TaxTMI 
TaxTMI 
2020 (12) TMI 47
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....r.CIT, Vijayawada u/s 263 of the Income Tax Act, 1961 (in short 'Act'). In the instant case, the assessee is engaged in the business of running a rice mill and admitted total income of Rs. 4,82,180/-. Subsequently, the case was taken up for scrutiny and the assessment was completed u/s 143(3) dated 26.12.2017. In this case, the assessee filed petition before the Jt.CIT u/s 144A and the Ld.Jt.CIT issued directions u/s 144A of the Act. The assessee produced books of accounts, bills and vouchers and the AO has verified the same. After verification of the information, AO found that some of the bills were not supported by proper vouchers or supported by self made vouchers, hence, the AO completed the assessment rejecting the books of accounts an....
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....so u/s 144A of the Act and issued necessary instructions to the AO. Therefore, argued that since all the issues were examined and the assessment was completed u/s 143(3), the present revision of the Pr.CIT is on difference of opinion, thus argued that there is no case for revision u/s 263 of the Act. 3.1. The Ld.AR further submitted that the sum of Rs. 3,81,03,903/- represent write off of paddy creditors to show better profit and there is no other income. The Ld.AR further submitted that the firm has not paid dues to the paddy creditors due to strike in rice mill and ultimately, the rice mill has closed its business. 4.0. In respect of interest on SBI Deposit, the Ld.AR argued that it has a direct nexus with the business since the sam....
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....oth the parties and perused the material placed on record. In this case, assessment was completed u/s 143(3) after receiving directions from Ld.Jt.CIT u/s 144A of the Act. Thus, the assessment was properly monitored by the Jt.CIT. The AO verified the bills, vouchers and on verification, the AO found that some bills, vouchers were unverifiable in nature, hence estimated the income @0.5% net of depreciation and accordingly assessed the total income of Rs. 7,32,466/-. No separate addition was made by the AO in respect of other income which was considered by the Ld.Pr.CIT in the proceedings u/s 263 of the Act. However, we find from the paper book filed by the assessee that the AO has called for the details of other income vide questionnaire ....
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....plained that the same represent interest on deposits made by the assessee firm as margin money for obtaining bank guarantee. Therefore, argued that the other income mentioned in the profit and loss account is part of business income which was considered by the AO and taken a conscious decision that no separate addition is warranted on account of other income. Since it is apparent from the assessment record that the assessee had explained that the other income represents business income which was accepted by the AO and did not make any addition, after examining the issue in detail, we are of the considered opinion, that the AO has applied his mind and taken a conscious decision holding that the other income is business income and estimation ....
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....ioner of Income Tax - III, Hyderabad [2013] 36 taxmann.com 348 (Andhra Pradesh). Hon'ble jurisdictional High Court in the case laws cited supra held that merely because of difference of opinion, Pr.CIT cannot invoke his powers u/s 263 of the Act. For the sake of clarity and convenience, we extract relevant part of the order of the Hon'ble Andhra Pradesh High Court in para No.59 which reads as under : "59. ......... The contention of the Revenue that the Assessing Officer had not applied his mind to the material on record cannot be accepted because the respondent in his order dated 31.03.2011 specifically records a finding at Para 5.1 that there is application of mind by the Assessing Officer. The Revenue cannot raise a ple....