TaxTMI 
TaxTMI 
2022 (11) TMI 1241
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....er referred to as "the Act") relevant to the Assessment Year 2015-16. 2. The only interconnected issue raised by the assessee is that the learned Principal CIT erred in holding the assessment framed under section 143(3) of the Act as erroneous insofar prejudicial to the interest of Revenue. 3. The brief facts are that the assessee is a private company and filed return of income for the year under consideration declaring NIL income. The assessment was reopened under section 147 of the Act. The AO in the reassessment proceeding found that that 10% of the URD purchases made by the assessee were not verifiable. Accordingly, the AO assumed that these purchases were made from commission agents. Hence, the AO made addition of commission @ 0.....
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....been agitated before the CIT(A). Therefore as per the provision of explanation 1(c) to section 263, the notice issued by the ld. PCIT lacks legal jurisdiction and therefore the same needs to be withdrawn. 6. However, the ld. PCIT disagreed with the submission of the assessee and held that the AO has clearly given a finding that 10% of URD purchase were not verifiable. Thus, the genuineness of such purchases were not established. However, the AO in next para assumed that such purchases were made from commission agents without bringing any material suggesting such assumption. Thus, in the absence of materials on record suggesting otherwise, the entire unverified purchases should have been disallowed under section 37 of the Act. Therefore, ....
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....d DR vehemently supported the order of the authorities below. 10. We have heard the rival contentions of both the parties and perused the materials available on record. The issue in the present case relates whether the assessment order has been passed by Ld. AO is proper and after due application of correct mind with respect to unverified URD purchases as discussed above and hence the assessment is erroneous insofar prejudicial to the interest of the Revenue and thus requiring revision by Pr. CIT u/s 263 of the Act. 10.1 Admittedly the assessment in the case of the assessee was framed under section 143(3) read with section 147 of the Act. The reassessment proceeding was started based on the extensive survey proceeding carried out in c....
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.....2016. 444 20. 13.12.2016 Reply filed on 14.12.2016 wherein information containing details of name, identity proof, revenue records majority of the persons out of 35 were submitted as required vide summons dated 02.12.2016. 297 - 443 21. 13.12.2016 Summons u/s 131(1A) of the Act was issued requesting to submit details (as stated herein below) in respect of URD cash purchase of raw cotton in respect of selected 20 persons / farmers and also directed to produce all the 20 farmers on 20.12.2016 (a) Valid identity proof, (b) PAN with ROI, (c) Form 7/12 & 8A, (d) Contra Confirmation (e) details of area under cultivation, crops produced and yield. 295 & 296 22. 17.12.2016 Reply filed on 19.12.2016 wherein in....
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....f the Income Tax Department has also made a detailed reply vide letter dated 15th February 2017 running from pages 57 to 66 of the paper book. Thereafter, the proceedings were initiated under section 147 of the Act by issuing notice under section 148 of the Act dated 26th of March 2019. Finally the assessment was framed by the AO under section 147 of the Act after considering all the facts with respect to URD purchases which can be verified from the assessment order available on record. Thus it can be inferred that there was due application of mind of the AO while framing the assessment under section 147 of the Act. Accordingly, we are of the view that the assessment order on hand cannot be held as erroneous insofar prejudicial to the inter....
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....ransaction is doubted then corresponding transaction should also be carrying same shadow of doubt. In other words, part of the transactions cannot be accepted as genuine and part of the transaction cannot accepted as bogus. Either the entire transaction to held as bogus or should be treated as genuine without making any cherry pick-up. Thus, for this reason as well, the assessment order cannot be held either erroneous or prejudicial to the interest of revenue. 10.4 As regards the contention of the learned AR for the assessee that the order of the AO got merged the order of the learned CIT-A, we are not in agreement with the assessee. It is for the reason that the issue before the learned CIT-A was with respect to the deduction of the TDS....