TaxTMI 
TaxTMI 
2025 (7) TMI 1852
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....ter referred to as 'the Act') for the Assessment Year (A.Y.) 2016-17. 2. The brief facts of the case are that the assessee is engaged in the business of selling petroleum products and had filed its original return of income for the A.Y. 2016-17 on 07.10.2016 declaring total income of Rs. 53,64,110/-. Subsequently, the Assessing Officer had received an information that the assessee had claimed deduction under Section 35(1)(ii) of the Act of Rs. 12,25,000/- @ 175% on the donation of Rs. 7,00,000/- made to M/s. Shri Arvindo Institute of Applied Scientific Research Trust. The case of the assessee was reopened under Section 147 of the Act to examine this transaction. The assessment was completed under Section 147 read with Section 144 of the ....
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.... rws 144B on 24.03.2023 by AO was erroneous and prejudicial to the interest of the revenue in as much as contract income to the tune of Rs. 66,22,032/- as per 26AS was not offered for taxation. 2.2 That the in the facts and circumstances of the Id. Pr. CIT ought not to have invoked the powers of revision u/s. 263 and thereby held that the order of assessment passed u/s. 147 rws 144 rws 144B on 24.03.2023 by AO was erroneous and prejudicial to the interest of the revenue in as much as contract income to the tune of Rs. 66,22,032/- as per 26AS was not offered for taxation. 2.3 The Pr. CIT has failed to appreciate that the issue relating to the contract receipts as per 26AS was very much subject matter of scrutiny by AO and a....
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....nt, the order of the Assessing Officer cannot be held as erroneous and prejudicial to the interest of the revenue. 5. Per contra, Shri R. P. Rastogi, Ld. CIT(DR) submitted that the Assessing Officer had merely accepted the explanation of the assessee regarding contract receipt without making necessary verification as required. He, therefore, strongly supported the order of the Ld. PCIT. 6. We have considered the rival submissions and gone through the materials brought on record in the paper-book. It is found that the Assessing Officer vide notice under Section 142 of the Act dated 16.03.2023 has made enquiry about the contract receipt as per Form 26AS, which is found to be as under :- "1. As per 26AS, you have received an amo....
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....Rs. 49,76,868/- with us and deducted & deposited the TDS u/s. 194C amounting to Rs. 1,04,514/-. In fact, we have not done any transaction/business with the Social Forestry Division, Jaunpur (TAN: ALDS03251D). We have also not claimed the said TDS in our ITR as it does not belongs to us. We have already communicated the fact to the Social Forestry Division, Jaunpur to rectify the said mistake vide letter dated 22.06.2016 through Registered Post sent on 24.06.2016 (CC to Income Tax Department). Copy of letter alongwith receipt of Registered Post acknowledgement enclosed in Annexure B of your ready reference. Your Honor can independently verify the said fact with Social Forestry Division, Jaunpur (TAN: ALDS03251D) as per the powers given to A.....
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....d merely accepted the contention of the assessee. 6.3 So far as contract receipt on account of tyre retreading income and tanker rent income is concerned, these receipts were duly accounted for by the assessee. However, with regard to receipt from Social Forestry Division, Jaunpur, which was denied by the assessee, the Assessing Officer should have made requisite enquiry from the said authority. When the assessee is denying any transaction, it was incumbent upon the AO to independently verify the contention of the assessee by making third party enquiry. Merely because the assessee had not taken credit of TDS made @ 2 %, it can't be considered as correct reason to accept the denial of the transaction by the assessee. As per Explanation-2 ....