KUSUMLATA SONTHALIA,KOLKATA vs. D.C.I.T.,C(C)-1(4), KOLKATA

ORDER

Per Shri Partha Sarathi Choudhury, JM

1.That in the facts and circumstances of the case, the Learned Assessing Officer has erred in disallowing the claim of the assessee for deduction under section 54 and 54F of the Act while passing order 263/154/153A/143(3) under section since the particulars relating to deduction claimed u/s section 54 and 54F of the Act were already forming part of regular books of accounts and no incriminating material whatsoever were found during the course of search. The Ld. CIT(A) has erred in confirming the action of the Ld. Assessing Officer. 2.That in the facts and circumstances of the case, the Learned Assessing Officer has erred in concluding that the appellant is not eligible to claim deduction under section 54 and 54F of the Act. The Ld. CIT(A) has erred in confirming the action of the Ld. Assessing Officer.

Kusumlata Sonthalia 3.That in the facts and circumstances of the case, the Learned Assessing Officer has erred in levying interest under section 234A and 234B and/ or the calculation of tax and interest thereon is incorrect. 4. That the appellant craves leave to add, alter and delete all or any grounds of appeal at the time of hearing.

2. In this case at the very outset, at the time of hearing before us, the Ld. AR of the assessee submitted that there was an order passed u/s. 263 of the Act by the Pr. CIT dated 15-01-2018 and thereafter a consequential order was also passed by the AO. Meanwhile the assessee had preferred an appeal against the order u/s 263 of the Act before ITAT, Kolkata and the Tribunal vide its order dated 17-06-2020 for the AY 2010-11 in (assessee’s own case) had quashed the said order, thereby granting relief to the assessee. In such scenario, consequential order passed by the AO on the basis of such order u/s. 263 of the Act has no legs to stand and the same is liable to be quashed. The Ld. DR conceded to these facts as submitted by the Ld.AR of the assessee.

“13. We also note that the Assessing Officer has adopted one of the courses permissible in law and even if it has resulted in loss to the revenue, the said decision of the Assessing Officer cannot be treated as erroneous and prejudicial to the interest of the revenue as held by Hon’ble Supreme Court in Malabar Industries Ltd vs. CIT (supra). Since the order of the Assessing Officer cannot be held to be erroneous as well as prejudicial to the interest of the revenue, in the facts and circumstances narrated above, the usurpation of jurisdiction exercising revisional jurisdiction by the Principal CIT is ‘null’ in the eyes of law and, therefore, we are inclined to quash the very assumption of jurisdiction to invoke revisional jurisdiction u/s. 263 by the Principal CIT.”

Kusumlata Sonthalia 4. In such scenario, the consequential order passed by the AO in relation to the order u/s 263 of the Act does not have any legal validity and accordingly, it is liable to be quashed. We order accordingly.

Order is pronounced in the open court on 5th November, 2020

Sd/- Sd/- (J.Sudhakar Reddy) (Partha Sarathi Choudhury) Accountant Member Judicial Member Dated : 5th November, 2020 **PP(Sr.P.S.) Copy of the order forwarded to: 1. Respective Appellant/Assessee: Kusumlata Sonthalia 34 Pankaj Mullick Sarani, Jayantika Apartment, 1st Fl., Kolkata-19. 2 Respondent/Department : DCIT, C.C 1(4), 110 Shantipally, Aaykar Bhawan Poorva, 3rd Floor, Kolkata 3. CIT(A), 4. CIT- , 5. DR, ITAT, Kolkata.