TaxTMI 
TaxTMI 
TaxTMI 
2021 (11) TMI 46
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....ts and circumstances of the case and in law, the Ld. CIT has exceeded legislative jurisdiction u/s 263 of the Income Tax Act, 1961 thus the order passed by the Ld. CIT is bad in the eyes of the law. 2. That the Ld. CiT has erred in passing order u/s 263 of the Income Tax Act, 1961 in the absence of any erroneous position prejudicial to the interest of revenue in the original assessment order passed by the Ld. AO u/s 143(3) read with section 147 of the Income Tax Act, 1961. 3. That the Ld. CIT has erred in concluding proceedings u/s 263 of the Income Tax Act, 1961 without proper perusal of the assessment record. 4. That the Ld. CIT has erred in substituting an alternative view as against the firm view adopted by the Ld. AO at the time ....
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....h the issue of source of cash deposit, a detailed reply was filed by the assessee explaining the source, as being out of his past savings, agricultural income and amount received from Shri Pradeep Singh, which was supported by an affidavit from him. The AO had, after considering the same, accepted the explanation of the assessee. He also drew our attention to the findings of the AO to the effect that regarding the genuineness of the facts mentioned in the affidavit necessary verification had been made and that the assessee had submitted cash flow statement explaining every single debit entry in detail in the same alongwith relevant supporting documents. The ld. counsel for the assessee thereafter contended that it is evident from the same t....
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.... out that the contents of both were contradictory. He drew our attention to para 3 of the order of the PCIT wherein he had brought out this discrepancy, noting that while the affidavit stated that the assessee's land as being leased out to Shri Pradeep Singh, the 'nakal jamabandi' still showed the assessee as cultivator of his agricultural land for the said period. The relevant findings at para 3, to which our attention was drawn are as under: "3. I have carefully examined the entire facts of the case from the assessment record. Perusal of assessment record shows that the assesses filed an affidavit in which it has been mentioned that he has given his three acres agriculture land on lease for ten years and received lease money of Rs. ....
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....d land was leased should also be examined. Inquiries should also be made from land revenue authorities and the cash deposit should be inquired into." 6. The ld. DR stated that this itself should have prompted the AO to check the veracity and the genuineness of the affidavit of Shri Pradeep Singh, which the AO having failed to do, it was a clear case of lack of inquiry. That mere acceptance of documents filed by the assessee in the present case could not be termed as inquiry having been conducted by the AO. He further pointed out that the ld. PCIT at para 6 of his order had categorically found the order of the AO erroneous on account of Explanation-2 inserted to Sect ion 263 by the Finance Act, 2015 which clearly mentioned the order passed ....
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....ut his land to Shri Pradeep Singh. We agree with the Revenue that this contradict ion should have prompted further inquiry by the AO regarding the genuineness of the claim of the assessee that he had received Rs. 9,50,000/- by leasing out his land to Shri Pradeep Singh. The documents on record by no stretch justify the acceptance of the claim of the assessee by the AO. No person of sound and logical mind could have, in the circumstances, found the claim of the assessee justifiable in the light of the conflicting documents before the AO. The AO, therefore, not proceeding with conducting further inquiry on the issue and having accepted the claim of the assessee, the order passed by the AO we agree with the ld. PCIT, is erroneous and prejudici....