TaxTMI 
TaxTMI 
TaxTMI 
2025 (3) TMI 1548
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.... income of Rs. 27,59,19,580/-. The said income was reduced to Rs. 11,24,19,211/- in terms of the order of ld. CIT(A)-IV, Kanpur dt. 14.07.2021. Thereafter, on the basis of information received from DCIT, Central Circle-1(3), Mumbai that during the year, the assessee had entered into bogus accommodation entries/transactions to the tune of Rs 4,54,23,000/- with M/s Pandhe Group, reassessment proceedings were initiated by issue of notice u/s 148 on 12.03.2021. During the course of reassessment proceedings, AO vide query letter dated 11.11.2021 issued alongwith notice u/s 142(1) of the Act, asked the assessee to explain the nature of all transactions made during the year under consideration with entities comprising M/s Pandhe group alongwith ledger account & other supporting documents like ITR, duly signed confirmation, bank statements etc., said notice is available in paper book pages 18-23. In reply, the assessee vide letter dated 17.11.2021 stated that it had made no transactions with any entity of M/s Pandhey Group, reply is placed in paper book page 27. Then the AO vide show cause notice dt. 27.03.2022 observed that transactions as per information available with him matc....
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.... proposed to be revised is not erroneous and is not prejudicial to the interest of the revenue. 4.1. That on the facts and circumstances of the case and in law the Ld. PCIT grossly erred in not considering that just because the Ld. AO has passed an order without making any addition and without mentioning any details elaborately, that by all cannot be said an order to be erroneous or prejudicial to the interest of the revenue. 5. That on the facts and circumstance of the case and in law, the Ld. PCIT grossly erred in not considering that the Revenue Authorities after concluding proceedings for a period, cannot, subsequently initiate proceedings for the very same period again and again. 6. That on the facts and circumstances of the case and in law the Ld. PCIT grossly erred in rejecting the submission and analyzing the evidence(s) furnished on record and passing the orders in summary manner on preconceived notion. 7. That on the facts and circumstances of the case and in law, the order passed by the Ld. PCIT is against the principles of natural justice, equity and fair play. 8. That on the facts and circumstances of the case and in law, th....
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....e M/s Pandhe group and made no addition. According to ld.AR, the Ld. PCIT solely on assumptions and presumptions held the order passed u/s 143(3) /147 as erroneous and prejudicial to the interest of revenue without referring to any material which was not considered by the AO or the issue on which no enquiry or verification was made by him. He thus prayed that when this issue has already been examined and found that the information available with the Department was not correct and the assessee is having no transaction with any entity of the Pandhe Group, the AO has taken a possible view, thus the order of the Ld. PCIT u/s 263 is nothing but mere change of opinion. 5.1 Ld. AR further submitted that just because the AO passed an order without making any addition and without mentioning the enquires conducted elaborately in the order, such order cannot be erroneous and prejudicial to the interest of revenue. It is not a case where no enquiry or verification was carried out by the AO rather all the necessary enquiries were made and based on which, best possible view was taken by the AO, therefore, the order passed u/s 263 of the Act deserves to be quashed. He further placed reliance o....
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...., he immediately made further inquiry to verify the genuineness of such transaction. This fact is verifiable from the show cause notice dt. 27.03.2022, placed in the paper book pages 93-94 wherein when the AO found that dates and amounts of transactions with M/s Patel Engineering Ltd. are matching with the information available, he asked the assessee to explain all such transactions and also further proposed to make the additions in the hands of the assessee of entire payment of Rs. 12,81,77,735/- as bogus and unexplained. This clearly shows that adequate and sufficient inquiries and verification was done by the AO taking the plausible view that no such alleged transaction was carried by the assessee with any entity of Pandhe group. All these documents and relevant replies filed by the assessee find place in the paper book filed by the assessee. Now, ld. PCIT alleged that the assessment order is erroneous and prejudicial to the interest of revenue as the AO has not made proper inquiries and verification which in our opinion is not correct nor there is any lack of inquiries on the part of the AO who has taken the plausible view on the material available on record and submission....
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....e jurisdiction under Section 263 of the 1961 Act, the Commissioner of Income Tax should have examined the merits and only on reaching a finding that the re-assessment order was erroneous and prejudicial to the interest of the Revenue made an addition. This is not a case of 'no inquiry and verification', but as made out by the Revenue, a case of wrong conclusion. The difference between the two situations is clear and has different consequences. This being the position, the High Court was right in dismissing the appeal preferred by the Revenue. The special leave petition is dismissed in the above terms. Pending application(s), if any, shall stand disposed of." 7.3 The hon'ble Delhi High court in the case of PCIT Vs. Clix Finance India Ltd. while concurring to the findings of the Tribunal has observed as under: 27. Considering the aforesaid judicial pronouncements, it can be safely concluded that inadequacy of enquiry by the AO with respect to certain claims would not in itself be a reason to invoke the powers enshrined in Section 263 of the Act. The Revenue in the instant case has not been able to make out a sufficient case that the CIT has exercised the ....