Lt. Suresh Chandra Kataria througn L/H Rakesh Kataria, Ratlam V. PCIT Indore-1, Indore

ITA 90/Ind/2022

AI Insights

The case revolves around an appeal by Lt. Suresh Chandra Kataria against the order of the PCIT-1, Indore, which was passed under Section 263 of the Income Tax Act for the assessment year 2017-18. The PCIT had deemed the assessment order passed by the Assessing Officer on 23.12.2019 as erroneous and prejudicial to the interest of the revenue, primarily due to a lack of inquiry regarding substantial cash deposits amounting to Rs. 1,76,00,009 in the assessee's bank account during the period from 01.01.2017 to 31.03.2017. The Tribunal examined the proceedings and found that the Assessing Officer had indeed conducted a detailed inquiry into these deposits, including obtaining bank statements and other relevant documents, and had considered the explanations provided by the assessee regarding the nature of these deposits, particularly in the context of the demonetization period.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 122473 (ITAT-INDORE)
• Duration Of Justice: 9 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-02-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 01-02-2023
• Assessment Year: 2017-2018
• Appeal Filed On: 27-04-2022
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 263; 2; 142(1); 133(6); 143(2); 264; 22

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE (CONDUCTED THROUGH VIRTUAL COURT) BEFORE MS. SUCHITRA KAMBLE, JUDICIAL MEMBER & SHRI BHAGIRATH MAL BIYANI, ACCOUNTANT MEMBER I .T .A . N o .9 0/ I n d/2 02 2 ( A s se ss m e nt Y e a r : 20 17- 18 ) Lt. S u r e s h C h a n dr a Ka ta r i ya Thr ou gh L . H. R a k e sh K a t ar i ya , 10 R o o m a yan , M a h a vi r N a g a r , R at la m, M .P . 45 70 0 1 V s . PC IT - 1 , In d or e PA N No .A D X P K 2 9 1 8 F (Appellant) .. (Respondent) Appellant by : Shri Pankaj Mongra, C.A. Respondent by : Shri Ashish Porwal, Sr. D.R. D a t e of H ea r i ng 02.02.2023 D a t e of P r o no u n ce me nt 22.02.2023 O R D E R PER SUCHITRA KAMBLE - JM: This appeal is filed by the assessee against the order dated 07.03.2022 passed by the Ld. PCIT-1, Indore for A.Y. 2017-18. 2. The grounds of appeal raised by the assessee read as under: “1. That having regard to the facts and circumstances of the case the Ld. Pr. CIT has erred in law and on facts in assuming jurisdiction u/s. 263 and further erred in holding the assessment order of AO dt. 23.12.2019 erroneous and prejudicial to the interest of the revenue. 2. That in the case and in view of the matter action of Ld. Pr. CIT erred in assuming jurisdiction u/s 263 and passing the impugned order under this section is bad in law and against the facts and circumstances of the case. 3. That having regard to the facts and circumstances of the case the Ld. Pr. CIT has erred in law and on facts in holding the assessment order as erroneous due to alleged lack of enquiry on the part of the AO for not examining the cash deposit of ITA No.90/Ind/2022 Lt. Suresh Chandra Kataria Through L/H Rakesh Kataria vs. PCIT Asst.Year –2017-18 - 2 – Rs. 1,76,00,009/- in the bank account of the assessee during the specific period of 01.01.2017-31.03.2017. 4. The appellant craves leave to add, amend, alter, vary and/or withdraw all the grounds of appeal above. 5. The appellant craves leave to refer to any material, documents placed on record.” 3. The assessee filed return of income for A.Y. 2017-18 on 28.10.2017 declaring total income of Rs. 4,71,520/-. The case was selected for limited scrutiny through CASS. Notice under Section 143(2) was issued on 09.08.2018 and was duly served upon the assessee. Notice under Section 142(1) dated 19.03.2019 and 27.03.2019 was issued for furnishing the information. No compliance was made by the assessee, therefore, the Assessing Officer against issued notices. Vide notice under Section 133(6) dated 10.10.2019 the bank was asked to furnish required information on 18.10.2019. Bank statement was received from HDFC Bank and further show-cause notice under Section 142(1) dated 08.11.2019 was issued. The assessee replied on 19.11.2019 alongwith copy of computation of income, copy of acknowledgement, copy of cash book, audit report etc. and thus the Assessing Officer examined all the details filed by the assessee while passing order under Section 143(3). The Principal CIT issue show-cause notice under Section 263 r.w.s. 264 on 24.12.2021 issued on large cash deposit in bank account during the year. The legal heir of the assessee filed the reply/written submission placing before the Pr. CIT. The Pr. CIT thereafter directed the Assessing Officer to frame the assessment de novo after examining the details. ITA No.90/Ind/2022 Lt. Suresh Chandra Kataria Through L/H Rakesh Kataria vs. PCIT Asst.Year –2017-18 - 3 – 4. Being aggrieved by the order under Section 263 the assessee filed appeal before us. 5. The Ld. A.R. submitted that at the time of assessment proceedings and before the CIT(A), the assessee has given the details related to the cash deposits in bank. Therefore, order under Section 263 is not justifiable. The verification and proper enquiry was made by the Assessing Officer. 6. The Ld. D.R. relied upon the order of the PCIT passed under Section 263 of the Act. 7. We have heard both the parties and perused all the relevant material available on record. It is pertinent to note that the Assessing Officer has issued 133(6) notice to the bank and obtained the bank statement received from HDFC Bank. As relates to large cash deposit in bank account the assessee has given the details as per the returns filed by the assessee. The assessee has also submitted the bank account for the period i.e. 01.01.2017 to 31.03.2017 thereby explaining that 90 % of sales of the assessee’s business are in cash and due to leaves after the Diwali and holidays the said amount / cash was deposited on various dates in which same cash was related to demonetization period as well. The assessee before the Assessing Officer as well as before the PCIT has explained the details and therefore, invocation of Section 263 which is a revisionary jurisdiction of PCIT does not apply in the present case as the ITA No.90/Ind/2022 Lt. Suresh Chandra Kataria Through L/H Rakesh Kataria vs. PCIT Asst.Year –2017-18 - 4 – relevant verification was done by the Assessing Officer at the time of assessment proceedings. Therefore, the appeal of the assessee is allowed. 8. In result, the appeal of the assessee is allowed. This Order pronounced in Open Court on 22/02/2023 Sd/- Sd/- (BHAGIRATH MAL BIYANI) (SUCHITRA KAMBLE) ACCOUNTANT MEMBER JUDICIAL MEMBER Ahmedabad; Dated 22/02/2023 TANMAY, Sr. PS TRUE COPY आदेश क त ल प अ े षत/Copy of the Order forwarded to : 1. अपीलाथ / The Appellant 2. यथ / The Respondent. 3. संबं धत आयकर आय ु त / Concerned CIT 4. आयकर आय ु त(अपील) / The CIT(A)- 5. वभागीय त न ध, आयकर अपील!य अ धकरण,इंदौर/ DR, ITAT, Indore 6. गाड' फाईल / Guard file. आदेशान ु सार/ BY ORDER, (Sr. Private Secretary) ITAT, Indore 1. Date of dictation 14.02.2023 2. Date on which the typed draft is placed before the Dictating Member 14.02.2023 3. Other Member..................... 4. Date on which the approved draft comes to the Sr.P.S./P.S 14.02.2023 5. Date on which the fair order is placed before the Dictating Member for pronouncement .02.2023 6. Date on which the fair order comes back to the Sr.P.S./P.S 22 .02.2023 7. Date on which the file goes to the Bench Clerk 22.02.2023 8. Date on which the file goes to the Head Clerk.......................................... 9. The date on which the file goes to the Assistant Registrar for signature on the order.......................... 10. Date of Despatch of the Order.......................................... O r d e r p ro n o u n c e d o n 2 2/02/ 2 0 23 b y p l ac i n g t h e r e s u l t o n t h e N o t i c e B o a r d a s p e r R u l e 3 4 ( 4 ) o f t h e In c o m e T ax ( A p p e l l at e T r i b u n al ) R u l e, 1 9 6 3 .