TaxTMI 
TaxTMI 
2025 (9) TMI 652
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....der of ld.PCIT u/s. 263 of the Act. Considering it to be a 'reasonable cause' and that the assessee would not have gained by delaying the filing of appeal, the delay of 237 days is condoned in light of judgments of Hon'ble Apex Court Court in the case of Collector, Land Acquisition, Anantnag & Anr. Vs. Mst. Katiji & Ors. reported in (1987) 2 SCC 107 and in the case of Inder Singh Vs. State of Madhya Pradesh judgment dated 21.03.2025 (2025 INSC 382). 3. Brief facts of the case are that the assessee is an individual and did not file the return of income for A.Y. 2015- 16. As far as information available with the income-tax department during the assessment proceedings in another assessee namely Mr. Atul Avinadh Patil, it was noticed that the assessee has given Rs. 1,58,94,320/- to Mr. Atul Avinash Patil in cash during F.Y. 2014-15. Since huge amount in cash given by the assessee to her husband and no return of income filed, ld. Assessing Officer had reason to believe that Rs. 1,58,94,320/- had escaped the assessment and accordingly issued notice u/s. 148 of the Act on 31.03.2021 and reopened the assessment u/s. 147 after duly recording the reasons. Assessee in response to the notic....
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.... Assessing Officer in your case for the A.Y. 2015-16 appears to be erroneous in so far as it is prejudicial to the interest of the revenue. Accordingly, and by virtue of the authority vested in the undersigned as per the provisions of section 263 of the Income Tax Act 1961, the said order is proposed to be revised under the said section." Show cause letter dated 23.02.2024 2. Vide your submission given to the FAO you had stated that "on 24.09.2014 a part of the receipt from the Sales proceedings (Rs.45,00,000) was converted in to a Fixed Deposit in the name of Tejashree Patil for only about 15 days & an amount of Rs 45,09,320. This FD Number was 34232339571 in SBI Kothrud. An appreciation of the above submission shows that the FD was made on 24.9.2014. The due date of Sling of return for AY 2015-16 was 31.7.2015, which was extended to 31.8.2015. This implies that the FD was made beyond the due date of filing of return. Hence in the instant case, no return of income was filed by you for AY 2015-16 u/s 139(1). Further as per the provisions of the Act, you had to deposit the 'un-utilized sale consideration into a special "Capital Gain account" (and not in FD] wit....
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.... case and in law Ld. Principal CIT Pune -2 has erred in law and on facts assuming jurisdiction in passing the 4 order u/s. 263, more so when the assessment order u/s. 143(3) r.w order u/s. 147 dt.22.03.2022 was neither erroneous nor prejudicial to the interest of Revenue. Thus, order passed by Ld. Principal CIT Pune -2 is bad in law, erroneous and may kindly be quashed. 4. The appellant would like to leave, add, alter, amend, modify, delete, above grounds of appeal before or during the course of hearing in the interest of natural justice." 7. At the outset, Ld. Counsel for the assessee referring to Ground Nos. 1 to 3 submitted that ld. PCIT gravely erred in assuming jurisdiction beyond the scope for which the reassessment proceedings were initiated and concluded. Ld. Counsel for the assessee submitted that the issues raised in the show cause notice u/s. 263 of the Act was not the subject matter and reasons recorded for reopening the assessment proceedings. Therefore, ld. PCIT erred in assuming jurisdiction. Referring to the following decisions, he claimed that ld. PCIT cannot assume jurisdiction u/s. 263 of the Act for the new issues which were never the subject matter ....
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....assed on or before or after the 1st day of June, 1988 by the Assessing Officer shall include- (i) an order of assessment made by the Assistant Commissioner or Deputy Commissioner or the Income-tax Officer on the basis of the directions issued by the Joint Commissioner under section 144A; (ii) an order made by the Joint Commissioner in exercise of the powers or in the performance of the functions of an Assessing Officer conferred on, or assigned to, him under the orders or directions issued by the Board or by the Chief Commissioner or Director General or Commissioner authorized by the Board in this behalf under section 120; (b) record shall include and shall be deemed always to have included all records relating to any proceeding under this Act available at the time of examination by the Commissioner; (c) where any order referred to in this sub-section and passed by the Assessing Officer had been the subject matter of any appeal filed on or before or after the 1st day of June, 1988, the powers of the Commissioner under this sub-section shall extend and shall be deemed always to have extended to such matters as had not been considered and decided i....
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....de the order and direct the Assessing Officer to pass a fresh order. At this stage, before considering the multi-fold contentions of the ld. Representatives, we deem it pertinent to take note of the fundamental tests propounded in various judgments relevant for judging the action of the CIT taken u/s 263. 12. Hon'ble Supreme Court in the case of Malabar Industrial Co. Ltd. vs. CIT (2000) 243 ITR 83 (SC)has laid down following ratio with regard to provisions of section 263 of the Act: "There can be no doubt that the provision cannot be invoked to correct each and every type of mistake or error committed by the Assessing Officer; it is only when an order is erroneous that the section will be attracted. An incorrect assumption of facts or an incorrect application of law will satisfy the requirement of the order being erroneous. In the same category fall orders passed without applying the principles of natural justice or without application of mind. The phrase 'prejudicial to the interests of the revenue' has to be read in conjunction with an erroneous order passed by the Assessing Officer. Every loss of revenue as a consequence of an order of the Assessing Officer ....
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...., it is found that the assessee has not filed the return of income for A.Y. 2015-16. However, as per the information, the assessee Smt. Tejashree Atul Patil has given the cash of Rs. 1,58,94,320/- to Shri. Atul Avinash Patil during the F.Y. 2014-15, which is the income of the assessee for A.Y 2015-16 which was not offered for taxation due to non filing of ITR for A.Y 2015-16. I have therefore, reason to believe that the income chargeable to tax amounting to Rs. 1,58,94,320/-has escaped assessment within the meaning of provisions of section 147(a) of the IT Act, 1961. 04. In this case, no return of income was filed for the year under consideration accordingly, in this case, no assessment was made and the only requirement to initiate proceedings u/s 147 is reason to believe which has been recorded above. 05. It is pertinent to mention here that in this case the assessee has chosen not to file return of income for the year under consideration although the total income of the assessee had exceeded the maximum amount which is not chargeable to tax as discussed in paragraph 2 above and the assessee was assessable under the Act. In view of the above, the provisions of cl....