TaxTMI 
TaxTMI 
2024 (7) TMI 132
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....r section 56 of the act is not tenable. 2. That on the Facts and in the circumstances of the case and in law the learned A.O. has erred in making addition without quantifying the amount of proposed addition and without proposing the variations is in violation of assessment discipline. 3. Without prejudice this ground is taken that on the Facts and in the circumstances of the case and in law the learned A.O. has erred in taking the registrar value of F.M.V at 66,13,000 instead of correct amount of Rs. 64,13,000 as per registry documents. 4. Without prejudice this ground is taken that on the Facts and in the circumstances of the case and in law the learned A.O. has erred in not giving an opportunity to the appellant to justify consideration value of Rs. 44,00,000 against stamp duty value of Rs. 64,13,000 due to the property situated at Agroha Society, Raipur. 5. That On the Facts and in the circumstances of the case and in law the learned CIT(A) erred in sending the notices on ITBA and five appeal hearing notices ,before deciding the appeal, were sent on the wrong mail Id in spite of updating the ITBA portal on 26.08.2021 and that no communication was made on other methods or....
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....022, 08.05.2023, 31.05.2023 and 07.06.2023 issued by the National Faceless Assessment Centre. It is important to delve into the judicial pronouncements on this issue which are elaborated below: 5.2.1 In the case of CIT vs. B.N. Bhattacharya reported at 118 ITR 461, it was held that ".........appeal does not mean merely filing of appeal but effectively pursuing it." 5.2.2 The decision of the Hon'ble High Court of Mumbai in the case of M/s. Chemipol v/s. Union of India, Law Ministry, Aayakar Bhawan, Mumbai and The Commissioner of Central Excise, Mumbai (Central Excise Appeal No.62 of 2009) clearly states, that every court judicial body or authority, which has a duty to decide a matter between two parties, inherently possesses the power to dismiss the case in default. 5.2.3 For the sake of reference, the relevant extract of the judicial pronouncement rendered by the Hon'ble High Court of Mumbai quoting decision of Hon'ble Supreme Court in the case of Nandramdas Dwarkadas AIR 1958 MP 260, is reproduced below: "Now the Act does not give any power of dismissal. But it is axiomatic that no court or tribunal is supposed to continue a proceeding before it when the part....
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....e are that the appellant has not pursued the appeal despite being granted several opportunities as elaborated supra. No details, documents or submissions have been provided to come to any conclusion other than those arrived at by the assessing officer in the assessment order. The Notices have been duly served upon the assessee. Regrettably no response whatsoever was forthcoming on the appointed date. Thus, nothing has been placed on record to substantiate as to why the addition made by the A.O. should not be sustained. 7. In view of the above, the undersigned is left with no option but to decide the case on the basis of material available on record. Bare perusal of the facts shows that the appellant has not pursued the appeal despite being granted several opportunities as elaborated supra. The appellant has jeopardized his case by not responding despite several opportunities that were provided. Sufficient opportunities were provided to the appellant (vide the Notices referred supra) to come up with the ground-wise written submissions alongwith documentary evidence in support of his contentions raised vide Grounds of Appeal & the Statement of Facts. However, there has been total n....
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....ntion, the Ld. AR submitted that though the case of the assessee was selected for "limited scrutiny", but the A.O, thereafter, had traversed beyond the scope of his jurisdiction and made an addition with respect to an issue which had never formed the basis for selection of the case for such limited scrutiny assessment. Carrying his contention further, the Ld. AR had drawn my attention to the notice issued u/s. 143(2) of the Act dated 20.09.2017, wherein reasons forming the basis for selection of the assessee's case for "limited scrutiny" (Computer Aided Scrutiny Selection) were stated. The Ld. AR submitted that the case of the assessee was selected for scrutiny for the limited purpose as mentioned in the aforesaid notice u/s. 143(2) of the Act, viz. whether the cash deposits were made from disclosed sources. The Ld. AR submitted that the assessee had during the subject year made cash deposits of Rs. 10 lacs in his savings bank account No.537010200001373 with Axis Bank, Branch: Tagore Nagar, Raipur which, inter alia, formed part of the sale consideration of Rs. 60 lacs that was received by her on sale of the property vide registered deed dated 07.12.2015. The Ld. AR had further ....
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....ds as under: It was submitted by the Ld. DR that the case of the assessee as per the A.O's report was selected for two fold reasons, viz. (i) there were large cash deposits in the assessee's bank account; and (ii) assessee has transferred one and more properties during the year. The Ld. DR submitted that based on the AO's report, it was incorrect on the part of the assessee to state that the case was selected for "limited scrutiny" only for verifying large cash deposits in his bank account. 10. I have heard the Ld. Authorized Representatives of both the parties, perused the orders of the lower authorities and material available on record as well as considered the judicial pronouncements that have been pressed into service by the Ld. AR for the assessee to drive home his contentions. 11. Ostensibly, the issue involved in the present appeal lies in a narrow compass, i.e. as to whether or not the A.O was right in law and facts of the case in traversing beyond the reasons, for which, the case of the assessee was selected for "limited scrutiny" and, thus, justifiably made the addition in the hands of the assessee. 12. At the threshold, I may herein observe that though it....
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....struction No.20/2015 dated 29.12.2015, observed that the A.O in a case of "limited scrutiny" assessment only after obtaining approval from the Pr. Commissioner of Income Tax/Commissioner of Income Tax can traverse beyond the reasons for which the case was selected for "limited scrutiny" after converting the same into complete scrutiny. It was observed by the Tribunal that in all other cases, the A.O would be divested of his jurisdiction from traversing on issues which did not fall within the limited purpose for which the case was selected for scrutiny assessment. For the sake of clarity, the observations of the Tribunal are culled out as under: "2. Briefly stated, the assessee company which is engaged in the business of manufacturing, trading, import & export of diamonds, jewellery, gold & silver had e-filed its return of income for A.Y. 2014-15 on 29.11.2014, declaring its total loss under the normal provisions of the Act at (-) Rs. 6,44,44,917/- and "book profit" under Sec. 115JB, at a loss of (-) Rs. 6,74,18,402/-. Subsequently, the case of the assessee was selected for "Limited scrutiny through CASS" and notice under Sec. 143(2) was served upon the assessee. As is discernible....
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....osing stock" in the course of the assessment proceedings. Accordingly, the Pr. CIT holding a view that the assessment order passed by the A.O under Sec. 143(3), dated 08.12.2016 was erroneous, insofar it was prejudicial to the interest of the revenue, therefore, "set aside" his order, with a direction to examine the issue relating to "closing stock" after affording an opportunity of being heard to the assessee. 4. The assessee being aggrieved with the order passed by the Pr. CIT under Sec. 263, dated 15.02.2019, has carried the matter in appeal before us. The ld. Authorized Representative (for short "A.R") for the assessee at the very outset of the hearing of the appeal submitted, that as the A.O after due application of mind had framed the assessment, therefore, the Pr. CIT had exceeded his jurisdiction and in the garb of the revisional powers vested with him under Sec. 263 had actually sought to review the order passed by the A.O. Apart therefrom, the ld. A.R also assailed the validity of the order passed by the Pr. CIT under Sec. 263 of the Act. It was submitted by the ld. A.R, that as the case of the assessee was selected for limited scrutiny under CASS for two reasons viz. (....
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....imited reasons" for which its case was selected for limited scrutiny assessment under CASS. 5. Per contra, the ld. Departmental Representative (for short "D.R") objected to the contentions advanced by the counsel for the assessee. It was submitted by the ld. D.R, that the Pr. CIT had rightly exercised his jurisdiction under Sec. 263 and directed the A.O to adjudicate the issue as regards valuation of "closing stock" after affording a reasonable opportunity of being heard to the assessee. In order to drive home his claim that the Pr. CIT had not exceeded his jurisdiction, the ld. D.R had drawn support from "Explanation 2" of Sec. 263 of the Act. In the backdrop of his bereft and devoid of any force, therefore, the same did not merit acceptance and was liable to be dismissed. 6. We have heard the authorized representatives for both the parties, perused the orders of the lower authorities and the material available on record, as well as the judicial pronouncements relied upon by them. Admittedly, the case of the assessee was selected for limited scrutiny through CASS for two reasons viz. (i). Large other expenses claimed in the P&L A/c.; and (ii). Low income in comparison to High ....
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....would not apply. iii. Scope of Enquiry: Specific issue based enquiry is to be conducted only in those scrutiny cases which have been selected on the parameter(s) of AIR/CIB/26AS data. In such cases, the Assessing Officer, shall also confine the Questionnaire only to the specific issues pertaining to AIR/CIB/26AS data. Wider scrutiny in these cases can only be conducted as per the guidelines and procedures stated in Instruction No 7/2014 iv Reason for selection: In cases under scrutiny for verification of AIR/CIB/26AS data, the Assessing Officer has to intimate the reason for selection of case for scrutiny to the assessee concerned. 3. As far as the returns selected for scrutiny through CASS-2015 are concerned, two type of cases have been selected for scrutiny in the current Financial Year-- one is 'Limited Scrutiny' and other is 'Complete Scrutiny'. The assessees concerned have duly been intimated about their cases falling either in Limited Scrutiny' or 'Complete Scrutiny' through notices issued under section 143(2) of the Income-tax Act, 1961 ('Act'). The procedure for handling 'Limited Scrutiny' cases shall be as under: a. In '....
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....ted for limited scrutiny through CASS, for the reasons, that there were viz. (i). Large other expenses claimed in the P&L A/c.; and (ii). Low income in comparison to High Loans/advance /Investment in shares.. Accordingly, it can safely be concluded that the assessment framed by the A.O fell within the realm of the limited purpose for which its case was selected for scrutiny assessment viz. viz. (i). Large other expenses claimed in the P&L A/c.; and (ii). Low income in comparison to High Loans/advance /Investment in shares. 7. As observed by us hereinabove, as per the CBDT instruction No. 20/2015, dated 29.12.2015, in a case which had been selected for scrutiny assessment on the basis of Computer Aided Scrutiny Selection ('CASS'), the scrutinising of such case would be confined only to the specific reasons/issues for which the case has been picked up for scrutiny. However, the case may thereafter be taken up for complete scrutiny with the approval of the administrative Principal commissioner of income-tax/ Commissioner of income-tax, where it is felt that apart from the CASS information there is potential escapement of income of more than Rs. 10,00,000/-. Accordingly, the ....
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....he assessment. In sum and substance, revisional jurisdiction cannot be exercised for broadening the scope of jurisdiction that was vested with the A.O while framing the assessment. As a matter of fact, what cannot be done directly cannot be done indirectly. Accordingly, in terms of our aforesaid observations, we are of the considered view that as the A.O had aptly confined himself to the issues for which the case of the assessee was selected for limited scrutiny, therefore, no infirmity can be attributed to his order, for the reason, that he had failed to dwell upon certain other issues which did not form part of the reasons for which the case was selected for limited scrutiny under CASS. We thus not being able to concur with the view taken by the Pr. CIT that the order passed by the A.O under Sec. 143(3), dated 08.12.2016 is erroneous, therefore, "set aside" his order and restore the order passed by the A.O. As we have quashed the order passed by the Pr. CIT under Sec. 263 on the ground of invalid assumption of jurisdiction by him, therefore, we refrain from adverting to and therein adjudicating the contentions advanced by the ld. A.R on the merits of the case, which thus are left....