TaxTMI 
TaxTMI 
2022 (1) TMI 41
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.... section 263 of the Act and setting aside the order of the AO, as being "erroneous and prejudicial to the interest of the revenue", which is contrary to fact, on the facts and circumstances of the case. 4. The learned CIT is not justified in law in holding that the order passed by the Assessing officer is bad in law, without appreciating that there was no error in the order passed, much less prejudicial to the interest of revenue, on the facts and circumstances of the case. 5. The learned CIT was not justified in appreciating that the AO has made enquiries during the course of assessment proceedings and accepted the claim of non deduction under section 194C(6) and (7) of the Act, and in view of the above, the order of assessment was not erroneous, on the facts and circumstances of the case. 6. The learned CIT was not justified on facts, in appreciating that the details filed demonstrate that the information was available before the completion of the assessment proceedings and no disallowance was required to be made under section 4o(a)(ia) of the Act, and thus the order of assessment was not prejudicial to the interest of revenue, on the facts and circumst....
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.... are as under: 2.1 The assessees an Ex-serviceman deriving pension, Transport Business "Ashok Roadlines" and is also running a retail petroleum outlet "Abhishek Petroleum". For year under consideration, assessee declared total turnover of Rs.11,42,55,867/- and gross profit at the rate of 2.82% of Rs.32,21,84/-. The return was selected for scrutiny and notices were issued calling for details. The Ld.AO after considering various details filed by Jesse passed order under section 143 (3) of the Act on 06/09/2016 by making addition of Rs. 2,26,671/-. 2.2 Subsequently, the Ld.AO issued notice under section 154 of the Act on 18/04/2018, proposing to rectify the assessment order, citing that, there was a mistake apparent from record which had effect of enhancing the order of assessment. 2.3 The Ld.AO stated that the PAN numbers furnished during the course of assessment was obtained in the year subsequent to relevant financial year and hence the requirement of deducting TDS earlier claimed as not applicable was not in order and hence the disallowance was sought to be made under section 40(a)(ia) of the act. This is an officer has not proceeded to pass an order of rectification and ....
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....ATH R KATTI DNRPK3140J 10.06.2013 25.04.2014 246330 9 GURURAJ B PATIL CSYPP2001C 20.06.2013 28.01.2015 251370 10 SIDDAPPA NAGAMMANNAVAR ASZPN5493P 20.06.2013 11.07.2014 203490 11 SHARANAPPA V HADAPAI AMCPH7401A 05.07.2013 23.07.2014 88200 12 CHANDRASHEKHARAPPA KULEPPANAVAR DDRPK2981K 10.07.2013 11.07.2013 225000 13 SIKANDARSAB NADAF AYIPN0862D 10.07.2013 19.05.2015 238950 14 LOKANNA A PATIL CKTPP6053K 10.07.2013 10.10.2013 188400 15 SHARANAPPA V HADAPAI AMCPH7401A 10.07.2013 23.07.2014 190800 16 BALAPPA R DANDIN BWOPD9673D 10.07.2013 25.11.2013 190800 17 YALGURESH I TALWAR AVVF7'1 772C 10.07.2013 21.07.2014 227700 18 KUMAR H HULASAGER ALWPH551 7J 20.07.2013 29.04.2014 164865 19 MALINGARAYA N HADIMA AMAPH2314L 28.07.2013 23.06.2014 178965 20 M R SUKESH DRDPK6026H 20.07.2013 24.09.2014 175890 21 BHIMAPPA H BHAJANNAL CCJPB6665D 20.07.2013 12.02.2015 195570 22 RAMESH S LAMANI AMEPL8186C 20.07.2013 17.05.2014 161745 23 ....
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.... BEVINAGIDAD ATYPB9690C 09.10.2013 234820 11 LAKKAPPA L SUNADHAHALLI AJLPS2899F 10.03.2014 113861 12 RAJU CHA.NDRAPPA AMMRP3173N 18.03.2014 268716 13 HALABASAPPA S MUDAKAVI CZPM6778B 30.03.2014 236083 No verification has been carried by the Assessing Officer to ascertain the genuineness of PANs furnished and in turn the genuineness of payments." 3. It is submitted that notice issued under section 154 was not proceeded with, as the assessing officer had enquired the issues based on the submissions / details filed and came to the conclusion regarding the same. 4. Ld.AR submitted that, the Ld.AO during assessment proceedings raised specific query regarding the applicability of TDS in case of payments of Lorry, charges people different lorry owners during the course of scrutiny herring. It was submitted that assessee obtained PAN during the assessment proceedings. It was submitted that the Ld.AO made enquiries based on documents filed during the course of scrutiny assessment and therefore the order passed under section 143 (3) is neither erroneous nor prejudicial to the interest of revenue. 5. The Ld.AR submitted t....
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.... Accordingly, the issue is set aside to the file of Assessing Officer with a direction to decide the issue as per law after giving opportunity to the assessee. Since the issue is set aside to the file of Assessing Officer, the Assessing Officer is also directed to look into the aspect of furnishing of wrong PAN while framing the assessment order. Accordingly, the order passed u/s 143(3) on 06/09/2016 is set aside u/s 263 of Income Tax Act with direction to Assessing Officer to decide the issue afresh after giving opportunity to the assessee." Aggrieved by the order of Ld.Pr.CIT, assessee is in appeal before us. 7. The Ld.AR referring to page 22 of paper book submitted that the notice issued by the Ld.AO calling for various details during scrutiny proceedings in respect of the issues under consideration. The Ld.AR submitted that provisions of section 194C of the Act is not applicable to assessee and therefore no deduction was made from any sum credited or likely to be credited or paid during the previous year to the account of contractor in the course of business. The Ld.AR submitted that as following conditions were satisfied tax was not deducted on the payments made by asses....
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....inance (No.2) Act 2009. The its scope of amendment was explained by the CBDT in Circular No.5 dated 03-06-2010 as under:- "49.3 Provisions for payments and tax deducted at source to transporters: - A) Under Section 194C, tax is required to be deducted on payments to transport contractors engaged in the business of plying, hiring or leasing goods carriages. However, if they furnish a statement that they do not own more than two goods carriages tax is not to be required deducted at source. Transport operators are reporting problem in obtaining TDS certificates as these are not issued immediately by clients and ITA No.2586/Bang/2018 they are not able to approach the client again as they may have to move across the country for their business. B) It is, therefore, the Act has been amended to exempt payments to transport operators (as defined in section 44AE) from the purview of TDS. However, this would only apply in cases where the operator furnishes his Permanent Account Number (PAN) to the deductor. Deductors who make payments to transporters without deducting TDS (as they have quoted PAN) will be required to intimate these PAN details to the Income tax Depa....
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....ion of TDS. In the present facts of the case the assessee being an individual had furnished copies of RC card extract of the vehicles owned by such lorry owners and affidavit from all the deductee's mentioning that the total income did not exceed the limit on which TDS is to be deducted for the year under consideration before the Ld.AO. The Ld.AR had submitted that the errors pointed in the PAN extracted in the notice u/s 263, is mere typing mistake and that the assessee had submitted that the photocopy of the PAN before the Ld.AO as well as Ld.Pr.CIT. Thus by furnishing the PAN details, assessee met with the requirement of the law, in so far as the during assessment. 16. In our view it is a possible view taken by the Ld.AO which cannot be found fault with. The proceedings under section154 are deemed to be dropped can be founded with the above amendments. The action of Ld.AO cannot be termed as lack of enquiry in the present facts of the case. The assessee places reliance on the below mentioned cases which enunciate the limitations of section 263 of the Income Tax Act: A. MALABAR INDUSTRIAL CO., LTD. Vs CIT [2000] 243 ITR 83 [SC] B. CIT Vs SUNBEAM AUTO LTD. [20....