TaxTMI 
TaxTMI 
TaxTMI 
2022 (5) TMI 854
X X X X Extracts X X X X
X X X X Extracts X X X X
....cipal Chief Commissioner of Income Tax (PCIT) is bad and erroneous in law and against the principles of natural justice. 2) The learned PCIT erred in assuming jurisdiction u/s.263 when the order is neither erroneous nor prejudicial to the interest of revenue. 3) The learned PCIT grossly erred in not appreciating the fact that when the assessment made has been completed by making an ad-hoc addition on GP basis, question of order being erroneous on the ground that the confirmation from purchase parties were not obtained doesn't arise for GP addition covers everything, inter-alia the purchases also, besides the opening stock, sales and closing stock. In other words, when the Sales of Rs.8,75,37,081/- has not been disputed, considerin....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... on the ground that non-verification of total purchases claim to have made by the assessee amounting to Rs.8.65 Crs. According to the PCIT, although, the AO had examined purchases by issuing notices to the parties, but the assessee could file evidences to the extent of Rs.3.07 Crs. only. Although, the assessee could not justify remaining purchases with necessary evidences, the AO had simply estimated income of the assessee on total sales which rendered the assessment order to be erroneous and prejudicial to the interest of the Revenue. In response, the assessee submitted that the assessment order passed by the AO is neither erroneous nor prejudicial to the interest of the Revenue, because the very purpose of scrutiny assessment for the impu....
X X X X Extracts X X X X
X X X X Extracts X X X X
....t is since well-established that the powers of the Pr. Commissioner of Income Tax to revise an order found to be erroneous and prejudicial to Revenue would always continue to exist, on all issues, till the order of appeal has been made by the CIT(A), as the legislature in its wisdom had used the words "considered and decided". The decision relied on are CIT vs. Eimco KCP Ltd (Mad) 147 ITR 603 and CIT vs. Subama Plantation and Trading Co. Ltd. (Cal) 238 ITR 319. 9. Reverting to the core of the issue in this case, it is to be stated that the assessee had failed in its duty of discharging the onus of proof to establish that all the purchases were genuine. The Apex Court while dealing with the issue of deciding the burden of proof, in the cas....
X X X X Extracts X X X X
X X X X Extracts X X X X
....assessee to discharge his onus are; Producing the books of accounts, bills, stock register, payment etc., filing confirmation and producing parties. Some indirect evidence could be production of delivery challans, lorry receipts, octroi payment proofs, confirmation from broker, etc. 12. Notwithstanding the fact that the assessee has not met its part of the obligation to prove the genuineness of the expenditure claimed to the satisfaction of the AO, the AO during the course of the scrutiny proceedings should have exhausted all the mode and means to establish that the purchases were genuine, in the availability of proof to the contrary, the expenses ought to have been disallowed. 13. On a careful consideration of the facts of the case and....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... supporting the order of the Ld.PCIT, submitted that the assessment order passed by the AO is erroneous, in so far as it is prejudicial to the interest of the Revenue, because the AO has accepted total purchases claimed by the assessee, even though, the assessee could not furnish necessary details for remaining purchases, which rendered the assessment order to be erroneous and prejudicial to the interest of the Revenue. Therefore, there is no error in the findings of the PCIT to revise the assessment order and their order should be upheld. 7. We have heard both the parties, perused the materials available on record and gone through orders of the authorities below. The provisions of Sec.263 of the Act, empowers the PCIT to revise the assess....