Indian Kanoon - Search engine for Indian Law

7. On the facts and circumstances of the case, of the case, Pr. CIT has erred both on facts and in law in setting aside the issue of section 43CA to the file of the AO without properly appreciating the explanation of assessee given during the assessment proceedings brought on record to prove that there is no violation of provisions of section 43CA by the appellant.

7. On the facts and circumstances of the case, of the case, Pr. CIT has erred both on facts and in law in setting aside the issue of section 43CA to the file of the AO without properly appreciating the explanation of assessee given during the assessment proceedings brought on record to prove that there is no violation of provisions of section 43CA by the appellant.

8. Without prejudice to above grounds, on the facts and circumstances of the case and law, Ld. Pr. CIT erred in branding assessment order, as erroneous/prejudicial on an issue which itself was not covered by ambit Hitesh Golchha of search assessment. Order passed u/s 263 is illegal and is liable to be quashed.

7. On the facts and circumstances of the case, of the case, Pr. CIT has erred both on facts and in law in setting aside the issue of section 43CA to the file of the AO without properly appreciating the explanation of assessee given during the assessment proceedings brought on record to prove that there is no violation of provisions of section 43CA by the appellant.

8. Without prejudice to above grounds, on the facts and circumstances of the case and law, Ld. Pr. CIT erred in branding assessment order, as erroneous/prejudicial on an issue which itself was not covered by ambit Hitesh Golchha of search assessment. Order passed u/s 263 is illegal and is liable to be quashed.

As it can be seen from the above submissions and the judicial pronouncements relied on by the appellant that the Ld. PCIT is incorrect Hitesh Golchha in assuming jurisdiction without bringing any additional material on record and therefore the order is illegal and unjustified.

As regards Ground No. 4:

4.1 In the case of appellant, on Audit examination of the case file by ITRAP-

II on basis of assessment records discrepancies with respect to underassessment of Income as prescribed u/s 43CA of the IT Act was raised. (refer page no. 131 of paper book) 4.2 The Ld. AO has not accepted the audit observation (refer page no.129 of paper book) stating that, the assessee has executed an agreement with M/s Adhiraj Developers for sale of plots in the previous year 2012- 13 on 17th August, 2012 and part of consideration has been received by account payee cheque as mentioned in the agreement. After that sale deeds executed as per terms and conditions mentioned in the agreement in various years as directed by M/s Adhiraj Developers favouring various persons. Thus, the assessee has not violated provisions of section 43CA of the Income Tax Act. Copy of Agreement with M/s Adhiraj Developers was filed on 7 December, 2018 during the course of assessment proceeding vide reply letter dated 05.12.2018 is enclosed. (Refer page no.118 of paper book) 4.3 The aforesaid audit objection of the Revenue Audit Department goes to prove that the Revenue Audit Department apparently had not agreed with the view taken by the Id. AO. Hence there exists two views on the same subject within the Income Tax Department itself. There is absolutely no incorrect assumption of fact or incorrect application of law by the Id. AO. Hence it could be safely concluded that the Id. AO had taken one of the possible view. Once a possible view has been taken by the Id. AO, his order cannot be termed as erroneous warranting revision proceedings u/s 263 of the Act. In any case, we find that there is no dispute that the Revenue Audit Party had indeed raised an objection on the very same subject under assessment of income u/s 43CA of the Act and that the Id. AO had not accepted the same. This is evident from the detailed reply given by the Id. AO to the Revenue Audit Party vide his letter dated 22.11.2019 (refer page no.129 of paper Book). We find that the Id. PCIT had invoked revision jurisdiction u/s 263 of the Act on the very same point of under assessment u/s 43CA of the Act. Hence, it could be safely concluded that the revision proceedings has been invoked by the Id. PCIT u/s 263 of the Act based on audit objection, which is nothing but borrowed satisfaction. Hence, the said revision proceedings u/s 263 of the Act needs to be construed as bad in law.