Appeal Details
Counselvise Citation
[2021] 107 COUNSELVISE.COM (IT) 7778 (ITAT-SURAT)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
4 month(s) 7 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
23-08-2021
Appeal Filed By
Assessee
Order Result
Allowed
Bench Allotted
DB
Assessment Year
2016-2017
Appeal Filed On
15-04-2021
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT BEFORE SHRI PAWAN SINGH, JM & DR. A. L. SAINI, AM ./ITA NO.37/SRT/2021 ( [ [ / ASSESSMENT YEAR: (2016-17) (VIRTUAL COURT HEARING) LAVJIBHAI DUNGARBHAI DALIYA, 4, MAMTA PARK SOCIETY, SPINNING MILL COMPOUND, VARACHHA, SURAT, SURAT-395006. VS. THE PCIT, CENTRAL, SURAT. ./ ./ PAN/GIR NO.: AGDPP5123E (ASSESSEE) (RESPONDENT) ASSESSEE BY : SHRI ASHWIN PAREKH, AR REVENUE BY : SHRI S.T. BIDARI, CIT(DR) / DATE OF HEARING : 14/07/2021 /DATE OF PRONOUNCEMENT : 23/08/2021 / O R D E R PER DR. A. L. SAINI, ACCOUNTANT MEMBER: CAPTIONED APPEAL FILED BY THE ASSESSEE, PERTAINING TO ASSESSMENT YEAR (AY) 2016-17, IS DIRECTED AGAINST THE ORDER PASSED BY THE LEARNED PRINCIPAL COMMISSIONER OF INCOME TAX(CENTRAL), SURAT [IN SHORT THE LD. PCIT], DATED 31.03.2021,UNDER SECTION 263 OF THE INCOME TAX ACT 1961, (HEREINAFTER REFERRED TO AS THE ACT). 2. GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE AS FOLLOWS: 1. THE LEARNED PR. COMMISSIONER OF INCOME-TAX, CENTRAL, SURAT HAS GRIEVOUSLY ERRED IN LAW AND ON FACTS IN ASSUMING JURISDICTION U/S 263 OF THE ACT ON THE ISSUE WHICH WAS NEVER THE SUBJECT MATTER IN SHOW CAUSE NOTICE. THE ORDER PASSED U/S. 263 IS UNJUST AND UNLAWFUL BEING PATENTLY INVALID. 2. THE LEARNED PR. COMMISSIONER OF INCOME-TAX, CENTRAL, SURAT HAS GRIEVOUSLY ERRED IN LAW AND ON FACTS IN SETTING ASIDE THE ORDER U/S 143(3) AND DIRECTING THE ASSESSING OFFICER TO VERIFY THE SPECIFIC ISSUE OF CASH DEPOSITED IN A PARTICULAR BANK WITHOUT APPRECIATING THE NON-EXISTENCE OF TWIN CONDITIONS OF 'ERRONEOUS' AND 'PREJUDICIAL' ORDER IN RESPECT OF ISSUE. THE ORDER OF PRINCIPAL COMMISSIONER OF INCOME-TAX BE QUASHED. PAGE | 2 ITA NO.37/SRT/20 21 ASSESSMENT YEAR.2016-1 7 LAVJIBHAI DUNGARBHAI DALIYA 3. THE LEARNED PR. COMMISSIONER OF INCOME-TAX, CENTRAL SURAT HAS ERRED ON FACTS AND IN LAW IN ASSUMING JURISDICTION U/S 263 BY SUBSTITUTING HIS OPINION WITH THAT OF ASSESSING OFFICER, FORMED AFTER DETAILED EXAMINATION / INQUIRIES AND PROPER APPLICATION OF MIND WHICH IS NOT PERMISSIBLE IN LAW. THE ORDER OF PRINCIPAL COMMISSIONER OF INCOME-TAX BE QUASHED. 4. THE LEARNED PR. COMMISSIONER OF INCOME-TAX, CENTRAL SURAT HAS GRIEVOUSLY ERRED IN LAW AND ON FACTS IN DIRECTING THE ASSESSING OFFICER TO VERIFY CASH DEPOSITED IN A PARTICULAR BANK ACCOUNT WITHOUT OFFERING ANY REASONS FOR REINVESTIGATION OF ISSUE ALREADY RAISED, VERIFIED AND ACCEPTED BY ASSESSING OFFICER AFTER INQUIRY AND APPRECIATION OF EVIDENCES. THE ORDER OF PRINCIPAL COMMISSIONER OF INCOME-TAX BE QUASHED. 5. THE APPELLANT RESERVES THE RIGHT TO ADD, ALTER, MODIFY, AMEND OR WITHDRAW ANY OF THE GROUNDS OF APPEAL BEFORE HEARING. 3. THE RELEVANT MATERIAL FACTS, AS CULLED OUT FROM THE MATERIAL ON RECORD, ARE AS FOLLOWS. THE RETURN OF INCOME FOR ASSESSMENT YEAR 2016-17, WAS FILED BY THE ASSESSEE ON 20.03.2017, DECLARING TOTAL INCOME AT RS. 1,93,12,110/-. THEREAFTER, SCRUTINY ASSESSMENT WAS FINALIZED BY PASSING ORDER U/S 143(3) OF THE ACT ON 24.12.2018 DETERMINING THE TOTAL INCOME AT RS.49,55,43,906/-. 4. SUBSEQUENTLY, LEARNED PRINCIPAL COMMISSIONER OF INCOME TAX (CENTRAL), SURAT [IN SHORT THE LD. PCIT] HAS EXERCISED HIS JURISDICTION UNDER SECTION 263 OF THE ACT. IT WAS NOTICED BY LD PCIT THAT ASSESSEE HAS SHOWN LONG TERM CAPITAL GAIN OF RS.1,39,52,118/- UPON SALE OF IMMOVABLE PROPERTY SITUATED AT BLOCK NO. 128 OF KOSAD. WHILE FINALIZING THE ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER HAS ACCEPTED THE LONG TERM CAPITAL GAIN ( IN BRIEF, LTCG), AS DISCLOSED BY THE ASSESSEE ON THE ABOVE PROPERTY, AS SUCH, AND PASSED THE ORDER U/S 143(3) OF THE ACT. HOWEVER, ON PERUSAL OF THE CASE RECORDS AND AIR INFORMATION IN THE CASE OF THE ASSESSE, IT WAS NOTICED BY LD PCIT THAT THE ASSESSEE ALONG WITH A CO-OWNER HAVE SOLD ANOTHER IMMOVABLE PROPERTY FOR SALE CONSIDERATION OF RS.3,06,00,000/-. THE ASSESSING OFFICER IN HIS NOTICE DATED 22.10.2018, U/S 142(1), HAS CALLED FOR DETAILS OF THE TRANSACTIONS I.E. COPY OF THE SALE DEED OF THE PROPERTY SOLD DURING THE YEAR (VIDE POINT NO.D). 5. IN RESPONSE TO THE QUERIES RAISED, THE ASSESSEE HAS SUBMITTED BEFORE AO THE DETAILS OF LONG TERM CAPITAL GAIN, AS DISCLOSED IN THE RETURN OF INCOME, AND PAGE | 3 ITA NO.37/SRT/20 21 ASSESSMENT YEAR.2016-1 7 LAVJIBHAI DUNGARBHAI DALIYA THE ASSESSING OFFICER HAS ACCEPTED THE SAME. HOWEVER, ON PERUSAL OF THE DETAILS OF LONG TERM CAPITAL GAIN SUBMITTED BY THE ASSESSEE, IT WAS OBSERVED BY THE LD PCIT THAT NO DETAILS OF THE ABOVE MENTIONED PROPERTY AS APPEARING IN THE AIR INFORMATION HAS BEEN SHOWN BY HIM AND NO CAPITAL GAIN ON THE SAME HAS BEEN DISCLOSED. IN THIS REGARD, IT IS NOTICED THAT AS REPORTED IN ITS/AIR/CIB DATA, THE PROPERTY WAS SOLD FOR A CONSIDERATION OF RS.3,06,00,000/- AND REGISTERED SALE DEED WAS EXECUTED ON 13.08.2015 WITH SUB REGISTRAR OFFICE, KATARGAM, SURAT. 6. FURTHER, ON PERUSAL OF THE CASE RECORDS, IT WAS ALSO OBSERVED BY LD PCIT THAT ASSESSEE HAS MAINTAINED A BANK ACCOUNT WITH INDUSIND BANK BEARING A/C. NO. 159909969836. THE THEN AO ISSUED NOTICE UNDER SECTION 133(6) OF THE ACT TO THE INDUSIND BANK AND REPLY TO THE SAME WAS RECEIVED ON 26.12.2018, THAT IS, AFTER PASSING THE ASSESSMENT ORDER BY ASSESSING OFFICER UNDER SECTION 143(3) OF THE ACT, DATED 24.12.2018. IN OTHER WORDS, THE INDUSIND BANK HAS REPLIED TO THE ASSESSING OFFICER AND SUBMITTED THE BANK STATEMENT TO THE ASSESSING OFFICER ON 26.12.2018, THEREFORE, ASSESSING OFFICER DID NOT EXAMINE THE SAME, AS THE ASSESSMENT ORDER U/S 143(3) WAS FRAMED BY ASSESSING OFFICER ON 24.12.2018, MUCH BEFORE THE DATE OF 26.12.2018, THEREFORE, THE BANK STATEMENT OF INDUSIND BANK HAS REMAINED UNVERIFIED. THEREFORE, LD PCIT NOTICED THAT ASSESSMENT PROCEEDINGS IN THE CASE OF THE ASSESSEE WAS FINALIZED U/S 143(3) ON 24.12.2018. THEREFORE, IT IS APPARENT THAT THE TRANSACTIONS IN THIS BANK ACCOUNT WERE NOT VERIFIED BY THE ASSESSING OFFICER WHILE FINALIZING THE ASSESSMENT PROCEEDINGS. IN VIEW OF THE ABOVE FACTS AND ONGOING THROUGH THE ASSESSMENT ORDER AND ASSESSMENT RECORDS, IT HAS BEEN OBSERVED BY LD PCIT THAT THE ASSESSMENT MADE BY THE ASSESSING OFFICER, VIDE ORDER DATED 24.12.2018, IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTEREST OF REVENUE AND ACCORDINGLY A SHOW CAUSE NOTICE WAS ISSUED TO THE ASSESSEE. THE RELEVANT PARA OF THE SAID SHOW CAUSE NOTICE IS REPRODUCED BELOW : AS YOU ARE AWARE, ASSESSMENT FOR ASST. YEARS 2016-17 IN YOUR CASE WAS COMPLETED UNDER SEC. 143(3) BY DETERMINING THE TOTAL INCOME RS.49,55,43,906/- . ON PERUSAL OF THE RETURN OF INCOME FILED FOR ASST. YEAR 2016-17, IT IS SEEN THAT YOU HAVE SHOWN LONG TERM CAPITAL GAIN OF RS.1,39,52,118/- UPON SALE OF IMMOVABLE PROPERTY SITUATED AT BLOCK NO. 128 OF KOSAD. WHILE FINALIZING THE PAGE | 4 ITA NO.37/SRT/20 21 ASSESSMENT YEAR.2016-1 7 LAVJIBHAI DUNGARBHAI DALIYA ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER HAS ALSO ACCEPTED THE LTCG AS DISCLOSED BY YOU ON THE ABOVE PROPERTY AS SUCH AND PASSED THE ORDER U/S 143(3) OF THE ACT. SUBSEQUENTLY, ON PERUSAL OF THE CASE RECORDS AND AIR INFORMATION IN YOUR CASE, IT IS NOTICED THAT YOU ALONG WITH A CO-OWNER HAVE SOLD ANOTHER IMMOVABLE PROPERTY FOR SALE CONSIDERATION OF RS.3,06,00,000/-. THE AO IN HIS NOTICE DATED 22.10.2018 U/S 142(1) HAS CALLED FOR DETAILS OF THE TRANSACTIONS I.E. COPY OF THE SALE DEED OF THE PROPERTY SOLD DURING THE YEAR VIDE POINT NO.(D). IN RESPONSE TO THE QUERIES RAISED, YOU HAVE SUBMITTED THE DETAILS OF LONG TERM CAPITAL GAIN AS DISCLOSED IN THE RETURN OF INCOME AND THE ASSESSING OFFICER HAS ACCEPTED THE SAME. HOWEVER, ON PERUSAL OF THE DETAILS OF LONG TERM CAPITAL GAIN SUBMITTED BY YOU, IT IS OBSERVED THAT NO DETAILS OF THE ABOVE MENTIONED PROPERTY AS APPEARING IN THE AIR INFORMATION HAS BEEN SHOWN BY YOU AND NO CAPITAL GAIN ON THE SAME HAS BEEN DISCLOSED. IN THIS REGARD, IT IS NOTICED THAT AS REPORTED IN ITS/AIR/CIB DATA, THE PROPERTY WAS SOLD FOR A CONSIDERATION OF RS.3,06,00,000/- AND REGISTERED SALE DEED WAS EXECUTED ON 13.08.2015 WITH SUB REGISTRAR OFFICE, KATARGAM, SURAT. IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES OF THE CASE, IT IS OBSERVED THAT THE ASSESSING OFFICER HAS NOT MADE ANY VERIFICATION OF THE ABOVE MENTIONED ISSUE OF CAPITAL GAIN BY TAKING COGNIZANCE OF THE AIR INFORMATION. IT IS, THEREFORE, EVIDENT THAT THE ASSESSMENT IN YOUR CASE WAS COMPLETED WITHOUT MAKING DUE INQUIRIES AND VERIFICATION IN RESPECT OF THE PROPERTY TRANSACTIONS AS APPEARING IN THE AIR INFORMATION. IT WAS IMPERATIVE ON THE PART OF THE ASSESSING OFFICER TO VERIFY ALL THE FACTS OF THE CASE ON THE BASIS OF MATERIAL AVAILABLE WITH HIM AND ALSO CONSIDERING THE SUBMISSIONS MADE BY YOU BEFORE REACHING A FINAL CONCLUSION ESPECIALLY IN A CASE WHERE SPECIFIC INFORMATION/DETAILS OF THE PROPERTY TRANSACTIONS WERE AVAILABLE WITH HIM AS PER AIR INFORMATION. FURTHER, ON PERUSAL OF THE CASE RECORDS, IT IS NOTICED THAT YOU HAVE MAINTAINED BANK ACCOUNT WITH INDUSIND BANK BEARING A/C. NO. 159909969836. THE THEN AO ISSUED NOTICE UNDER SECTION 133(6) OF THE ACT TO THE INDUSIND BANK AND REPLY TO THE SAME WAS RECEIVED ON 26.12.2018. HOWEVER, THE ASSESSMENT PROCEEDINGS IN YOUR CASE WAS FINALIZED U/S 143(3) ON 24.12.2018. THEREFORE, IT IS APPARENT THAT THE TRANSACTIONS IN THIS BANK ACCOUNT WERE NOT VERIFIED PROPERLY BY THE ASSESSING OFFICER WHILE FINALIZING THE ASSESSMENT PROCEEDINGS. ON PERUSAL OF THE BANK ACCOUNT STATEMENT, IT IS NOTICED THAT THERE WERE CREDITS OF MORE THAN 150 CHEQUES IN THIS BANK ACCOUNT AND THE TOTAL CREDITS IN THE BANK ACCOUNT WORKS OUT TO THE TUNE OF RS 1,75,94,227/-. THEREFORE, IT IS EVIDENT THAT THE ASSESSMENT IN YOUR CASE WAS COMPLETED WITHOUT PROPER VERIFICATION AND ENQUIRIES. IN VIEW OF THE ABOVE FACTS, IT IS EVIDENT THAT THERE WAS A FAILURE ON THE PART OF THE ASSESSING OFFICER TO CARRY OUT FURTHER VERIFICATION/ENQUIRIES OR COMPUTING THE TOTAL INCOME AS PER THE PROVISIONS OF THE ACT ON THE ABOVE MENTIONED TWO ISSUES. THEREFORE, THE ASSESSMENT ORDER PASSED BY THE ASSESSING OFFICER WITHOUT PROPER VERIFICATION AND ENQUIRIES IS ERRONEOUS IN SO FAR AS PREJUDICIAL TO THE INTEREST OF THE REVENUE. ACCORDINGLY, THE UNDERSIGNED PROPOSES TO PASS AN ORDER UNDER SEC.263 OF THE ACT IN YOUR CASE FOR THE RELEVANT ASSESSMENT YEAR I.E. 2016-17. PAGE | 5 ITA NO.37/SRT/20 21 ASSESSMENT YEAR.2016-1 7 LAVJIBHAI DUNGARBHAI DALIYA 7. IN RESPONSE TO THE ABOVE SHOW CAUSE NOTICE, THE ASSESSEE HAS FURNISHED WRITTEN SUBMISSIONS VIDE HIS LETTER DATED 26.03.2021 THROUGH ITBA AND ALSO THROUGH SHRI ASHWIN PAREKH, CHARTERED ACCOUNTANT. ON PERUSAL OF THE SUBMISSIONS, IT WAS OBSERVED BY LD PCIT THAT ASSESSEE HAS MAINLY CONTENDED THAT THE ISSUE OF SALE OF PROPERTY, SITUATED AT BLOCK NO.85, UTRAN, SURAT HAS BEEN SHOWN BY HIM IN THE ASSESSMENT YEAR 2015-16, THOUGH THE REGISTERED SALE DEED WAS ACTUALLY EXECUTED ON 13.04.2015. IN SUPPORT OF HIS CONTENTIONS, THE ASSESSEE HAS FURNISHED THE FOLLOWING DETAILS: (1) IT WAS SUBMITTED BY ASSESSEE THAT THE PROPERTY IN QUESTION WAS JOINTLY PURCHASED BY HIM, WITH SHRI JAYANTIBHAI, VIRJIBHAI BABARIYA, FOR A TOTAL CONSIDERATION OF RS.3,04,43,950/-(INCLUDING STAMP DUTY OF RS.14,08,300/-, REGISTRATION FEES OF RS.2,87,650/- AND ADVOCATE FEES OF RS.8,000/-, ON 26.07.2012. IN SUPPORT OF THE CLAIM HE HAS FURNISHED A COPY OF REGISTERED SALE DEED BEARING NO. SRT/4/15408/2012 DATED 16.07.2012. SINCE ASSESSEE WAS HOLDING 50% SHARE IN PROPERTY, HIS SHARE OF INVESTMENT IN THE SAID PROPERTY IS RS.1,43,74,000/-. FURTHER, ON PERUSAL OF THE DETAILS FURNISHED BY THE ASSESSEE, IT WAS OBSERVED BY LD PCIT THAT THE ASSESSEE HAS SHOWN THIS PROPERTY AS FIXED ASSETS IN ASSESSMENT YEARS 2013-14 AND 2014-15. HOWEVER, IN THE ASSESSMENT YEAR 2015-16, THE ASSESSEE HAS SHOWN THIS PROPERTY AS PURCHASED OF RS.1,52,21,975/- IN THE TRADING ACCOUNT AND ALSO SHOWN SALE OF RS.1,53,00,000/- IN THE TRADING ACCOUNT AND ACCORDINGLY, THE PROFIT HAS BEEN OFFERED FOR TAXATION. THE ASSESSEE HAS ALSO FURNISHED A COPY OF REGISTERED SALE DEED BEARING NO. SRT/4/KTG/8794/2015 DATED 13.04.2015, IN RESPECT OF THE SAID PROPERTY. AS PER THE DATE OF REGISTERED SALE DEED, THE RELEVANT ASSESSMENT YEAR INVOLVED IS 2016-17, AS THE DATE OF REGISTRATION OF THE PROPERTY IS 13.04.2015 I.E. IN THE FINANCIAL YEAR 2015-16. HOWEVER, THE ASSESSEE HAS ALSO SUBMITTED THAT ALL THE PAYMENTS WERE RECEIVED BY HIM DURING THE PERIOD RELEVANT TO ASSESSMENT YEAR 2015-16 AND ACCORDINGLY, THE SAME WAS CONSIDERED FOR TAXATION IN ASSESSMENT YEAR 2015-16. HOWEVER, FROM THE PERUSAL OF THE SALE DEED, IT IS NOTICED THAT THE POSSESSION OF THE PROPERTY WAS HANDED OVER ONLY ON THE DATE OF REGISTERED SALE DEED. THEREFORE, THE ASSESSEE PAGE | 6 ITA NO.37/SRT/20 21 ASSESSMENT YEAR.2016-1 7 LAVJIBHAI DUNGARBHAI DALIYA SHOULD HAVE SHOWN EITHER THE CAPITAL GAIN OR PROFIT DURING THE PERIOD RELEVANT TO ASSESSMENT YEAR 2016-17. (2) IN RESPECT OF THE ISSUE OF UNVERIFIED BANK ACCOUNT, THE ASSESSEE HAS SUBMITTED THAT THE COPY OF THE BANK STATEMENT IN RESPECT OF ACCOUNT NO.200999694833 WAS SUBMITTED ON 13.12.2018 DURING THE COURSE OF ASSESSMENT PROCEEDINGS BEFORE THE ASSESSING OFFICER. AS FAR AS THE CREDIT IN THE SAID BANK ACCOUNTS, OF RS.1,76,77,225/-, THE ASSESSEE HAS STATED THAT AN AMOUNT OF RS.1,61,44,975/- CREDITED TO THIS ACCOUNT WAS RECEIVED AS CONFIRMING PARTY PROFIT AND THE SAME HAS ALSO BEEN INCLUDED IN THE RETURN OF INCOME UNDER THE HEAD SHORT TERM CAPITAL GAIN. 8. THE LD PCIT, AFTER GOING THROUGH THE REPLY OF THE ASSESSEE HAS OBSERVED THE FOLLOWING: (I) IN RESPECT OF TRANSACTIONS PERTAINING TO THE PROPERTY SITUATED AT BLOCK NO. 85 FOR A TOTAL CONSIDERATION OF RS.3,04,43,950/-(INCLUDING STAMP DUTY OF RS.14,08,300/-, REGISTRATION FEES OF RS.2,87,650/- AND ADVOCATE FEES OF RS.8,000/-) ON 26.07.2012 IS FOUND VERIFIABLE FROM THE RECORDS. IN SUPPORT OF THE CLAIM ASSESSEE HAS FURNISHED A COPY OF REGISTERED SALE DEED BEARING NO. SRT/4/15408/2012 DATED 16.07.2012. SINCE ASSESSEE WAS HOLDING 50% SHARE IN PROPERTY, HIS SHARE OF INVESTMENT IN THE SAID PROPERTY IS RS.1,43,74,000/-. FURTHER, ON PERUSAL OF THE DETAILS FURNISHED BY THE ASSESSEE, IT WAS NOTICED BY LD PCIT THAT ASSESSEE HAS SHOWN THIS PROPERTY AS FIXED ASSETS IN ASSESSMENT YEARS 2013-14 AND 2014-15. HOWEVER, IN THE ASSESSMENT YEAR 2015-16, THE ASSESSEE HAS SHOWN THIS PROPERTY AS PURCHASED OF RS.1,52,21,975/- (50% SHARE) IN THE TRADING ACCOUNT AND ALSO SHOWN SALE OF RS.1,53,00,000/- (50%) IN THE TRADING ACCOUNT AND ACCORDINGLY, THE PROFIT HAS BEEN OFFERED FOR TAXATION. (II) ON PERUSAL OF THE SUBMISSION OF THE ASSESSEE IN RESPECT OF THE BANK ACCOUNT NO. 159909969836 MAINTAINED WITH INDUSIND BANK, IT WAS OBSERVED BY LD PCIT THAT ASSESSEE WAS MAINTAINING THE FOLLOWING TWO ACCOUNTS WITH INDUSIND BANK DURING THE YEAR UNDER CONSIDERATION: PAGE | 7 ITA NO.37/SRT/20 21 ASSESSMENT YEAR.2016-1 7 LAVJIBHAI DUNGARBHAI DALIYA SR. NO. ACCOUNT NO. NAME OF THE BANK TOTAL CASH DEPOSITS 1 159909969836 INDUSIND BANK 1,20,00,000/- 2 200999694833 INDUSIND BANK 1,70,00,000/- IN THE SHOW CAUSE NOTICE ISSUED, DURING THE COURSE OF PROCEEDINGS UNDER SECTION 263 OF THE ACT, IT WAS MENTIONED THAT THE ASSESSING OFFICER HAS NOT VERIFIED THE TRANSACTIONS REFLECTED IN THE ACCOUNT NO. 159909969836, AS THE ASSESSING OFFICER HAS CALLED FOR THE BANK STATEMENT BY ISSUE NOTICE UNDER SECTION 133(6) OF THE ACT. HOWEVER, AS EVIDENT FROM THE RECORDS, THE COPY OF THE BANK STATEMENT WAS RECEIVED FROM THE BANK AFTER COMPLETION OF THE ASSESSMENT PROCEEDINGS. HOWEVER, IN THE REPLY FURNISHED BY THE ASSESSEE DURING THE COURSE OF PROCEEDINGS UNDER SECTION 263 OF THE ACT, THE ASSESSEE FURNISHED THE DETAILS IN RESPECT OF CREDIT ENTRIES APPEARING IN BANK ACCOUNT NO.200999694833 IS THAT THE TOTAL CREDIT ENTRIES APPEARING IN THE BANK ACCOUNT ARE RELATED TO TRANSACTIONS OF CONFIRMING PARTY PROFIT FROM THIS BANK ACCOUNT OF RS.1, 61,44,975/- AND AN AMOUNT OF RS.15,32,250/- IS PERTAINING TO CAR LOAN DISBURSEMENT. THUS, THE TOTAL CREDIT ENTRIES APPEARING IN THE BANK ACCOUNT IS OF RS.1,76,77,225/-. THE ASSESSEE HAS SUBMITTED DURING 263 PROCEEDINGS, THAT THE CREDIT ENTRIES APPEARING IN THIS BANK ACCOUNT ARE ACTUALLY THE SHORT TERM CAPITAL GAIN (CONFIRMING PROFIT) SHOWN IN THE RETURN OF INCOME. THEREFORE, NO SUBMISSION HAS BEEN MADE BY THE ASSESSEE IN RESPECT OF THE ACCOUNT NO. 159909969836, WHICH WAS ACTUALLY MENTIONED IN THE SHOW CAUSE NOTICE. HOWEVER, ON PERUSAL OF THE ASSESSMENT RECORDS, IT WAS NOTICED THAT THE ASSESSEE HAS MADE A SUBMISSION VIDE POINT NO.5 ON 13.12.2018 WHEREIN THE ASSESSEE HAS FURNISHED A COPY OF BANK STATEMENT AND CASH FLOW STATEMENT WHEREIN THE ASSESSEE HAS STATED THAT CASH DEPOSITS IN THE ABOVE ACCOUNT WAS MADE OUT OF CASH ON HAND AND WITHDRAWALS FROM THE FIRM M/S. ANJANI TEXTILES. HOWEVER, IT WAS NOTED BY LD PCIT THAT ASSESSING OFFICER HIMSELF HAS MENTIONED THAT ASSESSEE HAS NOT PRODUCED ANY CASH BOOK DURING THE YEAR UNDER CONSIDERATION. THEREFORE, IT IS SEEN THAT THE ASSESSING OFFICER HAS NOT VERIFIED THE SOURCE OF CASH DEPOSITS IN THE ABOVE MENTIONED BANK ACCOUNT DURING THE COURSE OF ASSESSMENT PROCEEDINGS. ON PERUSAL OF THE SAME, IT IS QUITE EVIDENT PAGE | 8 ITA NO.37/SRT/20 21 ASSESSMENT YEAR.2016-1 7 LAVJIBHAI DUNGARBHAI DALIYA THAT THE ASSESSING OFFICER HAS NOT MADE VERIFICATION OF THE TRANSACTIONS AND CASH DEPOSITS IN ACCOUNT NO. 159909969836 HELD WITH INDUSIND BANK DURING THE COURSE OF ASSESSMENT PROCEEDINGS WHICH SHOULD HAVE BEEN MADE AND HENCE ASSESSMENT ORDER IN QUESTION IS FOUND TO BE ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTEREST OF REVENUE. 9. IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD PCIT HELD THAT ASSESSMENT ORDER U/S 143(3) OF THE ACT, PASSED ON 24.12.2018 FOR A.Y. 2016-17 WAS WITHOUT PROPER VERIFICATION AND ENQUIRIES ON THE ISSUE OF CASH DEPOSITS IN THE BANK ACCOUNT NO. 59909969836. 10. AGGRIEVED BY THE ORDER OF THE LD. PCIT, THE ASSESSEE IS IN APPEAL BEFORE US. 11. LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT DURING THE ASSESSMENT STAGE, THE ASSESSING OFFICER ISSUED SHOW CAUSE NOTICE WHICH IS PLACED AT PAPER BOOK PAGE NO.18 WHEREIN HE ASKED THE ASSESSEE TO FURNISH THE DETAILS OF THE BANK ACCOUNT STATEMENT. IN RESPONSE TO SAID SHOW CAUSE NOTICE, THE ASSESSEE SUBMITTED REPLY BEFORE THE ASSESSING OFFICER WHICH IS PLACED AT PAPER BOOK PAGE NO.24 TO 35. ON PAGE NO.34, THE ASSESSEE HAS SUBMITTED A COPY OF BANK ACCOUNT STATEMENT AND THE STATEMENT SHOWING DATE-WISE CASH DEPOSIT AND THE RELEVANT BANK ACCOUNT HIGHLIGHTED THAT THE SOURCE OF CASH DEPOSIT. THE LEARNED COUNSEL SUBMITTED THAT ASSESSEE HAS INITIAL CASH IN BANK ACCOUNT OF INDUSIND BANK AT RS.20,00,000/- ON 06.04.2015 VIDE PAPER BOOK PAGE NO.37, OUT OF ITS CASH BALANCE. LEANED COUNSEL ALSO SUBMITTED THE CASH FLOW STATEMENT AND THE CASH DEPOSIT OF THEIR SOURCES VIDE PAPER BOOK PAGE NO.27, THE COPY OF CAPITAL AMOUNT OF M/S. ANJALI TEXTILE PARK FROM BOOKS OF ACCOUNTS OF PARTNERSHIP FIRM (VIDE PB.41), THE ASSESSEE SUBMITTED LEDGER ACCOUNT OF ANJALI TEXTILE PARK FROM THE BOOKS OF ACCOUNTS (VIDE PB.42), ASSESSEE SUBMITTED I.T. RETURN ACKNOWLEDGMENT, COMPUTATION OF INCOME OF M/S. ANJALI TEXTILE PARK FOR THE AY.2016-17 (VIDE PB.42-48), ASSESSEE SUBMITTED THE RELEVANT PORTION OF THE AUDITED BALANCE SHEET OF THE ASSESSEE SHOWING AS ON 31.03.2015 (VIDE PB.68). THEREFORE, THE LEARNED COUNSEL SUBMITTED THAT THE ASSESSEE HAS DISCHARGED HIS ONUS TO SUBMIT ALL THE PAGE | 9 ITA NO.37/SRT/20 21 ASSESSMENT YEAR.2016-1 7 LAVJIBHAI DUNGARBHAI DALIYA DOCUMENTS BEFORE THE ASSESSING OFFICER AND IT WAS ON THE ASSESSING OFFICER TO EXAMINE THESE DOCUMENTS. IN FACT, THE ASSESSING OFFICER HAS RECEIVED THESE DOCUMENTS AND TAKEN INTO ACCOUNT AND THEN NO ADDITION HAS BEEN MADE BY THE ASSESSING OFFICER, THEREFORE ASSESSING OFFICER HAS APPLIED HIS MIND AND HENCE THE ORDER PASSED BY THE ASSESSING OFFICER SHOULD NOT BE ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE, THEREFORE, THE ORDER OF THE LD. PCIT MAY BE QUASHED. 12. ON THE OTHER HAND, THE LEARNED DEPARTMENTAL REPRESENTATIVE (IN SHORT THE LD. DR) FOR THE REVENUE RELIED ON THE ORDER OF THE LD. PCIT VIDE PARA NO.9 AND 10 OF THE LD. PCIT ORDER DATED 31.03.2021 PASSED UNDER SECTION 263 OF THE INCOME TAX ACT. THE LD. DR SUBMITTED THAT THE ASSESSING OFFICER RECEIVED THE BANK STATEMENT AFTER COMPLETION OF ASSESSMENT PROCEEDINGS WHICH IS RECORDED IN PARE NO.7 OF THE LD. PCIT ORDER, THEREFORE THE BANK STATEMENT WHICH WAS RECEIVED BY THE ASSESSING OFFICER AFTER COMPLETION OF THE ASSESSMENT PROCEEDINGS HAS NOT BEEN EXAMINED BY THE ASSESSING OFFICER AND THEREFORE ORDER PASSED BY THE ASSESSING OFFICER IS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE, THEREFORE THE ORDER OF THE LD. PCIT IS UPHELD. 13. WE HAVE HEARD BOTH THE PARTIES AND CAREFULLY GONE THROUGH THE SUBMISSIONS PUT FORTH ON BEHALF OF THE ASSESSEE ALONG WITH THE DOCUMENTS FURNISHED AND THE CASE LAWS RELIED UPON, AND PERUSED THE FACTS OF THE CASE INCLUDING THE FINDINGS OF THE LD. PCIT AND OTHER MATERIAL BROUGHT ON RECORD. WE NOTE THAT LD PCIT HAS EXERCISED HIS JURISDICTION UNDER SECTION 263 OF THE ACT, ONLY FOR THE ISSUE THAT ASSESSING OFFICER HAS NOT VERIFIED THE TRANSACTIONS REFLECTED IN THE BANK ACCOUNT NO. 159909969836, AS THE ASSESSING OFFICER HAS CALLED FOR THE BANK STATEMENT BY ISSUE NOTICE UNDER SECTION 133(6) OF THE ACT. HOWEVER, AS EVIDENT FROM THE RECORDS, THE COPY OF THE BANK STATEMENT WAS RECEIVED FROM THE BANK AFTER COMPLETION OF THE ASSESSMENT PROCEEDINGS. THE THEN AO ISSUED NOTICE UNDER SECTION 133(6) OF THE ACT TO THE INDUSIND BANK AND REPLY TO THE SAME WAS RECEIVED ON 26.12.2018, HOWEVER, ASSESSING OFFICER HAD ALREADY FRAMED THE ASSESSMENT UNDER SECTION 143(3) OF THE ACT, DATED PAGE | 10 ITA NO.37/SRT/20 21 ASSESSMENT YEAR.2016-1 7 LAVJIBHAI DUNGARBHAI DALIYA 24.12.2018. THEREFORE, ASSESSING OFFICER DID NOT VERIFY THE SAID BANK STATEMENT, HENCE, ON THIS COUNT ALSO THE ORDER PASSED BY THE ASSESSING OFFICER UNDER SECTION 143(3) OF THE ACT, DATED 24.12.2018 IS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE. WE NOTE THAT ASSESSEE SUBMITTED BEFORE THE ASSESSING OFFICER A COPY OF BANK ACCOUNT STATEMENT AND THE STATEMENT SHOWING DATE-WISE CASH DEPOSIT AND THE RELEVANT BANK ACCOUNT HIGHLIGHTING THAT THE SOURCE OF CASH DEPOSIT (VIDE PAPER BOOK PAGE NO.34). INITIAL CASH DEPOSITED IN BANK ACCOUNT OF INDUSIND BANK AT RS.20,00,000/- ON 06.04.2015 ( VIDE PAPER BOOK PAGE NO.37), HAS BEEN EXPLAINED BY THE ASSESSEE. IT IS EVIDENT FROM THE PAPER BOOK PAGE NO.36 THAT ASSESSEE HAS SUBMITTED COPY OF BANK STATEMENT OF INDUSIND BANK ACCOUNT NO. 159909969836, BEFORE THE ASSESSING OFFICER. THE COPY OF THE SAID BANK STATEMENT WAS AVAILABLE TO THE ASSESSING OFFICER BEFORE PASSING THE ASSESSMENT UNDER SECTION 143(3) OF THE ACT, DATED 24.12.2018. THEREFORE, THE STAND OF THE LD PCIT THAT COPY OF SAID INDUSIND BANK ACCOUNT NO. 159909969836, WAS NOT THERE BEFORE THE ASSESSING OFFICER, IS FACTUALLY INCORRECT. THAT IS, STATEMENT OF INDUSIND BANK ACCOUNT NO. 159909969836 WAS AVAILABLE BEFORE THE ASSESSING OFFICER TO EXAMINE THE SAME AND IN FACT THE ASSESSING OFFICER HAS EXAMINED AND VERIFIED THE SAME AND THEN FRAMED THE ASSESSMENT ORDER DATED 24.12.2018. THEREFORE, ORDER PASSED BY THE ASSESSING OFFICER IS NEITHER ERRONEOUS NOR PREJUDICIAL TO THE INTEREST OF REVENUE. 14. IT IS ABUNDANTLY CLEAR THAT ASSESSING OFFICER HAS EXAMINED AND VERIFIED THE INDUSIND BANK ACCOUNT NO. 159909969836, DURING THE ASSESSMENT STAGE, THUS WE NOTE THAT, LD. PR. C.I.T. BY INVOKING HIS JURISDICTION U/S 263 OF THE ACT, IS GIVING ANOTHER OPPORTUNITY TO THE ASSESSING OFFICER TO EXAMINE IT AGAIN, WHICH IS NOT PERMISSIBLE. HONBLE BOMBAY HIGH COURT IN THE CASE OF RANKA JEWELLERS VS. ADDL. CIT (328 ITR 148) RELYING ON THE DECISIONS OF HONBLE SUPREME COURT IN THE CASES OF MALABAR INDUSTRIAL CO. LTD. VS. CIT AND CIT VS. MAX INDIA LTD. [(2007) 295 ITR 282 (SC)], HAS HELD THAT ONCE THE ISSUE WAS CONSIDERED BY THE A.O., THE REMEDY OF THE REVENUE COULD NOT LIE IN INVOKING OF THE JURISDICTION U/S PAGE | 11 ITA NO.37/SRT/20 21 ASSESSMENT YEAR.2016-1 7 LAVJIBHAI DUNGARBHAI DALIYA 263 OF THE ACT. THEREFORE, THE ORDER OF THE LD. C.I.T. WAS DEFINITELY OUTSIDE THE PURVIEW OF SECTION 263 OF THE ACT. AS NOTED ABOVE, THE EXERCISE AIMED AT ASCERTAINING THE CORRECT INCOME OF THE ASSESSEE HAS BEEN FULFILLED BY THE LD. A.O. BY EXERCISING HIS QUASI-JUDICIAL FUNCTIONS VIS-A-VIS PASSING THE ASSESSMENT ORDER U/S 143(3) OF THE ACT. THEREFORE, CERTAINLY IT IS NOT A CASE WHEREIN ADEQUATE ENQUIRIES AT THE ASSESSMENT STAGE WERE NOT CARRIED OUT OR ASSESSMENT WAS MADE IN HASTE. HOWEVER, WHAT IS AN OPINION FORMED AS A RESULT OF THESE ENQUIRIES AND VERIFICATION OF THE MATERIALS IS SOMETHING WHICH IS IN EXCLUSIVE DOMAIN OF THE ASSESSING OFFICER, AND EVEN IF LD. PR. COMMISSIONER DOES NOT AGREE WITH THE RESULTS OF SUCH ENQUIRIES, THE RESULTANT ORDER CANNOT BE SUBJECTED TO REVISION PROCEEDINGS. FOR THAT WE RELY ON THE DECISION OF THE COORDINATE BENCH OF I.T.A.T., KOLKATA IN THE CASE OF SMT. JUTHIKA KAR VS. ITO [I.T.A. NO.1128/KOL/ 2009, DATED 16.5.2012 ], WHEREIN IT HAS BEEN HELD AS UNDER (RELEVANT PORTION) :- 8HOWEVER, WHAT IS OPINION FORMED AS A RESULT OF THESE ENQUIRIES IS SOMETHING WHICH IS IN EXCLUSIVE DOMAIN OF THE ASSESSING OFFICER, AND EVEN IF COMMISSIONER HAS SUCH RESULTS OF ENQUIRIES, THE RESULTANT ORDER CANNOT BE SUBJECTED TO REVISION PROCEEDINGS. THE CONCLUSIONS ARRIVED AT AS A RESULT OF ENQUIRIES CANNOT BE TINKERED WITH IN THE REVISION PROCEEDINGS. THE CONCLUSIONS BEING DRAWN UP AS A RESULT OF ENQUIRY IS A HIGHLY SUBJECTIVE EXERCISE AND AS TO WHAT IS APPROPRIATE CONCLUSION IS SOMETHING ON WHICH PERCEPTIONS VARY FROM PERSON TO PERSONS. THESE VARIATIONS IN THE PERCEPTIONS OF THE ASSESSING OFFICER VIS-A-VIS THAT OF THE COMMISSIONER, CANNOT RENDER AN ORDER ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE. 15. THEREFORE, BASED ON THE FACTS AND CIRCUMSTANCES OF THE CASE, WE NOTE THAT THE IMPUGNED ORDER OF LD PCIT HAS TO BE QUASHED FOR THE REASON THAT ORDER OF THE ASSESSING OFFICER SOUGHT TO BE REVISED IN THE IMPUGNED ORDER WAS NEITHER ERRONEOUS NOR PREJUDICIAL TO THE INTEREST OF THE REVENUE FOR THE REASON OF ANY LACK OF INQUIRY THAT THE ASSESSING OFFICER OUGHT TO HAVE MADE IN THE GIVEN FACTS AND CIRCUMSTANCES OF THE CASE. WE ACCORDINGLY QUASH THE ORDER U/S 263 OF THE ACT AND ALLOW THE APPEAL OF THE ASSESSEE. PAGE | 12 ITA NO.37/SRT/20 21 ASSESSMENT YEAR.2016-1 7 LAVJIBHAI DUNGARBHAI DALIYA 16. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER IS PRONOUNCED ON 23/08/2021 BY PLACING RESULT ON NOTICE BOARD. SD/- SD/- (PAWAN SINGH) (DR. A.L. SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER LWJR /SURAT / DATE: 23/08/2021 SAMANTA COPY OF THE ORDER FORWARDED TO 1. THE ASSESSEE 2. THE RESPONDENT 3. THE CIT(A) 4. CIT 5. DR/AR, ITAT, SURAT 6. GUARD FILE BY ORDER // TRUE COPY // ASSISTANT REGISTRAR/SR. PS/PS ITAT, SURAT
