Meena Choudhary, Bilaspur V. Income tax Officer, Ward 1(1), Bilaspur

ITA 70/RPR/2020

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 3719 (ITAT-RAIPUR)
• Duration Of Justice: 1 year(s) 3 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-10-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2015-2016
• Appeal Filed On: 24-06-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: RICHA KHATRI; C A
• Keywords: Set aside; Capital Gains
• Section: 263; 143(3); 142(1); 143(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL RAIPUR BENCH, RAIPUR BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER & SHRI N. K. CHOUDHRY, JUDICIAL MEMBER ./ I.T.A. NO. 70/RPR/2020) ( ASSESSMENT YEAR : 2015-16) MEENA CHOUDHARY JUNA BILASPUR, BILASPUR, CHHATTISGARH - 495001 / VS. PR. COMMISSIONER OF INCOME TAX AAYAKAR BHAWAN, MAHIMA COMPLEX, VYAPAR VIHAR, BILASPUR, CHHATTISGARH - 495001 ./ ./PAN/GIR NO. : AAOPC1566F ( APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : SMT. RICHA KHATRI, C.A. / RESPONDENT BY : SHRI P. K. MISHRA, CIT.DR DATE OF HEARING 29/07/2021 !'# / DATE OF PRONOUNCEMENT 12/10/2021 / O R D E R PER PRADIP KUMAR KEDIA - AM: THE CAPTIONED APPEAL HAS BEEN FILED AT THE INSTANCE OF THE ASSESSEE AGAINST THE ORDER OF THE PRINCIPAL COMMISS IONER OF INCOME TAX, BILASPUR (PCIT IN SHORT), DATED 31.03.2020 P ASSED UNDER S.263 OF THE INCOME TAX ACT, 1961 (THE ACT) WHEREBY THE A SSESSMENT ORDER PASSED BY THE ASSESSING OFFICER (AO) DATED 21.04.20 17 UNDER S. 143(3) OF THE ACT CONCERNING AY 2015-16 WAS SOUGHT TO BE SET ASIDE FOR REFRAMING ASSESSMENT IN TERMS OF SUPERVISORY DIRECTIONS. ITA NO. 70/RPR/2020 (MEENA CHOUDHARY VS. ITO) A.Y. 2015-16 - 2 - 2. AS PER ITS GROUNDS OF APPEAL, THE ASSESSEE HAS C HALLENGED THE REVISIONAL ACTION OF THE PCIT WHEREBY THE ASSESSING OFFICER (A.O.) WAS DIRECTED TO PASS THE ASSESSMENT ORDER DE NOVO AFTER MAKING ENQUIRIES ON THE POINTS SET OUT IN THE NOTICE WHICH HAS ALREADY EXAMINED AND CONSIDERED DURING THE ORIGINAL ASSESSM ENT PROCEEDINGS CONCERNING A.Y. 2015-16. THE ASSESSEE HAS CHALLENG ED THE ASSUMPTION OF JURISDICTION BY THE PCIT UNDER SECTION 263 OF TH E ACT ON THE GROUND THAT THE ASSESSMENT ORDER UNDER REVISION IS NEITHER ERRONEOUS NOR PREJUDICIAL TO THE INTEREST OF THE REVENUE. 3. BRIEFLY STATED, THE ASSESSEE FILED ITS RETURN OF INCOME FOR A.Y. 2015-16 IN QUESTION DECLARING TOTAL INCOME AT RS.2, 00,800/-. THE RETURN FILED WAS SUBJECTED TO LIMITED SCRUTINY ASSE SSMENT BY ISSUE OF NOTICE UNDER SECTION 143(2) AND 142(1) OF THE ACT A ND THE RETURN FILED BY THE ASSESSEE WAS ASSESSED AS SUCH. 4. THEREAFTER, THE PCIT IN EXERCISE OF REVISIONARY POWERS, ISSUED SHOW CAUSE NOTICE DATED 26.02.2020 TO SHOW CAUSE WH Y THE ASSESSMENT SO FRAMED UNDER SECTION 143(3) SHOULD NOT BE MODIFI ED/SET ASIDE ON THE GROUND THAT SUCH ORDER IS ERRONEOUS IN SO FAR AS PR EJUDICIAL TO THE INTEREST OF THE REVENUE. 5. AS PER THE SHOW CAUSE NOTICE, IT WAS ALLEGED THA T THE AO HAS FAILED TO EXAMINE THE SOURCE OF INVESTMENT IN PROPE RTY, EXAMINATION OF ADVANCES RECEIVED, CREDITWORTHINESS OF OTHER CO-PUR CHASERS OF THE PROPERTY, AGRICULTURAL INCOME DECLARED, EXAMINATION OF CAPITAL GAINS ETC. 6. AGGRIEVED BY THE REVISIONAL ORDER PASSED BY THE PCIT, THE ASSESSEE PREFERRED APPEAL BEFORE THE TRIBUNAL TO CH ALLENGE THE SUPERVISORY JURISDICTION USURPED BY THE PCIT UNDER SECTION 263 OF THE ACT. ITA NO. 70/RPR/2020 (MEENA CHOUDHARY VS. ITO) A.Y. 2015-16 - 3 - 7. WE HAVE HEARD THE RIVAL SUBMISSIONS ON THE ISSUE . ON THE BROADER RECKONING, THE CONTENTIONS OF THE ASSESSEE ARE: I) THE CASE WAS SELECTED FOR LIMITED SCRUTINY AND THEREFORE THE SCOPE OF THE ASSESSMENT WAS CONFINED TO THE POINTS NOTED IN THE SCRUTINY NOTICE ISSUED UNDER S.143(2) OF THE ACT. AS PER THE AFORESAID NOTICE DATED 20.09.2016, THE SOLITARY ISSUE IDENTIF IED FOR EXAMINATION WAS ON ACCOUNT OF PURCHASE OF PROPERTY. II) SPECIFIC QUERIES WERE RAISED IN THIS REGARD BY THE AO IN THE COURSE OF THE ASSESSMENT. THE SUBMISSIONS OF THE A SSESSEE TO EXPLAIN THE SOURCE OF PURCHASE OF PROPERTY AS PRESENTED BEF ORE THE AO IS ALSO PLACED AT PAGE NOS. 32-33 OF THE PAPER BOOK. THE A O HAVING BEEN SATISFIED WITH THE SOURCE OF INVESTMENT, AFTER REQU ISITE ENQUIRY, ACCEPTED THE INVESTMENT. III) ON FACTS, THE ASSESSEE JOINTLY PURCHASED THE P ROPERTY ALONGWITH FOUR FAMILY MEMBERS AND THE SHARE OF THE ASSESSEE I N THE PROPERTY WAS ONLY 20% I.E. RS.20,02,000/-. THE SOURCE OF PURCHA SE OF PROPERTY WAS EXPLAINED TO BE EXISTING CASH IN HAND ACCUMULATED T IDE EARLIER FINANCIAL YEAR AMOUNTING TO RS.13.45 LAKHS AS SHOWN IN THE BALANCE SHEET; AGRICULTURAL INCOME RS.2.03 LAKHS AND ADVANC ES RECEIVED ON SALE OF LAND RS.5LAKHS FOR WHICH COPY OF SALE DEED AND AGREEMENT EXECUTED WAS ALSO PRESENTED BEFORE THE AO. HAVING REGARD TO THESE FACTS, THE AO ACTED REASONABLY AND ACCEPTED THE BON AFIDES AFTER PROPER APPLICATION OF MIND. THE PCIT HAS POINTED OUT THE LAPSES IN THE ASSESSMENT DISREGARDING THE SCOPE OF LIMITED SCRUTI NY AND HAS ATTEMPTED TO EXPAND THE SCOPE OF ENQUIRY IN S.263 P ROCEEDINGS. FOR INSTANCE, CREDITWORTHINESS OF CO-PURCHASERS, AGRICU LTURAL INCOME, EXAMINATION OF CAPITAL GAINS ETC. COULD NOT HAVE BE EN MADE IN THE LIMITED SCRUTINY ASSESSMENT, HAVING REGARD TO SEVER AL CBDT INSTRUCTIONS ISSUED IN THIS REGARD. 8. A REFERENCE WAS MADE TO THE DECISIONS OF THE CO- ORDINATE BENCH OF TRIBUNAL IN M/S. SU-RAJ DIAMOND DEALERS PVT. LTD. VS. PCIT ITA ITA NO. 70/RPR/2020 (MEENA CHOUDHARY VS. ITO) A.Y. 2015-16 - 4 - NO. 3098/MUM/2019 ORDER DATED 27.11.2019; BALVINDER KUMAR VS. PCIT (2021) 125 TAXMANN.COM 83 (DELHI-TRIB.) & HILL QUEEN INVESTMENT (P.) LTD. VS. PCIT (2021) 127 TAXMANN.CO M 682 (KOLKATA- TRIB.) AND WAS SUBMITTED THAT THE CO-ORDINATE BENCH OF TRI BUNAL HAVE UNIFORMLY HELD THAT WHERE THE SCOPE OF SCRUTINY IS LIMITED TO THE ISSUES RAISED, THE REVISIONAL AUTHORITY IS NOT ENTITLED UN DER S.263 OF THE ACT TO EXAMINE THE ISSUE NOT SPECIFIED IN THE LIMITED SCRU TINY ASSESSMENT. IT WAS ALSO CONTENDED THAT WHERE SPECIFIC ENQUIRY HAS BEEN MADE, THE PCIT CANNOT SUBSTITUTE HIS OPINION ON THE SOURCE OF INVESTMENT TOWARDS PURCHASE OF PROPERTY AND HIS DIRECTIONS TO INCLUDE ITEMS NOT COVERED IN LIMITED SCRUTINY, ARE ALSO WITHOUT AUTHO RITY OF LAW. 9. ON APPRAISAL OF THE EVIDENCES PLACED BEFORE US, WE FIND THAT VIDE NOTICE DATED 20.09.2016 AND 04.04.2017, SPECIFIC QU ERIES WERE RAISED BY THE AO SEEKING DETAILS AND SOURCE OF INVESTMENT IN THE PROPERTY PURCHASED DURING THE YEAR. IN RESPONSE, THE ASSESS EE HAS FILED REPLIES DATED 11.04.2017 EXPLAINING THE RELEVANT FACTS TOWA RDS SOURCE OF MONEY UTILIZED FOR PURCHASE OF HER SHARE IN PROPERT Y AMOUNTING TO RS.20,02,000/-. THE SOURCE OF INVESTMENT WAS CORRO BORATED BY EVIDENCE. IT IS TRITE THAT THE PCIT CANNOT PASS REV ISIONAL ORDER TO DIRECT THE AO TO MAKE SOME FULLER AND EXTENDED ENQUIRY DES IRED IN THE OPINION OF THE REVISIONAL AUTHORITY. IN SUCH A SIT UATION, WHERE THERE APPEARS TO BE INADEQUACY TO THE PCIT IN THE MANNER OF ENQUIRY, HE HIMSELF SHOULD EMBARK UPON SOME ENQUIRIES TO DISCOV ER THE POSSIBILITY OF ERROR. A ROVING ENQUIRY CANNOT BE DIRECTED SUMM ARILY. THE ACTION OF THE PCIT IS UNSUSTAINABLE IN LAW WITHOUT OBJECTI VELY SHOWING HOW THE ORDER OF THE AO IS ERRONEOUS. THE REVISIONAL D IRECTION, IN THE INSTANT CASE, IS THUS UNSUSTAINABLE IN LAW. 10. WE ALSO FIND MERIT IN THE PLEA OF THE ASSESSEE THAT HAVING REGARD TO CBDT INSTRUCTION NOS. 7/2015, 20/2015 & 5/2016 A ND ALSO CBDT LETTER DATED 30.11.2017, THE AO WAS NOT ENTITLED TO GO BEYOND THE REASONS FOR SELECTION OF MATTER FOR LIMITED SCRUTIN Y. AS A COROLLARY, IT ITA NO. 70/RPR/2020 (MEENA CHOUDHARY VS. ITO) A.Y. 2015-16 - 5 - IS NOT OPEN TO THE PCIT TO PASS REVISIONARY ORDER A ND REMIT THE MATTER TO THE AO ON OTHER ASPECTS BY RENDERING ASSESSMENT ORDER AS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE. TH IS IS THE VIEW CONSISTENTLY TAKEN BY THE CO-ORDINATE BENCHES IN SE VERAL DECISIONS, SOME OF WHICH ARE NOTED EARLIER. THE ACTION OF THE PCIT UNDER S.263 OF THE ACT THUS CANNOT BE APPROVED ON THIS PARAMETE R ALSO. 11. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D. SD/- SD/- (N. K. CHOUDHRY) (PRADIP KUMA R KEDIA) JUDICIAL MEMBER ACCOUNTANT MEMBER TRUE COPY S. K. SINHA / COPY OF ORDER FORWARDED TO:- &. / REVENUE 2. / ASSESSEE (. )*+ , / CONCERNED CIT 4. ,- / CIT (A) /. 012 33*+4 *+#4 / DR, ITAT, RAIPUR 5. 267 8 / GUARD FILE. BY ORDER 4 SR. PRIVATE SECRETARY ITAT 4 RAIPUR (ON TOUR) ORDER PRONOUNCED ON 12 / 1 0/2021 BY PLACING THE RESULT ON THE NOTICE BOARD AS PER RULE 34(4 ) OF THE INCOME TAX (APPELLATE TRIBUNAL) RULE, 1963.