TaxTMI 
TaxTMI 
2025 (3) TMI 356
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....nal (for short, "the ITAT"), Rajkot, in ITA No. 67/Rjt/2022 for the Assessment Year 2012-2013, proposing the following substantial questions of law: A) Whether on the facts of the case as well as in law, the Appellate Tribunal was justified in quashing the order under Section 263 of the Income Tax Act particularly when Explanation 2 of Section 263 of the Act was expressly invoked by the Ld. PCIT to deem an order prejudicial and erroneous to the interest of revenue? (B) Whether on the facts of the case as well as law, the Appellate Tribunal was justified in quashing the order under Section 263 of the Income Tax Act of Ld. PCIT especially when the Assessment Order passed by the AO is unsustainable in law? (C) Whethe....
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....per the information/documents found during the course of search, the Assessee had entered into a financial transaction amounting to Rs.1,21,81,000/- with M/s. National Shroff. The assessment under Section 143(3) read with Section 147 of the Act was completed on 09.12.2019, declaring the total income of Rs.23,60,690/- by making addition of Rs.23,63,115/- on applying the G.P. rate of 19.40% on unexplained cash transaction of Rs.1,21,81,000/- made by the assessee with the National Shroff. 3.3 Subsequently, the Ld. PCIT, on examination of the assessment records, found that the Assessing Officer had made an addition of Rs.23,63,115/- by taking G.P. @ 19.40% of the total cash transactions of Rs.1,21,81,000/- made with National Shroff. Thus, th....
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....ns. 5. We find that the learned ITAT has discussed the scope and ambit of the revision under section 263 of the Act as arising in the facts of the present case in the following manner :- "8. We have heard rival contentions and perused the material available on record. We observe that the issue under consideration had been examined by the Assessing Officer during the course of original assessment proceedings, wherein notice u/s 133(6) of the Act was issued to the partner of M/s National Shroff, Rajkot. On the basis of disclosures made by the partner of National Shroff and the documents analysed by the Assessing Officer, the Assessing Officer was of the view that the aforesaid amount represented unaccounted cash sales of the asses....
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....sessing Officer had examined the issue in detail during the course of original assessment proceedings and also had taken a view which was a legally plausible view. Looking into the instant facts, we are unable to accept the proposition that the entire explained cash transaction should be brought to tax in the hands of the assessee, since it is a settled principle of law only the real "income" may be subject to tax in hands of the asssessee and nor the entire receipts. Accordingly, the ld. Assessing Officer not erred in applying the GP rate of 19.40% after holding that the aforesaid sum represented unaccounted cash sales of assessee. Therefore, we are of the view that the Assessing Officer took one of plausible/ possible view looking into th....