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Income Tax Appellate Tribunal, MUMBAI BENCHES “E” :MUMBAI
Before: SHRI B.R. BASKARAN & SHRI ANIKESH BANERJEE
the Order of the Learned Principal Commissioner Income Tax -1, Mumbai [In short PCIT], order passed u/s 263 of the 2 ITA.No.2799/Mum/2018 M/s The Cricket Club of India Ltd.
Income Tax Act, 1961 (in short “Act”), the order dated 30.03.2018 for the assessment year 2010-11. The impugned order was originated from the order learned Asst.
Commissioner of Income Tax, Circle-1(2)(2), Mumbai (in short “AO”), the order passed u/s 143(3) r.w.s. 263 of the Act, vide order dated 31.03.2016.
2. In brief we advert the fact of the case. The assessee was assessed u/s 143(3) of the Act dated 30.03.2013 for Ay 2010-11. This order was setting aside by the Ld. PCIT by order dated 30.03.2015 u/s 263 of the Act. The Ld. A.O. completed the order on dated 31.03.2016 u/s 143(3) r.w.s.
263 of the Act related to the assessment year 2010-11. The assessee filed an appeal before the ld. Commissioner of Income Tax (Appeal) [in short “CIT(A”)], order passed u/s 250 of the Act on 14.12.2016. All the additions are deleted except disallowance u/s 14A of the Act amounting to Rs. 8,79,268/- was uphold. The Ld. PCIT passed second order u/s 263 of the Act dated 13.03.2018 and setting aside the order passed u/s 143(3) r.w.s. 263 of the Act on 31.03.2016 and direct to assess afresh denovo for Ay 2010-11.
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2.1 In the meantime the assessee filed an appeal against the order u/s 263 of the Act of Ld. PCIT, the order passed on dated 30.03.2015 which was challenged before the ITAT.
The ITAT has adjudicated the issue & passed order dated 18.04.2022 bearing in ‘C’ Bench and quashed the order passed u/s 263 of the Act on dated 30.03.2015. The order u/s 263 dated 13.03.2018 was challenged before us which is based on the order u/s 143(3) r.w.s. 263 dated 31.03.2016 for adjudication.
2.2 The learned counsel of the assessee had filed a paper book from page no. 1 to 232 which kept in the record. The ld. Counsel of the assessee argued that the ITAT has quashed the order of the Ld. PCIT, passed u/s 263 dated 30.03.2015. So, the order passed by Ld. A.O. on 31.03.2016 u/s 143(3) r.w.s. 263 of the Act is automatically infructuous. Accordingly, the order of Ld. PCIT, passed u/s 263 which is standing on the foundation of the order passed u/s 143(3) r.w.s. 263 of the Act is nonest.
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2.3 The ld. Counsel of the assessee argued that Ld. PCIT erred in invoking the revisionary power u/s 263 of the Act without appreciating the fact that the Ld. A.O. after making all possible enquiry examining the fact and proper application of mind completed the assessment of the assessee u/s 143(3) of the Act which was in accordance with the provisions of law. The learned counsel of the assessee relied on the following judgment of the Hon’ble Apex Court reads as under:-
Malabar Industrial Co. Ltd. Vs CIT [243 ITR 83 (SC)
CIT Vs Gabriel India Ltd. [203 ITR 109 (Bombay HC]
3. Metacaps Engineering &Mahendra Construction Co.
(J.V.) vs. CIT [2017] ( 86 taxman 128 )(Mumbai-Trib.)
4. Narayan Tatu Rane vs ITO [2016] (70 taxman 227
(Mumbai Trib.)
5. CIT Vs. Nirav Modi [309 ITR 292 (Mombay HC)] In the observation of the Hon’ble ITAT bearing vide order 18.04.2022, the order of Ld.
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PCIT u/s 263 dated 30.03.2015 is reproducing in para 11.1 and 12 as under:-
“11.1 We hold that merely calling for information to see whether there is “potential reason” to hold that assessment erroneous and prejudicial to the interest of revenue, constitutes a roving or fishing inquiry. Reliance in this regard in placed on the decision of Hon’ble Delhi High Court in the case of CIT vs. International Travel House Ltd reported in 344 ITR 554 (Del), it has been held that the PCIT is not permitted to exercise his revisional powers to conduct a roving or a fishing inquiry with a view to detecting alleged potential sources of income.
In view of the above elaborate observations, we hold that the Ld. PCIT had grossly erred in invoking revisionary jurisdiction u/s 263 of the Act for more than one reason as detailed supra. Accordingly, the revision order passed by him u/s 263 of the Act is hereby quashed. Accordingly, the grounds raised by the assessee are allowed.”
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The Ld. DR vehemently argued and relied on the order of the Ld. PCIT and was unable to submit any contrary view related to submission of the assessee.
We heard the rival submission and relied on the documents available in the record. The Ld. PCIT invoked the provisions of section 263 of the Act on basis of the order passed u/s 143(3) r.w.s. 263 of the Act on 31.03.2016. The entire assessment order was generated as per the direction of the order of the Ld. PCIT u/s 263 of the Act passed on 30.03.2015 but this order u/s 263 of the Act has already quashed by the ITAT in order dated 18.04.2022.
Accordingly, this order passed u/s 263 of the Act has no leg to stand. The execution of order u/s 143(3) r.w.s. 263 is also has no life after the order of ITAT. The order passed u/s 263 of the Act on 13.03.2018 was generated on basis of nonest order. So entire foundation of the second round of order u/s 263 is beyond jurisdiction. Accordingly, the order passed u/s 263 of the Act on dated 13.03.218 is quashed.
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In the result, appeal of the assesseeITA.No.2799/Mum/2018is allowed.
Order pronounced in the open Court on. 03.08.2022.