2022 (4) TMI 179

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....er for being disposed of by a common order and for the sake of convenience the information of assessments and the revisionary orders is tabulated as under; Sr Appeal No Asstt Year Date of Order Passed U/s 263 U/s 143(3) 1 ITA/30/NAG/2021 2015-2016 30/03/2021 15/11/2017 2 ITA/31/NAG/2021 2016-2017 30/03/2021 14/11/2018 4. Before boarding, we shall make a mention that, in the instant case, the assessment order for sought to be revised for AY 2015-2016 was passed on 15/11/2017 and whereas a SCN u/s 263 was issued on 01/05/2019, however the revisionary order was passed on 30/03/2021. Albeit the period of two years from the end of relevant financial year in which the order sought to be revised was ended on 31/03/2020, however in the light of direction of Hon'ble Apex Court vide MA 21 & 29 of 2022, MA 665 of 2021 and Suo-motu WP 3 of 2020, the foresaid 263 order falls within the permitted relaxation period of limitation i.e. between 15/03/2020 to 28/02/2022, consequently the aforesaid revisionary order fraternised within the provisions of 263(2) of the Act. 5. The appellant assessee has taken twofold legal grounds against assumption o....

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....action u/s 263 of the Act. 7. After hearing to the rival contentions of both the parties; perused material placed on records and duly considered the facts of the case in the light of settled legal position and the case laws relied upon by the appellant assessee as well the respondent revenue. 8. It is evidently noticeable from the records are that; 8.1 The appellant is a public trust registered under the provisions of Bombay Trust Act, 1950 and is a registered trust under u/s 12A of the Act besides claiming exemption u/s 10(23C)(iiiab) of the Act. The assessee trust filed its returns of income for the assessment years under consideration which were subjected to scrutiny assessment under CASS by service of notice u/s 143(2) and by issue of notice u/s 142(1) of the Act, the information were sought. In response thereto, the appellant trust made submissions inter-alia computation of income, income and expenditure account and balance sheet etc., and considering the same, the assessment u/s 143(3) were completed accepting the returned total income of Rs."NIL" after allowing the claim of exemption u/s 10(23C)(iiiab) of the Act. There were specific queries were raised during the c....

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....cessary inquiry into the transactions and due deliberation the Ld AO had framed the assessment u/s 143(3) of the Act, therefore for the reasons, the exercise of revisionary jurisdiction is bad in law and secondly the exercise revisionary is inapplicable in its case as the trust is not claiming benefit u/s 11 but u/s 10(23C)(iiiab) of the Act. This averment of the appellant did convince the revisionary authority, consequently by an order u/s 263, Ld PCIT held that, the assessment framed u/s 143(3) of the Act was erroneous insofar it was prejudicial to the interest of the revenue for the reasons that, the said assessment were culminated without inquiry and verification of donation, building fund and expenditure incurred by the appellant trust and set aside for framing fresh assessment de-nova after conducting necessary inquiries and providing due opportunity of being hard to the appellant trust. 9. During this appellate hearing, the Ld AR in his submission taken us through consolidated paper-book submitted on records for both the assessment years under consideration, comprising of written submission, copies of notice issued u/s 142(1), copies SCN issued u/s 263 & submission made t....

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....tly are; (i) the order of the assessing officer sought to be revised is erroneous; and (ii) it is prejudicial to the interests of the revenue. If any one of two is absent or unsatisfied, that is where the order of the assessing officer is erroneous but is not prejudicial to the revenue or where order is not erroneous but is prejudicial to the revenue, then the recourse to Section 263(1) of the Act fails. 11.3 Albeit the foresaid twin satisfaction drawn from the assessment records may trigger the revisionary jurisdiction, yet such shall not automatically empower the revisionary tax authorities to conclude the revision proceedings without obeying additional dual riders such as; (i) making or causing to be made such enquiry as necessary and (ii) according an opportunity of being heard to the assessee following the principle of natural justice. 11.4 In the light of provision of law, it is of paramount importance to note that, an incorrect assumption of facts or an incorrect application of law or passing an order without application of mind or without applying the principle of natural justice, shall discretely be sufficient to hold the order being erroneous. Albeit the term prejud....

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....come received are exempt and hence cannot be subjected to revision u/s 263, is blatantly perverse under the settled law. Per se, the nature, amount and type of claim in the return vis-à-vis order passed does not decide the revisionary jurisdiction, but the validity of order does, consequently in the present case, the orders of assessment were passed u/s 143(3) irrespective of claims allowed thereby are undisputedly valid and legal orders and thus are subject matter of revision u/s 263. 12.2 Now coming to second premise, we find that, the Ld PCIT vouching the assessment records observed that, post culmination of assessments, a survey action u/s 133A was carried out on the assessee establishing on records that, the appellant trust for the assessment years under consideration was in receipt of voluntary donations and donation towards building funds etc., however no proper records were found maintained in showcasing the genuineness thereof, further the survey team also observed that, there were cash expenditure incurred without due supporting in the form of tax invoices / bills etc., substantiating the correctness and genuineness thereof and in the opinion of Learned PCIT the....