TaxTMI 
TaxTMI 
2024 (8) TMI 1423
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.... from the regular business activity of the assessee and thus can only be assessed under the head profits & gains of business liable for taxation under the normal provisions of the Act.'' 2.1 The assessee is proprietor of M/s Sandeep Mineral Industries engaged in the business of manufacturing of mineral products. A survey u/s 133A of the Act was carried out at the business premises of assessee on 11.10.2017. In course of survey assessee in his statement dt. 11.10.2017 (PB-22) which continued on 12.10.2017, in reply to Q. No.16 (PB 26) submitted that since books of accounts were not complete, there is an excess stock of Rs. 23,62,332/- which is offered for tax in the current year income. This statement was further confirmed by assessee on 13.10.2017 (PB 28-30). In this case, it is noted that the assessee filed the return on 25.09.2018 (PB 15-18) declaring total income of Rs. 36,04,600/- which includes excess stock of Rs. 22,14,825/- credited to P&L A/c (PB 20). Thus, the AO accepted the income returned by the assessee. 2.2 In this case, it is noted that the Ld. PCIT(Central), Jaipur issued show cause notice u/s 263 dt. 22.02.2024 stating that during the survey excess stock of Rs. 2....
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....r for correction of the error committed by the AO on the issues discussed in his order and that too based upon independent satisfaction of the AO who will duly consider the replies of the taxpayer. 2.3 Aggrieved by the order of the ld. Pr. CIT (Central), the ld. AR of the assessee prayed before the Bench to quash to order passed u/s 263 of the Act by the ld.Pr. CIT (Central) submitting following written submission alongwith case laws. ''1. At the outset it is submitted that clause (a) & clause (b) of Explanation 2 to section 263 provides that order passed by AO is deemed to be erroneous in so far as prejudicial to the interest of revenue if the order is passed without making enquiries or verification which should have been made or the order is passed allowing any relief without enquiring into the claim. In the present case, AO has referred to Q. No.16 of the statement recorded during survey where assessee has surrendered the amount of Rs. 23,62,332/- as his income of the year under consideration. However, in the return assessee offered Rs. 22,14,825/- and on difference of Rs. 1,47,507/- assessee paid tax with interest on 13.03.2024. The amount offered for tax has been subjected ....
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.... made by AO, that would not give occasion to invoke jurisdiction u/s 263 merely because Commissioner had different opinion unless view taken by AO is unsustainable in law. (v) Dhanraj Chhipa Vs. PCIT (2023) 225 DTR 315 (Jodhpur) (Trib.) If there was any enquiry and a possible view was taken by the AO, it would not give occasion to the CIT to pass orders u/s 263 merely because he has a different opinion in the matter. Since the AO has examined the assessee's case and made complete enquiry regarding the issue raised in the revision proceeding, the Principal CIT was not justified in passing the impugned revision order. (vi) Satya Narayan Dhoot Vs. PCIT (2023) 222 DTR 177 (Jodhpur) (Trib.) AO having issued notice u/s 142(1) wherein he called for details of exempt income and also justification for various exemptions and deductions claimed in the return of income including the profit on sale of investments and the assessee having filed the break-up details of exempt income including exemption of long-term capital gain claimed u/s 10(38) in reply thereto, the Principal CIT was not justified in initiating revision proceedings on the basis that the AO has allowed the exemption w....
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....ooks of accounts and the accounting treatment thereof so as to regularise its books of accounts. In fact, the same provides a credible base for Revenue to bring to tax subsequent profit/loss on sale of such stock of rice in future. 2.11. Having said that, the next issue that arises for consideration is whether the amount surrendered by way of investment in the unrecorded stock of rice has to be brought to tax under the head "business income" or "income from other sources". In the present case, the assessee is dealing in sale of food grains, rice and oil seeds, and the excess stock which has been found during the course of survey is stock of rice. Therefore, the investment in procurement of such stock of rice is clearly identifiable and related to the regular business stock of the assessee. The decision of the Co-ordinate Bench in case of Shri Ramnarayan Birla (supra) supports the case of the assessee in this regard. Therefore, the investment in the excess stock has to be brought to tax under the head "business income" and not under the head income from other sources". In the result, ground No. 1 of the assessee is allowed." Similar view has been taken by Hon'ble ITAT, Jaipur Be....