M/S JAYANTHI PROPERTIES (PVT.),VIJAYAWADA vs. THE DCIT, VIJAYAWADA

IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM BENCH, VISAKHAPATNAM BEFORE SHRI V. DURGA RAO, HON’BLE JUDICIAL MEMBER & SHRI D.S. SUNDER SINGH, HON’BLE ACCOUNTANT MEMBER ITA No. 209/VIZ/2015 (Asst. Year : 2010-11) M/s. Jayathi Properties (P) vs. DCIT, Circle-2(1), Ltd., D.No.36-11-7, Vijayawada. Santhinagar, 1st Lane, Moghalrajpuram, Vijayawada. PAN No. AABCJ 5079 Q (Appellant) (Respondent)

Assessee by : Shri G.V.N. Hari, Advocate. Department By : Shri Deba Kumar Sonawal, CIT DR Date of hearing : 23/07/2018. Date of pronouncement : 25/07/2018. O R D E R PER V. DURGA RAO, JUDICIAL MEMBER

This appeal by the assessee is directed against the order of Commissioner of Income Tax, Vijayawada, dated 27/03/2015 for the Assessment Year 2010-11. 2. Facts of the case, in brief, are that the assessee M/s. Jayathi Properties Pvt. Ltd. is engaged in the business of real estate, filed its return of income admitting total income of Rs.83,152/-. The return filed by the assessee was processed under section 143(1) of the Income Tax Act, 1961 (hereinafter

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referred to as "Act"). Thereafter, after following due procedure, assessment was completed under section 143(3) on 26/03/2013 determining total income of Rs. 12,85,740/- by making disallowance of registration charges of Rs. 1,97,185/- and development charges of Rs. 10,05,400/-. The Commissioner on examination of record found that the Assessing Officer has not examined certain issues, hence, assessment order passed by the Assessing Officer considered to be erroneous and so far as prejudicial to the interest of the revenue within the scope of section 263 of the Act. Therefore, he issued a show-cause notice under section 263, dated 25/01/2015 to the assessee calling for its objections. In response to that, assessee has filed a detailed reply. Ld. Commissioner after considering the reply given by the assessee, set aside the order passed by the Assessing Officer dated 26/03/2013 and directed the Assessing Officer to redo the assessment on the issues discussed in his order in accordance with law after affording the assessee a reasonable opportunity of being heard. 3. On being aggrieved, assessee carried the matter in appeal before the Tribunal. 4. Ld. counsel for the assessee has submitted that the Assessing Officer has completed assessment under section 143(3)

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of the Act after considering all the details, therefore, ld.Commissioner wrongly exercised his jurisdiction under section 263 of the Act and submitted that the order passed by the Commissioner is beyond of his jurisdiction and therefore, same may be quashed. 5. On the other hand, ld. Departmental Representative submitted that Assessing Officer though, order passed under section 143(3), not examined the issues identified by the ld.Commissioner, therefore, ld. Commissioner rightly set aside the order passed by the Assessing Officer, hence, same may be upheld. 6. We have heard both the parties, perused the material available on record and gone through orders of the authorities below. 7. The assessee is engaged in the business of real estate, filed its return of income for the Assessment Year 2011-12 by admitting income of Rs. 83,152/-. The Assessing Officer completed the assessment by determining total income of Rs.12,85,740/- by disallowing registration charges of Rs.1,97,185/-, development charges of Rs. 10,05,400/-. Thereafter, ld. Commissioner examined the record and found that the Assessing Officer not examined the issues involved in the

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assessment and therefore, considered the order passed by the Assessing Officer is erroneous and prejudicial to the interest of the revenue and issued a show cause notice to the assessee. After considering the assessee’s reply, set aside the order passed by the Assessing Officer and directed the Assessing Officer to redo the assessment after giving reasonable opportunity of hearing to the assessee. 8. We have gone through the assessment order. We find that there is no observation of the Assessing Officer in respect of the issues identified by the ld. Commissioner, which are examined by the Assessing Officer. When we pointed out ld. counsel for the assessee that during the course of assessment proceedings whether Assessing Officer has asked any question or any enquiry or called any details in respect of the issues pointed out by the ld.Commissioner, he is not able to answer the same. We find that the Assessing Officer without examining various issues identified by the ld. Commissioner, simply assessment is completed under section 143(3) of the Act. We find that ld. Commissioner rightly exercised his jurisdiction under section 263 of the Act and set aside the assessment order and directed the Assessing Officer to redo the assessment in accordance with law after giving reasonable opportunity of hearing to the assessee. We find no

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infirmity in the order passed by the ld. CIT(A). Thus, this appeal filed by the assessee is dismissed. 9. In the result, appeal filed by the by the assessee is dismissed. Order Pronounced in open Court on this 25th day of July, 2018.

Sd/- sd/- (D.S. SUNDER SINGH) (V. DURGA RAO) Accountant Member Judicial Member Dated : 25th July, 2018. vr/- Copy to: 1. The Assessee – M/s. Jayathi Properties (P) Ltd., D.No.36-11-7,Santhinagar, 1st Lane, Moghalrajpuram, Vijayawada. 2. The Revenue – DCIT, Circle-2(1), Vijayawada. 3. Ld. CIT, Vijayawada. 4. The D.R., Visakhapatnam. 5. Guard file. By order

(VUKKEM RAMBABU) Sr. Private Secretary, ITAT, Visakhapatnam.