TaxTMI 
TaxTMI 
2023 (11) TMI 581
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....w Delhi, (hereinafter referred to as the 'Ld. AO') u/s 143(3) of the Income Tax Act (hereinafter referred to as 'the Act') on 27/04/2017 for the Assessment Year 2015-16. 2. The assessee has raised the following grounds of appeal: "1. That on facts and in law the order dated 28th March 2021 passed by the Principle Commissioner of Income Tax-1, New Delhi {hereinafter referred to as "PCIT"} under section 263 of the Act is void ab initio and bad in law. 1.1 That on facts and in law the PCIT has erred in not providing a proper opportunity of being heard and has thereby has violated the settled principles of natural justice. 2. That on the facts and in law the PCIT has erred in holding that assessment order dated 27th April 2017 passed b....
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..... This assessment was sought to be revised by the Ld. PCIT by invoking revision jurisdiction u/d 263 of the Act by treating the order of the Ld. AO as erroneous in as much as it is prejudicial to the interest of the Revenue. A show cause notice issued by the Ld. PCIT on 03/02/2021 u/s 263 of the Act is enclosed in page 1 to 2 of the PB. The main crux of the show cause notice is that the assessee has claimed total expenditure of Rs. 58,23,64,185/- on account of Event, Package Tour, Service Fees and Sale of Air Ticket expenses. In the opinion of the Ld. PCIT, the assessee has merely furnished the ledger copy of these expenses which were allowed by the Ld. AO without making any enquiry and verification. Accordingly, the Ld. PCIT treated the or....
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....er expenses claimed in the profit and loss account. According to the Ld. DR, this questionnaire was stated to be a mere general questionnaire issued by the Ld. AO. We find that the assessee vide its Authorized Representative's letter dated 16/03/2017 had furnished the detailed reply as required by the Ld. AO. This reply is enclosed in pages 15 to 16 of the PB. In the said reply, vide Para -17, the assessee had furnished the details of Salaries, Staff Welfare Expenses, Events, Package Tour, Services fees, Sale of Air Tickets expenses, Rent, Power and Fuel, Business Promotion, Printing and Stationery, Conveyance, Communication Expenses, Recruitment Expenses, Travelling Expenses, Legal and Professional Charges, Consultancy Charges, Computer Re....
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....Ld. AO. The Ld. AO after making enquiries of the same and being satisfied with the details furnished by the assessee, concluded that the claim of the assessee to be genuine. Accordingly, he had decided not to make any disallowance of expenses thereon. 8. The only grievance of the Ld. PCIT is that the Ld. AO had not made any enquiries while framing the assessment. Whereas from the aforesaid narration of facts, it is evidently clear that more than adequate enquiries were indeed made by the Ld. AO while completing the assessment. We find that the Ld. PCIT in para 8.1 in his order had directly invoked the provisions of Explanation-2 to section 263 of the Act by stating that when the order is passed without making inquiries which should have be....
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....CIT to atleast state what are the requisite enquiries that are to be carried out by the Ld. AO and where the Ld. AO has failed in his duty. In the instant case, no such recording of facts and no finding thereon is given by the Ld. PCIT in his order with objective reasons. 9. We have already observed herein above that adequate enquiries were indeed carried out by the Ld. AO in the assessment proceedings with regard to the impugned expenditure of Events, Package Tours, Service Fees, Sale of Air Tickets expenses etc. Now, when enquires were already made by the Ld. AO while framing the assessment, if the Ld. PCIT is of the opinion that the enquiries carried out by the Ld. AO were inadequate, then it is the duty of the Ld. PCIT to conduct an en....
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.... cannot be remitted for a fresh decision to the Assessing Officer to conduct further enquiries without a finding that the order is erroneous. Finding that the order is erroneous is a condition or requirement which must be satisfied for exercise of jurisdiction under Section 263 of the Act. In such matters, to remand the matter/issue to the Assessing Officer would imply and mean the CIT has not examined and decided whether or not the order is erroneous but has directed the Assessing Officer to decide the aspect/question. 17. This distinction must be kept in mind by the CIT while exercising jurisdiction under Section 263 of the Act and in the absence of the finding that the order is erroneous and prejudicial to the interest of Revenue, exe....