O., JUDICIALLY AND PROPERLY FRAMED, TO RE - DO THE ASSESSMENT MAKING ADDITIONS, WHICH IS DISPUTED IN THIS APPEAL AS ILLEGAL AND NOT IN ACCORDANCE WITH LAW ON THE BASIS OF THE DECISION OF SUPREME COURT AND HIGH COURTS ACCEPTED BY THIS BENCH OF THE TRIBUNAL IN SIMILAR CASES MENTIONED BELOW. THEREFORE INVOKING SECTION 263 AND ASKING THE A.O. TO RE - DO AMOUNTS TO 'ROVING ENQUIRY' WHICH IS NOT PERMISSIBLE UNDER LAW AS DECIDED BY HON'BLE SUPREME COURT OF INDIA IN THE CASE OF M/S. MALBAR INDUSTRIES CO. LTD, 243 ITR 83 (SC) FOLLOWED BY HONOURABLE CUTTACK BENCH OF THE TRIBUNAL IN THE CASE OF MANGALA M TIMBER PRODUCTS LTD VS. ACIT, 134 TTJ PAGE 57. SIMILARLY NO ADDITION CAN BE MADE ON THE BASIS OF CLOSING STOCK DECLARED IN THE AUDITED ACCOUNTS AND SHOWN TO BANK INFLATING THE VALUE TO AVAIL LOAN FROM BANK HAS BEEN DECIDED BY HON'BLE GUJRAT HIGH COURT IN THE CASE OF CIT VS. VEERDIP ROLLERS PVT LTD, 323 ITR 341 (GUJ) AND APPROVED BY SUPREME COURT OF INDIA REPORTED IN 307 ITR (ST.)3 REJECTING THE SPECIAL LEAVE PETITION OF THE DEPARTMENT. HON'BLE I.T.A.T., CUTTACK ITA NO. 187 /CTK/201 5 8 BENCH, CUTTACK FOLLOWING THE ABOVE PRINCIPLE IN THE CASE OF MAMATA KATAL VS. ACIT, 52 ITR (TRIB) 138 HAVE DELETED THE ADDITION. THEREFORE, THE ADDITION MADE ON THIS SCORE IS LIABLE TO BE DELETED FOLLOWING THE DECISION OF CO - ORDIANTE BENCH OF THE TRIBUNAL ALSO. IT IS ALSO SETTLED LAW DECIDED BY HON' BLE SUPREME COURT IN THE CASE OF MALBAR INDUSTRIES VS. CIT, 243 ITR 83 (SC) THAT THE PROVISION IN SECTION 263 CANNOT BE INVOKED TO CORRECT EACH AND EVERY TYPE OF MISTAKES COMMITTED BY THE AO AND EVERY LOSS OF REVENUE AS A CONSEQUENCE OF THE ORDER OF THE AO CANNOT BE TREATED AS A PREJUDICIAL TO THE INTEREST OF THE REVENUE. FURTHER, WHEN TWO VIEWS ARE POSSIBLE AND THE ITO HAS TAKEN ONE VIEW WHICH THE CIT DOES NOT AGREE. IT CANNOT BE TREATED AS AN ERRONEOUS ORDER, FOR INVOKING THE PROVISION U/S. 263. THE SAME THING HAS HAPPENED IN THIS CASE. THEREFORE THE ORDER OF CIT U/S.263 IS NOT SUSTAINABLE IN LAW AND IS LIABLE TO BE QUASHED. PRAYER IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES OF THE CASE, THE ORDER U/S.263 MAY KINDLY BE QUASHED AND FOR THIS ACT OF YOUR KI NDNESS THE ASSESSEE AS IN DUTY BOUND SHALL EVER PRAY. LD. AR FURTHER SUBMITTED THAT THE BOOKS OF ACCOUNTS WAS GOT AUDITED BY THE QUALIFIED CHARTERED ACCOUNTANT, ACCORDING TO HIM THE ASSESSEE HAS MAINTAINED CASH BOOK, LEDGER STOCK BOOKS ETC. WHICH WERE VER IFIED BY HIM, THEREAFTER, HE HAS ISSUED AUDITED REPORT IN PRESCRIBED FORM NO.3CB & 3CD WHICH HAS NOT BEEN DISREGARDED BY THE AO DURING THE COURSE OF ASSESSMENT PROCEEDINGS. THE AO HAS VERIFIED ALL THE FINANCIAL TRANSACTIONS AND THE ASSESSEE SUBMITTED REQUI RED DOCUMENTS DURING THE COURSE OF ASSESSMENT PROCEEDINGS. HE ALSO STATED THAT THE DETAILS OF THE CREDITORS WERE PRODUCED BEFORE THE AO. IT WAS THE DUTY OF THE AO TO VERIFY TO THE EXTENT OF HIS SATISFACTION. IN RESPECT OF DIFFERENCE OF STOCK NOTED BY THE P R.CIT, HE STATED THAT CLOSING STOCK HAS BEEN ACCEPTED BY THE AO AND HE HAS ADDED TO THE DIFFERENCE OF STOCK FOUND DURING THE COURSE OF SURVEY U/S.133A OF THE ACT AND HE ALSO STATED THAT FOR ITA NO. 187 /CTK/201 5 9 AVAILABLE CASH CREDIT LIMIT AND SMOOTH RUNNING OF THE BUSINESS THE STOCK STATEMENT WAS GIVEN TO THE PUNJAB NATIONAL BANK WAS INFLATED IN THIS REGARD, HE RELIED ON THE FOLLOWING JUDGMENTS : - I) MALBAR INDUSTRIAL CO. LTD VS. CIT (2000) 243 ITR 83 (S.C.) II) CIT VS. GABRIEL INDUSTRIES LTD, 203 ITR 108,114 (BOM) III) S MALL WONDER INDUSTRIES, ITA NO. - 2464/MUM/2013 'E' MUMBAI IV) ITA VS. PAPELLAL GAUR 49 TTJ (NAG) PAGE - 126, 47 ITD PAGE 33 (NAG) V) GURUDEV SINGH VS. ASSISTANT COMMISSIONER OF INCOME TAX (2017) 56 ITR (TRIB) 503 (CUTTACK), VI) CIT VS. AMIT BHAI GUNUANT BHAI (1981) 129 ITR 573 (GUJ) V II ) MAMATA KATAL, 52 ITR(TRIB) 139 (CTC) VIII ) CIT VS. VEERDIP ROLLERS P. LTD., VOL. 323 ITR, PAGE 341 (GUJ) S.L.P. FILED BY DEPARTMENT REFLECTED IN 307 ITR 743 MP (PAGE 361) IX ) MANGALAM TIMBER PRODUCTS LTD. ORDER DATED 0 4.04.2011 X ) UNION OF INDIA VS. RAGHUBIR SINGH 178 ITR 548 (S.C) FOLLOWED IN THE SOCIETY OF PRESENTATION SISTERS, 318 ITR PAGE 287 AT PAGE 295 ITAT COCHIN 'B' BENCH. X I ) LYCOS INDIA LTD, I.TA. NO. 02/CTK/2018 DT. 01 - 09 - 2020 X II ) RAMPYARI DEVI SARAOGI VS. CIT, 67 ITR 84.(SC) X III ) SMT. TARA DEVI AGARWAL VS. CIT, 88 ITR 323 (SC ) X IV ) UMASHANKAR RICE MILL VS. CIT, 187 ITR 638.(SC) X V ) GEE VEE ENTERPRISES VS. ACIT, 99 ITR 375 (DEL) XV I ) INFOSYS BPO LTD VS. 149 TTJ 50 6. ON THE OTHER HAND, LD. DR R ELIED ON THE ORDER OF LD. PR.CIT AND HE SUBMITTED THAT THE LD. PR.CIT IS JUSTIFIED TO EXERCISE HIS POWERS AS PER SECTION 263 OF THE ACT. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO ISSUED NOTICE U/S.142(1) OF THE ACT FOR PRODUCTION OF ACCOUNT BOOKS A ND OTHER DOCUMENTS. EVEN AFTER RECEIVING SHOW CAUSE NOTICE ISSUED BY THE AO DATED 03.08.2015, T HE ASSESSEE DID NOT PRODUCE THE BOOKS OF ACCOUNTS. IN THE AUDIT REPORT HOW THE AUDITOR HAD CERTIFIED THAT THE CASH BOOK, STOCK LEDGER ETC. WAS MAINTAINED. AS PER THE ORDERSHEET THE AO GAVE MANY OPPORTUNITIES TO THE AO, IN SPITE OF THAT, HE DID NOT PRODUCE THE BOOKS OF ACCOUNTS. THE AO COMPLETED THE ASSESSMENTS ONLY ITA NO. 187 /CTK/201 5 10 ON THE BASIS OF FINANCIAL STATEMENTS AND COPY OF LEDGER ACCOUNTS AVAILABLE BEFORE HIM, WHICH CANNOT BE CONSIDERED PROPERLY THAT THE COMPLETE DOCUMENTS WERE PRODUCED FOR COMPLETING THE SCRUTINY ASSESSMENTS. HE REFERRED TO THE LIST OF THE CREDITORS PLACED IN THE PAPER BOOK. THE ASSESSEE SHOULD HAVE BEEN GIVEN COMPLETE NAME WITH ADDRESS OF THE DETAILS OF TH E CREDITORS SO THAT THE AO CAN VERIFY THE GENUINENESS OF THE CREDITORS SHOWN AT THE YEAR END . MERELY PROVIDING NAME, PAN AND AMOUNT , IS NOT SUFFICIENT AND THE COMPLETE ADDRESS WAS NOT PROVIDED BEFORE THE AO . HE ALSO SUBMITTED THAT THE AO DID NOT OBSERVE T O THE RECORDS WHICH WERE GATHERED DURING THE COURSE OF SURVEY PROCEEDINGS U/S.133 OF THE ACT AS WELL AS THE DOCUMENTS PRODUCED BEFORE HIM. THE STOCK STATEMENT S WERE SUBMITTED TO THE PUNJAB NATIONAL BANK FOR AVAILING CASH CREDIT LOAN. HE SHOULD HAVE WORKED OUT THE STOCK AMOUNT SHOWN IN THE STOCK STATEMENT AND ON THE DATE OF SURVEY WHICH IS 9 TH MARCH, 2010, BECAUSE THERE WAS A HUGE DIFFERENCE BETWEEN THE STOCK STATEMENTS SUBMITTED TO THE BANK AND STOCK SHOWN BY THE ASSESSEE. IN THIS REGARD, THE CASE LAWS RELI ED ON BY THE LD. AR IS NOT APPLICABLE IN THE PRESENT FACTS OF THE CASE. IN THE JUDGMENTS RELIED ON BY THE LD. AR, THE ASSESSEE HAD SUBMITTED WITH QUANTITATIVE DETAILS BUT THERE IS A DIFFERENCE IN ONLY VALUE OF THE STOCK AMOUNT. BUT IN THIS CASE THE CASE IS DIFFERENT, THEREFORE, IN THIS REGARD, THE CASE LAWS RELIED ON BY THE LD. AR IS NOT APPLICABLE. IN RESPECT OF LEGAL ITA NO. 187 /CTK/201 5 11 ISSUE, THE CASE LAWS RELIED ON BY THE LD. AR ARE ALSO NOT APPLICABLE BECAUSE IN THE PRESENT CASE IN HAND THE ASSESSEE DID NOT PRODUCE ANY BO OKS OF ACCOUNTS SO THAT THE AO CAN VERIFY THE CORRECT AND COMPLETENESS OF THE FINANCIAL TRANSACTIONS ON THE BASIS OF WHICH THE AUDITED REPORT U/S.44AB OF THE ACT WAS PREPARED. 7. FURTHER THE LD.CIT DR SUBMITTED THAT T HE ASSERTION OF THE ID. AR OF THE ASSE SSEE THAT DETAILS OF SUNDRY CREDITORS, UNSECURED LOAN CREDITORS AND LIABILITIES WERE AVAILABLE IN THE AUDITED BALANCE SHEET SHALL CLEARLY IMPLY THAT HE IS SHIRKING FROM HIS RESPONSIBILITY TO FILE THE RELEVANT DETAILS BEFORE THE A.O. AS WELL AS ONUS LYING O N THE ASSESSEE TO PROVE THE GENUINENESS OF SUCH SUNDRY CREDITORS, UNSECURED LOAN CREDITORS AND LIABILITIES HAS REMAINED UN - VERIFIED . THIS WOULD ALSO IMPLY RESTRICTING THE POWERS OF THE A.O. TO VERIFY SUCH DETAILS IN THE COURSE OF ASSESSMENT PROCEEDINGS. IF SUCH A PREPOSTEROUS CONTENTION OF THE ID. AR IS ACCEPTED THEN THERE WOULD BE NO NEED TO SELECT THE CASES FOR SCRUTINY. MOREOVER THE ASSESSMENT MAY BE FINALIZED ON THE BASIS OF AUDITED BALANCE SHEET, WHICH IS NOT THE INTENTION OF THE LEGISLATURE. TO SUPPOR T HIS ARGUMENTS, LD. CIT DR RELIED ON THE FOLLOWING CASE LAWS : - I) SMT. SHAKUNTLA THUKRAL [2014] 52 TAXMANN.COM 86 (PUNJAB & HARYANA); II) B.T.STEELS LTD. [2011] 196 TAXMAN 362 (PUNJAB & HARYANA); AND III) CENTURY FOAMS (P) LTD. [1995] 82 TAXMAN 575 (ALLA HABAD) 8 . IN THE REJOINDER THE LD. AR OF THE ASSESSEE FURTHER STATED THAT THE AO HAS MENTIONED IN HIS ORDER THAT THE AUDIT REPORT U/S.44AB OF THE ACT ITA NO. 187 /CTK/201 5 12 WAS PRODUCED BY THE ASSESSEE AND THE AO HAS TAKEN VIEW ON THE BASIS OF THE AUDIT REPORT FOR FRAMING THE A SSESSMENT. IF THERE WAS ONE PLAUSIBLE VIEW TAKEN BY THE AO, THE LD. PR.CIT CANNOT INVOKE HIS POWERS AS PER SECTION 263(1) OF THE ACT ON THE OTHER PLAUSIBLE VIEW IN RESPECT OF STOCK DIFFERENCE FOUND ON THE DATE OF SURVEY . IN SUPPORT OF HIS ARGUMENTS, HE RELI ED ON THE JUDGMENT OF THE HONBE SUPREME COURT IN CASE OF MALABAR INDUSTRIAL CO. LTD. VS. CIT (2000) 243 ITR 83 (SC) . 9 . AFTER HEARING BOTH THE SIDES AND PERUSING THE ENTIRE MATERIAL AVAILABLE ON RECORD AND THE ORDERS OF AUTHORITIES BELOW, WE FIND THAT THE AO COMPLETED THE ASSESSMENT ON THE BASIS OF AUDIT REPORT AND COPY OF LEDGER, BANK STATEMENTS ETC. BUT THE ASSESSEE DID NOT PRODUCE ANY BOOKS OF ACCOUNTS WHICH HAS BEEN CATEGORICALLY MENTIONED BY THE AO IN HIS ORDER AND HE HAD ALSO ISSUED SHOW CAUSE NOTICE IN THIS REGARD BUT THE ASSESSEE DID NOT COMPLY THE SAME, THEREFORE, THE AO COMPLETED THE ASSESSMENT AND DISALLOWED THE DIFFERENCE OF STOCK FOUND DURING THE COURSE OF SURVEY U/S.133A OF THE ACT. THE LD. PR.CIT ON THE BASIS OF RECORD HE OBSERVED THAT THE ORD ER OF THE AO WAS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE. ACCORDINGLY, HE ISSUED SHOW CAUSE NOTICE ON 15.01.2015. WE OBSERVE THAT IN RESPECT OF STOCK THE AO HAD TAKEN A PLAUSIBLE VIEW AND ADDED THE DIFFERENCE FOUND DURING THE COURSE OF SURVEY PROCEEDINGS U/S.133A OF THE ACT TO THE TOTAL INCOME OF THE ASSESSEE. AS PER THE ASSESSING OFFICER THE ASSESSEE HAD MAINTAINED ITA NO. 187 /CTK/201 5 13 STOCK REGISTER FROM WHICH HE HAD TAKEN FIGURES WHICH IS APPARENT FROM THE ASSESSMENT ORDER . THE LD. PR.CIT HAS OBSERVED THAT THERE IS STOCK STATEMENT ON RECORD WHICH HAS BEEN SUBMITTED BY THE ASSESSEE TO THE PUNJAB NATIONAL BANK IN INFLATED VALUE, THEREFORE, THE DIFFERENCE SHALL BE TREATED AS UNACCOUNTED SALES. IN RESPECT OF OTHER FINDINGS OF THE LD. PR.CIT, THE AO DID NOT ENQUIRE IN DEPTH WHICH OUGHT TO HAVE BEEN DONE FOR COMPETING THE ASSESSMENT PROCEEDINGS AS PER THE PROVISIONS OF I.T.ACT. EVEN BEFORE THE PROCEEDING U/S.263/143(3) OF THE ACT BEFORE THE AO, THE ASSESSEE DID NOT PRODUCE BOOKS OF ACCOUNTS. THE LD. PR.CIT SHOULD HAVE GOT CONFIRMED FROM PUNJAB NATIONAL BANK AS TO WHETHER THE STOCK STATEMENT HAS BEEN SUBMITTED BEFORE THE BANK IS CORRECT OR NOT BY MAKING INDEPENDENT ENQUIRY. FROM THE ORDER OF LD. PR.CIT IT IS NOT CLEAR THAT AS TO WHETHER ANY ENQUIRY HAS BEEN DONE BY THE LD. P R.CIT OR NOT AND IT IS ALSO NOT CLEAR WHETHER THERE WAS A DIFFERENCE IN QUANTITATIVE DETAILS OR ONLY ON VALUE SHOWN IN THE STOCK STATEMENT . IN THIS REGARD, THE LD. PR.CIT IS NOT JUSTIFIED FOR MAKING DIRECTION TO THE AO FOR REEXAMINATION OF THE VALUATION OF STOCK RECORDED IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE REPORTED TO THE BANK. THE DECISION OF HONBLE SUPREME COURT RELIED ON BY THE LD. AR OF THE ASSESSEE IN THE CASE OF MALBAR INDUSTRIES CO. (SUPRA) SUPPORTS OUR ABOVE VIEW. 10 . FURTHER WE OBSERVE FROM T HE RECORD OF AUTHORITIES BELOW AND ORDER SHEET THE AO HAD ASKED TO THE ASSESSEE MANY TIMES FOR PRODUCING ITA NO. 187 /CTK/201 5 14 THE BOOKS OF ACCOUNTS BUT THE ASSESSEE FAILED TO PRODUCE AT ANY STAGE BEFORE THE AUTHORITIES BELOW. THE LD. PR. CIT HAS OBSERVED THAT IN RESPECT OF UNSE CURED LOANS SUNDRY CREDITORS/LIABILITIES AND SUNDRY DEBTORS ON ASSET SIDE APPEARING ON THE BALANCE SHEET AS ON 31.03.2010 SUCH AS UNSECURED LOAN OF RS.3,24,069/ - SUNDRY CREDITORS OF RS.18,39,100/ - AFTER PAYABLE OF RS.3,34,474/ - AND IN RESPECT OF CURRENT AS SETS(SUNDRY DEBTORS) THE AO HAS ACCEPTED ONLY TO THE AUDIT REPORT FILED BY THE ASSESSEE. FROM THE RECORDS IT IS NOT CLEAR THAT THERE IS ANY ENQUIRY OR ANY DELIBERATION IN THIS REGARD. THE AO SHOULD HAVE DONE ENQUIRY FOR THE GENUINENESS OF THE CURRENT LIABI LITIES AND CURRENT ASSETS WHICH HAS BEEN OBSERVED BY THE LD. PR.CIT. THE AO IS NOT ONLY AN ADJUDICATOR, HE IS ALSO AN INVESTIGATOR BEFORE COMING TO ANY CONCLUSION WITH REGARD TO THE GENUINENESS OF THE TRANSACTIONS DONE BY THE ASSESSEE, WHICH IS LACK IN THIS CASE. IN THIS REGARD, WE WOULD LIKE TO REPRODUCE THE PROVISIONS OF SECTION 263(1) OF THE ACT, WHICH READ AS UNDER : - REVISION OF ORDERS PREJUDICIAL TO REVENUE. 263. (1) THE PRINCIPAL COMMISSIONER OR COMMISSIONER MAY CALL FOR AND EXAMINE THE RECORD OF ANY PROCEEDING UNDER THIS ACT, AND IF HE CONSIDERS THAT ANY ORDER PASSED THEREIN BY THE ASSESSING OFFICER IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE, HE MAY, AFTER GIVING THE ASSESSEE AN OPPORTUNITY OF BEING HEARD AND AFTER MA KING OR CAUSING TO BE MADE SUCH INQUIRY AS HE DEEMS NECESSARY, PASS SUCH ORDER THEREON AS THE CIRCUMSTANCES OF THE CASE JUSTIFY, INCLUDING AN ORDER ENHANCING OR MODIFYING THE ASSESSMENT, OR CANCELLING THE ASSESSMENT AND DIRECTING A FRESH ASSESSMENT. EXPLAN ATION 1 . FOR THE REMOVAL OF DOUBTS, IT IS HEREBY DECLARED THAT, FOR THE PURPOSES OF THIS SUB - SECTION, ( A ) AN ORDER PASSED ON OR BEFORE OR AFTER THE 1ST DAY OF JUNE, 1988 BY THE ASSESSING OFFICER SHALL INCLUDE ITA NO. 187 /CTK/201 5 15 ( I ) AN ORDER OF ASSESSMENT MADE BY THE ASS ISTANT COMMISSIONER OR DEPUTY COMMISSIONER OR THE INCOME - TAX OFFICER ON THE BASIS OF THE DIRECTIONS ISSUED BY THE JOINT COMMISSIONER UNDER SECTION 144A ; ( II ) AN OR DER MADE BY THE JOINT COMMISSIONER IN EXERCISE OF THE POWERS OR IN THE PERFORMANCE OF THE FUNCTIONS OF AN ASSESSING OFFICER CONFERRED ON, OR ASSIGNED TO, HIM UNDER THE ORDERS OR DIRECTIONS ISSUED BY THE BOARD OR BY THE PRINCIPAL CHIEF COMMISSIONER OR CHIEF COMMISSIONER OR PRINCIPAL DIRECTOR GENERAL OR DIRECTOR GENERAL OR PRINCIPAL COMMISSIONER OR COMMISSIONER AUTHORISED BY THE BOARD IN THIS BEHALF UNDER SECTION 120 ; ( B ) 'RECORD' SHALL INCLUDE AND SHALL BE DEEMED ALWAYS TO HAVE INCLUDED ALL RECORDS RELATING TO ANY PROCEEDING UNDER THIS ACT AVAILABLE AT THE TIME OF EXAMINATION BY THE PRINCIPAL COMMISSIONER OR COMMISSIONER; ( C ) WHERE ANY ORDER REFERRED TO IN THIS SUB - S ECTION AND PASSED BY THE ASSESSING OFFICER HAD BEEN THE SUBJECT MATTER OF ANY APPEAL FILED ON OR BEFORE OR AFTER THE 1ST DAY OF JUNE, 1988, THE POWERS OF THE PRINCIPAL COMMISSIONER OR COMMISSIONER UNDER THIS SUB - SECTION SHALL EXTEND AND SHALL BE DEEMED ALW AYS TO HAVE EXTENDED TO SUCH MATTERS AS HAD NOT BEEN CONSIDERED AND DECIDED IN SUCH APPEAL. EXPLANATION 2. FOR THE PURPOSES OF THIS SECTION, IT IS HEREBY DECLARED THAT AN ORDER PASSED BY THE ASSESSING OFFICER SHALL BE DEEMED TO BE ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE, IF, IN THE OPINION OF THE PRINCIPAL COMMISSIONER OR COMMISSIONER, ( A ) THE ORDER IS PASSED WITHOUT MAKING INQUIRIES OR VERIFICATION WHICH SHOULD HAVE BEEN MADE; ( B ) THE ORDER IS PASSED ALLOWING ANY RELIEF WITHOUT INQUIRING INTO THE CLAIM; ( C ) THE ORDER HAS NOT BEEN MADE IN ACCORDANCE WITH ANY ORDER, DIRECTION OR INSTRUCTION ISSUED BY THE BOARD UNDER SECTION 119 ; OR ( D ) THE ORDER HAS NOT BEEN PASSED IN ACCORDANCE WITH ANY DECISION WHICH IS PREJUDICIAL TO THE ASSESSEE, RENDERED BY THE JURISDICTIONAL HIGH COURT OR SUPREME COURT IN THE CASE OF THE ASSESSEE OR ANY OTHER PERSON. AS PER OUR CONSIDERED OPINION AS WELL AS TH E PROVISIONS OF SECTION 263(1) OF THE ACT AS REPRODUCED ABOVE, THE ORDER OF THE AO IN RESPECT OF UNSECURED LOANS , SUNDRY CREDITORS/LIABILITIES AND SUNDRY DEBTORS ACCEPTED BY THE AO IS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE. WE HEREBY MAKE IT CLEAR THAT THE DIRECTION OF THE LD. PR.CIT IN ITA NO. 187 /CTK/201 5 16 RESPECT OF STOCK DIFFERENCES FOUND FROM THE RECORD IS NOT REQUIRED TO FURTHER VERIFICATION AND IN RESPECT OF UNSECURED LOANS, SUNDRY CREDITORS/LIABILITIES AND SUNDRY DEBTORS THE AO HAS TO FOLLOW THE DIRECTION OF THE LD. PR.CIT. THEREFORE, THE LD. PR.CIT HAS RIGHTLY INVOKED HIS POWER PROVIDED U/S.263(1) OF THE ACT TO THE EXTENT OF THE DECISION OF THE LD. PR.CIT IN THIS REGARD . 11 . IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON 25 / 0 9 / 20 20 . S D/ - ( C.M.GARG ) SD/ - (L.P.SAHU) / JUDICIAL MEMBER / ACCOUNTANT MEMBER CUTTACK ; DATED 25 / 0 9 /20 20 PRAKASH KUMAR MISHRA, SR.P.S. / COPY OF THE ORDER FORWARDED TO : / BY ORDER, ( SENIOR PRIVATE SECRETARY ) , /ITAT, CUTTACK 1. / THE APPELLANT - SMT. DIMPLE MURARKA, PROP - M/S PARIVARTAN, PLOT NO.1263, SECTOR - 6, CDA, CUTTACK 2. / THE RESPONDENT - THE PR.CIT, CUTTACK 3. ( ) / THE CIT(A), 4. / CIT 5. , , / DR, ITAT, CUTTACK 6. / GUARD FILE. //TRUE COPY//