Harshad Rai Mehta, Nayasarak V. Pr.CIT-1, Bhubaneswar

ITA 33/CTK/2022

AI Insights

The case involves an appeal by Harshad Rai Mehta, the proprietor of Iswar Jewellers, against the order of the Pr.CIT, Bhubaneswar-1, which proposed a revision of the assessment order for the assessment year 2017-2018. The original assessment was completed under section 143(3) of the Income Tax Act, following a scrutiny of the return filed by Mehta, which resulted in certain disallowances of expenses. The Pr.CIT's revisionary order was challenged on the grounds that it was based on a casual and non-diligent approach by the AO, and it did not point out any specific errors in the original assessment. The Tribunal examined the submissions and evidence presented, including the notices and replies exchanged during the assessment proceedings, and concluded that the AO had adequately addressed the issues raised.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 127061 (ITAT-CUTTACK)
• Duration Of Justice: 9 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-01-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 18-01-2023
• Assessment Year: 2017-2018
• Appeal Filed On: 20-03-2022
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Gift

Judgement Text

आयकर अऩीऱीय अधधकरण, कटक न्यायऩीठ,कटक IN THE INCOME TAX APPELLATE TRIBUNAL CUTTACK BENCH CUTTACK श्री जाजज माथन, न्याययक सदस्य एवं श्री अरुण खोड़पऩया ऱेखा सदस्य के समक्ष । BEFORE SHRI GEORGE MATHAN, JUDICIAL MEMBER AND SHRI ARUN KHODPIA, ACCOUNTANT MEMBER आयकर अऩीऱ सं/ITA No.33/C TK/2022 (ननधाारण वषा / Asses s m ent Year :2017-2018) Harshad Rai Mehta, Prop. Iswar Jewellers, Naya Sarak, Cuttack-753002 Vs Pr.CIT, Bhubaneswar-1 PAN No. :ABCPM 1568 J (अऩीऱाथी /Appellant) .. (प्रत्यथी / Respondent) ननधााररती की ओर से /Assessee by : Shri Mohit Sheth, Advocate राजस्व की ओर से /Revenue by : Shri M.K.Gautam, CIT-DR स ु नवाई की तारीख / Date of Hearing : 19/01/2023 घोषणा की तारीख/Date of Pronouncement : 19/01/2023 आदेश / O R D E R Per Bench : This is an appeal filed by the assessee against the order of the ld.Pr.CIT, Bhubaneswar-1, dated 02.03.2022, passed in DIN & Order No.ITBA/REV/F/REV5/2021-22/1040277830(1) for the assessment year 2017-2018. 2. It was submitted by the ld. AR of the assessee that the assessee is an individual, who is doing business of manufacture and retail sale of jewellery. It was the submission that the return filed by the assessee came to be taken on scrutiny and the assessment came to be completed wherein certain disallowance out of the expenses had been made. It was the submission that the assessment order passed u/s.143(3) of the Act, dated 26.12.2019 was the subject matter of a proposed revision by the ld. Pr.CIT, Bhubaneswar-1 on multiple issues which is mentioned in para 3 of ITA No.33/CTK/2022 2 the order of the ld. Pr.CIT. It was the submission that in the course of the assessment the AO had issued a notice u/s.142(1) of the Act wherein all these issues had been called for examination. The ld. AR drew our attention to the notice issued u/s.142(1) of the Act dated 08.08.2019. It was the submission that in response to the notice issued u/s.142(1) of the Act and the consequential proceedings, replies have been filed by the assessee on 18.11.2019 & 25.11.2019, the cash book was specifically produced on 08.12.2019 and other registers were produced on 15.12.2019, gifts confirmations were produced on 12.03.2019. It was the submission that after examination of all these details only, the assessment order has been passed. It was the submission that this was also brought to the attention of the ld. Pr.CIT in reply to the show cause notice issued u/s.263 of the Act on 18.02.2022. It was the submission that without considering any of the explanation of the assessee the ld. Pr.CIT has taken a stand that the cash book copies are not on record whereas the cash book has been specifically produced on 08.12.2019. It was the submission that the ld. Pr.CIT in page 6 of his order holds that there are heavy transactions and heavy withdrawals which begged the scrutiny but the reply of the assessee does not indicate and nothing on record that this has been examined. In short, the approach of the AO has been casual, not diligent and without due application of mind. It was the submission that no specific error on the part of the assessee or in respect of any of the evidences produced by the assessee or the findings as arrived at by the ld. AO has been pointed out. It was the submission that the ITA No.33/CTK/2022 3 revisionary order is nothing but a direction by the ld. Pr.CIT to do a fresh fishing and roving enquiry into an already completed assessment. It was the submission that the order of the ld. Pr.CIT is liable to be quashed. 3. In reply, ld. CIT-DR vehemently supported the order of the ld. Pr.CIT. It was the submission that there is no evidence available on record to show that the AO has looked into the documents e-filed by the assessee. It was the submission that this was the reason as to why the ld. Pr.CIT was compelled to hold that the approach of the AO has been casual and not diligent and the assessment has been done without proper application of mind. It was further submitted that in respect of gift received from the mother no evidence of cash availability with the mother has been filed. It was the submission that the order of the ld. Pr.CIT is liable to be upheld. 4. We have considered the rival submissions. A perusal of the e-filing that has been done by the assessee clearly shows that all evidences have been furnished before the AO. The questions as raised by the AO in the notice issued u/s.142(1) of the Act clearly shows that these queries are not standard queries but are queries after looking into the returns and the financial statements of the assessee. When a specific query has been raised and they are also being answered by the assessee, it would be preposterous to say that the AO has not examined the reply. The dates of all the issues which are being proposed by the ld. Pr.CIT for revision having already been called for by the AO and replies having been filed by the assessee and the same having been considered by the AO and just ITA No.33/CTK/2022 4 because there is no addition made, it cannot be said that the AO has done the assessment in a casual, not diligent manner or that assessment order was passed without due application of mind. The question of as to whether the assessee is duty bound to prove the source of the funds of the assessee’s mother in respect of the gift of Rs.3 lakhs is farfetched. The assessee’s mother having confirmed the gift, if the AO did doubt the source for availability of the funds with the mother, he could very well transfer the issue to the file of the AO having jurisdiction over the mother. This being so, we are of the view that the order passed u/s.263 of the Act by the ld.Pr.CIT is in the nature of fishing and roving enquiry and the same is not permissible in revisionary proceedings u/s.263 of the Act. Consequently, the order passed u/s.263 of the Act stands quashed. 5. In the result, appeal of the assessee allowed. Order dictated and pronounced in the open court on 19/01/2023. Sd/- (अरुण खोड़पऩया) (ARUN KHODPIA) Sd/- (जाजज माथन) (GEORGE MATHAN) ऱेखा सदस्य/ ACCOUNTANT MEMBER न्यानयक सदस्य / JUDICIAL MEMBER कटक Cuttack; ददनाांक Dated 19/01/2023 Prakash Kumar Mishra, Sr.P.S. आदेश की प्रनतलऱपऩ अग्रेपषत/Copy of the Order forwarded to : आदेशान ु सार/ BY ORDER, (Assistant Registrar) आयकर अऩीऱीय अधधकरण, कटक/ITAT, Cuttack 1. अऩीऱाथी / The Appellant- 2. प्रत्यथी / The Respondent- 3. आयकर आय ु क्त(अऩीऱ) / The CIT(A), 4. आयकर आय ु क्त / CIT 5. पवभागीय प्रयतयनधध, आयकर अऩीऱीय अधधकरण, कटक / DR, ITAT, Cuttack 6. गार्ज पाईऱ / Guard file. सत्यापऩत प्रयत //True Copy//