2025 (3) TMI 1831

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.... and No.PCIT (Central), Delhi-1/Revision-263/100000674503/2024 u/s 263 of the of the Income Tax Act, 1961 (hereinafter referred as 'the Act') arising out of the orders dated 22.04.2021 and 04.06.2021, respectively, passed u/s 143(3) r.w.s. 144C(3) by the ACIT, Central Circle-8, Delhi (hereinafter referred to as the Ld. AO). 2. The assessee is a private limited company engaged in the business of manufacturing and export of readymade garments. For all the aforementioned assessment years, the assessment of the assessee was framed under section 143(3) of the Income Tax Act vide assessment orders dated 22.04.2021 for Assessment Year 2017-18 and 04.06.2021 for Assessment Year 2018-19. The same were subject to proceedings u/s 263 of the Act and....

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....as valid. 5. We have considered the rival contentions and are of the considered view that the issue arises out of the judgement of the Hon'ble Supreme Court in the case of Checkmate Services (P) Ltd. vs. CIT, 448 ITR 518 (SC) which is dated 12.10.2022. There is no dispute that the impugned assessments were passed well before this judgement of the Hon'ble Supreme Court. On a query from the bench, the ld. AR has admitted that when notices u/s 142(1) were issued, no specific query was raised with regard to the disputed disallowances. However, there is no denial to the fact that on the date of assessment orders, judgement of the Hon'ble jurisdictional High Court in CIT vs. AIMIL Ltd. was there and, as a matter of fact, the same judgement was....

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.... not sustainable. In that case, the Hon'ble Calcutta High Court has found that the AO was bound to follow the jurisdictional High Court judgement in the case CIT vs. Vijay Shree Ltd. (2014) 43 taxmann.com 396. For completeness, we consider it appropriate to reproduce para 7 of the order:- "7. Before we go into the three heads, under which action was initiated under Section 263 of the Act, we have to first examine as to whether the assumption of jurisdiction by the PCIT under Section 263 was just and proper. With regard to the first and third issues, the assessing officer had issued notice under section 142(1) on 1st of May, 2019 and issued a questionnaire form and the assessee had submitted all the relevant details which have been ....

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....t. Secondly, it was held that the PCIT had erred in invoking the revisional jurisdiction under Section 263 of the Act. The law on the subject is well settled, that if it is found, that the assessing officer has in fact conducted an enquiry, merely because the PCIT is of a different opinion, it would not justify action under Section 263 of the Act. The other issue with regard to the provident fund contribution, as mentioned, the assessment order was of the year 2017-18 and on the date, when the assessing officer completed the assessment, the law on the subject as laid down by the jurisdictional High Court, namely this Court is in the case of Commissioner of Income Tax Circle - 1, Kolkata Vs. Vijay Shree Ltd. [2014] 43 taxmann.com 396 (Calcut....