M/s Chengmari Tea Co. Ltd, Kolkata V. ACIT, CIR-4(1), Kolkata

ITA 812/KOL/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 7420 (ITAT-KOLKATA)
• Duration Of Justice: 9 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-01-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2014-2015
• Appeal Filed On: 18-04-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RADHEY SHYAM; RANU BISWAS A
• Keywords: Depreciation; Opportunity of being heard
• Section: 143(3); 115JB; 48

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH B KOLKATA BEFORE SHRI J.SUDHAKAR REDDY, ACCOUNTANT MEMBER AND SHRI S.S.GODARA, JUDICIAL MEMBER ITA NO.812/KOL/2019 ASSESSMENT YEARS: 2014-15 M/S CHENGMARI TEA CO. LTD., S.B. TOWRES, 37, SHAKESPEARE SARANI, KOLKATA-700 017 [ PAN NO.AABCC 0672 Q ] / V/S . ACIT, CIRCLE-4(1), P-7, CHOWRINGHEE SQUARE, KOLATA-700 069 /APPELLANT .. /RESPONDENT /BY APPELLANT SHRI SUNIL SURANA, FCA /BY RESPONDENT SHRI RADHEY SHYAM, CIT-DR & SMT. RANU BISWAS, ADDL. CIT-DR /DATE OF HEARING 18.09.2019 31.01.2020 /DATE OF PRONOUNCEMENT 31-01-2020 /O R D E R PER S.S.GODARA, JUDICIAL MEMBER:- THIS ASSESSEES APPEAL FOR ASSESSMENT YEAR 2014-15 ARISES AGAINST THE PRINCIPAL COMMISSIONER OF INCOME TAX (APPEALS)-2, KOLKATAS O RDER DATED 29.03.2019 PASSED IN M.NO.PR.CIT-2HQRS-2/KOL/U/S.263/CHENGMARI TEA/20 18-19/12488-91, INVOLVING PROCEEDINGS 263 OF THE INCOME TAX ACT, 1961; IN SHO RT THE ACT. HEARD BOTH THE PARTIES. CASE FILE(S) PERUSED. 2. WE ADVERT TO THE BASIC RELEVANT FACTS. THIS ASSE SSEE GROWS AND MANUFACTURE TEA. IT ALSO DEALS IN SHARES. THE ASSESSEE HAD FILED ITS RETURN ON 30.11.2014 STATING LOSS OF ITA NO.812/KOL/2019 ASSESSMENT YEAR 2 014-15 M/S CHENGMARI TEA CO. PVT. LTD. VS ACIT,CIR-4 (1), KOL. P AGE 2 57,29,768/-. THE ASSESSING OFFICER COMPLETED THE RE GULAR ASSESSMENT IN QUESTION DATED 18.10.2016 MAKING VARIOUS DISALLOWANCE(S) / A DDITION(S) THEREBY ASSESSING THE ASSESSEES CARRIED FORWARD LOSSES OF 49,68,628/- FOLLOWED BY SEC. 115JB COMPUTATION OF 1,51,79,827/-. 3. CASE FILE SUGGESTS THAT THE PCIT THEREAFTER PROP OSED TO INVOKE HIS SEC. 263 REVISION JURISDICTION BY TREATING THE ABOVE REGULAR ASSESSMENT AS ERRONEOUS CAUSING PREJUDICE TO THE INTEREST OF REVENUE. HE ISSUED HIS SHOW CAUSE NOTICE DATED 12.12.2018 PIN-POINTING THE FOLLOWING TWO ISSUES:- 3. IN THIS REGARD THE FOLLOWING DISCREPANCIES HAVE BEEN OBSERVED: AS PER SCHEDULE 15 OF THE BALANCE SHEET AN AMOUNT O F RS.78,73,866/- WAS DEPOSITED WITH NATIONAL BANK FOR AGRICULTURAL AND RURAL DEVELOPMEN T ON OR BEFORE 26.08.2014. A DEDUCTION U/S 33AB AMOUNTING TO RS.1,57,47,599/- AS CLAIMED B Y YOU IN YOUR COMPUTATION OF INCOME WAS ALLOWED. AN AMOUNT OF RS.78,73,733/- [ RS.1,57,47,599/- (-) RS.78,73,866/- ] WAS NOT DEPOSITED WITH THE NABARD IN CONFORMITY WITH THE PR OVISION AS LAID DOWN IN SECTION -33AB OF THE I.T. ACT, 1961, I.E. BEFORE THE EXPIRY OF SIX M ONTHS FROM THE END OF PREVIOUS YEAR ENDING OR BEFORE THE DUE DATE OF FURNISHING THE RETURN OF HIS INCOME WHICHEVER IS EARLIER. THEREFORE, RS.78,73,733/- WAS REQUIRED TO BE ADDED BACK TO YOU R TOTAL INCOME IN THE ASSESSMENT ORDER PASSED US.143(3) ON 18.10.2016. AN AGRICULTURE INCOME OF RS.1,53,14,554/- WAS DETER MINED AS PER THE ASSESSMENT ORDER DATED 18.10.2016,BUT AS PER INFORMATION RECEIVED FROM AGR ICULTURE INCOME TAX, WEST BENGAL, YOU HAD OFFERED AN AGRICULTURE INCOME OF RS.1,41,72,839 /- AND ALSO PAID THE AGRICULTURE TAX OF RS.44,00,000/-. THEREFORE, AGRICULTURE INCOME OF RS .11,41,715/-[ RS.1,53,554/- (-) RS.1,41,72,839/- ] WAS DETERMINED IN EXCESS AS PER THE ASSESSMENT OR DER DATED 18.10.2016. 4. THE ASSESSEE APPEARS TO HAVE FILED ITS REPLY STR ONGLY CONTESTING THE PCITS ABOVE TWIN REASONS. WE NOTICE THAT ALTHOUGH THE PCI T HAS DROPPED BOTH THE ABOVE STATED ISSUES, HE HAS HELD THAT THE ASSESSING OFFI CER HAD NOT VERIFIED THE UTILIZATION OF THE AMOUNT OF 165,36,500/- DEPOSITED UNDER TEA DEVELOPMENT ACCOUN TS SCHEME, 2007 AS TO WHETHER THE SAME SATISFIED THE RELEVANT STIPULATION THEREIN OR NOT AS UNDER:- 6. THE SUBMISSION OF THE AR AS WELL AS THE COMMENT S OF THE ADDL. CIT, RANGE-4. KOLKATA HAVE BEEN CONSIDERED. THE SAME ARE FOUND TO BE IN O RDER AS FAR AS THE CLAIM OF THE ASSESSEE FOR DEPOSIT U/S 33AB OF THE ACT ' AND THE QUANTUM OF AGRICULTURE INCOME ARE CONCERN ED. HOWEVER, IT IS SEEN, THE AO DID NOT VERIFY THE UTIL IZATION OF THE AMOUNT OF RS.1,65,36,500/- WITHDRAWN FROM THE TEA DEVELOPMENT ACCOUNT SCHEME, 2007 I.E., AS TO WHETHER IT WAS IN ACCORDANCE WITH AND FOR THE PURPOSES SPECIFIED IN S EC. 33AB OR NOT. FAILURE TO CONDUCT SUCH INQUIRY/VERIFICATION HAS RENDERED THE ASSESSMENT OR DER ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE WITHIN THE MEANING OF SEC. 263 OF THE' ACT '. IT IS TRITE THAT THE AO IS DUTY BOUND TO SCRUTINIZE/EXAMINE EVERY INFORMATION WHICH COMES TO HIS KNOWLEDGE. IT IS .IMPERATIVE ON THE PART OF THE ASSESSING OFFICER TO EXAMINE EACH AND E VERY DOCUMENT AND CONDUCT NECESSARY INQUIRY/SCRUTINY IN ORDER TO ASSESS CORRECT INCOME OF THE ASSESSEE. IN THIS CASE, THE ASSESSMENT ORDER WAS PASSED WITHOUT CONSIDERING THE CORROBORAT IVE MATERIAL, AVAILABLE AT THE DISPOSAL OF ITA NO.812/KOL/2019 ASSESSMENT YEAR 2 014-15 M/S CHENGMARI TEA CO. PVT. LTD. VS ACIT,CIR-4 (1), KOL. P AGE 3 THE AO AND ACCORDINGLY, THE AO FAILED TO CARRY OUT NECESSARY INQUIRY ON THE UTILIZATION OF THE AMOUNT WITHDRAWN FROM THE TEA DEVELOPMENT ACCOUNT S CHEME AS PER THE PROVISION OF SEC.33AB OF THE ' ACT ' AND ASSESS THE CORRECT INCOME OF THE ASSESSEE. 6.1 THE POWER OF REVISION BY THE CIT U/S 263 OF THE ACT IS VERY WIDE AND IT IS IN THE NATURE OF SUPERVISORY JURISDICTION. IT IS WELL SETTLED THAT I NCORRECT ASSUMPTION OF FACTS OR APPLICATION OF LAW SATISFIES THE REQUIREMENT OF LAW I.E. ORDER BEI NG ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE. THE ORDER PASSED BY THE AO. WITHOUT APPLIC ATION OF MIND OR ORDER SHOWING APPARENT ERROR OF REASONING OR THE ORDER WHERE THE A.O. SIMP LY ACCEPTS WHATEVER THE ASSESSEE SLATED IN HIS RETURN OF INCOME AND FAILS TO MAKE THE ENQUIRIE S WHICH ARE CALLED FOR IN THE FACTS AND CIRCUMSTANCES OF THE CASE WILL ALSO CALL FOR INTERV ENTION U/S 263 OF THE ACT BY THE CIT/PR. CIT. IT IS A TRITE LAW THAT THE DISCLOSURE OF FACTS BY T HE ASSESSEE, IN THE RETURN OF INCOME AND / OR IN THE COURSE OF ASSESSMENT PROCEEDINGS CANNOT GIVE IM MUNITY FROM REVISIONAL JURISDICTION OF THE CIT/PR. CIT U/S 263. IN THIS CONTEXT, IT MAY BE MEN TIONED HERE THAT IN THE CASE OF COMMISSIONER OF INCOME TAX, CENTRAL-L KOLKATA VS. M AITHAN INTERNATIONAL. IT WAS HELD BY CALCUTTA HIGH COURT [2015] 56 TAXMANN.COM 283(CALCU TTA) THAT: ' ..... IT IS NOT THE LAW THAT THE ASSESSING OFFICE R OCCUPYING THE POSITION OF AN INVESTIGATOR AND ADJUDICATOR CAN DISCHARGE HIS FUN CTION BY PERFUNCTORY OR INADEQUATE INVESTIGATION . SUCH A COURSE IS BOUND TO RESULT IN ERRONEOUS AND PREJUDICIAL ORDER. WHERE THE RELEVANT ENQUIRY WAS NOT UNDERTAKEN, AS IN THE CASE, THE ORDER IS ERRONEOUS AND PREJUDICIAL TOO AND THEREFORE REVISABLE. INVEST IGATION SHOULD ALWAYS BE FAITHFUL AND FRUITFUL. UNLESS ALL FRUITFUL AREAS OR ENQUIRY ARE PURSUED THE ENQUIRY CANNOT BE SAID TO HAVE BEEN FAITHFULLY CONDUCTED ' 6.2 THE HON'BLE SUPREME COURT, FURTHER, IN THE CASE OF RAMPYARI DEVI SARAOGI VS CIT(1968) 67 ITR 87(SC) AND SMT. TARA DEVI AGGARWAL VS CIT(L9 73)8B ITR323(SC) HAS HELD THAT IN ABSENCE OF PROPER ENQUIRIES, THE ASSESSMENT ORDER W OULD BECOME ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE. 6.3 THE HON'BLE DELHI HIGH COURT IN THE CASE OF GEE VEE ENTERPRISE VS ADDL. CIT (1975) 99 ITR 375 HAS ALSO HELD AS UNDER: 'THE REASON IS OBVIOUS. THE POSITION AND FUNCTION O F THE INCOME TAX OFFICER IS VERY DIFFERENT FROM THAT OF A CIVIL COURT. THE STATEMENT S MADE IN A PLEADING PROVED BY THE MINIMUM AMOUNT OF EVIDENCE MAY BE ACCEPTED BY A CIV IL COURT IN THE ABSENCE OF REBUTTAL THE CIVIL COURT IS NEUTRAL. IT SIMPLY GIVE S DECISION ON THE BASIS OF PLEADING AND EVIDENCE WHICH COMES BEFORE IT. THE INCOME TAX OFFICER IS NOT ONLY AN ADJUDICATOR BUT A/SO AN INVESTIGATOR. HE CANNOT REMAIN PASSIVE IN THE FACE OF RETURN WHICH IS APPARENTLY IN ORDER BUT CALLS FOR FURTHER ENQUIRY. IT IS HIS DUTY TO ASCERTAIN THE TRUTH OFF ACTS STATED IN THE RETURN WHEN THE CIRCUMSTANCES OF CASE ARE SUCH AS TO PROVOKE AN ENQUIRY. THE MEANING TO BE GIVEN TO THE WORD ERRONEOUS ' IN SECTION 263 EMERGES OUR OF THIS CONTEXT IT IS BECAUSE IT IS INCUMBENT O N THE INCOME TAX OFFICER TO FURTHER SUCH AN ENQUIRY PRUDENT THAT THE WORD ' ERRONEOUS ' IN SECTION 263 INCLUDES THE FAILURE TO MAKE SUCH AN ENQUIRY. THE ORDER BECOMES ERRONEOUS BECAUSE SUCH AN ENQUIRY HAS NOT BEEN AND NOT BECAUSE THERE IS ANYTH ING WRONG WITH THE ORDER IF ALL THE FACTS STATED THEREIN ARE ASSUMED TO BE CORRECT. ,. 6.4 IN ADDITION, RELIANCE IS ALSO PLACED ON THE FOL LOWING DECISIONS WHEREBY IT WAS HELD THAT THE FAILURE ON THE PART OF THE ASSESSING OFFICER TO MAK E AN ENQUIRY ON A RELEVANT ISSUE/POINT WOULD RENDER THE ASSESSMENT ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE: (1966) 220 ITR 456 (DELHI) DUGGAL AND CO. (1966) 220 ITR 167 (MP) MAHAVAR TRADERS (1995) 213 ITR 843 (RAJ) EMERY STONE MFG. CO. (1992) 198 ITR 611 (KER) MALABAR INDUSTRIAL CO. LTD . V. CIT: 243 ITR 83 ITA NO.812/KOL/2019 ASSESSMENT YEAR 2 014-15 M/S CHENGMARI TEA CO. PVT. LTD. VS ACIT,CIR-4 (1), KOL. P AGE 4 CIT VS. MAX INDIA LIMITED: 268 ITR 128 (P&H) [AFF IRMED IN 295 ITR 282 (SELL CIT V KWALITY STEEL SUPPLIERS COMPLEX: 395 ITR 1 ( SC) CIT VS. AMITABH BACHCHAN: 384 ITR 200 (SC) CIT V. HINDUSTAN LEVER LTD: 343 ITR 161 (BORN.) CIT V. VIKAS POLYMERS: 341 ITR 537 (DEL.) CIT V. SUNBEAM AUTO LTD.: 332 ITR 167 (DEL) CIT VS. DEVELOPMENT CREDIT BANK LTD: 323 ITR 206 (BORN.) VIMGI INVESTMENT (P) LIMITED: 290 ITR 505 (DEL) HARI IRON TRADING CO. VS. CIT: 263 ITR 437 (P&H) CIT VS. GABRIEL INDIA LIMITED: 203 ITR 108 (BORN ). 6.5 IT MAY BE FURTHER NOTICED THAT IN ORDER TO PROV IDE CLARITY ON THE ISSUE OF ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTEREST OF THE REV ENUE ', A NEW EXPLANATION HAS BEEN INSERTED TO CLARIFY THAT AN ORDER PASSED BY THE ASSESSING OF FICER SHALL BE DEEMED TO BE ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTERESTS OF THE RE VENUE, IF IN THE OPINION OF THE PRINCIPAL COMMISSIONER OR COMMISSIONER '(A) THE ORDER IS PASSED WITHOUT MAKING INQUIRIES O R VERIFICATION WHICH, SHOULD HAVE BEEN MADE; (B) THE ORDER IS PASSED ALLOWING ANY RELIEF WITHO UT 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 WIT H ANY DECISION WHICH IS PREJUDICIAL TO THE ASSESSEE, RENDERED BY THE JURISD ICTIONAL HIGH COURT OR SUPREME COURT IN THE CASE OF THE ASSESSEE OR ANY OTHER PERS ON. THIS AMENDMENT TAKES EFFECT FROM 1-6-2015. 6.6 THE SPIRIT OF THIS RATIO IS SQUARELY APPLICABLE IN A RECENT JUDGMENT, WHEREIN THE ORDER U/S 263 PASSED BY THE PCIT WAS UPHELD IN THE CASE OF M/ S VAMA SUNDARI INVESTMENT (DELHI) (P) LTD VS. PR. C.I.T.-9, NEW DELHI ( ITA NO: 2252/DEL/2018 ) BY THE HON'BLE ITAT, DELHI F BENCH, NEW DELHI. WHILE DOING SO, THE HONBLE IT AT HAD PLACED RELIANCE ON THE FOLLOWING ORDERS: (I) HON'BLE SUPREME COURT IN THE CASE OF DENIEL MERCHANTS PVT. LTD. VS. ITO (APPEAL NO. 2396/20171 DATED 29.11.2017 . IN THIS GROUP OF CASES, HON'BLE SUPREME COURT HAS DISMISSED SLPS IN CASES WHERE AO DID NOT MAKE ANY PROPER INQUIRY WHILE MAKING THE ASSESSMENT AND ACCEPTING THE EXPLANATION OF THE ASSESSEE(S) INSOFAR AS RECEIPT OF SHARE APPLICATION MONEY IS CONCERNED. ON THAT BASIS THE COMMISSIONER OF INCOME TAX HAD, AFTER SETTING ASIDE THE ORDER OF TH E ASSESSING OFFICER, SIMPLY DIRECTED THE ASSESSING OFFICER TO CARRY THOROUGH AN D DETAILED INQUIRY. (II) MALABAR INDUSTRIAL CO. LTD. VS CIT 109 TAXMAN 66 1 SC 171 [2000] 243 ITR 83 (SC)/20001 159 CTR 1 (SC) WHEREIN THE HON'BLE SUPREME COURT HELD THAT WHERE ASSESSING OFFICER HAD ACCEPTED ENTRY IN STATEMENT O F ACCOUNT FILED BY ASSESSEE, IN ABSENCE OF AI1) SUPPORTING MATERIAL WITHOUT MAKING ANY ENQUIRY, EXERCISE OF JURISDICTION BY COMMISSIONER UNDER SECTION 263(1) W AS JUSTIFIED. (III) RAIMANDIR ESTATES (P) LTD VS PCIT [2017] 77 TAXMANN.COM 285 (SC)/(2017) 245 TAXMAN 127 (SC) WHEREIN THE HON'BLE SUPREME COU RT HAS DISMISSED SLP AGAINST HIGH COURT'S RULING THAT WHERE ASSESSEE WITH A SMAL L AMOUNT OF AUTHORISED SHARE CAPITAL, RAISED HUGE SUM ON ACCOUNT OF PREMIUM, EXE RCISE OF REVISIONARY POWERS BY COMMISSIONER OPINING THAT THIS COULD BE A CASE OF M ONEY LAUNDERING WAS JUSTIFIED. 6.7 THUS IN THE INSTANT CASE, IT CAN BE SUMMARIZED THAT THE AFORESAID TWIN CONDITIONS OF RENDERING AN ASSESSMENT ERRONEOUS IN SO FAR AS IT I S PREJUDICIAL TO THE INTERESTS OF THE REVENUE, ARE MET SINCE DURING THE ASSESSMENT PROCEEDINGS, TH E ASSESSING OFFICER DID NOT CONDUCT ITA NO.812/KOL/2019 ASSESSMENT YEAR 2 014-15 M/S CHENGMARI TEA CO. PVT. LTD. VS ACIT,CIR-4 (1), KOL. P AGE 5 EXTENSIVE / NECESSARY ENQUIRIES REGARDING THE WITHD RAWAL OF THE AMOUNT FROM TEA DEVELOPMENT ACCOUNT SCHEME AS PER THE PROVISION OF SEC. 33AB OF THE ' ACT '. 6.8 IN VIEW OF THE FACTS AND THE LEGAL POSITION STA TED ABOVE, I AM OF THE CONSIDERED VIEW THAT THE ORDER PASSED ON AN INCORRECT ASSUMPTION OF FACT S OR INCORRECT APPLICATION OF LAW AND WITHOUT MAKING REQUISITE INQUIRIES WILL SATISFY THE REQUIREMENT OF THE ORDER BEING ERRONEOUS AND PRE-JUDICIAL TO THE INTEREST OF THE REVENUE WIT HIN THE MEANING AND SCOPE OF SECTION 263 OF THE INCOME TAX ACT, 1961. 6.9 THE AFORE STATED DECISIONS POSTULATE THAT WHEN THE OFFICER IS EXPECTED TO MAKE AN INQUIRY OF A PARTICULAR ITEM OF INCOME AND IF HE DOES NOT M AKE AN INQUIRY AS EXPECTED, THAT WOULD BE A GROUND FOR THE COMMISSIONER TO INTERFERE WITH THE O RDER PASSED BY THE OFFICER SINCE SUCH AN ORDER PASSED BY THE OFFICER IS ERRONEOUS AND PREJUD ICIAL TO THE INTERESTS OF THE REVENUE (K.A. RAMASWAMY CHETTIAR V. CIT, (1996) 220 ITR 657). 7. HAVING REGARD TO THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN THE LIGHT OF THE AFORESAID DECISIONS OF HON'BLE SUPREME COURT AND HON'BLE HIGH COURT AND IN ACCORDANCE WITH THE AMENDMENT MADE TO SECTION 263 OF THE' ACT' WITH EFF ECT FROM 01.06.2015. I HOLD THAT THE IMPUGNED ASSESSMENT ORDER DATED 18.10.2016 PASSED B Y THE A.O. IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTERESTS OF REVENUE. THEREFORE, AFTER GIVING THE ASSESSEE AN 'OPPORTUNITY OF BEING HEARD, THAT THE IMPUGNED ASSESSMENT ORDER DAT ED 18.10.2016 IS QUASHED WITH THE DIRECTIONS GIVEN IN THIS ORDER SEPARATELY. 8. ACCORDINGLY, IN VIEW OF THE FACTS AND CIRCUMSTAN CES OF THE CASE AS STATED ABOVE, AND ALSO RESPECTFULLY FOLLOWING THE JUDGMENTS CITED ABOVE, I AM OF THE CONSIDERED VIEW THAT THE ISSUE OF UTILISATION OF WITHDRAWN OF THE AMOUNT FROM THE TEA DEVELOPMENT ACCOUNT SCHEME NEEDS TO BE VERIFIED IN ACCORDANCE WITH THE PROVISION OF SEC . 33AB OF THE . ACT' IN THE INSTANT CASE SO THAT A JUDICIOUS CONCLUSION COULD BE MADE BY THE RE VENUE AFTER GIVING DUE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THEREFORE, IT IS DEEME D FIT AND APPROPRIATE IN THE INTEREST OF JUSTICE TO RESTORE THE FILE BACK TO THE A.O FOR DE NOVO ASSESSMENT WITH A DIRECTION TO HIM TO CONSIDER THE ISSUE AS MENTIONED ABOVE. ACCORDINGLY, I DIRECT THE AO TO RE-ASSESS THE INCOME OF THE ASSESSEE FOR THE RELEVANT AY -2014-15 ON THE LIMITED ISSUE AS DISCUSSED SUPRA. 5. LEARNED COUNSELS FIRST AND FOREMOST ARGUMENTS B EFORE US IS THAT PCITS HAS ERRED IN LAW AND ON FACTS IN EXERCISING HIS REVISIO N JURISDICTION QUA THE IMPUGNED SOLE SURVIVING ISSUE OF FACTUAL VERIFICATION, REGARDING UTILIZATION OF THE AMOUNT OF 165,36,580/- WITHDRAWN FROM THE TEA DEVELOPMENT ACC OUNTS SCHEME, 2007 AS TO WHETHER IT WAS IN ACCORDANCE WITH AND FOR THE SPECI FIED PURPOSES U/S 33AB OR NOT (SUPRA), IS NOT SUSTAINABLE SINCE HE HAD NOWHERE AF FORDED ANY OPPORTUNITY OF HEARING TO THE ASSESSEE AS PER CERTIFIED COPY(IES) OF THE CORR ESPONDING ORDER-SHEETS FROM 12.12.2018 TO 29.03.2019 FORMING PART OF THE PAPER BOOK PAGES 51-51. LEARNED COUNSELS NEXT ARGUMENT IS THAT THE ASSESSEES SCRU TINY ASSESSMENT WAS AN INSTANCE OF LIMITED SCRUTINY SELECTION UNDER CASS FOR ASSESSMEN T YEAR 2014-15 ( AS PER PAGES 24- 26 OF THE PAPER BOOK ) WHEREIN THE ONLY ISSUES TO BE EXAMINED WERE LARGE OTHER ITA NO.812/KOL/2019 ASSESSMENT YEAR 2 014-15 M/S CHENGMARI TEA CO. PVT. LTD. VS ACIT,CIR-4 (1), KOL. P AGE 6 EXPENDITURE CLAIM OF PROFIT AND LOSS ACCOUNT, LARGE ANY OTHER DEDUCTION CLAIM IN SCHEDULE-B E CREATING THE LOSS WITHOUT ANY INCOME I N PROFIT AND LOSS ACCOUNT, DEPRECIATION CLAIM AT HIGHER RATES / HIGHER DEPRECI ATION, MIS-MATCH IN SALES TURNOVER RETURNED IN AUDITED REPORT AND ITR AND MIS-MATCH IN AMOUNTS PAID TO RELEVANT PARTIES U/S 40A(2)(B) REPORTED IN AUDITED REPORT AND ITR AN D THEREFORE, THE PCITS MAIN REASON FOR ASSUMING SEC. 263 REVISION JURISDICTION HOLDING THE ASSESSING OFFICER TO HAVE NOT CARRIED OUT ANY FACTUAL VERIFICATION / ENQ UIRY AS SEC. 33AB CLAIM GOES AGAINST THE RECORD OF THE CASE. THE ASSESSEES THIRD ARGUME NT SOUGHT TO INVITE OUR ATTENTION TO THE PAPER BOOK PAGES NO. 34 TO 48 COMPRISING OF NAB ARD IS LEDGERS CONFIRMING THE DEPOSITS IN THE TEA DEVELOPMENT ACCOUNTS, ITS AUDIT ORS CERTIFICATE IN FORM NO.3AC DATED 29.11.2014 SHOWING UTILIZATION OF FUNDS WITHD RAWN FROM NABARD TO BE IN COMPLIANCE U/S 33AB OF THE ACT, COPY OF TEA DEVELOP MENT SCHEME, 2007 INDICATING PROVISION OF WITHDRAWAL AND UTILIZATION OF THE AMOU NT DEPOSITED AS WELL AS COPY OF STATEMENT SHOWING DETAILS OF MACHINERY PURCHASED; R ESPECTIVELY. ITS CASE THEREFORE IS THAT ONCE THE CORRESPONDING WITHDRAWALS SATISFIED T HE RELEVANT PURPOSES ENVISAGED IN THE TEA DEVELOPMENT ACCOUNTS SCHEME,2007, THERE IS NEITHER ANY ERROR NOR PREJUDICIAL CAUSED TO THE INTEREST OF THE REVENUE A S CANVASSED IN THE PCITS REVISION DIRECTIONS UNDER CHALLENGE. LEARNED COUNSEL HAS ALS O TAKEN PAINS TO REFER TO VARIOUS JUDICIAL PRECEDENTS WHICH SHALL BE TAKEN NOTE OF IN SUCCEEDING PARAGRAPHS. 6. LEARNED CIT-DR HAS VEHEMENTLY SUPPORTED THE PCIT S IMPUGNED REVISION DIRECTIONS UNDER CHALLENGE HOLDING THE ASSESSING OF FICER TO HAVE FAILED IN CARRYING OUT THE NECESSARY ENQUIRY / FACTUAL VERIFICATION REGARD ING THE ASSESSEES WITHDRAWAL OF FUNDS AMOUNTING TO 165,36,500/- AS TO WHETHER THE SAME WAS FOR THE SPE CIFIED PURPOSES U/S 33A OR NOT. MR. RADHEY SHYAM STRONGLY ARGUED THAT THE NON-EXAMINATION OF THE ABOVE STATED CLINCHING ISSUE BY THE ASSESSIN G OFFICER DURING THE COURSE OF ASSESSMENT RENDERS THE SAME AS ERRONEOUS CAUSING PR EJUDICE INTEREST OF THE REVENUE. COMING TO THE ASSESSEES FOREGOING THIRD ARGUMENT ( SUPRA), HE STATED THAT THE SAME IS NOT LIABLE TO BE ACCEPTED SINCE THE PCIT HAS RIGHTL Y EXERCISED HIS REVISION JURISDICTION IN THE GIVEN FACTS AND CIRCUMSTANCES OF THE CASE. ITA NO.812/KOL/2019 ASSESSMENT YEAR 2 014-15 M/S CHENGMARI TEA CO. PVT. LTD. VS ACIT,CIR-4 (1), KOL. P AGE 7 7. WE HAVE GIVEN OUR THOUGHTFUL CONSIDERATION TO FO REGOING RIVAL PLEADINGS. COMING TO THE ASSESSEES THREE FOLDED ARGUMENTS, WE FIND NO MERIT IN ITS FIRST PLEA THAT THE PCITS NOWHERE GRANTED IT OPPORTUNITY OF HEARIN G AS THE SOLE SURVIVING ISSUE OF UTILIZATION OF THE AMOUNT INVOLVING FIGURE IN QUEST ION OF 165,36,500/- UNDER THE TEA DEVELOPMENT ACCOUNTS SCHEME, 2007. IT IS COME ON RE CORD THAT PCITS SEC. 263 SHOW CAUSE HAD RAISED THE ISSUE OF SEC. 33AB DEDUCTION O NLY FROM BEGINNING TILL THE END. IT WAS VERY WELL WITHIN HIS JURISDICTION THEREFORE TO EXAMINE ALL ASPECTS OF THE SAME DURING THE COURSE OF REVISION PROCEEDINGS. WE OBSER VE IN THESE FACTS AND CIRCUMSTANCES THAT THE ASSESSEES TECHNICAL PLEA TH AT THE PCIT HAD NOT SPECIFIED THE ABOVE STATED SOLE SURVIVING ISSUE IN REVISION PROCE EDINGS CARRIES NO SUBSTANCE SINCE IT ITSELF WAS VERY WELL AWARE OF THE ENTIRE COMPREHENS IVE ISSUE TOUCHING UPON SEC. 33AB DEDUCTION CLAIM. WE THEREFORE DECLINE THE ASSESSEE S FIRST PLEA. 8. NEXT COMES THE ASSESSEES SECOND SUBSTANTIVE ARG UMENT THAT SINCE THE ASSESSING OFFICER HAD FRAMED HIS REGULAR ASSESSMENT INVOLVING LIMITED SCRUTINY ON THE ABOVE STATED ISSUES NOT INCLUDING SEC. 33AB DEDUCTI ON TO THE PURPOSE OF THE IMPUGNED WITHDRAWALS. WE FIND THAT THE SAME IS DULY COVERED IN ITS FAVOR AS PER THIS TRIBUNALS CO-ORDINATE BENCHS DECISION IN ITA NO.1361/KOL/2016 IN SANJEEV K.KHEMKA VS. PR. COMMISSIONER OF INCOME-TAX-15, KOLKATA DECIDED ON 02.06.2017 AS UNDER:- 4. WE HAVE HEARD THE RIVAL CONTENTIONS OF THE PARTI ES AND PERUSED THE MATERIALS ON RECORD. THE PRIMARY ISSUE IN THE CASE ON HAND REVOLVES WHET HER IT IS A CASE SELECTED UNDER CASS FOR LIMITED SCRUTINY OR REGULAR SCRUTINY. IT CAN BE SEE N FROM THE GROUNDS OF APPEAL THAT THE ASSESSEE WANTS TO CONTEND THAT THE VERY INITIATION OF PROCEEDINGS U/S 143(3) OF THE ACT ON THE BASIS OF REGULAR SCRUTINY UNDER THE ACT WAS BAD IN LAW. THE PROCEEDINGS UNDER SECTION 143(3) OF THE ACT SHOULD HAVE BEEN LIMITED TO THE EXTENT O F THE INFORMATION GATHERED THROUGH AIR. ACCORDINGLY THE PROCEEDINGS U/S 263 OF THE ACT CANN OT BE EXPANDED BEYOND THE ISSUE RAISED IN AIR. THUS THE ORDER U/S 143(3) OF THE ACT BEYOND TH E POINTS OF AIR IS INVALID IN LAW AND SO THE SAME IS WITH THE ORDER PASSED U/S 263 OF THE ACT. I T IS THE FURTHER CONTENTION OF THE ASSESSEE THAT IN THE ITEMS WHICH ARE NOT SUBJECT MATTER OF A IR CANNOT SUBJECT MATTER OF SCRUTINY. SUCH MATTERS INCLUDE SALARY OF THE ASSESSEE, LOANS & INT EREST ON LOANS, PAYMENT OF LIC, COMMISSION & BROKERAGE INCOME ETC. IT IS THE CASE O F THE ASSESSEE THAT IN THE ASSESSMENT ORDER PASSED U/S 143(3) OF THE ACT, THE AO HAS TRAV ELLED BEYOND THE POINTS OF THE AIR ON THE BASIS OF WHICH THE CASE OF SCRUTINY WAS SELECTED UN DER CASS MODULE. IT IS THE PLEA OF THE ASSESSEE THAT WHEN NO ADDITION/DISALLOWANCE CAN BE MADE BEYOND THE POINTS MENTIONED IN AIR IN THE ASSESSMENT PROCEEDINGS THEN SAME IS THE CASE WITH PROCEEDINGS INITIATED U/S 263 OF THE ACT. 9. THIS TRIBUNALS YET ANOTHER DECISION IN ITA NO.1011/KOL/2017 IN SRI HARTAJ SEWA SINGH VS. DCIT,(IT),CIRCLE1(1), KOLKATA DECIDE D ON 27.04.2018 ALSO DECIDES THE ITA NO.812/KOL/2019 ASSESSMENT YEAR 2 014-15 M/S CHENGMARI TEA CO. PVT. LTD. VS ACIT,CIR-4 (1), KOL. P AGE 8 INSTANT ISSUE IN ASSESSEES FAVOUR ON IDENTICAL REA SONING. WE CONCLUDE IN THESE FACTS AND CIRCUMSTANCES THAT THE PCIT HAS ERRED IN LAW AN D ON FACTS IN HOLDING THE IMPUGNED ASSESSMENT AS ERRONEOUS CAUSING PREJUDICE TO THE INTEREST OF REVENUE ON THE GROUND WHICH NOWHERE FORMED SUBJECT-MATTER OF THE C ASS SCRUTINY AS IT IS EVIDENT FROM THE CASE RECORDS. WE REITERATE THE LEARNED CO- ORDINATE BENCHS DETAINED REASONING HEREINABOVE THAT THE SEC. 263 REVISION PROCEEDINGS OUGHT NOT TO HAVE BEEN SET INTO MOTION FOR EXPANDING THE JURISDICTION OF THE ASSESS ING OFFICER TO EXAMINE THE ISSUES BEYOND THE SCOPE OF LIMITED SCRUTINY. WE THEREFORE REVERSE THE PCITS ACTION ASSUMING SEC. 263 REVISION JURISDICTION IN THESE FA CTS AND CIRCUMSTANCES. 10. COMING TO THE ASSESSEES THIRD ARGUMENT ON MERI TS. WE FIND THAT THE RELEVANT CLAUSE IN TEA DEVELOPMENT ACCOUNTS, SCHEME, 2007 ( PAGES 1 TO 45 OF THE PAPER BOOK ) CONTAIN CLAUSE NO.9 REGARDING WITHDRAWAL OR UTILI ZATION OF THE AMOUNTS DEPOSITED THEREUNDER. THE ASSESSEES STATEMENT OF N ECESSARY PARTICULARS IN PART-II ALONGWITHI FORM NO.3AC {AUDITOR REPORT SEC. 33AB(2) } INDICATES THAT IT HAD WITHDRAWN 44,58,300/-, 96,54,000/- AS ON 26.04.2013, 24.05.2013 AND 05.05. 2013 FOR GREEN TEA FACTORY MATERIAL ALONGWITH PLANT AND EQUIPMENT OF FORMER TWO AND IRRIGATION; RESPECTIVELY. THESE CRUCIAL FACTS AS WE LL AS THE CORRESPONDING PURPOSE IN THE TEA DEVELOPMENT ACCOUNTS SCHEME, 2007 HAVE GONE UNR EBUTTED FROM THE REVENUE SIDE DURING THE COURSE OF HEARING. WE CONCLUDE IN T HIS FACTUAL BACKDROP OF THAT EVEN IF WE AGREE WITH THE PCITS STAND THAT THE ASSESSING O FFICER HAD NOT CARRIED OUT NECESSARY ENQUIRIES ABOUT THE PURPOSE OF THE ASSESS EE WITHDRAWALS AMOUNTING OF 165,36,500/- FROM THE TEA DEVELOPMENT ACCOUNTS SCHE ME, 2007, NO PREJUDICE HAS BEEN CAUSED TO INTEREST OF THE REVENUE SINCE THE AM OUNTS PERTAIN TO THE SPECIFIED PURPOSE UNDER THE SCHEME ONLY. WE MAKE IT CLEAR THA T HON'BLE APEX COURTS LANDMARK JUDGMENT IN MALABAR INDUSTRIAL CO. LTD. VS. COMMISSIONER OF INC OME TAX (2000) 243 ITR 83 (SC) HAS SETTLED THE LAW LONG BACK THAT TWIN CONDITIONS OF AN ASSESSMENT BEING ERRONEOUS AS WELL AS CAUSING PREJUDICE TO THE INTER EST OF THE REVENUE HAVE TO BE SIMULTANEOUSLY SATISFIED BEFORE THE COMMISSIONER OF INCOME TAX OR PRINCIPAL COMMISSIONER OF INCOME TAX; AS THE CASE MAY BE, SEE KS TO INVOKE SEC. 263 REVENUE PROCEEDINGS. WE THEREFORE HOLD THAT THE PCITS REV ISION DIRECTIONS UNDER CHALLENGE ITA NO.812/KOL/2019 ASSESSMENT YEAR 2 014-15 M/S CHENGMARI TEA CO. PVT. LTD. VS ACIT,CIR-4 (1), KOL. P AGE 9 ARE NOT SUSTAINABLE IN LAW. THE IMPUGNED REGULAR AS SESSMENT DATED 18.10.2016 IS RESTORED AS A NECESSARY COROLLARY. ORDERED ACCORDIN GLY. 11. THIS ASSESSEES APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE COURT ON FRIDAY, 31 ST JANUARY, 2020 SD/- SD/- ( ') () ') (J.SUDHAKAR REDDY) (S.S.GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER *DKP-SR.PS * - 31/01/2020 / KOLKATA / COPY OF ORDER FORWARDED TO:- 1. /APPELLANT-M/S CHENGMARI TEA CO. LTD., S.B. TOWERS, 37, SHAKESPEARE SARANI, KOLKA T-17 2. /RESPONDENT-ACIT, CIRCLE-4(1), P-7, CHOWRINGHEE SQ. KOLKATA-700069 3. - . / CONCERNED CIT 4. . - / CIT (A) 5. ))- , - /DR, ITAT, KOLKATA 6. 2 / GUARD FILE. BY ORD ER/ , /TRUE COPY/ -,