AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2016 (6) TMI 783
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....d under section 143(3) after due application of mind by the Assessing Officer and the learned Commissioner of Income-tax has wrongly completed the proceedings under section 263 of the Act. Explaining the facts of the assessment year 2008-09, the learned authorised representative submitted the original return in this case was filed on December 31, 2008, declaring an income of Rs. 1,06,870 and the case of the assessee was selected for scrutiny and notice under section 143(2) was issued on August 17, 2009. The assessee revised his return of income declaring an income of Rs. 4,49,510 on June 24, 2010, and included in the return his income from trading under the provisions of section 44AF of the Act. He submitted that the assessment was completed under section143(3) on November 30, 2010, at an income of Rs. 5,09,510 after taking into consideration the revised return. The learned authorised representative submitted that the revised returns were filed because of the fact that the assessee had forgotten to include his income from retail trade business and, therefore, before the questionnaire was issued on August 31, 2010, the assessee voluntarily revised his return of income. The learned a....
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....cess of manufacturing of products and, accordingly, granted the deduction under section 80-IB, the order of the learned Commissioner of Income-tax for revision was held to be not valid. Reliance was also placed on the decision of the Income-tax Appellate Tribunal, Amritsar Bench, in the case of Roshan Lal Vegetable Products Pvt. Ltd. v. ITO [2011] 9 ITR (Trib) 431 (Amritsar) in ITA No. 6(Asr)/2010, for the proposition that where the relevant issues have duly been considered and adjudicated by the Assessing Officer while making the assessment, the Commissioner of Income-tax is not competent to readjudicate the same issue by invoking the provisions of section 263. The learned authorised representative further placed his reliance on the case law of CIT v. Kelvinator of India Ltd. reported in [2011] 332 ITR 231 (Delhi), for the proposition that where the Assessing Officer has taken one of the possible views with which the Commissioner of Income-tax does not agree, the order cannot be termed as erroneous and prejudicial to the interests of the Revenue. Further, reliance was placed on the case law of CIT v. Max India Ltd. reported in [2007] 295 ITR 282 (SC), for the proposition that wher....
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....eet placed at the paper book pages 7 and 8 for the assessment year 2008-09. The learned authorised representative submitted that, vide the order-sheet entry dated October 18, 2010, the Assessing Officer had asked to submit a cash flow statement and sales tax, VAT return for which a detailed reply was filed, vide letter dated November 11, 2010, and after considering the replies and reply filed on November 11, 2010, the Assessing Officer had completed the assessment. The learned authorised representative submitted that in this reply dated November 11, 2010, the assessee had relied upon the case law of the Income-tax Appellate Tribunal, Amritsar Bench, for the proposition that where the assessee claims income under section 44AF, no further enquiries can be made. Therefore, the learned authorised representative argued that the Assessing Officer had completely applied his mind. 7. We have heard the rival parties and have gone through the material placed on record. We find that the learned Commissioner of Income-tax has issued a notice under section 263, vide show-cause notice dated November 25, 2011. For the sake of convenience the contents of the notice as reproduced in the order unde....
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....cent. under section 44AF Rs. 1,25,000 (iv) Maximum estimated profit from business Rs. 3,32,000. (iv) The revised returns have been filed only after the issue of notice under section 143(2) for the assessment year 2008-09. You attended the office on June 18, 2010, and submitted a written reply. At that time you were not aware of the factual position of the case. On that date, when you came to know that deposits in your IDBI A/c. No. 113960 amounting to Rs. 16,85,260 could not be reflected in the original return of income, you immediately filed the revised returns on June 24, 2011, for this year, preceding and succeeding assessment years also. (v) The basis of filing the revised return, i.e., 'retail trade of gems' has at no point of time been enquired into by the Assessing Officer and whereas you have also been bound twisting from the main issue of verification of your business in retail trade by seeking shelter of section 44AF of the Income-tax Act, 1961, that you are not required to maintain the books of account. (vi) The compliance with the provisions of section 143(2), i.e., to prove the correctness of your return revised for all these years which is the mandator....
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....liabilities are evident from my statement of affairs/balance-sheet. I may repeat here that I am not required to maintain books regarding the salary and share of profit, etc., from the firm. But regarding the income under section 44AF, it is outside the purview of section 44AA." We further find that, vide the order-sheet entry dated October 18, 2010, the assessee was asked to file a cash flow statement and copy of sales tax/VAT return and in reply the assessee filed a letter dated November 11, 2010, wherein again a detailed reply was filed and wherein the assessee relied upon the decision of the Income-tax Appellate Tribunal, Amritsar Bench, in the case of Smt. Saviti alias Sweety Sekhir v. ITO (ITA No. 548 (Asr)/2008) for the assessment year 2005-06. For the sake of completeness the reply of the assessee as placed in the paper book pages 68 to 70 is made part of this order and is reproduced below : "Apropos of the above, the above assessment proceedings are in progress before your esteemed self. The questionnaire had been issued by you which have been duly replied to, vide letter dated September 14, 2010, along with the annexure referred to therein. On the last date of the heari....
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....again towards deposit in the bank account will result in double addition, which is against the principles of section 44AF of the Act. 4.2 The learned Departmental representative, on the other hand, relied on the orders of the authorities below. 4.3 We have heard both the parties and perused the material placed on record. The first question for our consideration is that whether the assessee can be said to have not engaged in the retail business of trading in textile/fabrics and applicability of section 44AF of the Act. According to the assessee, she is engaged in the retail trade of the textile/fabrics and offered the turnover of Rs. 25,00,000 for taxation at five per cent. and this amount of 5 per cent. at Rs. 1,25,000 is considered as income of the assessee. The fact of income at five per cent. on the turnover of Rs. 25 lakhs is not disputed by the Assessing Officer. In addition to this Rs. 1,25,000 the assessee also offered Rs. 1,00,000 towards peak in the said bank account and thus the total income offered was at Rs. 2,25,000. The Assessing Officer after accepting this amount of Rs. 22,500, made further addition of Rs. 24,38,100. The reason given by the Assessing Officer is ....
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.... statement from April 1, 2007, to March 31, 2008, correlated to deposits and withdrawals of cash to and from various bank accounts maintained by me. I have furnished all the information that was legally tenable to be required of me and I am sure you will find it in order." Therefore, from the above queries of the Assessing Officer and the replies filed by the assessee from time to time we find that the Assessing Officer has made sufficient enquiries in this respect and only after being satisfied about the claim of the assessee under section 44AF and after going through the case law of the Amritsar Tribunal in the case of Smt. Saviti alias Sweety Sekhir v. ITO (supra) had completed the assessment. Therefore, this is a case where the Assessing Officer had made sufficient enquiries which to the best of his knowledge and belief were necessary, therefore, the action under section 263 was not warranted. The honourable Income- tax Appellate Tribunal Delhi Bench in the case of Addl. CIT v. Shipra Estate Ltd. [2010] 35 SOT 256 (Delhi) has held that where the Assessing Officer acting in accordance with law frames an assessment order, the same cannot be branded as erroneous simply because ....
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.... this year the revised return was after the prescribed period of time. The due date for filing the revised return in this year is March 31, 2010, whereas the revised return has been filed on June 24, 2010. Therefore it is correct that the Assessing Officer should not have taken cognizance of the revised return as the assessee had filed the revised return beyond the prescribed period of time. But the question remains that whether the Assessing Officer could have ignored such revised return. It was not even necessary on the part of the assessee to file the revised return as he could have claimed during the assessment proceedings itself that the bank deposits reflected the turnover of the assessee from retail trade because the claim of the assessee being engaged in retail trade was open to scrutiny and the Assessing Officer had carried sufficient enquiries in this respect. Therefore, these are not the cases where no enquiry has been done. There is a difference between lack of enquiry and no enquiry. The honourable Delhi High Court in the case of CIT v. Sunbeam Auto Ltd. [2011] 332 ITR 167 (Delhi) in this respect has held as under (page 179) : "We have considered the rival submission....