TaxTMI 
TaxTMI 
2014 (10) TMI 1005
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.... circumstances of the case and in law, the Ld. Commissioner of Income Tax has erred in cancelling the assessment completed u/s 143(3) of the Act vide assessment order dt. 28.03.2013 holding that the order passed by the Assessing Officer is erroneous and prejudicial to the interest of revenue with the direction to reframe the assessments after examining the issues, whereas the impugned assessment order has already been merged with the appellate order dated 30.01.2013 passed by the Ld. Commissioner of Income Tax (Appeals), Raipur (CG), camp at Bhopal, M.P." 2. The grounds of appeal in each of the assessment year are common therefore all these appeals are disposed of by this common order. The brief facts of the case are that the CIT, after pursuing the assessment records, was of the prima facie view that consolidated assessment order for the assessment years 2003-04 to 2009-10 passed vide order dated 31.12.2010 by the than Dy. Commissioner of Income Tax, 1(1), Bhopal u/s 153A r.w.s.143(3) of the Income Tax Act 1961 was erroneous and pre-judicial to the interest of the revenue. Accordingly, the CIT issued show cause notice to the assessee dated 25.3.2013 which states as under :- ....
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....eposed that in these documents transactions of deposits made by you in the bank accounts of your family members. You had admitted Rs. 4 crores as your additional undisclosed income on account of the transactions recorded in these dairies. 3.2 However, the Assessing Officer has erroneously failed to make any addition on this account. This has resulted in under assessment of income by Rs. 4 crores. This shows that the assessment order is erroneous in so far as it is prejudicial to the interests of Revenue. 4. In your statement on oath recorded on 21.07.2008 vide question no. 4 your were enquired in relation to page 78 LPS 1/1 wherein you had shown some loan transactions against your name and in the name of your wife, Smt. Neena Sharma totaling to Rs. 1.11 crores in the year of search. You were also enquired about the loans appearing in the name of Sh. Rajesh Bajaj, Sh. Manohar Lal Bajaj, Ms. Riya Bajaj, Ms. Chandra Bajaj etc. whose names appeared in the LPS and were enquired about their antecedents, their address and whether the loans shown were genuine. 4.1 In your answer to question no. 4, you had deposed on oath that these entries shown in the form of lo....
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.... on oath recorded on 21.7.2008, vide question no. 25, you were asked regarding the amount of Rs. 3 lakhs in cash in your possession and Rs. 4 lakhs cash given by you to your mother. Further, you had stated in the statement recorded that you had shown your agricultural and licensing income on estimated basis and that no books were being maintained by you. You were asked to comment on these discrepancies. 7.1 In your answer to question no. 25 of your statement recorded on oath, you had deposed on oath that keeping in view the discrepancies, you had admitted the said amount as your undisclosed income. Further, in the Financial year 2008-09, you had also admitted Rs. 1 crores as your undisclosed income. 7.2 However, the Assessing Officer erroneously failed to make any addition of this amount inspite of yourself admitted disclosure. This shows that the assessment order is erroneous in so far as it is prejudicial to the interests of Revenue. In view of the above, the assessment order passed by the Assessing officer is erroneous in so far as it is prejudicial to the interests of revenue and is therefore, proposed to be cancelled u/s 263 of the I.T. Act, 1961. Yo....
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....tly filed their returns of income for A. Y. 2009-10 at Gwalior wherein their stated share of investment stands disclosed. Thus the assessee‟s interest/share in the property works out to 1/10th only (50 lakhs out of the total stated consideration was paid by him)." "However the assessee‟s denial regarding payment "ON Money" can not be accepted because of the overwhelming and clinching evidence available on record." Sir, the Assessing Officer findings were finally concluded in this regard in page number 59 as under:- "Since the assessee‟s share in the stated consideration is 1/10th only, the unaccounted payment made by the assessee is held to be Rs. 87,46,000/- which is his undisclosed income for the A. Y. 2009-10. Penalty Proceedings u/s 271AAA of the I.T. Act are being initiated." "The balance addition will be considered in the hands of the 14 other persons of Dabra in whose names, the land has been purchased and /or the actual person who has made investment in the name of these 14 persons." Sir, from the discussion as above, it is apparently clear that the Assessing Officer has well considered the surrender of Rs. 5 Cr....
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....ssment order wherein the name of all the aforesaid persons has been appeared and after giving the detailed findings and considering the explanation offered by the assessee during the assessment proceedings, the Assessing Officer has considered Rs. 41,00,000/- as explained and Rs. 70,00,000/- was added being not properly explained. Thus, the order passed by the Assessing Officer is not erroneous and has not prejudicial to the interest of the revenue. 4. Sir, this issue was also discussed in paragraph 8 page number 61 to 69 of the assessment order and particularly on page number 67 wherein it is mentioned by the Assessing Officer that the issue of M/s Shikhar Builders was well considered and hence, no addition is made on this account. Sir, being this issue was also well considered by the Assessing Officer at the time of passing the assessment order and the addition was not made after satisfying the explanation offered by the assessee, it cannot be said that the order passed by the Assessing Officer is erroneous on this issue. 5 & 6 Regarding point number 5 and 6 above, pertaining to Rs. 3,00,000/- paid to Shri Sukhram as advance against land and Rs. 3,00,000/- cash ....
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....ancelling the assessment and directing a fresh assessment." Sir, a bare reading of section 263(1) makes it clear that the pre-requisite to exercise of jurisdiction by the Commissioner suo motu under it, is that the order of the AO is erroneous in so far as it is prejudicial to the interests of the Revenue. The Commissioner has to be satisfied with twin conditions, namely, (i) the order of the AO sought to be revised is erroneous, and (ii) it is prejudicial to the interests of the Revenue. If one of them is absent - if the order of the AO is erroneous but is not prejudicial to the Revenue or if it is not erroneous but is prejudicial to the Revenue- recourse cannot be had to section 263(1) [Malabar Industrial Co. Ltd. v. CIT (2000) 243 ITR 83, 87 (SC)] Further, the error envisaged by section 263 is not one which depends on possibility or guesswork, but it should be actually an error either of fact or of law [CIT v. Trustees of Anupam Charitable Trust, (1987) 167 ITR 129 (Raj.)]. Sir, only if it is self-evident and apparent from the record that the assessment order is erroneous either on the facts or on law or if the assessment order is perverse in so far as....
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....gment of the Assessing Officer in fixing the amount of valuation of the property. Similarly,"erroneous judgement‟ means "one rendered according to course and practice of court, but contrary to law, upon mistaken view of law, or upon erroneous application of legal principles‟. From the aforesaid definitions, it is clear that an order cannot be termed as erroneous unless it is not in accordance with law. If an Assessing Officer acting in accordance with law makes a certain assessment, the same cannot be branded as erroneous by the Commissioner simply because, according to him, the order should have been written more elaborately. Section 263 does not visualize a case of substitution of the judgment of the Commissioner for that of the Assessing Officer, who passed the order, unless the decision is held to be erroneous. Sir, it is held by various court that the revisional power is not meant to be exercised to correct every error of fact, but the error must be of such a nature that it is erroneous and prejudicial to the interest of the Revenue. Further, the power of revision is not to meant to be exercised for the purpose of directing the officer to hold ano....
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....g the assessment on different issues as mentioned in your notice u/s 263 and hence also action u/s 263 is not required. In the light of our above submission, it is respectfully submitted that the revisional proceedings initiated u/s 263 of the Act may kindly be dropped...." 4. CIT did not agree with the submissions of the assessee but took the view that the assessment order passed on 30.12.11 is erroneous in so far as prejudicial to the interest of revenue and accordingly, he cancelled the same u/s 263 of the Income Tax Act, 1961 and directed the assessing officer to reframe the assessment in each of the assessment years after examining these issuesafresh and affording sufficient opportunities of being heard to the assessee by observing as under vide order dt.28.3.13:- "I have carefully examined the records of the assessment proceedings, and explanations submitted by the assessee, keeping in view the relevant provisions of law and judicial precedents. 11.1 The assessee has challenged the jurisdiction of section 263 mainly on the ground that the Assessing Officer has examined all the issues during the assessment proceedings. However, it is evident from ....
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....ment are also duly satisfied in the assesse‟s case as errors subject matter of this order are not which depends on possibilities or guess work but is an actual error. 12.3 The facts of the case clearly show that fresh assessment will certainly result in more revenue. Hence conditions laid in CIT v/s Shakthi Charities (2000) 160 CTR 107 (MAD) are also duly satisfied. 12.4 The ratio laid down in CIT v/s Gabrial India Ltd. (1993) 203 ITR 108 (Bom) is not applicable in the case of the assessee, since the enquiry ordered in this order are specific and are based on seized documents and admission made by the assessee on oath. 12.5 The ratio laid down in State of Karnataka vs. Marico Industries Limited (2001) 124 STC 196 (Kar) is not applicable in case of the assessee as the said judgment is in relation to the revision proceedings under Karnataka Sales Tax Act, 1957 and not Income Tax Act, 1961. Nevertheless, the conditions of said judgment are duly met in this case as the notice u/s 263 is very detailed and contains all the documentary and testamentary evidence in support of such a belief. 13. It is important to note that admission of undisclosed ....
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....the amount of Rs. 1.5 crores being share capital investment, Rs. 4 crores being investments in land and the overall declaration of Rs. 12.5 crores were not correct declaration and these incomes does not constitute the correct income and as such, the returns filed in response to notice u/s. 153A show the correct income and there are no other undisclosed income. The AO has discussed this affidavit on pages 13, page 23, page 28, page 29, page 64, page 65. The AO after rejecting the affidavit has made various additions on the basis of the papers, spiral diaries, and documents found and on the basis of the enquiries made during the course of the assessment proceedings. The assessments were approved by the Additional Commissioner u/s. 153D. Thus, it was contended that even the higher authority has considered the additions made by the AO. The assessee went in appeal for part of the additions made by AO. Part of the additions are deleted by the CIT (A) vide order dated 30.01.2013 for which our attention was drawn to the order of the CIT(A). 6. It was further submitted that Subsequent to the order of CIT(A), the Ld. CIT issued the common show cause notice u/s. 263 for the A.Yrs. 2003-04 ....
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....ount of loose papers, the AO has made various additions on account of loose papers. The addition in respect of purchase of property, the same was already disclosed in the Balance Sheet of various years. The assessee has already surrendered Rs. 4.13 crores in the A.Y. 2009-10 and for other years amounting to Rs. 45.85 lakhs in the different assessment years. The income so surrendered by the assessee in the return has duly been accepted by the assessing officer and in addition to this income, the assessing officer made additions certain additional addition. In this regard attention was drawn to page 28, 32, 36, 40, 44 and 48 of the paper book. 10. Regarding the additions of loans as mentioned in para 5 about the addition of Rs. 1.11 crores, the AO has discussed this point from pages 62 to 69 and has made the addition of Rs. 70 lakhs. The Ld. AO has also narrated the question put to the assessee and the disclosure made on page 65. The Ld. CIT(A) has after considering the detailed submissions in para 4 ground 7, has restricted the addition to Rs. 5 lakhs. For this attention was invited to the order of the CIT(A). It was further submitted that the assessing officer has also discussed....
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.... 212 Taxmann 184 (Del.) j. CIT v/s Mehrotra Brothers, 270 ITR 157 (M.P) k. CIT v/s Shri Govindram Seksariya Cahrity Trust, 166 ITR 580 (M.P) l. Hari Iron Trading Co. v/s CIT, 263 ITR 437 (P&H) m. CIT v/s HARI Singh & Associates, 267 CTR 442 (Raj.) n. CIT v/s Shalimar Housing & Finance Ltd., 24 DTR 58 (M.P) ii. It was further submitted that the points referred by the CIT have all been considered by the CIT(A) and as such on the same point, the action u/s. 263 cannot be taken. Reliance was placed in this regard on the full bench judgment of MP High Court in the case of CIT v/s. Rajput reported in 164 ITR 197 wherein it was held that CIT has no power u/s. 263 to revise the order which merged with the order of the Appellate Assistant Commissioner. It is further submitted that explanation (c) to section 263 provides that where any order referred to in this sub-section and passed by the Assessing Officer has been the subject matter of any appeal, the powers of the Commissioner under this sub-section shall extend to such matters as had not been considered and decided in such appea. iii. The orders for the A.Yrs. 2003-04 to 200....
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....the case laws as relied on from both the sides before us as well as the order of the CIT passed u/s. 263 of the Income Tax Act.and the assessment orders passed by the assessing officer. Before deciding the issue whether the order passed by the CIT is valid and in accordance with law laid down u/s 263, It is necessary for us to discuss the provisions of section 263 which empowers the CIT to revise the assessment order. Section 263 lays down as under:- "263. (1) The Commissioner may call for and examine the record of any proceeding under this Act, and if he considers that any order passed therein by the Assessing Officer is erroneous insofar as it is prejudicial to the interests of the revenue, he may, after giving the assessee an opportunity of being heard and after making or causing to be made such inquiry as he deems necessary, pass such order thereon as the circumstances of the case justify, including an order enhancing or modifying the assessment, or cancelling the assessment and directing a fresh assessment. Explanation.-For the removal of doubts, it is hereby declared that, for the purposes of this sub-section, - (a) an order passed on or befor....
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....e as is required u/s 147 or 148(2). It is a part of his administrative power to call for the record and examine them relating to any assessee which falls under his jurisdiction. Secondly, he may consider any order passed by the Assessing Officer as erroneous as well as prejudicial to the interest of the Revenue. This is exercised by calling for and examining the record available at this stage. There is no question of the assessee to appear and make submission at this stage. Thirdly, if after calling for and examining the records the Commissioner considers that the order of the Assessing Officer is erroneous in so far it is prejudicial to the interest of the Revenue, he is bound to give an opportunity to the assessee of being heard and after making or causing to be made such enquiry as he may deem fit, pass such order thereon as the circumstances of the case may justify including an order enhancing or modifying the assessment or cancelling assessment and directing a fresh assessment. This empowers the CIT to cause or make such enquiries as he deems necessary. Fourthly, the CIT u/s 263 can enhance or modify the assessment as a result of enquiry conducted and hearing of the assessee. ....
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.... on the basis of the document found and seized during the course of the search. CIT has referred to question no.2, 3, 4, 8, 17 and 25 asked from the assessee while recording the statement during search and reply given by the assessee in respect of these questions. CIT was of the opinion that in respect of question no.2,3,4 the assessing officer has not added the income as was required to be added while in respect of question 8,17 and 25 assessing officer failed to make any addition even though assessee has accepted the income during the course of the statement recorded at search. In respect of each of the issue the main contention of the ld. A.R are that it is not a case of any inquiry on the statements recorded during the course of search. The assessing officer has examined each and every document found and seized during the course of the search relating to the issues raised by the CIT and which has the bearing on the statements recorded from the assessee and after examining each of the points, he made the addition in respect of the some issues while he did not make any addition in respect of other issues. In respect of some issues, the assessee surrendered the un disclosed income....
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....3.9.2010 along with the notice u/s 142(1) was issued. The hearing were adjourned and attended from time to time and ultimately assessment order was passed on 31.12.2010. The assessing officer at page 45 of the assessment order noted about the memorandum of agreement to purchase the land dated 24.5.2008 and noted that the total consideration was Rs. 5 crore and a sum of Rs. 49,18,335/- were incurred on registry and other charges. There were fifteen purchasers including the assessee. The assessing officer at page 46 of the assessment order noted that, the assessee in the statement recorded during search admitted entire amount of Rs. 5 crores be taken pertaining to him and he was ready to surrender the amount. Accordingly, the assessing officer issued questionnaire dated 13.9.2010 why this amount of Rs. 5 crore plus expenses should not be added in his income. The assessing officer also noted from the seized document that actually total payment of Rs. 14,24,60,600/- was paid towards the land on the basis of certain other paper seized during the course of the search relating to land dealing. The assessee submitted the reply about the purchase of land by 15persons. The reply submitted by....
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....to s. 263 it is vivid that the aforesaid section clearly stipulates that powers of the CIT shall extend to such matters as had not been considered and decided in appeal. The Tribunal has adverted to the factual position in a detailed manner and has appreciated those issues that have been taken up by the CIT while exercising jurisdiction under s. 263 and it has held that the said facets have already been dealt with by the CIT(A). Once the same has been dealt with, in exercise of appellate jurisdiction, the order cannot be regarded as incorrect and prejudicial to the interest of revenue on the basis of which the CIT can exercise jurisdiction under s. 263. The entire case hinges on facts and the tribunal has properly dealt with it and, therefore, no substantial question of law arises. - CIT vs. Max India Ltd. (2007) 213 CTR (SC) 266 : (2007) 295 ITR 282 (SC), Malabar Industrial Co. Ltd. Vs. CIT (2000) 159 CTR (SC) 1 : (2000) 243 ITR 83 (SC) and CIT vs. Associated Food Products (P) Ltd. (2006) 202 CTR (MP) 192 : (2006) 280 ITR 377 (MP) relied on." b) In the case of CIT Vs K.L. Rajput, 59 CTR 65 (M.P) (FB) 32, Taxman 326 has held as under :- "The principles of merger has cor....
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....ssue also in our opinion the order passed by the assessing officer cannot be regarded to be erroneous and prejudicial to the interest of the revenue. 20. The third issue relates to the surrender of Rs. 1.1 crore in the statement recorded on 21.7.2008 on the basis of page 78 of LPS1/1. The assessing officer has examined the issue relating to the loan transactions in the name of the assessee and his wife totalling to Rs. 1.11 crores. The assessee no doubt had not shown this income in the return filed by him subsequent to the search even the assessing officer did not accept retraction of the assessee on this account at page 65 and therefore he examined this issue in detail from page 66 to 69 and ultimately came to the conclusion that to the extent of Rs. 70,00,000/- loan are non-genuine in the case of assessee and to the extent of Rs. 25,00,000/- are non-genuine in the hands of assessee‟s wife Mrs Neena Sharma out of the said sum of Rs. 1.11 crores and to that extent he has sustained the addition totalling to Rs. 95,00,000/- in the hands of assessee as well as his wife. We also noted the sum of Rs. 1.11 crores unsecured loan also include the sume of Rs. 10 lacs received from ....
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.... A.Y.2008-09 to the extent of Rs. 1800000/- in addition to the other undisclosed income in different assessment years, as enumerated by us in the preceding paragraphs and which we verified, the income so disclosed is sufficient to cover these declarations and in our opinion also there was no need to make further addition once the assessee has duly declared the income more than what he surrendered during the course of search in this regard. On the basis of this fact it cannot be said that the order passed by the assessing officer is erroneous and prejudicial to the interest of the revenue. It is not the case of the revenue that the assessee has not surrendered additional income during the assessment year 2008-09. 23. In our opinion, the CIT cannot enter into the shoes of the A.O. If the A.O. has taken one of the views. Until and unless that view is unsustainable in law, the CIT cannot take action under section 263 holding the order passed by the A.O. to be erroneous. There is nothing on record how the explanation given by the assessee were not acceptable. The A.O. who has been empowered under section 143(3) r.w. 153A to frame the assessment and determine the taxable income of the....
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....he assessee, could not say that the allowance of the claim of the assessee was erroneous and that the expenditure was not revenue expenditure but an expenditure of capital nature. He simply asked the Income-tax Officer to re-examine the matter. That was not permissible. The Tribunal was justified in setting aside the order passed by the Commissioner of Income-tax under section 263." 24. Similar view has been taken by the Hon‟ble Allahabad High Court in the case of CIT vs. Mahender Kumar Bansal, 297 ITR 0099 in which respectfully following the decision of Allahabad High Court in the case of CIT vs. Goyal Private Family Specific Trust, 171 ITR 698 (Alld.) has held under para no.12 as under :- "As held by this Court in the case of Goyal Private Family Specific Trust (supra,) we are of the considered opinion that merely because the ITO had not written lengthy order, it would not establish that the Assessment Order passed under section 143(3)/148 of the Act is erroneous and prejudicial to the interest of the Revenue without bringing on record specific instances, which in the present case, the CIT has failed to do." 25. A perusal of the order framed by CIT indicates ....
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....e phrase 'prejudicial to the interest of the revenue' has to be read in conjunction with an erroneous order passed by the assessing officer. Every loss of revenue as a consequence of the order of the assessing officer cannot be treated as prejudicial to the interests of the revenue. For example, if the assessing officer has adopted one of the courses permissible in law and it has resulted in loss of revenue, or where two views are possible and the assessing officer has taken one view with which the commissioner does not agree, it cannot be treated as an erroneous order prejudicial to the interests of the revenue, unless the view taken by the assessing officer is unsustainable in law. Where a sum not earned by a person is assessed as income in his hands on his so offering the order passed by the assessing officer accepting the same without application of mind as such will be erroneous and prejudicial to the interest of the revenue." 26. In the case of CIT vs. R.K. Construction Co., Hon‟ble Gujarat High court 313 ITR 65 (Guj.) as confirmed by supreme court, confirming the order of the ITAT for which the undersigned was the author, has held as under:- "The de....
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....k to sub-contractors nor there was any illegality in making all due payments to them. The Tribunal has also given specific finding to the effect that there was no evidence on record that these contractors were related to the assessee or were associates or sister concerns of the assessee. The Tribunal has also given finding that the Revenue has not discharged the onus that the payments to sub-contractors were not genuine. Thus the Tribunal has come to the conclusion that no disallowances can be made merely on the basis of suspicion, howsoever strong may it be, and the suspicion cannot take the place of actuality. AO has taken a particular view on the basis of evidence produced before him. On the basis of the said material and materials which were collected by the CIT in revisional proceedings, the CIT has taken a different view. However, in the revisional proceedings under s. 263, it is not open for the CIT to take such a different view. No substantial questions of law arise out of the order of the Tribunal and hence, the appeal filed by the Revenue deserves to be dismissed. - CIT vs. Arvind Jewellers (2002) 177 CTR (Guj) 546 : (2003) 259 ITR 502 (Guj) and Malabar Industrial Co. Ltd....
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....onclusion reached by the ITO. Sec. 263 does not empower him to take action on these facts to arrive at the conclusion that the order passed by the ITO is erroneous and prejudicial to the interest of the Revenue. Since the material was there on record and the said material was considered by the ITO and a particular view was taken, the mere fact that different view can be taken, should not be the basis for an action under s.263 and it cannot be held to be justified. Having regard to the facts and circumstances of the case, the Tribunal was justified in setting aside the order passed by the CIT under s. 263. - Malabar Industrial Co. Ltd. vs. CIT (2000) 159 CTR (SC) 1: (2000) 243 ITR 83 (SC) followed. 30. We have also gone through the decision of CIT vs. Vodafone Essar South Ltd. 212 Taxmann 184 (Del.) on which the ld . AR vehemently relied. In this decision, we noted that the Hon‟ble High Court relied on the earlier decision of the High Court in the case of CIT vs. Sunbeam Auto Ltd., 332 ITR 167 in which it was held that if there is some inquiry by the AO in the original proceedings, even if inadequate, that cannot clothe the Commissioner with jurisdiction u/s 263 merely beca....
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.... appeal: Held, dismissing the appeal, that the Tribunal had held that the order of the Assessing Officer could not be regarded as erroneous even if the Assessing Officer had failed to carry out necessary verification and required enquiries in respect of the share application money, as no addition had been made on account of the reasons for reopening, which were recorded before issue of notice under section 148 of the Act. It had held that the Assessing Officer could not have made an addition on account of the share application money as no addition had been made on account of fixed deposits of Rs. 20 lakhs. The Tribunal had noticed and recorded that in the reasons for reopening it was mentioned that the assessee had made investment in the form of fixed deposits of Rs. 20 lakhs but in the assessment order passed under section 147/143(3) of the Act it had been held that the assessee had been able to show and establish the genuineness and capacity of the share applicants to make the investment. The Assessing Officer did not make any addition for the reasons recorded at the time of issue of notice under section 148 of the Act. This position was not disputed or disturbed by the Commissio....
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.... the Commissioner took the view that the accounting practice followed by the assessee to debit the entire cost of tools and dyes in the year of installation was not correct and he remitted the case to the Assessing officer for re-examination. The Tribunal allowed the claim of the assessee. On appeal: Held, dismissing the appeal, (i) that the Assessing Officer allowed the claim on being satisfied with the explanation of the assessee. Such decision of the Assessing Officer could not be held to be erroneous simply because in his order he did not make an elaborate discussion in that regard. The Assessing Officer had called for explanation on the very item from the assessee and the assessee had furnished its explanation. This fact was conceded by the Commissioner himself in his order. This showed that the Assessing Officer had undertaken the exercise of examining as to whether the expenditure incurred by the assessee in the replacement of dyes and tools was to be treated as revenue expenditure or not. Therefore, it could not be said that it was a case of lack of inquiry. The accounting practice followed for a number of years had the approval of the income-tax authorities. Even ....
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....round that the Assessing officer did not make proper enquiry was not valid. The Tribunal was justified in setting aside the order of revision. No substantial question of law arose from the order." The Supreme court has dismissed the special leave petition filed by the Department against this judgement. In our opinion, the case of the assessee is also covered by this decision of the jurisdictional High court. 35. Similar view has been taken by jurisdictional High court in the case of CIT Vs Shri Govindram Seksariya Charity Trust,166 ITR 580 (M.P), in which it has held as under :- "The assessee was a public charitable trust. For the assessment years 1973-74 and 1975-76 to 1977-78, the Commissioner of Income Tax found that the debtors of the assessee were persons to whom the provisions of section 13(3) of the Income Tax Act, 1961, were applicable and that the income of the assessee would be deemed to have been used for the benefit of those persons, as provided by section 13(2) of the Act. The Commissioner was of the view that the Income Tax Officer had allowed exemption under section 11 of the Act to the assessee without examining in detail the applicability of the p....
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....stock as per books and that in fact there was no discrepancy in stock. The Assessing Officer in the office note had explained as to why the addition of Rs. 10 lakhs was not being made. The record also showed that purchases from various parties had been verified as the Assessing Officer had placed on record certified copies from such parties. The Tribunal had based its findings entirely on the fact that there was no mention in the assessment order about the inquiries made by the Assessing Officer about the discrepancy in stock. This was not the correct approach as was evident from the provisions of section 263(1). In the absence of any suggestion by the Commissioner as to how the inquiry was not proper, the action taken by him under section 263 could not be sustained. The letter by the Assessing Officer to the Commissioner supported the contention of the assessee that the case was being monitored by the Commissioner from time to time and the assessment order had been passed after a draft order along with survey file had been forwarded to the Commissioner for his approval. Both the appellate authorities had failed to take the trouble of even referring to the assessment record. Once t....
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....ision in our opinion will not help the revenue as it relates to the case where no enquiry has been conducted by the assessing officer while in the case of the assessee due enquiry was conducted and other income as surrendered were duly returned by the assessee. 39. In the case of Bhagirath Aggarwal Vs CIT, 351 ITR 143 (Delhi) as relied by Ld. DR , we noted that Hon‟ble High court has held as under :- "The assessee was insisting that it was for the department to corroborate the statement of admission made by him and until and unless the department corroborates the same, the statement cannot be relied upon. It was held that that is not the correct position of law. The admission once made can certainly be retracted, if the circumstances permit, and it can also be shown to have been made under some mistake or to be otherwise incorrect. But, the onus would be on the maker of that admission. In this case it was the assessee who had admitted and surrendered as his undisclosed income. It was incumbent upon him to show that he had made a mistake in making that admission and that the said admission was incorrect. He had access to all the documents which had been seized in a....