SUBLIME WAREHOUSING PRIVATE LIMITED,NAGPUR vs. PRINCIPAL COMMISSIONER OF INCOME TAX (CENTRAL), NAGPUR

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ITA 443/NAG/2026Status: DisposedITAT Nagpur07 September 2026AY 2016-1719 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the PCIT cannot assume jurisdiction under Section 263 merely by asserting that the AO could have taken a different view. The PCIT must establish that the assessment order is not sustainable in law or that the AO's findings are not probable, which requires some minimal inquiry.

What were the facts?

The assessee challenged the revisionary order passed by the Principal Commissioner of Income Tax (PCIT) under Section 263 of the Income Tax Act. The PCIT had held the assessment orders passed by the Assessing Officer (AO) to be erroneous and prejudicial to the interest of revenue, despite the AO having made inquiries and the assessee providing detailed responses.

What were the issues?

Whether the PCIT's revisionary order under Section 263 was justified when the AO had conducted inquiries and the assessee had provided satisfactory responses, and whether the PCIT's assertion of an alternative view is sufficient to deem the assessment order erroneous.

Which sections of the Income-tax Act were involved?

Section 263,Section 143(3),Section 147,Section 148A,Section 148,Section 132,Section 133A,Section 142(1),Section 143(2)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “DB” BENCH, NAGPUR

Before: SHRI ANUBHAV SHARMA & SHRI KHETTRA MOHAN ROY

Hearing: 19.06.2026Pronounced: 07.09.2026

PER ANUBHAV SHARMA, JM:

These appeals preferred by the Assessee against the order of the Ld. Pr. Commissioner of Income Tax (Central), Nagpur (hereinafter referred to as the First Appellate Authority or ‘the Revisionary Authority’ for short)

P a g e | 2 ITA Nos. 443 to 445/Nag/2026 Sublime Warehousing Private Limited (AYs: 2016-17, 2017-18 & 2019-20) in appeals filed before him against the orders of the ld. Assessing Officer (hereinafter referred to as the Ld. AO, for short) passed u/s 143(3) r.w.s147 of the Income-tax Act, 1961 (hereafter referred to as ‘the Act’).

Further details of the orders of the lower authorities are as under: -

ITA No. & Ld. FAA who passed Appeal No. & Date of AO who passed the AY the appellate order order of the Ld. FAA assessment order & Date of order 443/D/26 PCIT (Central) DIN & Order No : ACIT/DCIT, CC-2(2) 2016-17 Nagpur ITBA/REV/F/REV5/20 Nagpur 25-26/1087854307(1) 19.01.2024 Dated: 24.03.2026 444/D/26 PCIT (Central) DIN & Order No : ACIT/DCIT, CC-2(2) 2017-18 Nagpur ITBA/REV/F/REV5/20 Nagpur 25-26/1087851289(1) 29.12.2023 Dated: 24.03.2026 445/D/26 PCIT (Central) DIN & Order No : ACIT/DCIT, CC-2(2) 2019-20 Nagpur ITBA/REV/F/REV5/20 Nagpur 25-26/1087851058(1) 29.12.2023 Dated: 24.03.2026

2.

Heard and perused the records. The issues involved in these appeals is common, on facts and law. Thus they are adjudicated by common order.

Facts where relevant of AY 2016-17 shall be relied in this order. On hearing both sides we find that assessee has challenged the impugned

order u/s 263 of the Act primarily alleging that all the relevant inquiries were made by the AO at the time of inquiry and assesse had filed detailed

response to the queries raised while the ld. Revisionary Authority has examined the issues afresh and without conducting any further inquiry or

P a g e | 3 ITA Nos. 443 to 445/Nag/2026 Sublime Warehousing Private Limited (AYs: 2016-17, 2017-18 & 2019-20) pointing out any substantive reason has held the assessment order to be erroneous so far as prejudicial to the interest of revenue. Ld. Counsel has also submitted that in fact the assessment were completed u/s 147 of the Act and were based on approval of the draft assessment orders from Additional Commissioner of Income Tax (Central), Range-2 and without finding the approval to be erroneous so far as prejudicial to the interest of revenue, the assessment order could not have been held so independently and reliance in this regard has been placed on various decision.

3.

It is countered by the ld. DR by submitting that merely raising of query and submissions filed do not satisfy the intent of law which requires AO to make inquiries about the genuineness of claims. It was submitted by ld. DR that approval granted does not form part of the assessment and on the basis of approval alone the assessment order does not become sacrosanct so as to fall outside purview of Section 263 of the Act. Reliance was placed on Hon’ble Supreme Court Decision in T.N Civil Supplies Corp. Ltd versus CIT [2003] 129 Taxman 69 (SC). In support of contentions supporting the findings of ld. PCIT, ld. DR has filed written submissions and a paper book citing numerous judicial decisions with request to reproduce the same in order for institutional memory and to help perusal of matter further for filing appeal, if needed. However, we have

P a g e | 4 ITA Nos. 443 to 445/Nag/2026 Sublime Warehousing Private Limited (AYs: 2016-17, 2017-18 & 2019-20) considered the submissions filed on 07.08.2026 and 21.08.2026 but their reproduction at length is not necessary as they are primarily reproductions of facts and reasoning of ld. PCIT, which we were well appraised by ld. DR at time of hearing itself.

4.

We have taken into consideration the rival contentions and we find from the material on record that consequent to search and seizure operation u/s 132 of the Act in Anil Deshmukh group of cases and during the course of search and survey action the assessee’s case was covered u/s 133A of the Act. Thereupon information was placed on insight portal for which assesse was issued notice u/s 148A(b) of the Act and thereupon order u/s 148A(d) was passed and consequently notice u/s 148was passed which became basis of the impugned order. The assessment order reflects that notices u/s 143(2) and u/s 142(1) were issued and various dates in response to which assesse had filed various evidences and based upon the same AO had made an addition by way of disallowance on account of two vehicles which were being for personal purpose and not business purposes.

5.

We find that in these cases the ld. PCIT, has examined in AY 2016- 17, the issue of Credits of Rs. 1.30 Cr. Received from group entity, Mismatch in closing balance of M/s Concrete Enterprises Ltd., and disallowance of vehicle expenses, These issues are common to other years

P a g e | 5 ITA Nos. 443 to 445/Nag/2026 Sublime Warehousing Private Limited (AYs: 2016-17, 2017-18 & 2019-20) too and there is issue of disallowance of delayed payment of PF/ESI expenses in AY 2016-17 only.

6.

Now, when we look at the paper book we find that in response to notice u/s 142(1) assesse had filed a detailed reply copy of which is available at page No. 8 and this reply is supported by all the supporting documents. The questionnaire of Section 142(1) of the Act is available at page No. 7-7B of the paper book. At page No. 4-6 copy of order under clause (d) of Section 148A of the Act is made available which show the reasons for reopening as we take into consideration the aforesaid documents it is very apparent that the assessment which has been subject to examination by ld. Revisionary Authority have been very much under the contemplation of the AO at the time of reopening and assesse had given very detailed and illustrative reply of the issues with regard to unsecured loans and ld. Revisionary Authority has held the findings of AO to be erroneous so far as prejudicial to the interest of revenue only on the basis that AO has accepted the submissions and evidences of the assesse without examining that the same were hit by human probability.

7.

The impugned order and findings of ld. Revisionary Authority with regard to issue of unsecured loans seems to be merely very generic wherein ld. Revisionary Authority has expressed the opinion about the

P a g e | 6 ITA Nos. 443 to 445/Nag/2026 Sublime Warehousing Private Limited (AYs: 2016-17, 2017-18 & 2019-20) failure of AO to draw inferences in correct perspective. However, absolutely no material has been extracted from the assessment record or by any other inquiry conducted that the inferences drawn by AO was not at all probable inference and so not sustainable in law. So as to allege that the inference drawn is illegal. We find from the PB that in AY 2019-20, copy of assessment order in case of Concrete Enterprises Pvt. Ltd. And of Adhya Real Estate Pvt. Ltd are made available at pages, 80-81 and 82-83, respectively, for same year where in there is nothing adverse to doubt the impugned transactions.

8.

In this context, we are of the considered view that while holding assessment order or its proceedings to be erroneous so far as prejudicial to the interest of revenue is concerned the law mandates that ld. Revisionary Authority should establish that the assessment order or its findings are not sustainable in law. If allegation is of lack or insufficient enquiry then ld. Revisionary authority should hold some minimal enquiry, and establish that the outcome of assessment would have been otherwise in favour of Revenue. This can be by establishing that the material examined by the ld. AO and the inference drawn are not in accordance with law, but by merely asserting that AO could have taken another view which according to ld. PCIT was a more rational or prudent approach cannot lead to hold that the

P a g e | 7 ITA Nos. 443 to 445/Nag/2026 Sublime Warehousing Private Limited (AYs: 2016-17, 2017-18 & 2019-20) assessment order or findings of AO are erroneous so far as prejudicial to the interest of revenue. The allegation of receiving funds from group entities, by circular rotation of funds, on its own did not make the transaction tainted and needed to be examined by ld. AO, on a holistic basis. To allege same should have been looked upon suspiciously doesn’t lead to inference that its acceptance by ld. AO, makes the assessment order erroneous so far as prejudicial to interest of revenue.Suspicion alone is not sufficient to invoke powers of Section 263 of the Act, the findings of ld. Revisionary Authority should crystallise the facts and evidences to hold that ld. AO, erred in accepting the responses to query as the response was not complete or incorrect, yet accepted by ld. AO.InMalabar Industrial Co. Ltd. v. CIT (243 ITR 83)where Hon’ble Apex Court has held that where the AO has adopted one of the possible courses permissible in law, resulting in a loss of revenue, such order cannot be treated as "erroneous" merely because the Commissioner does not agree with that view, unless the view taken by the AO is unsustainable in law.

9.

Hon’ble Delhi High Court in the case of PCIT Vs. Delhi Airport Metro Express Private Limited vide ITA No.705/2017 order dated 05.09.2017 has held that for the purpose of exercising jurisdiction u./s. 263 of the Act, the conclusion that the order of the AO is erroneous and

P a g e | 8 ITA Nos. 443 to 445/Nag/2026 Sublime Warehousing Private Limited (AYs: 2016-17, 2017-18 & 2019-20) prejudicial to the interest of the revenue has to be preceded by some minimal inquiry. If the PCIT is of the view that the AO did not undertake any inquiry, it becomes incumbent on the PCIT to conduct such inquiry. If he does not conduct such basic exercise then the PCIT is not justified in setting aside the order u/s. 263 of the Act. Reliance for this can also be placed on the Hon’ble Delhi High Court decision in ITO Vs. D.G. Housing Projects Ltd. (2012) 343 ITR 329 (Del), whereby the Hon’ble High Court held as under :

“16. Thus, in cases of wrong opinion or finding on merits, the CIT has to come to the conclusion and himself decide that the order is erroneous, by conducting necessary enquiry, if required and necessary, before the order under section 263 is passed. In such cases, the order of the Assessing Officer will be erroneous because the order passed is not sustainable in law and the said finding must be recorded. CIT cannot remand the matter to the Assessing Officer to decide whether the findings recorded are erroneous. In cases where there is inadequate enquiry but not lack of enquiry, again the CIT must give and record a finding that the order/inquiry made is erroneous. This can happen if an enquiry and verification is conducted by the CIT and he is able to establish and show the error or mistake made by the Assessing Officer, making the order unsustainable in Law. In some cases possibly though rarely, the CIT can also show and establish that the facts on record or inferences drawn from facts on record per se justified and mandated further

P a g e | 9 ITA Nos. 443 to 445/Nag/2026 Sublime Warehousing Private Limited (AYs: 2016-17, 2017-18 & 2019-20) enquiry or investigation but the Assessing Officer had erroneously not undertaken the same. However, the said finding must be clear, unambiguous and not debatable. The matter cannot be remitted for a fresh decision to the Assessing Officer to conduct further enquiries without a finding that the order is erroneous. Finding that the order is erroneous is a condition or requirement which must be satisfied for exercise of jurisdiction under section 263 of the Act. In such matters, to remand the matter/issue to the Assessing Officer would imply and mean the CIT has not examined and decided whether or not the order is erroneous but has directed the Assessing Officer to decide the aspect/question.”

10.

Hon’ble Supreme Court in Malabar Industrial Company Ltd. (Supra) has held that provision of Section 263 of the Act, cannot be invoked to correct each and every type of mistake or error committed by the AO. It is only when order is erroneous that Section 263 will be attracted. In that case, on facts Hon’ble Supreme Court has found that assessee’s return of income at nil was accepted without there being any query in context to certain amounts received which assesse had claimed to be compensation/damages for loss of agricultural income while the same should have been construed under the head income from other sources. However, in the case before us AO had raised all relevant queries which

P a g e | 10 ITA Nos. 443 to 445/Nag/2026 Sublime Warehousing Private Limited (AYs: 2016-17, 2017-18 & 2019-20) were duly replied with substantive evidences and the law in that regard also balanced towards the assesse.

11.

Addressing contention of ld. DR that assessment order is silent on enquires and resultant findings, we are of considered that on its own this cannot lead to inference that no enquiry was made. In this regard we are of considered view that the sufficiency or absence of AO's enquiry must be ascertained from the assessment records as a whole, not merely from the written order.

12.Then settled legal position is that the existence and adequacy of enquiry must be determined from the entire assessment record and surrounding circumstances, and not solely from the face of the assessment order.Reliance in this regard is placed on the decision of Hon’ble Delhi High Court in case of CIT v Sunbeam Auto Ltd. (2011) 332 ITR 167 (Del) held as:

"12. We have considered the rival submissions of the counsel on the other side and have gone through the records. The first issue that arises for our consideration is about the exercise of power by the Commissioner of Income-tax under section 263 of the Income-tax Act. As noted above, the submission of learned counsel for the

P a g e | 11 ITA Nos. 443 to 445/Nag/2026 Sublime Warehousing Private Limited (AYs: 2016-17, 2017-18 & 2019-20) revenue was that while passing the assessment order, the Assessing Officer did not consider this aspect specifically whether the expenditure in question was revenue or capital expenditure. This argument predicates on the assessment order which apparently does not give any reasons while allowing the entire expenditure as revenue expenditure. However, that by itself would not be indicative of the fact that the Assessing Officer had not applied his mind on the issue. There are judgments galore laying down the principle that the Assessing Officer in the assessment order is not required to give detailed reason in respect of each and every item of deduction, etc. Therefore, one has to see from the record as to whether there was application of mind before allowing the expenditure in question as revenue expenditure. Learned counsel for the assessee is right in his submission that one has to keep in mind the distinction between "lack of inquiry" and "inadequate inquiry". If there was any inquiry, even inadequate, that would not by itself, give occasion to the Commissioner to pass orders under section 263 of the Act, merely because he has different opinion in the matter.”

12.1 Similarly Hon'ble Delhi High Court in case of Commissioner of Income-tax vs. VikasPolymers [2012] 341 ITR 537 (Delhi) held that:

"18.......This is for the reason that if a query is raised during the course of scrutiny by the Assessing Officer, which was answered to the satisfaction of the Assessing Officer, but neither the query nor the answer were reflected in the assessment order, this would not by

P a g e | 12 ITA Nos. 443 to 445/Nag/2026 Sublime Warehousing Private Limited (AYs: 2016-17, 2017-18 & 2019-20) itself lead to the conclusion that the order of the Assessing Officer called for interference and revision."

13.

Particularly, as with regard to disallowance of vehicle expenses issue assesse explained that the disallowance itself for subject matter of appeal before ld. CIT(A) and the disallowance or depreciation was deleted. Thus, the very basis to allege that vehicle being used for personal use so as to deny vehicle expenses is not sustainable.

14.

As with regard to failure to payment of employees contribution the subsequent decision of Checkmate Services (P) Ltd. v. CIT[2022] 448 ITR 518 (SC), in AY 2016-17,cannot result into making order erroneous so far as prejudicial to the interest of revenue as on the date of assessment AO had given benefit to the assesse of the then prevalent judicial decisions in favour of assesse.

15.

It appears that the fact which may have had actual bearing on mind of ld. PCIT was that the case of assesse were part of search in a group and assesse had received money from group companies in the form of circulation of funds within company while these companies were actually alleged to be shell companies by investigation wing and so also there were issues about certain expenditures being not on actual basis or for benefit of

P a g e | 13 ITA Nos. 443 to 445/Nag/2026 Sublime Warehousing Private Limited (AYs: 2016-17, 2017-18 & 2019-20) directors and their family members. However, each case had to be examined individually on its own facts by the ld. AO, and taking a gross view, the submissions, explanations and evidences of assesse could not have been discarded on suspicion or scale of human probability, as done by ld. PCIT, in the impugned order. What is alleged to be lack of enquiry is on foundation that as it was case reopening on material found in search of group, the submissions, explanations and evidences of assesse should not have been accepted at all, as the department had found the group to be indulging in some financial irregularities in regard to expenditures or sourcing its funds. However, the burden on AO, was to rebut the submissions, explanations and evidences of assesse, by some evidences. Had AO simply on basis of suspicion and surmises rejected submissions, explanations and evidences of assesse, to make additions or disallowances, as indicated by ld. PCIT, the same would not have sustain the rigours of law, where submissions, explanations and evidences of assesse, cannot be rejected merely on bald and uncorroborated allegations of facts. We are of the considered view when assessing officer had opportunity to examine the issue in group companies together then AO’s comprehensive view of the issue cannot be alleged to be erroneous so far as prejudicial to the interest of revenue as AO having examined the transactions of the group entities

P a g e | 14 ITA Nos. 443 to 445/Nag/2026 Sublime Warehousing Private Limited (AYs: 2016-17, 2017-18 & 2019-20) may have considered it to be genuine inter group transactions for the benefit of the group as a whole. The lack of income of any entity of the group in itself cannot be a basis to doubt its creditworthiness and especially at the stage of proceedings u/s 263 of the Act without otherwise establishing that the opinion formed by the AO was not sustainable in law. Thus conclusion of ld. PCIT, to hold the assessment order to be erroneous so far prejudicial for the revenue cannot be sustained by us. On the contrary, the corresponding grounds raised by the assesse deserves to be sustained.

16.

Then, we find substance in the contention of ld. Counsel that when assesse had responded to the queries of AO and AO has draft assessment order along with assessment records for approval and approval has been granted by competent authority and that approval forms part of the assessment record then without examining and holding the approval to be outcome of any erroneous findings or conclusions, the assessment order cannot be held to be erroneous so far as prejudicial to the interest of revenue. Reliance in this regard is placed on the decision of Hon’ble Madras High Court in PCIT versus Prabhakar Developer (P) Ltd. (2024) 162 taxmann.com 48 (Mad) as relied by Delhi Bench in Devendra Kumar Gupta versus PCIT, Central, Gurugaon vide ITA

P a g e | 15 ITA Nos. 443 to 445/Nag/2026 Sublime Warehousing Private Limited (AYs: 2016-17, 2017-18 & 2019-20) No. 1890 to 1893/Del/2014 order dated 30.08.2024 where in Pune Bench decision in the case of RamamoorthyVasudevan versus PCIT vide ITA No. 967 and 968/Pune/2016 was relied. Similar view is expressed in Shalimar Corp. Ltd. Versus PCIT, Central-3, New Delhi ITA 1546 and 1548/Del/2025 order dated 27.02.2026 (Delhi Tribunal), Manohar and Filament Pvt. Ltd versus PCIT. Central-3, Delhi ITA 2645/Del/2025 order dated 31.12.2025. Similar view is expressed by Mumbai Tribunal in Shashi Kant DamodarKhandelwal and others versus PCIT, Central-1, Mumbai vide ITA 8772/Mum/2025 and others order dated 24.04.2026, Patna Bench in case of GyanInfrabuild Private Ltd. Versus PCIT, Central, Patna, ITA 175 to 178/Pat/2023 order dated 13.05.2024. As also a similar has been the view of Co- ordinate Bench at Nagpur, in case of Sufalam Infra Project Ltd. Versus PCIT, Central, Nagpur ITA 97/Nag/2019 order dated 29/07/2024and by this Bench, itself, in Kumar Builders versus PCIT, Central, Nagpur ITA 450/Nag/2026 order dated 12.06.2026

17.

The decision of ld. DR has relied in case of T.N Civil Suplies Corp. Ltd. Case (supra) we find that was a case where assessment was completed u/s 144B of the Act, and in that case there is actually no need

P a g e | 16 ITA Nos. 443 to 445/Nag/2026 Sublime Warehousing Private Limited (AYs: 2016-17, 2017-18 & 2019-20) for assessing officer and the authority issuing direction, to have their

respective, reasoning for assessment and directions issued u/s 144A of the

Act, as in case of search assessments or re-opening assessments concluded

with approval of competent authority.

18.

We have considered rival contentions as aforesaid and reached a

conclusion, however, for completeness we like to observe that ld. DR has

placed voluminous legal paper book where he has referred the following

judgments:

i. Hon 'ble ITAT, Nagpur in the case of Abhishek NagarmalJangid Vs. Pr. CIT (Central), NagpurITA No. 255/NAG/2025 dated 18.05.2026 ii. Hon'ble ITAT, Nagpur in the case of Rajesh KrushnaraoChikte, Nagpur VS. PCIT-1, Nagpur, ITA No. 335/NAG/2025 dated 20.05.2026 iii. Malabar Industrial Co. Ltd. v. Commissioner of Income-tax, [2000| 243 ITR 83 (SC) iv. Rampyari Devi Saraogi v. Commissioner of Income-tax, [1968] 67 ITR 84 (SC) [01- 05-1967] v. Deniel Merchants P. Ltd. Vs Income Tax Officer Petition(s) for Special Leave to Appeal (C) No(s).23976/2017 vi. Vedanta Ltd. v. Commissioner of Income Tax, [2021]124 taxmann.com 435 (Bombay) vii. Pr. Commissioner Of Income Tax V. Shri Braham Dev Gupta, ITA 907/2017, 2018:DHC:4397-DB viii. Commissioner of Income-tax v. Infosys TechnologiesLtd., 2012] 341 ITR 293 (Karnataka) ix. Gee Vee Enterprises v. Additional Commissioner of Income-tax, [1975| 99 ITR 375 (Delhi)[07-10-1974] x. Hon'ble Delhi ITAT in the case of Ankush Garg v. C.I.T., Rohtak, ITA No. 2287 & 2288/Del/2015 dated21.05.2019 xi. Hon'ble Delhi ITAT in the case of Ramesh Kumar v. ITO, Ward- 3, Hisar, ITA No. 1982/Del/2018 dated25.01.2019 xii. Hon'ble Delhi ITAT in the case of Pooja Gupta v. Pr. CIT, New Delhi, ITA No. 4057/Del/2018 dated31.01.2019 xiii. Hon'ble Delhi ITAT in the case of Bhushan Steel Ltd. v. Asstt. Commissioner of Income Tax, Central Circle-13, New Delhi., I.T.A.No. 1641/Del/2014 dated 30.03.2015

P a g e | 17 ITA Nos. 443 to 445/Nag/2026 Sublime Warehousing Private Limited (AYs: 2016-17, 2017-18 & 2019-20) xiv. Principal Commissioner of Income-tax (Central)-1 v. NRA Iron & Steel (P.) Ltd., [2019] 103 taxmann.com 48 (SC) xv. Commissioner of Income-tax v. Durga Prasad More, [1971| 82 ITR 540 (SC)[26-08- 1971] xvi. Pr. Commissioner Of Income Tax -6, New Delhi V. NDR Promoters Pvt. Ltd., ITA 49/2018, 2019:DHC:348 xvii. Commissioner of Income-tax v. Nova Promoters &Finlease (P) Ltd., [2012] 342 ITR 169 (Delhi) xviii. SajanDass& Sons v. Commissioner of Income-tax, [2003] 264 ITR 435 (Delhi) xix. Ram Lal Agarwal v. Commissioner of Income-tax, Meerut [2006] 280 ITR 547 (Allahabad) xx. Hon'ble Delhi ITAT in the case of Shri Hersh W. Chadha v. DDIT, Circle-1(1) I.T.A.Nos.3088 to 3098 &3107/Del/2005 dated 31.12.2010 xxi. T.N. Civil Supplies Corpn. Ltd. Vs. Commissioner of Income-tax, [2003 260 ITR 82 (SC) xii. NIIT Ltd. Vs. Union of India &Ors.,WP (C) No. 4722/2008, (2009:DHC:5377-DB) xxiii. Hon 'ble Delhi ITAT in the case of Kapil Mehta Vs. Pr. CIT(Central), Delhi-3, ITA No.533/Del/2021 dated11.10.2021 xxiv. Checkmate Services (P.) Ltd. Vs. CIT, [2022] 448 ITR 518 (SC) [12-10-2022] xxv. Dinesh Babulal Thakkar v. Assistant Commissioner of Income-tax, Central Circle 2(2), Ahmedabad, [2010] 39SOT 332 (Ahmedabad - ITAT)[31-03-2010] xxvi. K. Ramasamy v. Commissioner of Income-tax, [2003] 261 ITR 358 (Madras) xxvii. Rajmandır Estates (P.) Ltd. v. Principal Commissioner of Income-tax, Kolkata-III, Kolkata, [2016] 386 ITR 162 (Calcutta) xxviii. SubhlakshmiVanijya (P.) Ltd. v. Commissioner of Income-tax-l, Kolkata, 2015] 155 ITD 171 (Kolkata - Trib.) xxix. Sunil Siddharthbhai v. Commissioner of Income-tax, [1985] 156 ITR 509 (SC)

19.

However, based on our discussion, we find that what all the

decisions relied by ld. DR are distinguishable on facts and in fact in regard

to basic principle for assumption of jurisdiction u/s 263 for which we have

relied the aforesaid decisions in Malabar Industrial Co. Ltd. (supra)

there can be no denial that the principles holds good and therefore, these

judgments do not help the case of ld. DR. However, as he has also referred

P a g e | 18 ITA Nos. 443 to 445/Nag/2026 Sublime Warehousing Private Limited (AYs: 2016-17, 2017-18 & 2019-20) the two cases of Coordinate Bench of Nagpur in Abhishek Nagarmal Jangid (supra) and Rajesh Krushnarao Chikte (supra) we distinguish them on facts as in case of Abhishek Nagarmal Jangid (supra) the Coordinate Bench had examined the issue that AO had accepted additional income offered by assesse which was not disclosed in the regular books of account and thus, the error was found in accepting only 8% of such unrecorded sales without conducting proper verification. Similarly, in case of Rajesh Krushnarao Chikte (supra) the Bench was dealing with an issue where AO had failed to examined applicability of provision of Section 56(2)(vii)(b) of the Act in respect of purchase of immovable property by the assesse. Thus, in peculiar facts the Coordinate Bench in these two decisions had sustained the orders of ld. PCIT but in the case before us we have dealt aforesaid we find that primarily on the basis of relevant queries being raised and response of the assesse we have drawn conclusion that allegation of inadequate, insufficient or lack of inquiry on the issues for which ld. PCIT had merely caused suspicion without any conclusive determination of his own on the basis of any further inquiry, to hold that the assessment orders are erroneous so far as prejudicial to the interest of revenue.

P a g e | 19 ITA Nos. 443 to 445/Nag/2026 Sublime Warehousing Private Limited (AYs: 2016-17, 2017-18 & 2019-20) 20. As a consequence of aforesaid discussion in for AY 2016-17 in ITA 443/NAG/2026, we are of considered view the findings squarely apply to other AYs involved. Thus the grounds are sustained and impugned order deserves to be quashed. The appeals are accordingly allowed.

Order pronounced in the open court on 07.09.2026

Sd/- Sd/- (Khettra Mohan Roy) (Anubhav Sharma) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated 07.09.2026 Rohit, Sr. PS

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