TaxTMI 
TaxTMI 
2019 (4) TMI 1378
X X X X Extracts X X X X
X X X X Extracts X X X X
....ax Act, 1961 (the Act) concerning AY 2011-12. 2. The assessee in the present appeal has challenged revisional jurisdiction of the Pr.CIT invoked under s.263 of the Act whereby order of the AO under s. 143(3) of the Act dated 28.11.2013 is sought to be set aside by the Pr.CIT for fresh assessment on the ground of lack of inquiry into certain vital aspects. 3. Briefly stated, the assessee, a partnership firm, is engaged in the business of construction. The return of income of the assessee for AY 2011-12 was subjected to scrutiny assessment and consequently, assessment order was framed under s.143(3) of the Act. The AO merely accepted the return of income of Rs. 31,450/- as assessed income without any adjustment. On verification of assessmen....
X X X X Extracts X X X X
X X X X Extracts X X X X
....on consideration or market value as per Jantri Rate. Accordingly, the value of the alleged property comes to Rs. 4,67,40,816/- (22,90,300*100/4.90), as against Rs. 45,61,000/- declared/shown. It may therefore be presumed that Rs. 4,21,79,800/- (4,67,40,800 - 45,61,000) is undisclosed investment. 2. In view of above, you are being granted an opportunity of being heard and to show cause as to why the aforesaid assessment made by the Assessing Officer for A.Y. 2011-12 should not be enhanced or cacelled with a direction to make fresh assessment in accordance with the provisions of law in this regard. For this purpose, you may appear before the undersigned, in person or through your authorized representative or file written submission on 29.01....
X X X X Extracts X X X X
X X X X Extracts X X X X
....t dated 18.10.2013 to submit that the AO had initiated inquiry on investments of Rs. 1.17 crore as appearing in the balance sheet on 31.03.2011 with source thereof. The learned AR thereafter referred to MOU (memorandum of understanding) / Banakhat dated 31.08.2007 to point out that the agreement for purchase of land made way back in August 2007. A formal agreement for purchase of the land was ultimately made on 29th March, 2011 to give effect earlier Banakhat. It was submitted that the land was originally agricultural land which was converted into non-agricultural land by the assessee and thereafter the actual registration was carried out in the FY 2010-11 concerning AY 2011-12 in question. The learned AR further emphasized that the payment....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ayment of stamp duty totally disproportionate qua the cost of purchase of land as declared by the assessee. It was submitted that the AO has not made any inquiry into claim of the assessee towards bonafides of cost of purchase declared and assessment order has been passed in a cryptic & non-descript manner. The agreement has been registered and therefore the stamp duty was paid during the year. Therefore, it was thus contended that the cause of action against the assessee did arise in the FY 2010-11 to the concerning AY 2011- 12. The learned CIT-DR referred to the judgment of the Hon'ble Supreme Court in the case of Malabar Industrial Co. Ltd. vs. CIT (2000) 243 ITR 83 (SC) to contend that the Pr.CIT was entitled to cancel the order of the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... in the purchase of land. The question that arises is whether the Pr.CIT was justified in setting aside the assessment order where the cost of purchase of land has been accepted summarily without any tangible inquiry in this regard on the fact of such documents. A perusal of the questionnaires issued and reply made by the assessee thereon clearly shows that no relevant meaningful inquiry was conducted in respect to correctness of the cost of purchase of land. What was inquired was source of cost of purchase declared. The issue raised by the Pr.CIT is altogether different and quite valid for that matter. A bare look at the assessment order also gives the infallible impression that the assessment order was passed in a routine and perfunctory ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ny application of mind on the crucial aspect which is self-revealing from the stamp duty payment itself. 9. The judicial precedents relied upon on behalf of the assessee are not found to be of any assistance. The decisions referred too are broadly based on the circumstances where either relevant material was not found or where it was found is a matter of fact that there was no failure on the part of the AO is to make inquiries. Needless to say, the scope of Section 263 of the Act is quite different. In order to invoke Section 263 of the Act, the competent authority is required to find that order sought to be revised is erroneous and caused prejudice to the Revenue. A lack of inquiry on a pertinent point which demonstrates possible revenue ....