M/s R.P. Foundary (P) Ltd., Mandi Gobindgarh V. Principal Commissioner of Income Tax, Ludhiana

ITA 422/CHANDI/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 8343 (ITAT-CHANDIGARH)
• Duration Of Justice: 10 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-03-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 04-01-2016
• Assessment Year: 2010-2011
• Appeal Filed On: 21-04-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Assessment record
• Section: 143(3); 153A; 263; 63; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND MS. RANO JAIN, ACCOUNTANT MEMBER ITA NO.422 /CHD/2015 ( ASSESSMENT YEAR : 2010-11) M/S R.P. FOUNDARY (P) LTD., VS. THE PRINCIPAL C.I.T.(CENTRAL) MANDI GOBINDGARH. LUDHIANA. PAN: AACCR8095F (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SUDHIR SEHGAL RESPONDENT BY : SHRI SUSHIL KUMAR, CIT DR DATE OF HEARING : 12.01.2016 DATE OF PRONOUNCEMENT : 15.03.2016 O R D E R PER RANO JAIN, A.M . : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF LEARNED COMMISSIONER OF INCO ME TAX (CENTRAL), LUDHIANA DATED 16.03.2015, PASSED UNDE R SECTION 263 OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT). 2. BRIEFLY, THE FACTS OF THE CASE ARE THAT THE ASSESSEE FILED RETURN DECLARING INCOME OF RS.59,55,040/- AS ON 9.8.2012. THE ASSESSMENT WAS COMPLETED UNDER SECTION 153A AS ON 25.3.2013 MAKING 2 ASSESSMENT AT AN INCOME OF RS.1,35,89,928/-. THE COMMISSIONER OF INCOME TAX ISSUED A SHOW CAUSE NOTICE UNDER SECTION 263 OF THE ACT, DATED 8.1.2015 , WHICH READS AS UNDER : A SEARCH U/S 132 OF THE I.T. ACT, 1961 WAS CONDUCT ED ON 30.06.2010 IN NARAIN AND COMPANY GROUP OF CASES. THE ASSESSEE COMPANY M/S R.P. FOUNDARY (P) LTD., MANDI GOBINDGARH BELONGS TO NARAIN AND COMPANY GROUP OF CASES. THE RETURN OF INCOME FOR A.Y. 2010-11 DECLARING INCOME OF RS.59,55,040/- WAS FILED ON 09.08.2012. ASSESSMENT WAS COMPLETED DETERMINING TOTAL INCOME OF RS.1,35,89,928/- VIDE ORDER DATED 25.03.2013 PASSED U/S 153A R.W.S. 143(3) OF THE I.T. ACT. 2. AFTER GOING THROUGH THE ASSESSMENT RECORDS AND T HE RELEVANT SEIZED MATERIAL, IT IS NOTICED THAT ASSESSMENT ORDER IS ERRONEOUS IN AS MUCH AS IT IS PREJUDICIAL TO THE IN TEREST OF REVENUE FOR THE REASONS GIVEN BELOW :- IN THE COURSE OF SEARCH, INTER-ALIA; A NOTE-BOOK (LE DGER) MARKED AS A-2 WAS FOUND AND SEIZED FROM THE RESIDENTI AL PREMISES OF SH. NARAIN SINGLA. AFORESAID LEDGER RECORDED DETAILS OF UNACCOUNTED PURCHASES AND SALE ETC. AS PER FACTS DISCUSSED FROM PAGE 2 TO 8 OF THE ASSESSMENT ORDER FOR A.Y. 2010-11, THERE ARE UNRECORDED PURCHASES OF RS.8,12,01,500/- AND UNRECORDED SALES OF RS.7,65,43,329/-. ON THE BASIS OF ABOVE WORKING OF UNRECORDED PURCHAS ES AND SALE, A.O. HAS COMPUTED PEAK INVESTMENT OF RS,I,25, 54,782/~ APART FROM PROFIT ON THE UNACCOUNTED SALES. SINCE AS SESSEE HAD ALREADY DECLARED AN AMOUNT OF RS.50 LAC, A.O, MADE FURTHER ADDITION OF RS.75.54 LACS (RS.1,25,54,782 - RS.50,00,000/-). 3. HOWEVER, ON PERUSAL OF THE AFORESAID LEDGER, IT IS FOUND THAT FOLLOWING TRANSACTIONS AS PER ANNEXURE S GIVEN IN THE BELOW-MENTIONED TABLE THOUGH RECORDED IN THE L EDGER 3 DO NOT FIND PLACE IN THE DETAILS OF PURCHASE AND SA LE RECORDED ON PAGE 3 TO 8 OF THE ASSESSMENT ORDER. IT THEREFORE FOLLOWS THAT ALL THE TRANSACTIONS RECORDED IN THE AFORESAID LE DGER HAVE NOT BEEN TAKEN INTO ACCOUNT FOR COMPUTING THE P EAK INVESTMENT AND PROFIT ON THE SALES AND CONSEQUENTIALLY ADDITIONS MADE :- SR. NO. PARTICULARS AMOUNT ANNEXURE 1. DETAILS OF DATE- WISE UNACCOUNTED SALES. RS.65,91,496/- ANN. 1 2. DETAILS OF DATE-WISE UNACCOUNTED SALES (TAX DETAILS) RS.2,51,99,926/- TOTAL TAX : RS.2,76,814/- ANN. II (PAGE 3) 3. DETAILS OF DATE-WISE UNACCOUNTED PURCHASE RS.21,83,083/- ANN. ILL 4. THEKDAR (DEBIT AMOUNT NOT ENTERED IN ASSESSMENT ORDER). RS.28,19,608/- ANN. IV 5. DETAILS OF PURCHASE BIRDI - DELUX (NOT ENTERED IN ASSESSMENT ORDER) RS.14,00,480/- ANN. V 6. DETAILS OF ENTRIES OF LIME STONE (DEBIT AMOUNT NOT ENTERED IN ASSESSMENT ORDER) RS.66,081/- ANN. VI 4. IT IS ALSO RELEVANT TO STATE HERE THAT WHILE ALLOWING SET OFF OF PROFITS ON UNACCOUNTED SALES RE CORDED IN THIS LEDGER FROM THE PEAK INVESTMENT OF RS.1,25,54, 7827-, A.O. HAS CONSIDERED THE PROFIT ELEMENT EVEN ON THE SALES M ADE AFTER THE DATE ON WHICH THE PEAK INVESTMENT HAS BEE N CONSIDERED BY THE A.O. WHICH IN MY CONSIDERED OPINION IS NOT PROPER. IN OTHER WORDS, PROFIT ELEMENT ON THE SALES MA DE AFTER 11.01.2010; THE DATE ON WHICH THE PEAK INVESTMENT OF RS.1,25,54,782/- HAS BEEN ADOPTED BY THE A.O. FOR M AKING ADDITION (A.O. HAS ALLOWED SET OFF OF PROFIT ELEMENT ON WHOLE 4 OF THE SALES INCLUDING THE SALES MADE AFTER THE DATE O F PEAK INVESTMENT) WOULD NOT BE AVAILABLE WITH THE ASSESSEE FOR MAKING THE PEAK INVESTMENT. 5. IN THE LIGHT OF THE AFORESAID FACTS, IT IS CONSIDERED THAT THE ORDER PASSED U/S 153A R.W.S. 143 (3) OF THE ACT DATED 25.03.2013 BY THE DCIT, CENTRAL CIRCL E-ILL, LUDHIANA IS PRIMA FACIE ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTEREST OF REVENUE. YOU ARE, THEREFORE, REQ UESTED TO SHOW CAUSE AS TO WHY THE AFORESAID ORDER DATED 25.03.2013 PASSED U/S 153A R.W.S. 143(3) OF THE ACT FOR THE A.Y.2010-11 SHOULD NOT BE REVISED/MODIFIED/ENHANCED O R SET ASIDE WITH THE DIRECTIONS TO MAKE THE ASSESSMEN T DENOVO. 6. FOR THIS PURPOSE, YOU ARE HEREBY GIVEN AN OPPORTUNITY OF BEING HEARD EITHER IN PERSON OR THROU GH AN AUTHORIZED REPRESENTATIVE IN MY OFFICE SITUATED AT KITC HLU NAGAR, 2 ND FLOOR, NEAR B.V.M. SCHOOL, LUDHIANA ON 20.01.2015 AT 1.30 P.M. ON THAT DATE, YOU MAY SUBMIT YOUR OBJ ECTIONS WITH EVIDENCE, IF ANY, TO THE PROPOSED ACTION IN WRIT ING. IN CASE OF YOUR FAILURE TO ATTEND ON THE AFORESAID DAT E OR TO SUBMIT WRITTEN REPLY BY THAT DATE, IT WILL BE PRESUM ED THAT YOU HAVE NO OBJECTION TO THE PROPOSED ACTION AND MATT ER SHALL BE DECIDED ON MERITS. 3. IN REPLY TO THE SAID NOTICE, THE ASSESSEE SUBMITTED THAT ALL THE ENTRIES RECORDED IN THE IMPO UNDED DIARY MARKED AS ANNEXURE-A-I HAVE BEEN DULY CONSID ERED BY THE ASSESSING OFFICER DURING THE ASSESSMENT PROCEEDINGS. IT WAS AN ADMITTED FACT THAT PART OF THE ENTRIES NOT RECORDED IN THE BOOKS OF ACCOUNT REPRES ENTING PURCHASES AND SALES OUTSIDE THE BOOKS OF ACCOUNT WE RE TAKEN INTO ACCOUNT AND THEREAFTER CALCULATING PEAK AT RS.1,25,54,782/- AND AFTER DEDUCTING A SUM OF RS.50 LACS 5 BEING THE AMOUNT SURRENDERED, THE ADDITION OF RS.75,54,782/- WAS MADE BY THE ASSESSING OFFICER. THE LEARNED CIT (APPEALS) HAD DELETED THE ADDITION TO T HE EXTENT OF RS.69,24,127/- AND BALANCE ADDITION OF RS.6,30,655/- WAS UPHELD. THE ASSESSEE AS WELL AS THE DEPARTMENT ARE IN APPEAL BEFORE THE I.T.A.T. AGAINS T THE SAID ORDER OF THE LEARNED CIT (APPEALS), WHICH IS S TILL PENDING. APART FROM THIS, CERTAIN CLERICAL MISTAKE S WITH REGARD TO WRONG NOTING DOWN OF FIGURE WERE ADMITTED BY THE ASSESSEE. 4. AFTER CONSIDERING THESE SUBMISSIONS OF THE ASSESSEE, THE LEARNED COMMISSIONER OF INCOME TAX H ELD THAT THE CONTENTION OF THE ASSESSEE THAT THESE ENTR IES HAVE BEEN RECORDED IN THE BOOKS OF ACCOUNT, HAVE BEEN CH ECKED BY THE ASSESSING OFFICER IS NOT EVIDENT. FURTHER, HE HELD THAT THERE ARE ADMITTEDLY CERTAIN ARITHMETICAL ERRO RS IN NOTING DOWN OF FIGURES AND ALSO WORKING OUT OF PEAK . FURTHER, THE LEARNED COMMISSIONER OF INCOME TAX HE LD THAT ON THE BASIS OF A TABLE REPRODUCED IN HIS ORDE R AT PAGE 5, THAT THESE AMOUNTS ARE NOT RECORDED IN THE BOOKS OF THE ASSESSEE AND THE ASSESSEES CONTENTION THAT THESE ARE COVERED IN THE SURRENDER MADE BY IT CANNOT BE ACCEPTED. WITH REGARD TO ASSESSEES SUBMISSION THA T ASSESSING OFFICERS ORDER HAVING MERGED WITH THE OR DER OF THE CIT (APPEALS), THE JURISDICTION UNDER SECTION 2 63 OF THE ACT IS NOT PROPER, THE LEARNED COMMISSIONER OF INCOME TAX BRUSHED ASIDE THE SAME AND HELD THAT THE ISSUE IS 6 NOT OF ADDITION TO BE MADE ON ACCOUNT OF TRANSACTIO N ALREADY NOTED IN THE ASSESSMENT ORDER, THE ISSUE IS NON RECORDING OR WRONG RECORDING OF CERTAIN TRANSACTION S. FURTHER, HE ALSO OBSERVED THAT THE ASSESSING OFFICE RS CONSIDERING PROFIT ELEMENT EVEN ON THE SALES MADE A FTER THE DATE ON WHICH THE PEAK INVESTMENT HAS BEEN ADOP TED IS ALSO NOT CORRECT. RELYING ON A NUMBER OF JUDGME NTS OF VARIOUS HIGH COURTS AND BENCHES OF THE I.T.A.T., TH E LEARNED COMMISSIONER OF INCOME TAX HELD THE ORDER OF THE ASSESSING OFFICER TO BE ERRONEOUS AND PREJUDICIAL T O THE INTEREST OF THE REVENUE AND SETTING ASIDE THE SAME, GAVE DIRECTION TO THE ASSESSING OFFICER TO MAKE FRESH ASSESSMENT DE-NOVO AFTER PROPERLY EXAMINING THE FAC TS AND RELEVANT LEGAL PROVISION AND CONDUCTING PROPER ENQU IRY AND AFTER AFFORDING OPPORTUNITY OF BEING HEARD TO T HE ASSESSEE. 5. AGGRIEVED BY THIS ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX , THE ASSESSEE HAS COME IN APPEAL BEFORE US, RAISING FOLLOWING GROUNDS OF APPE AL : 1. THAT THE WORTHY PRINCIPAL COMMISSIONER OF INCOME TAX (CENTRAL) HAS ERRED IN INVOKING THE PROCEEDINGS U/S 263 AND PASSING THE ORDER U/S 263 OF THE INCOME TAX ACT, 1961 THEREBY SETTING ASIDE THE ORDER OF THE ASSESSING OFFICER WITH THE DIRECTION TO MAKE FRESH ASSESSMENT. 2. THAT THE WORTHY PRINCIPAL CIT(CENTRAL) HAS ALSO ERRED IN NOT CONSIDERING THE FACT THAT THE ASSESSMENT W AS 7 COMPLETED U/S 153A R.W.S. 143(3), AFTER THOROUGH INVESTIGATION AND APPLICATION OF MIND AND, AS SUCH, T HE ASSESSMENT FRAMED WAS NEITHER ERRONEOUS AND NOR PREJUDICIAL TO THE INTEREST OF REVENUE. 3. NOTWITHSTANDING THE ABOVE SAID GROUND OF APPEAL, TH E PR. CIT (C) , HAS ERRED IN NOT CONSIDERING THE FOLLOWIN G FACTS THAT THE ASSESSMENT WAS NEITHER ERRONEOUS NOR PREJUDICIAL TO THE INTEREST OF REVENUE: - I). THE ENTRIES AS CONFRONTED BY THE PR. C!T( C) BY WAY OF ANNEXURE -1 ARE DULY RECORDED IN THE BOOKS OF ACCOUNTS, WHICH WERE VERIFIED BY THE ASSESSING OFFICER AND THE EVIDENCE OF THE SAME WAS GIVEN TO, THE PRINCIPAL CIT(C) AND WHICH, IT DID NOT REQUIRE ANY FURTHER VERIFICATION. FURTHER, THE TYPOGRAPHICAL ERROR OF ONE FIGURE AS SHOWN AT ITEM NO. 23 OF THE SEIZED DOCUMENT DID NOT EFFECT THE INCOME AS ALREADY ASSESSED BY THE ASSESSING OFFICER. II). SIMILARLY, THE ENTRIES AS CONFRONTED BY THE WORTHY PR.CIT (C) AS PER ANNEXURE-2 HAVE BEEN DULY RECORDED IN THE BOOKS OF ACCOUNTS, WHICH WERE VERIFIED BY THE ASSESSING OFFICER AND EVIDENCE OF THE SAME WAS ALSO FURNISHED TO THE WORTHY PR.CIT (C), EXCEPT ITEM NO. 35 OF THE SEIZED DOCUMENT, WHICH HAVE A TYPOGRAPHICAL ERROR, BUT DID NOT EFFECT THE INCOME AS ALREADY ASSESSED BY THE ASSESSING OFFICER. III). SIMILARLY, AS REGARDS CERTAIN ENTRIES IN THE SEIZ ED DOCUMENT COMMUNICATED AS PER ANNEXURE-LLL WERE PARTLY RECORDED IN THE BOOKS OF ACCOUNTS, WHICH WERE VERIFIED BY THE ASSESSING OFFICER AND FOR WHICH, THE EVIDENCE WAS ALSO FURNISHED TO THE WORTHY PR.CIT (C) AND FOR THE OTHERS, IT 8 WAS A TYPOGRAPHICAL ERROR AND WHICH DID NOT EFFECT THE AMOUNT OF ADDITION AS MADE BY THE ASSESSING OFFICER. IV). AS REGARDS THE ENTRIES AS CONFRONTED BY TH E WORTHY PR.CIT(C) BY WAY OF ITEM NO. IV, V, & VII THOUGH, THEY HAD NOT BEEN RECORDED IN THE BOOKS OF ACCOUNT, BUT ARE DULY COVERED IN THE OFFER OF RS.50 LACS AS MADE ,WHILE FILLING THE RETURN OF INCOME AND WHICH ASPECT HAS BEEN EXAMINED BY THE ASSESSING OFFICER. V). THAT THE FINDING OF THE WORTHY PR.CIT (C) THAT CERTAIN FIGURES, WHICH HAD BEEN TAKEN INCORRECTLY WHILE WORKING OUT THE ADDITION WOULD MAKE THE ASSESSMENT ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE IS NOT CORRECT FINDING, SINCE EVEN IF, THE ASSESSMENT IS ERRONEOUS BUT NOT PREJUDICIAL TO THE INTEREST OF REVENUE WOULD NOT GIVEN THE POWER TO THE WORTHY PR.CIT (C) TO ASSUME THE JURISDICTION U/S 263. 4. THAT THE FINDING OF THE WORTHY PR.CIT (C) THAT ENT RIES WHICH ARE COVERED IN THE DISCLOSURE OF RS. 50 LACS WOULD MAKE THE ASSESSMENT AS ALREADY FRAMED AS INCORRECT, IS NOT A CORRECT OBSERVATION, SINCE THE ME RE FACT THAT THE ASSESSMENT AS ALREADY FRAMED IS INCORRECT, BUT NOT PREJUDICIAL TO THE INTEREST OF REVENUE WOULD NOT AUTHORIZE THE WORTHY PR.CIT (C) TO SET ASIDE THE CASE TO THE ASSESSING OFFICER. 5. THAT THE WORTHY PR.CIT (C) HAS FAILED TO CONSIDER THE FACT THAT THE ISSUE OF DIARY WAS A SUBJECT MATTER O F APPEAL BEFORE THE WORTHY CIT (A)-L, WHO HAD ALREADY ADJUDICATED AND DECIDED THE MATTER AND BOTH THE ASSESSEE AND DEPARTMENT ARE IN APPEAL BEFORE THE HON'BLE INCOME TAX APPELLATE TRIBUNAL, 9 CHANDIGARH AND, THEREFORE, THE ORDER OF THE ASSESSING OFFICER HAVING ALREADY MERGED WITH THE ORDER OF CIT (A)-L, LUDHIANA AND, AS SUCH, THE ORDE R AS PASSED BY THE WORTHY PR.CIT (C) IS NOT A VALID ORDER EITHER. 6. THAT THE DETAILED SUBMISSIONS FILED DURING THE COURSE OF HEARING HAS NOT BEEN CONSIDERED PROPERLY. 7. THAT THE APPELLANT CRAVES LEAVE TO ADD OR AMEND THE GROUNDS OF APPEAL BEFORE THE APPEAL IS FINALLY HEAR D OR DISPOSED OFF. 6. THE LEARNED COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE LOWER AUTHORITIES. IN ADDITION, IT WAS SUBMITTED THAT THE LEARNED COMMISS IONER OF INCOME TAX HAS INVOKED HIS REVISIONARY POWERS O N THE BASIS OF THE SAME DOCUMENTS, WHICH WERE THERE BEFOR E THE ASSESSING OFFICER. ON THE SAME DOCUMENTS, ONLY CHA NGE IN MODE AND MANNER OF MAKING ADDITION BY THE ASSESS ING OFFICER, IS NOT PROPER ON THE PART OF THE LEARNED COMMISSIONER OF INCOME TAX TO ASSUME JURISDICTION UNDER SECTION 263 OF THE ACT. AS REGARDS UNACCOUNTED ENT RIES, OUR ATTENTION WAS INVITED TO THE OFFICE NOTE WRITTE N BY THE ASSESSING OFFICER AT THE END OF HIS ORDER, WHEREBY HE HAS CLEARLY STATED THAT ALL UNACCOUNTED ENTRIES HAVE BE EN CONSIDERED BY HIM. FURTHER, IT WAS ARGUED THAT AS REGARDS THE PREJUDICE CAUSED TO THE REVENUE, NO FINDING HAS BEEN RECORDED BY THE LEARNED COMMISSIONER OF INCOME TAX. IN VIEW OF THE ORDER OF THE ASSESSING OFFICER, GETTI NG MERGED 10 WITH THE ORDER OF THE CIT (APPEALS), THE LEARNED COMMISSIONER OF INCOME TAX DOES NOT HAVE POWER TO R EVISE THE ORDER UNDER SECTION 263 OF THE ACT. 7. THE LEARNED D.R. RELIED ON THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX. HIS EMPHASIS W AS MAINLY ON THE ISSUE THAT ADMITTEDLY THERE WERE CERT AIN FIGURES RECORDED INCORRECTLY, THE LEARNED COMMISSIO NER OF INCOME TAX HAS JURISDICTION TO RECTIFY THE SAME. 8. WE HAVE HEARD THE LEARNED REPRESENTATIVES OF BOTH THE PARTIES, PERUSED THE FINDINGS OF THE AUTHO RITIES BELOW AND CONSIDERED THE MATERIAL AVAILABLE ON RECO RD. ON PERUSAL OF THE PAPER BOOK FILED BY THE ASSESSEE, THAT OF THE ASSESSING OFFICERS ORDER AS WELL AS THE SUBMIS SION OF LEARNED COUNSEL FOR THE ASSESSEE, THERE IS NO DOUBT TO THE FACT THAT THE SAME ISSUE WHICH THE LEARNED COMMISSI ONER OF INCOME TAX IS RAKING UP IN PROCEEDINGS UNDER SE CTION 263 OF THE ACT, WHICH WAS THERE BEFORE THE ASSESSIN G OFFICER DURING THE ASSESSMENT PROCEEDINGS. THERE I S A DIARY CONTAINING CERTAIN TRANSACTIONS WHICH AS PER THE ASSESSING OFFICER WERE NOT RECORDED IN THE BOOKS OF ACCOUNTS, WHILE THE CONTENTION OF THE ASSESSEE IS T HAT THESE ARE RECORDED IN THE BOOKS OF ACCOUNT. THE ASS ESSING OFFICER ANALYZED ALL THE TRANSACTIONS AFTER HEARING THE ASSESSEE, APPLIED HIS MIND ON THE SAME AND ARRIVED AT A CERTAIN CONCLUSION, WHILE MAKING ADDITIONS. IN FA CT, THIS 11 WAS THE SOLE ISSUE BEFORE THE ASSESSING OFFICER DU RING THE ASSESSMENT PROCEEDINGS. THEREFORE, CERTAINLY IT IS NOT A CASE OF NO INQUIRY. THE ASSESSING OFFICER HAS MADE SPECIFIC QUERIES, DULY REPLIED BY THE ASSESSEE, TOT ALLY APPLYING HIS MIND, HE TOOK A JUDICIOUS DECISION. T HE DECISION TAKEN BY HIM IS CERTAINLY BASED ON THE MAT ERIAL AND EXPLANATION ON RECORD BROUGHT BY HIM AS WELL AS THE ASSESSEE. WE CANNOT SEE IN THESE CIRCUMSTANCES TH AT HE HAS NOT APPLIED HIS MIND. THERE IS NOTHING VERY SP ECIFIC PROVIDED UNDER THE LAW TO BE DONE IN SUCH CIRCUMSTA NCES. THE ASSESSING OFFICER HAS BEEN GIVEN POWERS TO TAKE A JUDICIOUS DECISION AFTER CONSIDERING THE MATERIAL A ND EVIDENCES, WHICH HE HAS DULY DONE. NOW, THE LEARNE D COMMISSIONER OF INCOME TAX, IN THE GARB OF ASSUMING JURISDICTION UNDER SECTION 263 OF THE ACT, CANNOT I MPOSE HIS OWN DECISION AS THAT OF THE ASSESSING OFFICER. AT MANY PLACES IN HIS ORDER, HE HIMSELF OBSERVED THAT HE IS NOT IN AGREEMENT WITH THE DECISION TAKEN BY THE ASS ESSING OFFICER, THIS CANNOT BE A RIGHT OCCASION TO ASSUME JURISDICTION UNDER SECTION 263 OF THE ACT. AS WE H AVE ALREADY STATED THAT THE CONCLUSION DRAWN BY THE ASS ESSING OFFICER IS NOT ONE WHICH IS IN CONTRAVENTION OF SOM E LAW. THE ASSESSING OFFICER HAS DRAWN CONCLUSION TO THE B EST OF HIS ABILITY, THE LEARNED COMMISSIONER OF INCOME TAX , NOW CANNOT IMPOSE HIS OWN VIEW UNDER SECTION 263 OF THE ACT. THE LEARNED COMMISSIONER OF INCOME TAX HAS HELD 12 SOMEWHERE IN HIS ORDER THAT THE CONTENTION OF THE ASSESSEE THAT ALL THESE ENTRIES ARE ACTUALLY RECORD ED IN THE BOOKS OF ACCOUNT IS NOT ACCEPTABLE. WE DO NOT UNDE RSTAND HOW THE LEARNED COMMISSIONER OF INCOME TAX ASSUMING JURISDICTION UNDER SECTION 263 OF THE ACT, CAN DECI DE AN ISSUE, WHICH HAS BEEN ALREADY DECIDED BY THE LEARNE D CIT (APPEALS) AND THE MATTER IS PENDING BEFORE THE I.T. A.T. FURTHER, HIS OBSERVATION THAT THERE IS NO EVIDENCE THAT THE ASSESSING OFFICER HAS EXAMINED THE SAME OR NOT IS A LSO NOT CORRECT, SINCE ALL ALONG THE CONTENTION OF THE ASSESSEE HAS BEEN THAT THESE ENTRIES ARE RECORDED IN THE BOO KS OF ACCOUNT AND THE ASSESSING OFFICER AS WELL AS THE CI T (APPEALS) HAVE ACTUALLY WORKED ON THESE LINES ONLY. SOME OF THE OBSERVATIONS MADE BY THE LEARNED COMMISSIONE R OF INCOME TAX WITH REGARD TO WRONG NOTING AND NOT NOT ING OF CERTAIN ENTRIES MAY BE CORRECT, AS WE SEE THAT EVEN THE ASSESSEE HAS ADMITTED TO THAT. HOWEVER, THESE MIST AKES DO NOT GIVEN THE LEARNED COMMISSIONER OF INCOME TAX JURISDICTION UNDER SECTION 263 OF THE ACT, THERE AR E OTHER MECHANISMS PROVIDED UNDER THE ACT TO CORRECT THESE ANOMALIES. FURTHER, IN THIS CONTEXT, WE ALSO OBSE RVE THAT IF ALL THESE CORRECTIONS ARE DONE, WHETHER THE TAX IMPOSABLE ON THE ASSESSEE WILL INCREASE OR DECREASE , THIS FACT ALSO REMAINS UNDER THE CLOUDS. IN SUCH CIRCUMSTANCES, HOW CAN THE LEARNED COMMISSIONER OF INCOME TAX INFER THAT THESE MISTAKES LEAD TO THE O RDER 13 BEING PREJUDICIAL TO THE INTEREST OF THE REVENUE, I T MAY RESULT INTO BEING PREJUDICIAL TO THE INTEREST OF AS SESSEE ALSO. THEREFORE, WE SEE THAT THE LEARNED COMMISSIO NER OF INCOME TAX S ACT OF ASSUMING JURISDICTION UNDER SE CTION 263 OF THE ACT IS NOT AS PER LAW. 9. THE OTHER ASPECT RAISED BY THE ASSESSEE IS THAT THE ORDER OF THE ASSESSING OFFICER HAVING MERGED WI TH THE ORDER OF THE CIT (APPEALS), THE LEARNED COMMISSIONE R OF INCOME TAX DOES NOT HAVE JURISDICTION TO REVISE TH E SAME UNDER SECTION 263 OF THE ACT. THERE IS NO DISPUTE TO THE FACT THAT THE PROCEEDINGS UNDER SECTION 263 OF THE ACT HAVE BEEN INITIATED AFTER THE ORDER OF THE CIT (APP EALS), WHERE PARTIAL RELIEF WAS GIVEN TO THE ASSESSEE AND AT PRESENT BOTH THE ASSESSEE AS WELL AS DEPARTMENT ARE IN APPEAL BEFORE THE I.T.A.T. IT IS A TRITE LAW BY NO W THAT THE ISSUES WHICH ARE ADJUDICATED BY THE CIT (APPEALS), THE ORDER OF THE ASSESSING OFFICER ON SUCH ISSUES GETS MERGED IN THE ORDER OF THE CIT (APPEALS). BOTH THE CIT (A PPEALS) AS WELL AS THE LEARNED COMMISSIONER OF INCOME TAX BEING THE OFFICERS OF THE SAME RANK, THE LEARNED COMMISSI ONER OF INCOME TAX CANNOT ASSUME JURISDICTION UNDER SECTIO N 263 OF THE ACT, ON SUCH ORDERS. OTHERWISE ALSO, THE LE ARNED COMMISSIONER OF INCOME TAX UNDER SECTION 263 OF TH E ACT HAS THE POWERS TO REVISE ASSESSING OFFICERS ORDER ONLY AND NOT THAT OF CIT (APPEALS). IN THE PRESENT CASE , THE CONTENTION OF THE LEARNED COMMISSIONER OF INCOME TA X , THAT THE ISSUE IS NOT OF ADDITION TO BE MADE ON ACC OUNT OF 14 TRANSACTIONS ALREADY NOTED IN THE ASSESSING OFFICER S ORDER, BUT OF NON-RECORDING OR WRONG RECORDING OF C ERTAIN TRANSACTIONS. HOWEVER, WE FIND THAT THIS IS NOT T HE PROPER OCCASION TO ASSUME JURISDICTION UNDER SECTIO N 263 OF THE ACT. THE ISSUE OF RECORDING, NON-RECORDING, UNDER RECORDING OF ENTRIES ETC. ARE ALL INTER-RELATED AND THE ASSESSING OFFICER AS WELL AS CIT (APPEALS) HAVE ALR EADY APPLIED THEIR MIND TO THE SAME, HOW CAN THE WRONG RECORDING OR UNDER RECORDING CAN BE CONSIDERED AN I SSUE INDEPENDENT OF NON-RECORDING, WE DO NOT UNDERSTAND. OTHERWISE ALSO, AS WE HAVE HELD ELSEWHERE IN THIS O RDER, THERE ARE OTHER MECHANISMS UNDER THE ACT TO CORRECT THESE KIND OF ANOMALIES, IF ANY. 10. BEFORE PARTING, WE WOULD ALSO LIKE TO OBSERVE THAT THE LEARNED COMMISSIONER OF INCOME TAX HAS AT THE END OF HIS ORDER GIVEN DIRECTION TO THE ASSESSING O FFICER TO MAKE ASSESSMENT DE-NOVO AFTER MAKING FURTHER ENQUIR Y. THIS, IN OUR VIEW, IS NOT PROPER. IF THE LEARNED COMMISSIONER OF INCOME TAX IS SATISFIED THAT THE O RDER IS ERRONEOUS, HE HAS TO GIVE A CATEGORICAL FINDING IN THIS REGARD AFTER CONDUCTING ENQUIRIES AND INVESTIGATION , HE THINKS FIT. THE ACT OF THE LEARNED COMMISSIONER OF INCOME TAX TO GIVE SUCH DIRECTION TO THE ASSESSING OFFICE R, GOES TO PROVE THAT THE LEARNED COMMISSIONER OF INCOME TA X HIMSELF IS NOT SURE WHETHER THE ORDER IS ERRONEOUS OR NOT, AS THE ENQUIRIES CONDUCTED AT THE LEVEL OF THE ASSE SSING OFFICER MAY NOT LEAD TO SUCH ERROR. FROM THIS POIN T ALSO, 15 THE LEARNED COMMISSIONER OF INCOME TAX HAS NOT ACT ED AS PER LAW. 11. IN VIEW OF THE ABOVE, WE SET ASIDE THE ORDER O F THE LEARNED COMMISSIONER OF INCOME TAX AND ALLOW T HE APPEAL OF THE ASSESSEE. 10. IN THE RESULT APPEAL OF THE ASSESSEE IS ALLOWE D. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 15 TH DAY OF MARCH, 2016. SD/- SD/- (BHAVENESH SIANI) (RANO JAIN) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 15 TH MARCH, 2016 *RATI* COPY TO: THE APPELLANT/THE RESPONDENT/THE CIT(A)/THE CIT/THE D R. ASSISTANT REGISTRAR, ITAT, CHANDIGARH 16