2015 (7) TMI 938

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....show cause notice under section 263(1) dated 14.03.2013 had been issued and accordingly the same deserves to be quashed. 3. BECAUSE the assessment order dated 30.12.2010 was "no order" in the eyes of law and accordingly the same could not have been subjected to revision under section 263 of the Act. 4. BECAUSE the direction for fresh assessment as per Para 7 of the order dated 28.03.2013 as has been impugned in the present appeal, is wholly unenforceable in law as the earlier assessment order dated 30.12.2010 itself was "non-existent" and consequently no fresh assessment can be made (even in pursuance of the order dated 28.3.2013). WITHOUT PREJUDICE TO THE AFORESAID 5. BECAUSE the "CIT", after himself having found and accepted that - (a) the assessee "succeeds in establishing that its claim was not accurate/correct"; (b) such "inaccuracy"/"incorrectness" was on account of under statement of claim for deduction of service tax; could not have held that the deduction of Rs. 1,73,30,720/- claimed by the appellant and allowed in the assessment order dated 30.12.2010 was prejudicial to the interest of Revenue and accordingly no revision under section 263 was permissi....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... based on erroneous grounds and considerations and the same is not sustainable either on facts or in law." 3. It was submitted by Learned A.R. of the assessee that the notice issued by learned CIT u/s 263(1) is available on pages 3 to 4 of the paper book. He pointed out that the first objection of learned CIT is about debiting of a sum of Rs. 1,73,20,720/- in the profit & loss account on account of service tax paid and the reason for the objection is that as per CIT, the assessee has shown receipt of handling charges of Rs. 12,37,47,784/- which has been credited after excluding the element of service tax and therefore, as per learned CIT, service tax cannot be debited to profit & loss account. He also submitted that the second objection of learned CIT is that the assessee has debited a sum of Rs. 4,09,21,518/- on account of commission paid on handling contract to three persons and this is the objection of learned CIT that no documentary evidence is placed on record to establish that the services were actually rendered by these three parties to whom commission payment was made. 4. Thereafter Learned A.R. of the assessee submitted that the query letter issued by Assessing Offic....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....the paper book also. There is no reply regarding service tax aspect and therefore, in our considered opinion, there is complete lack of enquiry on service tax aspect by the Assessing Officer. 6.1 Regarding the commission payment aspect, the Assessing Officer has very much raised a query regarding services rendered by commission agents with documentary evidence. But in the reply of the assessee, available on pages 28 to 31 of the paper book, the assessee has furnished copy of agreement and copy of commission bills along with the details of provisions of commission on handling charges, TDS, date of payment of TDS etc. but there is no evidence furnished by the assessee before the Assessing Officer regarding services rendered by the commission agents. Hence, in our considered opinion, there is lack of application of mind by the Assessing Officer even after making query and therefore, in the facts of the present case, the exercise of the revisionary power by learned CIT u/s 263 appears to be proper. 7. Now we examine the applicability of various judgments cited by Learned A.R. of the assessee. 7.1 The first judgment cited by Learned A.R. of the assessee is the judgment of Hon&#....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....bunal decision in the case of Greenland Motors (supra). This Tribunal decision is also not rendering any help to the assessee because in that case, all the additions made by learned CIT in order passed by him u/s 263 were deleted by the Tribunal and thereafter, it was held by Tribunal that since all the addition were deleted on merit, the order passed by CIT u/s 263 is set aside and quashed. Hence, there is no finding in this Tribunal order regarding validity of order passed by CIT u/s 263 without considering the issue on merit and in the present case, the issue on merit is admittedly not properly examined by the Assessing Officer because no query was made by him on the first aspect and there is no application of mind by him on the second aspect and the assessee could not bring sufficient material on record before CIT or before us to establish that the deduction was rightly allowed by the Assessing Officer and therefore, this Tribunal decision is not rendering any help to the assessee. 7.4 The next judgment cited by Learned A.R. of the assessee is the judgment of Hon'ble Delhi High Court rendered in the case of Vikas Ploymers (supra). In this case, it was held that CIT must ....