TaxTMI 
TaxTMI 
2022 (12) TMI 102
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.... it cannot be said that the Assessing Officer has not taken a conscious decision on the issue of alleged capital employed on the alleged undisclosed sales, while framing the assessment. 3. That the Ld. PCIT has failed to appreciate that the assessment had been completed after due consideration of various replies by the Assessing Officer during the course of assessment proceedings and the Assessing Officer having taken a possible view and, therefore, the assumption of jurisdiction u/s 263 was not called for by the Ld. PCIT. 4. That the Id. PCIT has failed to consider that the issue of alleged undisclosed turnover was considered by the Ld. CIT(A) also and that appeal, has been decided and the issue of alleged undisclosed turnover being linked with the alleged capital employed and, thus the order of the Assessing Officer having been merged with the order of the Assessing Officer, no action u/s 263 could have been called for. 5. Notwithstanding, the above said grounds of appeal, the Ld. PCIT has failed to consider that even after considering the addition of capital employed, no prejudice shall be caused to the assessee since, the MAT is applicable to the asse....
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....atiala set aside the assessment order and directed the Assessing Officer (AO) to pass a fresh assessment order. The assessment subsequent to the revisionary proceedings was completed on 26.12.2018 wherein the income of the assessee was assessed as per the original assessment order passed u/s 143(3) of the Act on 20.03.2016. 3.1 Meanwhile, there was a search and seizure operation on 05.08.2016 on the business premises of the assessee by the Directorate General of GST Intelligence and the search was also conducted on one Shri Sanjay Dhawan, Ex-President of the assessee company as well as three-four dealers of the assessee company and information was passed on by the Intelligence Wing of GST to the Income Tax Department that the assessee company had been allegedly suppressing its turn over by way of not accounting for the sales by under invoicing the sales. During the course of search at the residential premises of Shri Sanjay Dhawan, parallel invoices of goods manufactured and sold by the assessee company were allegedly recovered. The evidence of under valuation of sales was allegedly in the form of statements of third parties recorded u/s 14 of the Central Excise Act, 1944. There....
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....loyed is required atleast for maintaining the minimum additional stock to carry out unaccounted turnover and which has not been inquired into by the AO. 3.4 In response to the show cause, the assessee filed its submission which were considered but same were not found acceptable and the matter was set aside to the file of the AO with the following directions which are contained at para 7 of the impugned order which read as under: "Considering the overall facts and circumstances on the issues and the legal position, assessment order passed by the AO dated 29.12.2019 on the issue of additional capital investment in the form of inventory estimated at Rs.61,66,723/- in the SCN, as indicated above, is set aside to the file of AO with the direction to pass assessment order afresh in accordance with the law, after granting sufficient opportunity to the assessee." 4. Against the said findings and directions of the Ld. Pr. CIT, the assessee is in appeal before us. 5. During the course of hearing, the Ld. AR submitted that though the assessee has taken various grounds of appeal but in nutshell the grounds of appeal number 1 to 4 relates to the fact that the AO has applied hi....
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....e Department in as much as the Department should not have placed complete reliance without any corroborative evidence on such documents when the conduct of Shri Sanjay Dhawan itself was under suspicion. Therefore, in view of the above narrated factual matrix and after duly considering the various evidences which the Department has relied upon for making the impugned additions, we are of the considered opinion that the additions based on such alleged unrecorded sales do not have any sound basis and, therefore, for assessment years 2012-13 and 2013-14, the impugned additions on account of additional net profit earned on alleged unrecorded sales are liable to be deleted. It is so ordered accordingly." 5.2 It was accordingly submitted that where there is no addition on account of unaccounted sales and the resultant additional net profit, then the question of alleged capital employed to carry out such alleged unaccounted sales and turnover as per the order of the Ld. Pr. CIT for which the proceedings under section 263 of the Act have been initiated is bad in law and it was accordingly requested that the order of the Ld. Pr. CIT may be set aside. 6. Per contra the Ld. CIT DR submit....