SH. SANDEEP KUMAR AGGARWAL,NEW DELHI vs. ITO, NEW DELHI

O R D E R PER PRASHANT MAHARISHI, A. M. 1. This appeal is preferred by assessee against the order of the Commissioner of Income Tax passed under section 263 of the Income Tax Act dated 18/02/2014 for assessment year 2009- 10. 2. Though assessee has raised 8 different grounds of appeal in appeal memo. The only issue in appeal before us is whether the Ld. CIT is justified in invoking the jurisdiction under section 263 of the Income Tax Act in the present case.

3. The brief facts of the case is that assessee is an individual who filed his return of income on 29/09/2009 declaring income of Rs. 1023140/– and assessment under section 143(3) of the Act was completed on 06/07/2011 at income of Rs. 1106240/-. The main reason for invoking the jurisdiction under section 263 of the income tax act by the Ld. CIT was that as survey operation under section 133A was conducted on Sh. KK Aggarwal, father of the assessee, on 19/9/2008, wherein it has come to the notice that assessee was the proprietor of 2 firms and books of accounts and documents pertaining to the above firms were found during the course of survey operation. During the course of assessment proceedings, the genuineness of the sundry creditors of Rs. 1.40 crore was not properly enquired by the assessing officer and a substantial fall in the gross profit as assessee has declared the gross profit of Rs. 5.20 crores on total turnover of Rs. 9.38 crores while in the same year under consideration, it was Rs. 3.58 crores on total turnover of Rs. 14.02 crores, was also not enquired. It was further noted that during the year the total withdrawal for household expenditure was shown by the assessee of Rs. 137930, which was not commensurating with Sandeep Kumar Aggarwal Vs. ITO, (Assessment Year: 2009-10) the size and family status of the assessee. Therefore, the Ld. assessing officer moved proposal before the Ld. CIT stating that the assessment order was erroneous and prejudicial to the interest of the revenue. Therefore, the Ld. CIT issued a show cause notice on 12/08/2013. After examining the explanation of the assessee, the Ld. CIT was of the view that the order passed by the Ld. assessing officer is erroneous and prejudicial to the interest of revenue as no enquiries were conducted by the assessing officer in respect of sundry creditors of Rs. 1.40 crores. The assessing officer has further not examined the genuineness of the commission expenses. The assessee has shown a meager withdrawal of Rs. 137930/- during the year which is not commensurate with the size, status, and living standard of the family of the assessee. The Ld. CIT passed order under section 263 of the Income Tax Act on 18/2/2014 annulling the assessment with direction that fresh assessment be made as per the provisions of the Act after examining the material available with the assessing officer as well as the impugned material found during the survey operation and properly examining the facts as well as legal positions. This order is under challenge before us.

details of the assessee for various years submitted. With respect to the details of the sundry creditors, he stated that the page No. 71 to 76 of the paper book submitted before the assessing officer shows the name, address, amount outstanding and permanent account number of all the creditors. He further stated that commission paid of Rs. 2439314/- is also submitted to the Ld assessing officer which is at page No. 85 to 86 of the paper book. He further referred to the submission made before the Ld. CIT, dated 10/9/2013 wherein he submitted various details submitted before the Ld. assessing officer and stated that the complete enquiry has been made by the Ld. assessing officer. In the end he relied upon the decision of the Hon’ble Delhi High Court in case of Pr. Commissioner Of Income Tax Vs. Delhi Airport Metro Express Private Limited dated 05/09/2017 wherein the Hon’ble Delhi High Court has held that where the Ld. assessing officer has made enquiries regarding the addition for which the revision has been made by the Ld. CIT, the assessment order cannot be termed as erroneous unless it is not in accordance with the law. It further held that the Ld. CIT has not made any enquiry himself which is necessary for him to establish and show the error or mistake made by the Ld. assessing officer making the assessment order unsustainable in law, and such finding must be clear, unambiguous and not debatable. Therefore, he submitted that order u/s 263 of the Act is not sustainable.

80 with respect to the claim of gross profit and sundry creditors. With respect to the sundry creditors name, address, amount outstanding and PAN along with the confirmation were filed. Same are placed at page No. 115 to 133 of the paper book. Further with respect to the commission expenditure of Rs. 2439314/- the details were submitted as per page No. 85 to 86 of the paper book. With respect to the survey conducted it was stated that assessee has shown income from Siva International Apparels in his computation of total income and during the course of survey no incriminating evidence were found. These proprietorship concern of the assessee was disclosed by the assessee in his return of income. Further, the job work income and expenditure of other concern were incorporated in profit and loss account. He stated that complete examination of details were made by the ld Assessing Officer of the business transactions of the assessee. Further, with respect to ABC Enterprise he submitted that assessee has completely incorporated the income of Rs. 4099538/- and expenses of Rs. 7842730/- in the profit and loss account. Therefore, all these details/ facts were duly examined by the ld Assessing Officer. He further took us to the details of the TDS claimed by the assessee of Rs. 121068/- for which credit has already been given to the assessee. In view of this he submitted that the ld Assessing Officer has made the complete enquiry. On perusal of the order of the ld CIT, it is noticed that it has not stated how the order of the ld Assessing Officer is erroneous as complete income including the job work income was shown. It was also not stated that how the survey of the premises of the father of the assessee has made the order erroneous. The ld CIT has stated that why the tax has not been deducted at source on payments to ABC Enterprise. However, in the same order the ld CIT himself has stated that assessee was the proprietor of ABC Enterprise and M/s. Shiva International. As the payment is made from one proprietary concern to another proprietary concern of the same assessee, ld DR could not show any provision of tax deduction at source applicable. Furthermore, the ld CIT has not carried out any enquiry to show that order passed by the ld Assessing Officer is erroneous. In view of this Hon'ble Delhi High Court in Pr.CIT Vs. Delhi Airport Metro Pvt. Ltd in dated 05.09.2017 has held that when no enquiry was undertaken by the Pr. CIT to come to the conclusion that the original assessment order was erroneous and prejudicial to the interest of revenue, it cannot be sustained. The Hon'ble High Court further stated that when the ld CIT has sent the entire matter back to the file of Assessing Officer for fresh assessment can also be done only after he undertakes an enquiry. Apparently, same is missing in this case. Therefore, respectfully following the decision of the Hon'ble Delhi High Court and in view of the complete enquiry