AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
2020 (3) TMI 547
X X X X Extracts X X X X
X X X X Extracts X X X X
....ts of the case asked the AO to make enquiries on secondary evidence of third parties for considering the sale consideration of Rs. 2,71,00,000/- and ignoring the detailed order DIG (Stamps) dtd. 22-6-16. The Competent Authority has also considered such photo stat copy of agreement and treated such complaints as fake and passed his order that no such agreement was made for consideration of Rs. 2,71,00,000/-. 3. That as asked by Pr. CIT to make detailed enquiry and to make addition of deposit which were already explained. The payment received from Kailash was paid by cheque and it was sufficient proof and accordingly accepted by AO after source thereof. 4. That the order passed u/s 263 is bad in law. It is also time barred from date of original due date of return filed for Nil tax liability for 07-08-09 also. 5. That as decided by Supreme Court in (2007) 211 CTR page 69 (SC) there is distinction between lack of enquiry and inadequate enquiry. As held by Supreme Court if there is an enquiry even inadequacy. As held by Supreme Court if there is an enquiry even inadequate that would not by itself given occasion to the Pro CIT to pass an order u/s 263 of IT Act....
X X X X Extracts X X X X
X X X X Extracts X X X X
....as follows:- Date Amount 31-12-2008 Rs. 597650 03-02-2009 Rs. 748500 03-02-2009 Rs. 150000 11-02-2009 Rs. 3048 19-03-2009 Rs. 1000 Total Rs. 1500198 3. However, the AO failed to make enquiries with reference to the explanation offered as is evidenced in the assessment order. You tried to explain the source from following:- i) Vehicle sold to Sukh Ram Rs. 700000 ii) Vehicle sold to Sheo Ram Rs. 600000 iii) Vehicle sold to Pusa Ram Rs. 400000 iv) Plot sold to various parties Rs. 119000 v) Agriculture income Rs. 252000 vi) Received from Hari Ram Rs. 200000 vii) Funds from operations Rs. 480000 viii) Amount routed through Kailash paid Rs. 600000 on 6-1-2009 Rs. 600000 4. The AO failed to inquire into the dates of these transactions to explain the cash deposits. Further, Shri Pusa Ram and Shri Sukh Ram had not agreed to the claim of assessee that they have purchased such vehicles leave aside in cash. In fact the statement of Shri Pusa Ram was on Oath and in the presence of Shri Vimal Chauhan A/R. The statement of Shri Sukh Ram too was on oath. The important....
X X X X Extracts X X X X
X X X X Extracts X X X X
....sidered but not found acceptable to the Ld. Pr. CIT and for the reasons, stated in his order at para 5-7, he held that assessment order passed by A.O. is erroneous in so far as it is prejudicial to the interest of Revenue and the assessment order was set-aside to the aforesaid extent for making afresh assessment after carrying out enquiries in the manner as above and after giving opportunity to the assessee. In the aforesaid factual background, the present appeal has been filed by the assessee against the said order of ld. Pr. CIT, Ajmer passed u/s 263 of the Act. 6. During the course of hearing, the ld. AR submitted that for invoking provisions of section 263, the condition precedent is that assessment order passed by A.O. is erroneous and prejudicial to the interest of Revenue i.e. both conditions must co-exist. In the case of assessee, the order is neither erroneous nor prejudicial to the interest of Revenue. 7. It was submitted that the assessee in reply to show cause notice issued by ld. Pr. CIT explained that sums paid to him by Shri Sukhram and Shri Pusaram in cash was confirmed by them by filing affidavits. Further the said cash transactions with the said persons h....
X X X X Extracts X X X X
X X X X Extracts X X X X
....order is grossly wrong and far from the facts. The correct facts of the amount Rs. 221 are that the assessee received back interest of Rs. 221. The said sums Rs. 221 (Rs. 158 + 63) was on account of interest received on SB A/c No. 51084340304 on deposits and out of the said amounts Rs. 63 has already been declared in return of income and balance sum Rs. 158/- has been added by the Ld. AO in the assessment order. Thus the above said observation of the Ld. Pr.CIT that in place of Rs. 2,21,00,000 the Ld. AO has added only Rs. 221/- is wrong, without any basis and against the true facts of the case as evident from record. In view of the above facts duly supported by legal documentary evidences that no agreement was executed by the assessee for a sum of Rs. 27100000 as alleged by the Ld. Pr. CIT in his order. Further as evident from the impugned order passed u/s 263 that The Pr. CIT did not held that contention of assessee is not correct in law but only held that Ld. A.O. erred in accepting the claim without any enquiry or verification which should have been made. 9. It was further submitted that it is evident that Ld. A.O. made enquiries on the issue and assessee complied to the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e interest of revenue. The Karnataka High Court after considering various judicial pronouncement in the case of CIT Vs. Gokul Das Exports (2011) 333 ITR 214 (Kar) has held that assessing officer taking one out of two views the assessment order is not prejudicial to interest of revenue. In view of the above judicial pronouncements and various other judgements on the issue the assessment order passed by A.O. cannot be treated as an erroneous and prejudicial to the interest of revenue. In the case of CIT Vs. Vodafone Essar South Ltd. (2013) 2012 Taxman 184, the Hon'ble Delhi High Court held that assessing officer before passing assessment order made an enquiry and directed his mind on all aspects. View adopted by him was clearly one among two plausible views that could have been taken. Commissioner did not specifically furnish any reasons to say why original order was unsupportable in law. Commissioner could not have validity exercised his revisionary power u/s 263 in instant case. 10. It was further submitted that the order is not prejudicial to revenue as A.O. was correct in law and on the facts of the case. Thus the Ld. Pr. CIT is wrong in holding that A.O. did not make any ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....r application of his mind on evidences submitted on 26-10-2015. Thus it is wrong to allege that Ld. AO failed to make enquires into the dates of these transactions of cash deposits in Bank. As Shri Pusram and Shri Sukhram has filed an affidavit, the disagreement by them not maintainable in view of affidavit given on Oath duly notarized. As admitted Shri Sheoram was not made available to Inspector on 16-11-2016 but later on appeared and admitted the purchases of Tractor, Trolley, machine, jilan/pilan plough etc. As Shevram appeared before AO, it was not our duty to ask AO to make an investigation that when affidavit filed by Pusaram and Sujhram both, the denial made later on 18-11-2016, the action should have been taken by you against his affidavit given on Oath which is more Valuable documents as against denial of parties under undue influence in their statement taken under undue influence because cleared from their written submission on 27-12-2016 on a plain letter. The 5 cheques deposit clearly shown in Bank account and deposit of all the five cheques mentioned in Bank statement. 13. It was further submitted that similarly with regards to investment of Rs. 27100000/- we are to....
X X X X Extracts X X X X
X X X X Extracts X X X X
....eration of sale has been received. A copy of said assessment order is placed on record. 16. It was accordingly submitted that assessment order passed by A.O. is neither erroneous nor prejudicial to the interest of revenue. Therefore, the invoking of provisions of section 263 by Ld. Pr. CIT was wrong, bad in law and without jurisdiction. The impugned order u/s 263 passed by Pr. CIT thus deserves to be cancelled/set aside. 17. Per contra, the ld. DR is heard who has submitted that the AO has failed to go into the enquiries with reference to failure of assessee to prove the veracity of the explanation offered for bank deposits, with the help of any documentary evidence. The assessee had not been able to controvert the finding that in their statements recorded on oath, Shri Pusa Ram and Shri Sukh Ram had not agreed to the claim of the assessee that they have purchased the vehicles in cash, specially when they were made aware of the version of Shri Balu Ram Jat in Question No. 6 of both the statements where in AO failed to enquire. Moreover, no date about purchase and sale of vehicle has been mentioned in the plain letter which is must to explain the deposit made on a particula....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... was drawn to reasons recorded by the Assessing officer before issuance of notice u/s 148 which reads as under: "On the basis of information available with the undersigned, it is noticed that the assessee has entered into transaction of purchase of property from M/s. Sterling Build Estate Pvt.Ltd. (the seller). On the basis of available copy of Ikrarnama, it is found that the assessee Shri Balu Ram Jast along with partner Shri Radhey Shyam Yadav (R/o Gogawas, Tehsil - Dantaramgarh) entered into Ikrarnama of purchase of property bearing Khasra No. 96 and measuring 06 bighas 8 biswas for a total consideration of Rs. 2.71 crores with M/s.Sterling Build Estate Pvt.Ltd. on 01-10-2008. As per available copy of Ikrarnama (which is duly notarized on 2/10/2008 by Notary Public Shri Ramesh Chand Sharma, Kishangarh) a sum of Rs. 50,00,000/- (fifty lacs only) has been claimed to be paid in cash by the purchasers on 1/10/2008 itself i.e. at the time of execution of Ikrarnama. As per Ikrarnama, the remaining amounts were claimed to be paid by cheque of Shri Balu Ram Jat bearing Nos. 213745 to 213749 of SBBJ, Madanganj Kishangarh. However, the cheques bearing Nos 213745 to 213749 were no....
X X X X Extracts X X X X
X X X X Extracts X X X X
....2011. A payment of Rs. 2.16 crores has been made in cash during the period 2/10/2008 and 31/3/2009 i.e. period relevant to the A.Y. 2009-2010. Out of this a sum of Rs. 50 lacs has been made on 1/10/2008 as reflected in Ikrarnama itself. Thus, a payment of Rs. 2.16 crores remains escaped assessment in the hands of the purchasers as mentioned in Ikrarnama for the A.Y. 2009-2010. The perusal of bank account No. 51084340304 with SBBJ, Madanganj of Shri Balu Ram reflects transactions of certain deposits in cash on different dates during the period relevant to the A.Y. 2009-2010 which are reflected as under:- Date Amount 23/09/2008 Rs. 15000 12/01/2009 Rs. 41000 27/01/2009 Rs. 450000 30/1/2009 Rs. 1110000 31/01/2009 Rs. 300000 02/02/2009 Rs. 200000 07/02/2009 Rs. 800000 9/02/2009 Rs. 446000 9/02/2009 Rs. 145000 13/02/2009 Rs. 1500 9/3/2009 Rs. 1500 Total Rs. 3510000 The assessee has filed his return of income for the A.Y.2007-2008 and 2008-2009 declaring total taxable income of Rs. 204000 and Rs. 180500 respectively. Return of income for the A.Y. 2009-2010 has not been filed and thus, with mea....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e of assessment proceedings, it was submitted before the AO that no such investment was made by any agreement/IKrarnama and a fake complaint was filed before the DIG Registration and Stamps on the basis of above alleged Ikrarnama for sale. On receipt of said complaint, the DIG Registration and Stamps directed the Sub-Registrar, Kishangarh to investigate the matter and the Sub Registrar after investigation submitted his report to DIG Stamps. The Collector, Stamps, Kishangarh has thereafter passed the order vide case No. 516/2011 namely Sub-Registrar Kishangarh vs. Baluram Jat dated 22- 06-2016 and in the said order, the above said agreement shown in the name of assessee has been found to be fake. It was accordingly submitted that no such alleged agreement was made for Rs. 271,00,000/-. The AO therefore examined this particular matter in detail and has also written a letter dated 14.12.2016 to DIG Registration and Stamps who has in turn replied to the AO vide his letter no. 10185 dated 14.12.2016 and the contents thereof reads as under:- 22. Further, our reference was drawn to findings in the order passed by the Collector, Stamps, kishangarh in case of Sub-Registrar Kishangarh vs.....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Ld. AO has accepted that no extra sale consideration was received in cash of Rs. 2.21 crores as mentioned in the alleged agreement to sale and sale consideration of Rs. 55 lacs as per registered sale deed during offered to tax in return of income was accepted. Our reference was drawn to the findings of the AO vide his order passed under 143(3) r/w 147 dated 30.12.2016 which reads as under:- "The assessee has filed its return of income for the A.Y. 2009-10 on 31.03.2010 declaring income at Rs. NIL. Later on, as per information available with the department, the assessee has executed an lkrarnama with Sh. Balu Ram Jat S/o Shri Ghasiram & Sh. Radhey Shyam Yadav S/o Bholaram Yadav for sale of agriculture land measuring 6 bigha 5.70 biswas Khasara situated at No.96, Mandaganj, Kishangarh (Ajmer) on 01.10.2008. As per Ikrarnarna, the actual sale consideration was Rs. 2,71,00,000/- (Rupees Two Crore and Seventy One Lakhs) which includes cash of Rs. 50 lakhs and Rs. 221 lakhs received through post dated cheques serial No. 213745-213749. This Ikrarnama was duly signed by buyer, seller and witness and was also notarized. 2. Further, it has came to notice that the assessee ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... by the Assessing officer cannot be held as erroneous and prejudicial to the interest of Revenue for the reasons stated herein. We find that the case of the assessee was reopened and one of the reasons recorded by the AO was source of investment of Rs. 2.71 crores as per copy of agreement entered into with M/s Sterling Build Estate Private limited which remain unexplained and to that extent, the income of the assessee has escaped assessment. During the course of assessment proceedings, the matter was examined by the Assessing officer wherein the assessee submitted that no such agreement was entered into and even a complaint has been lodged with the Stamp authorities regarding evasion of stamp duty and on investigation, an order dated 22.06.2016 has been passed by Collector (Stamps) wherein the said agreement was found to be fake. A copy of said order dated 22.06.2016 was filed before the Assessing officer and in turn, the Assessing officer also enquired from DIG stamps about the veracity of such assertion made by the assessee and passing of such an order which was duly confirmed by the DIG Stamps. The Assessing officer has thereafter recording a specific finding in the assessment o....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the assessee shall be binded to pay taxes is more a precautionary approach adopted by the Assessing officer and the order so passed by the Assessing officer cannot be held to be erroneous and prejudicial to the interest of the Revenue where he has carried out the necessary and thorough examination of the matter. 27. Now, coming to the issue of deposits in the bank account maintained by the assessee, we find that this was again one of the reasons to reopen the case of the assessee u/s 147 and thereafter, during the course of assessment proceedings, the matter was examined by the Assessing officer wherein the assessee was asked to explain the source of such deposits, further statement of the person whom the assessee claim to have received the amount were also recorded and these persons also filed affidavits before the Assessing officer. Taking all these explanation and documentation into consideration, the Assessing officer has recorded his findings in the assessment order which reads as under:- "Further, the assessee was asked to explain sources of these cash deposits in his bank accounts. In compliance, the assessee has submitted that he has deposited Rs. 35,10,000/- i....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e persons and also taking into consideration the affidavits filed by these persons and thereafter, has come to a finding that out of total deposits, an amount of Rs. 2.99 lacs remains unexplained and the same was brought to tax in the hands of the assessee. The ld CIT has referred to certain inconsistencies in the statements and the affidavits so filed and has held that the AO has failed to make further enquiries in the matter and to that extent, the order of the AO is erroneous and prejudicial in nature. However, what further enquiries are required in the matter have not been spelt out by the ld CIT when the explanation of the assessee, the statements and affidavits of the person from whom the assessee claims to have received the money is on record. In such a situation, where enquiries have already been made by the AO and all material is on record, the ld CIT should come with a definite finding instead of remanding the matter to the Assessing officer for fresh adjudication. In this regard, we refer to the decision of the Coordinate Bench in case of M/s Dangayach Hotels (P) ltd vs Pr. CIT (ITA No. 290/JP/2017 dated 4.09.2017) wherein the relevant findings read as under:- "....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... rarely, the Commissioner of Income Tax can also show and establish that the facts on record or inference drawn from facts on record as per se justified and mandated further enquiry or investigation but the Assessing Officer had erroneously not undertaken the same. However, the said finding must be clear, unambiguous and not debatable. The matter cannot be remitted for a fresh decision to the Assessing Officer to conduct further enquiries whether a finding that the order is erroneous. Finding that the order is erroneous is a condition or requirement which must be satisfied for exercise of jurisdiction under section 263 of the Act. In such matters, to remand the matter/ issue to the Assessing Officer would imply and mean the Commissioner of Income Tax has not examined and decided whether or not the order is erroneous but has directed the Assessing Officer to decide the aspect/question.'' We would also like to state that this explanation cannot override the interpretation provided by the Hon'ble Delhi High Court and if that be the case then the ld. Pr. CIT can find fault with each and every assessment without conducting any enquiries or verification in order to establish tha....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rrect in exercising jurisdiction under section 263 of the Act and the order passed by the ld Pr. CIT passed u/s 263 is accordingly set-aside and the order passed by the AO u/s 143(3) r/w 147 is sustained. In the result, the appeal of the assessee is allowed. Order pronounced in the open Court on12/03/2020. ============= Document 1 "उपरोकà¥à¤¤ विषय के पà¥à¤°à¤¾à¤¸à¤¾à¤‚गिक पतà¥à¤° के कà¥à¤°à¤® में लेख है कि पà¥à¤°à¤•à¤°à¤£ संखà¥à¤¯à¤¾ 516/2011 उप पंजीयक किशनगढ़ बनाम बालूरामत जाट में निरà¥à¤£à¤¯ दिनांक 22.06.2016 पारित कर रेफरेंस खारिज किया गया हà....
X X X X Extracts X X X X
X X X X Extracts X X X X
....¤¶à¥à¤šà¤¾à¤¤ कà¤à¥€ à¤à¥€ इस नà¥à¤¯à¤¾à¤¯à¤¾à¤²à¤¯ में उपसà¥à¤¥à¤¿à¤¤ नही हà¥à¤à¥¤ शिकायत से वà¥à¤¯à¤¥à¤¿à¤¤ पकà¥à¤·à¤•à¤¾à¤° मौजूदा अपà¥à¤°à¤¾à¤°à¥à¤¥à¥€à¤—ण ने उपसà¥à¤¥à¤¿à¤¤ होकर इस नà¥à¤¯à¤¾à¤¯à¤¾à¤²à¤¯ में जरिये अधिवकà¥à¤¤à¤¾ अपना पकà¥à¤· रखते हà¥à¤ जबाब पà¥à¤°à¤¸à¥à¤¤à¥à¤¤ कर पà¥à¤°à¤•à¤°à¤£ के तथà¥à¤¯à¥‹à¤‚ से सà¥à¤ªà¤·à¥à¤Ÿ इनà¥à¤•à¤¾à¤° किया और अपने जबाब ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ा नà¥à¤¯à¤¾à¤¯ निरà¥à¤£à¤¯ à¤à¤¤à¥à¤°à¤†à¤ˆ.आर. 1971 सà¥à¤ªà¥à¤°à¥€à¤® कोरà¥à¤Ÿ पृषà¥à¤ संखà¥à¤¯à¤¾ 1070 à¤à¤µà¤‚ 1997 (1) डबà¥à¤²à¥à¤¯à¥‚ à¤à¤². सी. पृषà¥à¤ संखà¥à¤¯à¤¾ 484 सà¥à¤ªà¤·à¥à¤Ÿ है। à¤à¤¸à¤¾ कहीं पर कोई साकà¥à¤·à¥à¤¯, पà¥à¤°à¤®à¤¾à¤£ नही है कि तथाकथित दिनांक 1.10.2008 के कूटरचित पà¥à¤°à¤²à¥‡à¤– की फोटोसà¥à¤Ÿà¥‡à¤Ÿ कॉपी को पकà¥à¤·à¤•à¤¾à¤°à¤¾à¤¨ दà¥à¤µà¤¾à¤°à¤¾ उपयोग में ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....बाजार दर पर किया जाना पà¥à¤°à¤®à¤¾à¤£à¤¿à¤¤ है। अतः इस विवेचन के आधार पर à¤à¥€ जाà¤à¤š में अनà¥à¤¤à¤°à¥à¤²à¤¿à¤ªà¥à¤¤ बिनà¥à¤¦à¥‚ निसार हो चà¥à¤•à¤¾ है। यह कि शिकायतकरà¥à¤¤à¤¾ ने जिस कताकथित इकरारनामे के आधार पर शिकायत की है वह असल इकरारनामा ना होकर मातà¥à¤° फोटो कॉपी है और फोओ कà¥....
X X X X Extracts X X X X
X X X X Extracts X X X X
....¤¨à¥€à¤¯ नà¥à¤¯à¤¾à¤¯à¤¾à¤²à¤¯ का गà¥à¤®à¤°à¤¾à¤¹ करना चाहता है। à¤à¤¸à¥€ सà¥à¤¥à¤¿à¤¤à¤¿ में उसके दà¥à¤µà¤¾à¤°à¤¾ पà¥à¤°à¤¸à¥à¤¤à¥à¤¤ à¤à¤¸à¥‡ कूटरचित फोटो कॉपी जैसे दसà¥à¤¤à¤¾à¤µà¥‡à¤œ पर किसी à¤à¥€ कानूनी दृषà¥à¤Ÿà¤¿à¤•à¥‹à¤£ से विशà¥à¤µà¤¾à¤¸ नहीं किया जा सकता है। उकà¥à¤¤ विà¤à¤¿à¤¨à¥à¤¨ नà¥à¤¯à¤¾à¤¯à¤¾à¤²à¤¯à¥‹à¤‚ के नà¥à¤¯à¤¾à¤¯à¤¿à¤• दृषà¥à¤Ÿà¤¾à¤¨à¥à¤¤à¥‹à¤‚ से सà¥....
X X X X Extracts X X X X
X X X X Extracts X X X X
....¹à¤¾à¤ तक सरकार की पà¥à¤°à¤¶à¤¾à¤¸à¤¨à¤¿à¤• कारà¥à¤¯à¤ªà¥à¤°à¤£à¤¾à¤²à¥€ का किसी शिकायत पर कारà¥à¤¯à¤µà¤¾à¤¹à¥€ जॉच किये जाने का दिशा निरà¥à¤¦à¥‡à¤¶ है उसमें शिकायतकरà¥à¤¤à¤¾ का नाम पता सà¥à¤ªà¤·à¥à¤Ÿ होने के साथ-साथ शिकायतकरà¥à¤¤à¤¾ का शपथ-पतà¥à¤° à¤à¥€ अनà¥à¤¸à¤‚लगà¥à¤¨ होना आवशà¥à¤¯à¤• होता है, लेकिन उसका पूरà¥à¤....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ष à¤à¥€ सà¥à¤ªà¤·à¥à¤Ÿ नही हो रहा है। इससे सà¥à¤ªà¤·à¥à¤Ÿ होता है कि शिकायतकरà¥à¤¤à¤¾ दà¥à¤µà¤¾à¤°à¤¾ मौजूदा अपà¥à¤°à¤¾à¤°à¥à¤¥à¥€à¤—ण को बेवजह परेशान करना चाहती है उकà¥à¤¤ तथाकथित इकरारनामें में उसके सà¥à¤µà¤¯à¤‚ के कूटरचित पà¥à¤°à¤¤à¥€à¤¤ होते है। हमने विवादित पà¥à¤°à¤µà¤¾à¤°à¤£ à¤à¤µà¤‚ पतà¥à¤°à¤¾à¤µà¤²à¥€ उपलबà¥....