2026 (4) TMI 1772

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....30.09.2021 u/s 143(3) r.w.s 263 of DCIT, Central Circle-1, Noida [hereinafter referred as 'the AO]. 2. On hearing both the sides we find that the appellant filed his return of income on 14.09.2016 declaring total income of 16,76,97,150/-. The copy of notice u/s 143(2) as enclosed at page no 126 to 129 of the PB reveals that the case was selected for compulsory manual scrutiny vide notice dated 25.09.2017 under section 143(2), purportedly in terms of para 1(i) of CBDT Instruction No. 5/2017 dated 07.07.2017.During the course of assessment proceedings, notice under section 142(1) dated 09.10.2018 was issued, and subsequently notice dated 14.11.2018 sought details regarding investments and claim of exemption under section 10(38) of the Act ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....rsuant to the findings recorded by the Tribunal, the Assessing Officer completed the assessment and made an addition of 8,74,51,109/- under section 68 of the Act by treating the Long Term Capital Gain declared by the assessee as income arising from alleged penny stock transactions. Further, an addition of Rs.26,23,533/- was made under section 69C of the Act on account of alleged unexplained expenditure, being commission estimated at 3% for purportedly arranging accommodation entries. 7. The appellant preferred appeal before the CIT(A). However, vide order impugned order dated 01.09.2025, the appeal was dismissed for which assessee is in appeal raising various grounds and following additional ground; That the Ld. CIT(A) has erred....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....exceed 10 lakhs in non-metro charges and 25 lakhs in metro charges. Thus, the Instruction prescribes specific and mandatory preconditions for invoking manual scrutiny under the said category. 11. In the present case, the assessee falls within a non- metro charge. However, it is an undisputed fact that no addition whatsoever had been made in the earlier assessment years, nor had any order been passed sustaining any addition on a recurring issue. In support thereof, the relevant order sheet and assessment records have been placed at page No. 155-161 of the Paper Book, which clearly demonstrate that no such additions existed in the preceding years. Therefore, Department could not contest and deny that the essential condition precedent for i....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....T Instruction No. 5/2017 dated 07.07.2017. The case therein had been selected under Para 1(vi) of the Manual Compulsory Scrutiny Guidelines; however, the mandatory approval as contemplated under the said Instruction was not found to have been properly accorded on record. The Coordinate Bench categorically held that the Instructions issued by the CBDT are binding on the Departmental authorities and are required to be strictly complied with. Since the procedural safeguards and mandatory conditions prescribed in the Instruction were not adhered to, the Tribunal held that the assumption of jurisdiction was invalid and the assessment was liable to be quashed. The Revenue carried the matter further before the Hon'ble High Court in the case of....