2023 (5) TMI 412

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....3) of the Act on 30-12-2019. The grounds raised by the assessee read as under: 1) The order of the PCIT is bad and erroneous in law and facts and is absolutely against the principles of Natural Justice. 2) The PCIT failed to consider the replies/explanations filed by the appellant in proper perspective. 3) The PCIT grossly erred in passing the revisionary order u/s.263 even though he was made aware of the fact that the same issues were the subject matter of appeal before the CIT(A), that the same was heard and that the order was awaited, making the revisionary order void ab initio in view of sec.263 (1)( c) of the Act. [Relying on the jurisdictional Madras High Court decision cited in 409 ITR 567(Mad) and also on ....

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....ring the same, the revision would be bad in law. The Ld. CIT-DR, on the other hand, controverted the arguments of Ld. AR and submitted that full disallowance should have been made by Ld. AO u/s 40A(3). The Ld. AO invoked the provisions wrongly and therefore, the revision was justified. Having heard rival submissions and after perusal of case records, our adjudication would be as under. Assessment and Revisionary Proceedings 3.1 From the records, it emerges that the assessee was subjected to survey u/s 133A on 03-01-2017 and an assessment was framed for the year u/s 143(3) on 30-12-2019. In the assessment order, Ld. AO made addition of Rs.202.97 Lacs for discrepancies in stock. The same was considered under the head business income.....

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....ITO (409 ITR 567) as well as the decision of Hon'ble Allahabad High Court in CIT vs. VAM Resorts and Hotels Pvt. Ltd. (418 ITR 723). However, rejecting the same, Ld. AO was directed to redo the assessment afresh after verification of the facts pertaining to both the issues. Aggrieved, the assessee is in further appeal before us. Our findings and Adjudication 4. From the stated facts, it emerges that an assessment was framed based on survey findings. The discrepancy in stock was added under the head business income whereas disallowance u/s 40A(3) for jewellery acquired in cash through exchange was estimated at 10%. It is quite clear that there was clear application of mind on the issues as flagged in the revisionary order. Proceeding f....

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....ioner of Appeals, and in such circumstances, the Commissioner could not exercise power under Section 263 of the Act on account of the statutory bar. Therefore, on this ground also, the assumption of jurisdiction under Section 263 of the Act was wholly erroneous. 24. As noticed above, the Assessing Officer while completing the re-assessment proceedings has assigned certain reasons for coming to a conclusion that the assessee is entitled for deduction under Section 54F and not under Section 54 of the Act. This reason assigned by the Assessing Officer has been found by us to show due application of mind. As observed, we cannot expect an Assessing Officer to write a judgment. In such circumstances, the view taken by the Commissioner in....