TaxTMI 
TaxTMI 
2016 (9) TMI 1153
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....ara No.4.1(b) : Rs.23,17,264/- Add: As per para No.5 : Rs. 51,632/- Total Income : Rs.1,59,57,716/-". 3. The C.I.T. in exercise of his powers u/s 263 of the Act was of the view that the aforesaid order of the AO was erroneous and prejudicial to the interest of the revenue for the following reasons :- l. For the A.Y. 2011-12, share application money was increased from Rs. 26.50 lakh to Rs. 194.48 lakh the details of which was not submitted. " 2. In the A.Y. 2010-11 the profit was disclosed Rs. 48.23 Lakh against the turnover of Rs. 9.99 Crore. However, in the A.Y. 2011-12, the-net profit disclosed is only Rs. 49.82 Lakh against the turnover of Rs. 20.61 Crore. No submission or explanation regarding fall of net profit ratio compared to turnover was provided. 3. It was also seen than GP from sales of fabricated items is found to be around 26% of total sales of Rs. 8.92 Crore compared to last year's GP of around 33% on total sales of Rs. 9.52 Crore. The reasons for fall in gross profit is not provided. 4. Anomalies and gross divergences in expenses claimed have not been verified during the scrutiny proceedings....
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.... 7. Aggrieved by the order of CIT the assessee has preferred the present appeal before the Tribunal. 8. The appeal before the Tribunal has been filed belatedly by 27 days. In an application for condonation of delay, the reason for the delay have been stated by the assessee as due to the absence of Shri.Anil Kumar Agarwala, director of the assessee, who was looking after the tax matter. It has been mentioned that Shri Anil Kumar Agarwala had to go out of station from 28.01.2016 for some urgent business purpose and had to remain out of station for the period between 28.01.2016 to 07.04.2016. It appears that after the return of Shri Anil Kumar Agarwala to Kolkata on 08.04.2016 he went and met his advocate Shri Subash Agarwal, who filed the appeal of the impugned year before the Tribunal. The advocate prepared the appeal and after signing the same was filed in the registry on 21.04.2016. The delay of 27 days in filing the appeal has been explained thus. Shri Anil Kumar Agarwala, Managing Director of the assessee has sworn to an affidavit mentioning all the above facts. The ld. DR opposed the prayer of the assessee for condonation of delay. According to him the reasons given by the....
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....calling for books of accounts and other documents. In all there were about 16 hearings before the AO. A perusal of Paragraph 4 of the order of assessment shows that the AO had called for books of accounts supporting bills, vouchers, cash book, bank statements etc. The same were produced by the Assessee and test examined by the AO. In respect of purchase of goods and sundry creditors the Assessee was asked to furnish name and address of the concerns from who purchases were made. Notices u/s.133(6) of the Act were issued and served on the various parties to verify the genuineness of purchases as shown by the Assessee and the replies received were cross verified with Assessee's books of accounts, ledger and payments verified through bank statements. Thereafter the AO found that there was nondeduction of tax at source in respect of certain payments which resulted in disallowance of expenses u/s.40(a)(ia) of the Act. Un-reconciled difference in loan amount was added to the total income of the Assessee. 13. In one of the reply of the assesee dated 27.02.2014 to queries raised by the AO, throws light on the enquiries made by the AO and the same is as follows :- "Sub : Submissi....
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....r CBDT instructions dated 8.9.2010 which was the norm applicable for selection of cases for scrutiny when the case of the Assessee was picked up for scrutiny, the scope of scrutiny assessments is limited to only that aspect of information received through AIR. He pointed out that the case of the Assessee was picked up for scrutiny only based on AIR information which was with reference to difference of TDS as per 26AS and TDS as declared in the return of income by the Assessee. According to him, therefore the AO could not go into any other aspect while concluding the assessment, more so, on the various issues pointed out by the CIT in the impugned order u/s.263 of the Act. In support of his contention that the scope of scrutiny assessment proceedings cannot be enlarged by the AO contrary to the CBDT Instruction referred to above, the learned counsel for the Assessee relied on the decision of the Delhi ITAT in the case of Smt.Santosh Yadav Vs. CIT in ITA No.1810/Del/2012 order dated 18.1.2013 and the decision of the ITAT Amritsar in the case of Smt.Gurupreet Kaur Vs. ITO in ITA No.87/(Asr.)/2016 order dated 24.3.2016. In both the aforesaid decisions, the Tribunal has taken a view tha....
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....on the ground that the AO should have gone deeper into a particular issue or should have made elaborate discussions. In this regard the ld. Counsel for the assessee had placed reliance on the decision of certain judicial pronouncements namely : i) CIT vs :Leisure Wear Exports Ltd. 341 ITR 166 (Del) ii) CIT vs Budhilal Hiralal Rana 125 Taxman 455 (Guj.) 18. In these decisions it was held that there was no material brought on record to show that there was an error or omission or failure on the part of the AO. In our view, in the present case, as we have already observed, the material on record shows that the AO failed to make necessary enquiries on the issues set out in the show cause notice u/s 263 of the Act. Another argument of the ld. Counsel proceeded on the basis that there is a difference between the lack of enquiry and inadequate enquiry. It was submitted that it is only in the case of lack of enquiry that jurisdiction u/s 263 of the Act could be invoked and not in a case of where the CIT feels that the enquiry made by the AO was inadequate. In this regard reliance was placed by the ld. Counsel on the decision of the Hon'ble Delhi High Court in the case o....