TaxTMI 
TaxTMI 
2022 (8) TMI 1351
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....he initiated revision proceedings u/s 263 of the Act. 3. The assessee objected to initiation revision proceedings, submitting that the assessing officer has made proper enquiries in respect of above said issue by raising various types of queries several times and thus, he has extensively examined the details of cash deposits made during demonetization period. The assessee submitted that the assessee has furnished the details of sales, stock details, purchase details and details of cash deposits before the AO during the course of assessment proceedings. Accordingly, it was submitted that the AO has accepted the explanations of the assessee after due application of mind. The assessee has relied upon the decision rendered by Hon'ble Supreme Court in the case of Max India Ltd (2007)(295 ITR 282)(SC) and submitted that the AO has taken a possible view and hence the impugned revision proceedings should be dropped. However, rejecting objections raised by the assessee, the Ld PCIT passed the impugned revision order holding that the assessment order passed by the Assessing Officer is rendered erroneous in so far as it is prejudicial to the interests of Revenue. Accordingly, he set aside th....
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....2018-19; copies of cash book & stock register; comparative GP and NP ratios for FY 2014-15 to 2018-19; monthwise stock position for FY 2014-15 to 2018-19; details of sales above Rs.2,00,000/-. (f) The AO issued another notice dated 12.12.2019 u/s 142(1) of the Act, wherein he asked the assessee to explain abnormal sales made in the month of October, 2016 compared to the sales made in October, 2015. He also asked the assessee to furnish sales made in October, 2017 and October, 2018. The assessee duly furnished the details to the AO. The Ld A.R submitted that the above queries raised by the AO would substantiate the contentions that the AO has made detailed enquiries with regard to the cash deposited into the bank account. The Ld A.R submitted that the learned PCIT has taken the view that the AO, after having called for details, has not acted upon the same diligently. In this connection the learned PCIT has expressed the view that the AO has neither made any addition towards cash deposit in the assessment order nor has applied case law for the year, i.e., the view of the Learned PCIT is that the AO should have made addition in respect of cash deposits. Mere forming of a differen....
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....nto the bank account. Accordingly, the Ld D.R submitted that the order passed by the Assessing Officer without application of mind is susceptible to revision proceedings under section 263 of the Act. In support of this proposition, learned DR placed reliance on the following case laws : * Sesa Starlite Ltd. Vs. CIT (2021) 123 taxmann.com 217 (Bom) * Jeevan Investment & Finance (P) Ltd. (2017) 88 taxmann.com 552 * PCIT Vs. Zuari Maroc Phosphates Ltd. (2021) 126 taxmann.com 170 (Bom) 8. In the rejoinder, the Ld A.R submitted that the increase in sales achieved in AY 2017-18 has been maintained in the succeeding year also. Hence, it is not a case of abnormal sales in AY 2017-18 alone. He further submitted that the cash deposits made into the bank accounts of various years are very much comparable to each other, i.e., there is no abnormal increase in cash deposits. He submitted that the quantity details of sales of gold bars are given in the tax audit report. Accordingly, he submitted that the AO has conducted proper enquiries in respect of cash deposits from almost every possible angle and has accepted the same. Hence, the action of the AO cannot be found fault with. In any cas....
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.... Officer, cannot be treated as prejudicial to the interests of the Revenue, for example, when an Income-tax Officer adopted one of the courses permissible in law and it has resulted in loss of revenue, or where two views are possible and the Incometax Officer has taken one view with which the Commissioner does not agree, it cannot be treated as an erroneous order prejudicial to the interests of the Revenue unless the view taken by the Income-tax Officer is unsustainable in law." The principle which has been laid down in Malabar Industrial Co. Ltd. [2000] 243 ITR 83 (SC) has been followed and explained in a subsequent judgment of the Supreme Court in CIT v. Max India Ltd. [2007] 295 ITR 282." The principles laid down by the courts are that the Learned CIT cannot invoke his powers of revision under section 263 if the Assessing Officer has conducted enquiries and applied his mind and has taken a possible view of the matter. If there was any enquiry and a possible view is taken, it would not give occasion to the Commissioner to pass orders under section 263 of the Act, merely because he has a different opinion in the matter. The consideration of the Commissioner as to whether an o....
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....us details during the course of assessment proceedings with regard to the cash deposits made during the demonetization period through various notices issued both u/s 131 of the Act and u/s 142(1) of the Act. The assessing officer has called for various details such as, copies of cash book, bank book, stock details, purchases details, sales details, Explanations for increase in cash deposits, comparison of sales of the current year with past year etc. The Ld A.R took us to the replies given by the assessee to the AO to the various queries raised by him. Thus, we notice that the AO has examined the issue of cash deposits from various angles and hence his enquiries or verifications, in our view, cannot be considered to be inadequate or not up to the required standard. Accordingly, we are of the view that the clause (a) to Explanation-2 to sec. 263 shall not apply to the facts of the present case. 12. There is no dispute with regard to the fact that the impugned cash deposits have been made out of cash balance available in the books of accounts. The said cash balance has been accumulated out of past cash balance and sales made by the assessee. The quantity details of purchases and sal....