AMITSINGH DALJITSINGH JAGGI,MUMBAI vs. COMM. OF INCOME TAX - 24, MUMBAI

The assessee has filed the present appeal against the order dated 30.03.2017 passed by the Commissioner of Income Tax, Mumbai in view of the provision u/s 263 of the Act, 1961.

The assessee has raised the following grounds:- 1. “The Ld. CIT was not justified in passing the order u/s 263 without giving a reasonable opportunity to the assessee.

The order passed by the Ld. CIT is without jurisdiction. 4. The order u/s 263 passed by the Ld. CIT is based on vague notice with a view to starting fishing and roving enquiries in the matter and hence bad in law. 5. The appellant craves leave to alter, amend or add to any of the above grounds.” 3. The brief facts of the case are that the assessment u/s 143(3) of the Act, 1961 was completed on 19.03.2015 for the A.Y. 2012-13 at the net income to the tune of Rs.14,57,890/- by the ITO-24(1)(1), (Mumbai). A show cause notice dated 20.03.2017 u/s 263 of the I.T. Act, 1961 was issued to the assessee which was received by the assessee on 29.03.2017. The assessee did not raise any objection regarding jurisdiction of the assessee during the course of assessment proceeding. The assessment order passed by the AO on dated 19.03.2015. The Ld. Representative of the assessee filed the reply dated 29.03.2017 stating therein that the notice was without jurisdiction hence, invalid. The objection was held to be invalid being the assessee did not raised the question at the time of the proceeding. Show cause notice dated 29.03.2017 was sent to the assessee asking him as to why the assessment order dated 19.03.2015 should not be revised within the meaning of the provision u/s 263 of the Act on the following issues.:-

After considering the reply of the assessee, the Commissioner of Income Tax was of the view that there was a lack of enquiry or lack of application of mind on the part of the AO while accepting the submission of the assessee on its face value without its proper verification, therefore, held that the assessment order was erroneous in so far as the prejudicial to the interest of revenue and the case was directed to be reopen in view of provision u/s 263 of the Act.. Feeling aggrieved, the assessee filed the present appeal before us.

We have heard the argument advanced by the Ld. Representative of the parties and perused the record. The Ld. Representative of the assessee has argued that the assessee did not received any notice through post however, the assessee received the notice through Email which has not been signed by in authority,therefore, in the said circumstances, the order u/s 263 of the Act is not justifiable hence liable to be set aside. In this regard, the Ld. Representative of the assessee has placed reliance relied upon the law settled in Criminal Appeal 172 of 2014 Shaikh Farooq Vs. Shaikh Rafiq. It is also argued that the order u/s 263 of the Act was passed with a view to starting fishing and roving enquiry, hence, the said order is bad in law and is liable to be set aside. On the other hand, the Ld. Representative of the department has strongly relied upon the order passed by the CIT(A) in question. Before going further, it is necessary to advert the reasons on the basis of which the order u/s 263 of the Act, 1961 was passed. The reasons are hereby mentioned below:-

The above said reasons nowhere speak about this fact that the order is erroneous in so far as the prejudicial to the interest of the revenue. The order must be based on material on record of proceeding called for by him. The Commissioner could not initiate the proceeding with a view to start fishing and roving enquiries in the matter of order which has already been concluded. Now, it is to be seen whether this matter of controversy has already been examined by the AO or not while passing the order u/s 143(3) of the Act, 1961 dated 19.03.2015. We noticed that the Assessing Officer had issued the notice u/s 142(1) of the I.T. Act, 1961 dated 11.07.2014 to the assessee wherein the Assessing Officer has already raised the query about the sundry creditors of transport, sundry creditors for goods, sundry debtor with credit balance and other liabilities. The said letter has been placed on record which lies at page 10 of the paper book. Subsequently, the notice dated 07.10.2011 was also filed in which the Assessing Officer called for information in view of the letter issued on 11.07.2014. The ITA. No.3962/M/2017 A.Y.2012-13 reply has been filed by the assessee which lies at page 17 to 18 of the paper book. The reply in connection with sundry creditors has been given by the assessee which is hereby reproduced below.:-