TaxTMI 
TaxTMI 
2023 (4) TMI 279
X X X X Extracts X X X X
X X X X Extracts X X X X
....in his business dealings with M/s Yuvraj Enterprises and M/s Shakti Enterprises, to whom, total credit entries of Rs.1,43,85,000/- had been transferred; that in response, the assessee had furnished only the copies of invoices in support of the purchases made from M/s Yuvraj Enterprises; that further, summons under section 131 of the I.T. Act had also been issued to the assessee for providing complete books of account along with purchase bills, sale bills and mode of transportation of purchases, freight, receipts/bilties, etc.; that the statement of Shri Gaurav Pathak/Thakur, proprietor M/s Yuvraj Enterprises and M/s Shakti Enterprises was recorded by the DDIT (Investigation), Ludhiana, in which, he had stated and confirmed that there was no business conducted in these concerns and these were formed only for the purpose of providing accommodation entries and that the amounts received by cheque were returned in cash, etc.; that from the statement of Shri Gaurav Pathak/Thakur, proprietor M/s Yuvraj Enterprises and M/s Shakti Enterprises, it had clearly transpired that purchases shown by the assessee from M/s Yuvraj Enterprises were not genuine and the expenses had been claimed to redu....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n these concerns and these concerns had been formed only for the purpose of providing accommodation entries and that the amounts received by cheque were returned in cash; that thus, the claim of payment by banking channels should not have been accepted on face value without making further enquiries; that however, no enquiry of any worth had been conducted by the Assessing Officer; that the assessee had also submitted that he had availed the scheme under The Direct Tax Vivad Se Vishwas Act, 2020 against the assessment order, which was accepted by the Department; that however, this fact had no effect on the issue which had been left to be investigated by the Assessing Officer; that as such, it was evident that the assessment order had been passed without enquiries or verification; that the Assessing Officer did not enquire/verify about the complete details and documentary evidence regarding the credit entries as appearing in the bank account, at Rs.1,43,85,000/-; that therefore, the Assessing Officer's order was erroneous, as the Assessing Officer did not enquire/verify about the complete details and documentary evidences of availability of cash for the said cash deposits and it ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ister of the goods traded and manufactured by him; that the assessee had also filed a copy of the ledger account of the relevant parties as in his books; that the assessee had filed detailed reply and arguments before the Assessing Officer, stating that these purchases were genuine and that no addition on this account could be made; that on considering the issue, the reply of the assessee and the position of law, the Assessing Officer did not agree that the purchases were genuine; that he made addition, for which, he applied a GP rate of 1.03% on the quantum of purchases, thereby, making addition of Rs.1,48,165/-; that against the assessment order so passed, the assessee filed an appeal before the ld. CIT(A) on 8.1.2020; that therein, the assessee challenged the reopening of the completed assessment under section 148 of the I.T. Act and also the addition made by applying the GP rate; that while the appeal was pending, The Direct Tax Vivad Se Vishwas Act, 2020 came into force and the assessee opted for the same and settled, thereunder, the dispute regarding the addition made by the Assessing Officer concerning the alleged bogus purchases; that the ld. PCIT issued Certificate dated 2....
X X X X Extracts X X X X
X X X X Extracts X X X X
....w, the jurisdiction under section 263 of the I.T. Act could not have been invoked by the ld. PCIT; that even otherwise, evidently, the issue regarding purchases had been thoroughly examined by the Assessing Officer in the assessment proceedings and it was only thereafter, that the addition had been made by the Assessing Officer, by applying the GP rate; that as such too, jurisdiction under section 263 of the I.T. Act was wrongly invoked by the ld. PCIT. 9. In this manner, the ld. Counsel for the assessee has requested that the order under appeal be quashed on allowing the appeal filed by the assessee. 10. The ld. D.R., on the other hand, has placed strong reliance on the impugned order. It has contended that, as correctly observed by the ld. PCIT, the assessee did not produce the complete books of account along with purchase bills, sale bills and mode of transportation of purchases, freight, receipts/bilties, etc., during the assessment proceedings before the Assessing Officer; that the Assessing Officer did not carry out any investigation whatsoever into the matter, despite the fact that the proprietor of M/s Yuvraj Enterprises and M/s Shakti Enterprises had stated before th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d Se Vishwas Act, 2020 is explicit, when it states that every order passed under section 5(1) of the Direct Tax Vivad Se Vishwas Act, 2020, determining the amount payable under this Act, shall be conclusive as to the matters stated therein and no matter covered by such order shall be reopened in any other proceedings under the Income Tax Act or under any other law for the time being in force. There is, thus, an express bar to proceedings being continued/reopened under any law, including the Income Tax Act, once an order stands passed under section 5(1) of the Direct Tax Vivad Se Vishwas Act, 2020 determining the amount payable and concerning any matter covered by such order is not to be reopened. 16. In "Gopalkrishan Rajkumar vs. PCIT" (supra), the question before the Hon'ble High Court was, as is the case herein, as to whether the proceedings initiated after the assessee had opted to settle the dispute under the Direct Tax Vivad Se Vishwas Act, 2020, were sustainable or not. Their Lordships held, inter alia, that section 6 of the Direct Tax Vivad Se Vishwas Act, 2020 makes it very clear that once there is compliance with the timelines specified under section 5, the designat....
X X X X Extracts X X X X
X X X X Extracts X X X X
....function within the limits of the jurisdiction vested with him under the statute; that thus, once the declaration is accepted, the authority accepting is estopped from taking any steps which would in effect amount to reopening and/or revising the decision already taken on such declaration; that the IDS scheme was introduced in order to encourage an assessee to make a disclosure of the income not disclosed earlier; that the PCIT invoked power under Section 263 of the I.T. Act in respect of an item of income which was declared in terms of the said scheme; that all particulars were available before the PCIT in respect of such income and the PCIT, on being satisfied, accepted such declaration; that thus, if the contention of the Revenue that the PCIT has power to invoke Section 263 of the Act were to be accepted, it would frustrate the object behind introduction of such scheme; that the PCIT was not justified in invoking the power under Section 263 of the Act, as it would amount to revising a decision taken by the PCIT on such declaration by the Assessing Officer, which is not contemplated under the Income Tax Act; that thus, all materials were available before the PCIT when the declar....
X X X X Extracts X X X X
X X X X Extracts X X X X
....hallenged by the assessee by way of appeal. The purchases qua which such addition had been made were, therefore, subject matter of appeal before the ld. CIT(A) and the ld. CIT(A) had passed his order on 15.4.2021. The show cause notice under section 263 of the I.T. Act had, on the other hand, been issued only on 17.3.2022, i.e., almost a year later. That being so, given the provisions of Explanation 1(c) to section 263(1) of the I.T. Act, the revisional jurisdiction under section 263 of the I.T. Act, by issuance of such show cause notice, could not have been assumed. "CIT vs. Bholenath Poly Feb Pvt. Ltd." (supra) and "PCIT vs. Rishabhdev Technocable Ltd." (supra) are eloquent in this regard. As per these decisions, as is the case herein also, the view taken by the Assessing Officer was a possible view, due to which, invocation of powers under section 263 of the I.T. Act could not have been done. 22. We find that the Assessing Officer, therefore, had carried out a thorough enquiry and examination of the purchases in question and it was only after such enquiry and examination that the addition was made by the Assessing Officer, by applying GP rate. 23. In this view of the matte....