Loading judgment…
Facts
The assessee company, engaged in agricultural and other activities, filed its return for AY 2011-12 showing a loss. The case was reopened under section 148 and the assessment completed under section 143(3) r.w.s. 147 also resulted in a loss. Subsequently, the Principal Commissioner of Income Tax (PCIT) set aside the assessment order under section 263, and a revised assessment order was passed. The assessee appealed this revised order to the CIT(A).
Held
The CIT(A) held that since the revisionary order passed by the PCIT under section 263 had been set aside by the coordinate bench of the ITAT, the foundation for the subsequent assessment order was removed, causing the assessment order to collapse. Therefore, the CIT(A) directed the AO to delete all additions/disallowances made giving effect to the revisionary order.
Key Issues
Whether the ITAT was justified in setting aside the revisionary order passed under section 263 of the Act and whether the subsequent assessment order could survive when the basis of the revisionary order was quashed.
Sections Cited
143(1), 148, 143(3), 147, 263
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “C” BENCH, MUMBAI
is filed by the Income Tax Officer, Ward – 9 (2) (1), Mumbai (the learned AO) for A.Y. 2011 – 12 against the appellate order passed by National faceless appeal Centre NFAC Delhi (the learned CIT – A) dated 11th August, 2023 raising following grounds of appeal:-
2. Whether on the facts and circumstances of the case and in law, the Hon'ble ITAT was justified in holding that the decision of the Ld. PCIT in treating the order u/s 143(3) r.w.s. 147 dated 13.12.2018 as erroneous and prejudicial to the interest of the revenue is not justified, especially when the Ld. PCIT in para nos. 5.2, 5.3, 5.4, 5.5, 7 and 8 of the order u/s 263 dated 24.03.2021 have elaborately given facts and findings which were remained to verified thoroughly by the Assessing Officer while passing the assessment order dated 13.12.2018?
3. Whether on the facts and circumstances of the case and in law, the Hon'ble ITAT was justified in holding that the Ld. PCIT had not pointed out in order u/s 263 about what sort of verification was required to be made by the Assessing Officer while passing the assessment order dated 13.12.2018 despite the fact that the PCIT vide para nos. 5.4, 5.5 and 7 of the order dated 24.03.2021 u/s 263 have given categorical findings about what issues remained to be verified and examined by the Assessing Officer while passing the assessment order dated 13.12.2018?
5. Whether on the facts and circumstances of the case and in law, the Hon'ble ITAT was justified in setting-aside the order u/s 263 dated 24.03.2021 without going into the merits of the issues regarding identity, credit worthiness and genuineness of loan availed of Rs. 1.82 crore from the entities Multiventure Financial Pvt. Ltd. and Prakhyat Infraprojects Pvt. Ltd."
Brief facts of the case shows that assessee is a company engaged in agricultural and other activities. It filed its return of income for A.Y. 2011-12 on 27th September, 2011 at a total loss of ₹ 42,393 which was processed under section 143 (1) on 15th January, 2012. The case of the assessee was reopened by issue of notice under section 148 of the Act on 28th March, 2018 and assessment under section 143 (3) read with section 147 of the Act was completed on 13th December, 2018 at a total loss of ₹ 42,393/-. Subsequently, the principal Commissioner of income tax, Mumbai – 1 has set-aside the assessment order dated 13th December, 2018 as per order under section 263 of the income tax act dated 24th
The learned CIT – A based on this held that the foundation on which the assessment order is based is no longer intact held that when the foundation is removed the superstructure collapses. Therefore, he held that the assessment order cannot survive, and he directed the learned AO to delete all the additions/disallowances made in connection with giving effect to the revisionary order passed under section 263 after the verification of the facts of the case and perusal of the aforesaid order of the ITAT. 05. The learned AO is aggrieved with that and has preferred this appeal. 06. The learned departmental representative supported the order of the learned assessing officer and submitted that
In the result, appeal filed by the learned AO is dismissed.
Order pronounced in the open court on 25.04.2024.