2005 (10) TMI 246

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....f the IT Act, 1961 (hereinafter referred to as 'the Act' for short). Thereafter, the income of the assessee was assessed at Rs. 42.78,794 under s. 143(3)/148 vide order dt. 31st March, 2004. 3. Against the assessment order dt. 31st March, 2004, the AOP has preferred an appeal before the learned CIT(A). Hearing of this appeal was on and during its pendency the CIT issued a show-cause notice under s. 263, dt. 1st March, 2005. The assessee objected inter alia, that the CIT's jurisdiction was ousted because of the appeal before the learned CIT(A) and the notice under s. 263 was thus void ab initio. 4. Before we decide the real controversy, we have to cull out that first in clear-cut terms. The assessee had entered into agreements to sell ....

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....stead of treating the same as business income of the assessee and to this extent the order passed by the AO is erroneous and requires to be set aside under s. 263 of the IT Act.' He continued (at page No.7) 'The order of the AO is erroneous in treating Rs. 38.17 lakhs as business income as money received as advance cannot be treated as income. 1, therefore, set aside this order passed by the AO in considering Rs. 38.17 lakhs as business income whereas the addition should have been (made) considering the same as undisclosed income of the AOP and to this extent the order of the AO is erroneous and is set aside, insofar as it is prejudicial to the interest of Revenue.'" 8. The law on this subject settled Rather a bare reading of s. 263 of t....