2024 (3) TMI 170

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....edings u/s. 263 without appreciating that a case of the appellant was selected under CASS for limited scrutiny i.e. to verify transactions undertaken in commodity and derivative (futures) segment 2. The ld. Pr. CIT erred on facts and in law set aside an order passed by the Assessing Officer under Section 143(3) of the Act by Invoking provision of Section 263 of the Act without Justifying, how is it prejudicial to the interest of the revenue which is a pre-requisite condition for invoking power under Section 263 of the Act. 3. The ld. Pr. CIT erred on facts and in law in setting aside the order passed by Assessing Officer by invoking provisions of Section 263 of the Act by holding that the proper enquiry with respect to transactions in c....

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....at Rs. 32,07,485/- and offered taxable income taking recourse of the provisions of Section 44AD of the Act. The profit at 8% of the turnover as per Section 44AD of the Act was worked out at Rs. 2,56,599/-. However, the assessee disclosed profit of Rs. 9,36,220/- in the return of income. After giving show cause notice and taking cognisance of the assessee's reply, the PCIT held that the order passed by the Assessing Officer under Section 143(3) of the Act was made merely relying on the general information submitted by the assessee without attempting to make any investigation in order to ascertain the correctness of the claim of the assessee and thus, directed the Assessing Officer to pass a fresh Assessment Order. 4. The Ld. AR submitted th....

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....y disclosing profit over and above which is permissible under Income Tax Statute cannot be termed as not appropriate. 5. The Ld. DR relied upon the order of the PCIT passed under Section 263 of the Act. 6. We have heard both the parties and perused all the relevant material available on record. From the perusal of the show cause notice dated 26.02.2020 by the PCIT under Section 263 of the Act it can be seen that the PCIT is harping on the issue that the assessee declared Net Profit of Rs. 9,36,220/- from business & profession which is more than 8% of the total turnover of the business as per Section 44AD of the Act. The PCIT further observed that the profit was earned from transactions of derivative and commodity transactions with MCX, NS....