TaxTMI 
TaxTMI 
2023 (10) TMI 201
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....ax (IT & TP), has erred in not appreciating the facts, that the Ld. assessing officer has re-opened and completed the assessment u/s 147 of the Act for sole reason and for that he had made the complete inquiries and verification of the facts and recorded his satisfaction in the assessment order itself and therefore, the Ld. Commissioner of Income tax (IT & TP) has no jurisdiction to invoke the revisionary power u/s 263 of the Act. (3) Moreover, Ld. Commissioner of Income tax (IT & TP), Ahmedabad has erred in passing the order u/s 263 of the act without considering the submissions made by the appellant before him during the proceedings u/s 263 of the Act. (4) Therefore, the Ld. Commissioner of Income tax (IT & TP), Ahmedabad At SRT, has erred in law and facts by passing order u/s. 263 of the Act and therefore, the appellant prays to quash the order passed u/s. 263 of the Act. II. Miscellaneous:- (1) The appellant craves leave to add, alter or vary any of the grounds of appeal." 3. The relevant material facts, as culled out from the material on record, are as follows. The assessee before us is an individual and filed return of income for assessm....
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....er source of cash deposits in bank account except the sale of sugarcane. The Assessing Officer should have made necessary inquiry or verification in this regard. However, the assessing officer has passed the order without making any inquiry or verification in this case. Therefore, the order passed u/s 143(3) r.w.s 147 of the Act dated 04.02.2022 was treated by ld PCIT as erroneous and prejudicial to the interest of the Revenue. 5. Therefore, ld PCIT issued a show cause notice u/s 263 of the I.T. Act dated 12/08/2022 which was issued and served to the assessee to show cause as to why appropriate order u/s 263 of the Act should not be passed, the said show cause notice is reproduced by ld PCIT in his revision order, (vide page no.3 to 5). In response to the above notice, the assessee filed a request letter for adjournment before the ld. PCIT. The ld PCIT noted that assessee has not filed the reply on time, therefore ld PCIT, based on the facts available before him noted that the ITO (I&CI), Surat had carried out verification of the said cash deposits and during the course of proceedings before him, the assessee had contended that the source of the said cash deposits was from sale ....
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....paper book page no.26, and in this notice the Assessing Officer raised the issue which is also raised by the ld. PCIT under section 263 of the Act. The assessee has submitted its reply before the Assessing Officer in respect to the notice under section 142(1) of the Act. The assessing officer has examined the issue raised by the ld. PCIT, which is placed at paper book page nos. 27 to 28, therefore Assessing Officer having examined the issue, passed the assessment order, hence order passed by the assessing officer is neither erroneous nor prejudicial to the interest of Revenue, therefore order of ld PCIT may be quashed. 9. The ld. Counsel also submitted that reasons recorded by the assessing officer under section 147/148 of the Act are bad in law and defective. On such defective reassessment, the PCIT should not have exercised his jurisdiction under section 263 of the Act. 10. On the other hand, Learned Departmental Representative (ld. DR) for the Revenue submitted that Assessing Officer has not conducted the further enquiry. No doubt, the Assessing Officer has issued the notice under section 142(1) of the Act, wherein he has asked the assessee to provide the explanation about....
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.... bank account and given to the assessee. Copy or confirmations of these party, received by the assessee, is also submitted herewith alongwith copy of bank statement of those party. I hope above will meet with your requirements and in case your honour requires any further details kindly let us know." 12. From the above reply of the assessee, it is abundantly clear that assessing officer was very much aware about the reply, explanation and documents submitted by the assessee during the assessment proceedings. The assessing officer examined the documents and evidences submitted by the assessee along with reply and having examined all the documents and evidences, the assessing officer framed the assessment order, therefore such order should not be erroneous. 13. We note that during the assessment proceedings, the assessing officer has issued notice under section 142(1) of the Act, which is placed at page no.26 of the paper book. In response to notice under section 142(1) of the Act, the assessee has filed its reply, which is placed at page no.27 to 28 of the paper book. Before the Assessing Officer, the assessee has submitted further reply in respect of the issue raised ....
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....cer has not conducted enquiry. For that reliance can be placed on the judgment of Hon'ble Gujarat High Court in the case of CIT v. Nirma Chemical Works Pvt. Ltd., 309 ITR 67 (Guj.), wherein it was held as follows: "The contention on behalf of the revenue, that the assessment order did not reflect any application of mind as to the eligibility or otherwise under section 80-I, was also required to be rejected. An assessment order cannot incorporate reasons for making/granting a claim of deduction. If it does so, an assessment order would cease to be an order and become an epic. The reasons are not far to seek. Firstly, it would cast an almost impossible burden on the Assessing Officer, considering the workload that he carries and the period of limitation within which an order is required to be made; and, secondly, the order is an appealable order. An appeal lies and would be filed only against disallowances for which an assessee feels aggrieved with. [Para 22]" 17. We note that main grievance of ld DR for the Revenue was that assessing officer has not conducted further enquiry. As we have noted earlier that it is the domain of the assessing officer to decide, based on ....
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....Vee Enterprises v. Addl CIT [1995] 99 ITR 375], "it is his duty to ascertain the truth of the facts stated in the return when the circumstances of the case are such as to provoke an inquiry. It is, therefore, obvious that when the circumstances are not such as to provoke an inquiry, he need not put every proposition to the test and probe everything stated in the income tax return. In a way, his role in the scrutiny assessment proceedings is somewhat akin to a conventional statutory auditor in real life situations. Of course, an Assessing Officer cannot remain passive on the facts which, in his fair opinion, need to be probed further, but then an Assessing Officer, unless he has specific reasons to do so after a look at the details, is not required to prove to the hilt everything coming to his notice in the course of the assessment proceedings. When the facts as emerging out of the scrutiny are apparently in order, and no further inquiry is warranted in his bona fide opinion, he need not conduct further inquiries just because it is lawful to make further inquiries in the matter. [Para 21]" 18. We note that the Ld. Pr. C.I.T. by invoking his jurisdiction u/s. 263 of the Act is giv....