2023 (3) TMI 780

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....per se. 3.That the surrender of Rs. 10 crores when made during survey, by relating it to impounded documents, to cover the discrepancies noticed by Ld. A.O. offered as business income in return, duly accepted by Ld. AO after detailed inquiry and verification of all relevant documents in assessment by further enhancing the same by Rs.5 lacs, the Ld. PCIT's allegation that no inquiry and verification was made by AO on this point, is wholly unfounded so as not to vest him with valid jurisdiction to invoke powers under section 263 of the Act ibid. 4. That a legally sustainable view taken by the Ld. AO, backed by documents found during survey, already accepted by survey team as discrepancies in business income taxable at normal rates, duly secured by collecting cheques for tax due thereon, the Id. PCIT grossly erred in arbitrarily imposing his view, de hors the facts and material on record, to direct its taxation u/s 115BBE, more so when on the date of survey, such higher tax rate was not on statute. 5. That by not disputing the nature of Rs.5 lacs, added by Ld. AO as discrepancies in order to cover other minor deviations business income by enhancing the s....

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....t is created by you, assessment proceedings shall be carried out either through your e-mail account or manually (if e-mail is not available) e) In cases where order has to be passed under Section 16315 153A/153C of the Income Tax Act, 1961 read with section 143(3), assessment proceedings would be conducted manually Yours faithfully AMIT SHUKLA CIR-2(1)(1) GHAZIABAD ANNEXURE 1. A brief note on the nature of business activity carried out during the FY2016-17. 1. Furnish computation of income for FY2016-17 1 Furnish copy of Balance sheet and P/L account, with all annexures, for the period FY2016-17 1 Furnish comparative figures of turnover and profits (GP as well as NP) for three previous years. Explain the sudden jump in NP rate from 3.98% in FY2015-16 to 28.68% in FY2016-17 even when the turnover has declined from Rs 616 cr to 36.85cr 1. You have reported sundry creditors of Rs 12,38,56,4271-as on 31.03.2017. Furnish the complete details of sundry creditors with outstanding above Rs 10,00,000/- as on 31.03.2017 in the following format: Name and complete address of the creditor Opening bal....

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.... is furnishing following statements relating to A.Y. 2017-18:- 1. The copy of return (ITR-V) alongwith computation of income for the relevant A.Y. 2017-18 is enclosed. 2. That the Assessee is also enclosing Copy of Audit Report, Balance sheet/Trading and P&L a/c along with all schedules and annexure for the A.Y. 2017-18. The assessee has submitted all of the information with regard to queries as raised by your honour. Should, however, any further clarification required the assessee would be obliged to furnish the same. Yours faithfully [Samit Bajaj] Counsel for assessee" Sir, This has reference with the ongoing assessment proceedings in which the assessee is furnishing following statements relating to A.Y. 2017-18 as required by your honour.- 1. That the assessee is enclosing confirmation of S. Creditors account of the following assessees: Mis. Kansai Nerolac Paints Ltd. Mis. Spencer Trading Corporation Mis. Chintamani Sharma & Sons Mis. J itendra Strips & Tubes Pvt. Ltd Mis. Ankur Enterprises Mis. Maa Jagdambe Engineering Works 2. The asse....

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.... required the assessee would be obliged to furnish the same. The assessee trusts this shall satisfy your honour in completing the assessment. Thanking You. Yours faithfully, (SAMIT BAJAJ) Counsel for the assessee 7. After considering the detailed reply of the assessee and after examining the books of account, bills and vouchers produced by the assessee, the Assessing Officer completed assessment vide order dated 11.06.2019 at the assessed total income of Rs. 10.64 crores. 8. Assuming jurisdiction u/s 263 of the Assessing Officer, the ld PCIT issued the following show cause notice: "M/s/Mr/Ms Subject Notice for Hearing in respect of Revision proceedings us 263 of the THE INCOME TAX ACT, 1961-Assessment Year 2017-18 In this regard, a hearing in the matter is fixed on 17/03/2022 at 03:00 PM You are requested to attend in person or through an authorised representative to submit your representation if any alongwith supporting documents/information in support of the issues involved (as mentioned below) if you wen that the Revision proceeding be concluded on the basis of your written submissions/representations filed in ....

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.... order to buy peace of mind for discrepancies surrendered an amount of Rs. 10 crores as additional evidence for F.Y. 2015-16. This was in response to a specific query relating to bogus expenses, cash payment for purchase of property and further cash book revealed cash payment made in violation of provisions of section 40A(3) of the Act. 11. A perusal of the record and assessment order shows that there is neither unexplained credit in the books of account nor there is any unexplained investment/unexplained money/unexplained expenditure. Therefore, the provisions of section 68, 69, 69A, 69B, 69C and 69D of the Act are not attracted on the surrendered amount of Rs. 10 crores. 12. We are of the considered view that the evidence on record shows that the said amount of Rs. 10 crores was offered in case any discrepancy is found in the books of account but the fact of the matter is that neither the Assessing Officer nor the PCIT has brought anything on record to show that there is unexplained investment or unexplained expenditure was found during the course of survey proceedings. With these facts, it can be safely concluded that the surrender of Rs. 10 crores can be said to have been....

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....lanation could be submitted to the audit for its settlement. Further, little time is left for taking remedial action 263 of the I.T. Act 1961 if the aforesaid explanation to the audit objection is not accepted by the RAP as the same is expiring on 31-03-2022. In view of above facts of the case and for the sake of abundant precaution on the matter, proposal is submitted hereby for kind consideration for action u/s 263 of the IT Act to revise the order u/s 143(3) dated 21/03/2016. Assessment record in one volume is also being submitted herewith for further necessary action. 14. The co-ordinate bench in ITA No. 1287/PUN/2017 in the case of Alfa Laval Lund AB order dated 02.22.2021 has taken an adverse view in such a case where the Assessing Officer himself has proposed for revision u/s 263 of the Act. The relevant findings of the co-ordinate bench read as under: 5. It is trite that a power which vests exclusively in one authority, can't be invoked or cause to be invoked by another, either directly or indirectly. Section 263 of the Act confers power on the CIT to revise an assessment order, subject to certain conditions. Instantly, we are confronted with a situatio....