ABIS BROILER PRIVATE LIMITED( A PRIVATE LIMITED COMPANY),RAJNANDGAON vs. ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL-2, RAIPUR

As per its grounds of appeal, the assessee has challenged the revisional action of the PCIT whereby the Assessing Officer was ABIS Broiler Pvt Ltd Vs. ACIT AY : 2012-13 - 2 - directed to pass the assessment order de novo after making inquiries on the points set out in the notice which has already examined and considered during the original assessment proceedings concerning AY 2012-13. The assessee has challenged the assumption of jurisdiction by the PCIT under Section 263 of the Act on the ground that the Assessment Order under revision is neither erroneous nor prejudicial to the interest of the revenue.

The relevant facts, in brief, are that the return of the assessee was subjected to search assessment for the AY 2012-13 in question and the assessment was completed by the Assessing Officer by passing the assessment order under Section 153A r.w.s. 143(3) of the Act dated 19.12.2016.

Thereafter, the PCIT called for the assessment records and opined that the assessment order so passed is erroneous insofar as prejudicial to the interest of the revenue on the issue of non- examination of arranging bogus purchase bills amounting to Rs.1,24,02,421/- from M/s. Rajdhani Trading Company by the assessee. Similarly, another group company M/s. Indian Agro and Food Industries Limited is also stated to have availed the bogus purchase bills from M/s. Rajdhani Trading Company. The PCIT accordingly invoked revisional powers under Section 263 of the Act and issued show-cause notice dated 26.04.2017 to this effect.

The PCIT did not find merit in the explanations of the assessee in its defense and alleged that the Assessing Officer did not make verification and inquiries that should have been made in the context of the case. The PCIT accordingly set aside the impugned assessment

When the matter was called for hearing, the learned Counsel for the assessee, at the outset, submitted that the action of the PCIT is plainly without authority of law. The assessee was earlier subjected to assessment which stood completed earlier before the search and was thus not abated in terms of second proviso to Section 153A of the Act. The inquiries in the concluded assessment thus could not go without reference to incriminating material found in the course of search. In response to the substantive allegation of the PCIT that the transactions of the purchase done with M/s. Rajdhani Trading Company was not property verified by the Assessing Officer, the learned Counsel adverted to question No.6 of the questionnaire dated 19.02.2016 on the issue (Page Nos. 17 & 18 of the paper-book). In response to the specific query raised by the Assessing Officer, the assessee has furnished a detailed submission on 30.06.2016 to defend its factual position (Reply placed at page Nos.22 to 25 of the paper- book). It was thus contended that it is after perusal of the submissions and examination of facts and circumstances of the case, the Assessing Officer found merit in the plea of the assessee after proper application of mind. It is thus contended that the factual issue which has been examined threadbare by the Assessing Officer in search assessment, the reopening of the assessment on the same issue in the garb of review is highly unjustified. It was further submitted that the assessment order passed under Section 153A of the Act, after

The learned Departmental Representative, on the other hand, supported the action of the revisional authority and relied upon the revisional order.

We have carefully considered the rival submissions and perused the revisional order in question and also other materials referred to and relied upon by the respective sides and case-laws cited in this regard. On a broader reckoning, the factual position that emerges out is that the assessee has procured poultry feed from M/s. Rajdhani Trading Co. The revenue was in possession of certain information pertaining to M/s. Rajdhani Trading Co. and on the basis of that information, the Assessing Officer raised specific query and confronted the factual position to the assessee. In response to the specific query, the assessee submitted certain submissions to support its case that the transactions undertaken with M/s. Rajdhani Trading Co. is bonafide and also submitted the copy of confirmation and tax audit report of the supplier company. All the bills and vouchers for ABIS Broiler Pvt Ltd Vs. ACIT AY : 2012-13 - 5 - such transactions were placed before the Assessing Officer for verification. It was also pointed out that the proprietor of the supplier company has not identified the assessee for the purposes of alleged bogus bills and such statement of the supplier company is vague and generic in nature. The request for cross-examination of the concerned person (Shri Jitendra Kumar Sahu) giving statement on behalf of the supplier company was not honoured. The proprietor of supplier namely Shri Jitendra Kumar Sahu vide affidavit dated 10.04.2013 has also retracted his original statement, which in any case, was general without implicating the assessee in particular. In this factual backdrop and after considering the submissions of the assessee and verification of books of accounts and documents produced by the assessee, the Assessing Officer was convinced with the bonafides of the purchases made and did not embark upon any additions in this regard.

In the result, the appeal of the assessee is allowed.