TaxTMI 
TaxTMI 
2022 (8) TMI 1456
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....mation available with the Income Tax Department, the assessee's case was taken for scrutiny and the assessment came to be completed u/s. 143(3) of the Act, wherein the AO had considered the deposit of the specified bank notes deposited in Urban Cooperative Bank Ltd., Choudwar and UCO Bank, Oranda, Khuntuni. It was the submission that after examination of the details and considering the evidence produced by the assessee, no addition had been made by the AO. It was the submission that the ld. Pr. CIT on the basis of the information received u/s. 133(6) of the Act by the AO from Urban Cooperative Bank Ltd., Choudwar that the assessee had deposited specified bank notes to an amount of Rs. 20,71,500/- and from UCO Bank, Oranda that the assessee ....
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....t to explain the cash deposit. It was the submission that in the reply to the show cause notice the assessee had categorically explained the deposit in cash in the bank account from the cash book of the assessee. It was also shown that there was no increase in the turnover of the assessee during the relevant period. However, the ld. Pr. CIT without considering the explanation of the assessee proceeded to hold that the AO did not examine the opening balance as on 08.11.2016 and passed an order u/s. 263 of the Act directing the AO to examine the issues of the cash deposit of the specified bank notes again. It was the submission that the issue having already examined by the AO, no question arises for revision of the assessment order passed u/s....
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....ubmission that the order of the ld. Pr. CIT passed u/s. 263 of the Act was liable to be upheld. To support his arguments, ld.CIT-DR placed reliance on the decision of the Hon'ble Bombay High Court in the case of Jeevan Investment & Finance (P.) Ltd., reported in [2017] 88 taxmann.com 552 (Bombay), wherein in para 10 of the order, the Hon'ble High Court has categorically held that, "in fact, merely asking a question which goes to the root of the matter and not carrying it further is a case of non-enquiry, if the query is not otherwise satisfied while responding to another query". It was the submission that the non-examination of the cash book in its entirety, more specifically the closing cash as on 08.11.2016 has rendered the enquiry done b....
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....rissa in the case of Orissa State Police Housing & Welfare Corporation Ltd., reported in [2022] 139 taxmann.com 207 (Orissa), wherein the Hon'ble High Court in para 14 has held as under :- 14. Section 263 of the Act requires the CIT, after hearing the Assessee, to pass an order by making "such enquiry as he deems necessary". The purpose of such an enquiry would be to arrive at a subjective view that the order of the AO was erroneous in so far as it is prejudicial to the interest of Revenue. Even if such enquiry may not be mandatory, there has to be some basis on which the CIT can form such a view. In the present case, the basis for forming a view that the profit element in the WIP was not accounted for by the Assessee is absent in the ord....
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....ferent bank accounts of the assessee. The ld. Pr. CIT has invoked powers u/s. 263 of the Act to revise the assessment order passed u/s. 143(3) of the Act on the basis of said information received by the AO u/s. 133(6) of the Act. When the assessment was done u/s. 143(3) of the Act the AO had examined the issue of the Specified Bank Notes on the basis of the information available at that point. Fresh information in the form of Section 133(6) of the Act was received by the AO from the Banks. A perusal of the order of the AO passed u/s. 143(3) of the Act shows that in the assessment order there is no discussion of the deposit of the specified bank accounts in two bank accounts. However, a perusal of the order of the ld.Pr.CIT passed u/s. 263 o....
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....g the assessment records and has rejected the explanation of the assessee without any proper enquiry. With this in mind, applying the principle of law laid down by the Hon'ble Jurisdictional High Court in the case of Orissa State Police Housing & Welfare Corporation Ltd. (supra), one comes to the clear conclusion that the ld. Pr. CIT did not have any basis on which he could have come to a view that the specified bank notes deposited by the assessee in the bank accounts had not been examined by the AO to its logical conclusion. A perusal of the order of the ld. Pr. CIT would clearly show that no enquiry has been done nor caused to be done as required u/s. 263(1) of the Act by the ld. Pr. CIT before setting aside the assessment order passed u....