TaxTMI 
TaxTMI 
TaxTMI 
2015 (9) TMI 1720
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....nt of cash for AY 2006-07, and Rs. 60,00,000/- on account of unsecured loans for AY 2005-06. Thereafter, the assessee filed its return for the impugned AY declaring total income of Rs. 43,92,280/- , on 31/10/2006. Assessment u/s 143(3) was framed on the assessee at an income of Rs. 1,08,92,280/- vide order dt. 26/12/2008. Subsequently, notice u/s 148 was issued to the assessee on 11/02/2010. Assessment u/s 147/143(3) was completed vide order dt. 29/07/2010 at an income of Rs. 1,11,12,890/-after making disallowance of interest amounting to Rs. 2,20,614/-u/s 36(1)(iii) of the Act. Thereafter proceedings under section 263 were initiated against the order passed u/s 147/143(3) on 29/07/2010, considering it as erroneous and prejudicial to ....
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....also gone through the various case laws relied upon by the assessee in its support. There is no denying the fact that the assessee was maintaining two sets of books of accounts - one audited by M/s Anil Raj and Associates Chartered Accountant New Delhi dated 05/08/2006 showing a turnover of Rs. 8,21,20,978 which was submitted to the bank authorities, and the other signed by Sh. Harish Kumar Chartered Accountant dated 05/08/2006 submitted along with the return of the income showing a turnover of Rs. 4,12,83,916/-. The AO had rejected the books of account of the assessee on this account under section 145(3) of the Income Tax Act and framed the assessment applying a GP rate 24.57% as against 9.27% shown by the assessee. However the AO applied ....
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....ssumption of jurisdiction under section 263 of the Act is beyond his competence. 2. That the Ld. Commissioner of Income tax has in fact resorted to the provisions of Section 263 to revise the original assessment order dated 26.12.2008 passed under section 143(3) which otherwise had become time barred in as much as the assessment framed on 26.12.2008 stood finalized and as such the order passed is arbitrary and unjustified. 3. That even the return filed in response to notice under section 148 ws inclusive of the income assessed under section 143(3) and as such there was no occasion to resort to the provision of Section 263 which renders the order illegal, arbitrary and unjustified. 4. That the re-assessment order h....
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....ted that this error was committed in the order passed u/s 143(3) on 26/12/2008. Ld. AR further drew our attention to the order passed u/s 147/143(3) and stated that the same dealt with interest disallowable u/s 36(i)(iii) and had nothing to do with the application of G.P. Rate on turnover. The Ld. AR therefore pleaded that the doctrine of merger did not apply in this case and therefore the order sought to be revised was that passed u/s 143(3) on 26/12/2008. The Ld. AR placed reliance on the order of the apex court in the case of CIT vs. Alagendran Finance Ltd.(2007)293 ITR 1(SC) in support of his contention. The Ld. AR further stated that the order passed u/s 143(3) could be revised u/s 263 upto 31/03/2011 as per the provision of section 2....
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....uld not merge with the order u/s 147. 10. The Hon'ble Supreme Court in the case of CIT Vs. Alagendran Finance Ltd. [2007] 293 ITR 1 while dealing with an identical issue has held as under : "Held, affirming the decision of the High Court, that the Commissioner had sought revise only that part of the order of assessment which related to Lease Equalisation Fund; but the proceedings for reassessment had nothing to do with that item of income. The doctrine of merger did not apply in a case of this nature: the period of limitation commenced from the dates of the original assessments and not from the reassessments since the latter had not had anything to do with the Lease Equalisation Fund. This was not a case where the subject matter of reass....