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Income Tax Appellate Tribunal, RAIPUR BENCH, RAIPUR
Before: SHRI RAVISH SOOD & SHRI JAMLAPPA D BATTULL
आदेश/ ORDER
PER RAVISH SOOD, JM:
The present appeal filed by the assessee is directed against the order passed by the Principal Commissioner of Income Tax, Raipur-1 (for short ‘Pr. CIT’) under Section 263 of the Income-tax Act, 1961 (for short ‘the Act’), dated 09.03.2021, which in turn arises from the order passed by the A.O under Sec. 143(3) r.w.s. 147 of the Act, dated 07.12.2018 for assessment year 2015-16. Before us the assessee has assailed the impugned order on the following grounds of appeal:
“1. In the facts and circumstances of the case and in law, the ld. Principal Commissioner of Income-tax has erred in initiating proceedings u/s. 263 of the Income-tax Act, 1961 on the basis of audit objection and accordingly initiation of proceedings is ab initio illegal and without jurisdiction.
2. Without prejudice to the above, the ld. Principal Commissioner of Income-tax has erred in setting aside proceedings without considering appellant's reply dated 26/02/2021 filed online.
3. In the facts and circumstances of the case and in law, the Id. Principal Commissioner of Income-tax has erred in setting aside the assessment order dated 07/12/2018 and in remanding it back to the Assessing Officer for fresh adjudication, especially when ld. Assessing Officer has examined, considered and taken a view on the impugned issues while completing regular assessment u/ s.143(3) r.w.s. 147 of the Income-tax Act, 1961.
4. In the facts and circumstances of the case, the impugned order is arbitrary and bad in law.
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5. The appellant craves leave to add, alter or omit all or any grounds of appeal in the interest of justice.”
Succinctly stated, on the basis of information received by the Assessing Officer that the assessee during the year under consideration i.e. A.Y.2015-16 had carried out cash transactions of Rs. 23,81,000/- and had contract receipts of Rs.2,74,03,668/- but had not filed his return of income, the Assessing Officer reopened his case u/s.147 of the Act. In compliance, the assessee had placed on record a copy of his return of income for the year under consideration i.e. AY 2015- 16 that was filed by him on 30.03.2017, declaring an income of Rs.5,77,934/-.
During the course of the assessment proceedings, it was submitted by the assessee that he was engaged in the business of hiring trucks for carrying/transporting goods by road. It was submitted by the assessee that he had during the year under consideration purchased 4 trucks and declared income derived therefrom higher than that prescribed u/s.44AE of the Act i.e., the deemed income that would otherwise be worked out by triggering the mechanism contemplated under the said statutory provision for determining the income of an assessee engaged in the business of plying goods carriages on a presumptive basis.
Apropos the issues on the basis of which the case of the assessee was re- opened u/s.147 of the Act, it was claimed by the assessee that during the year under consideration he had hired trucks for carrying/transporting goods under two
4 Ashfhaque Quamar Vs. Pr. CIT contractor concerns, viz. (i) M/s. Shafi Ahmed; and (ii) M/s. Singh Transporters. On being queried as regards the contract receipts/turnover from the aforementioned concern, viz. (i) M/s. Shafi Ahmed; Rs.2,71,25,900/- and (ii) M/s. Singh Transporters ; Rs. 2,77,768/-, as was shown in his Form 26AS, it was claimed by the assessee that the same was not correct. In order to substantiate his aforesaid claim the assessee had drawn support from the confirmation of M/s. Shafi Ahmed which revealed his total turnover qua the said contractor at Rs.1,19,62,195/-. Apart from that, the assessee also placed on record copies of his bank statements which substantiated his aforesaid claim. Backed by the aforesaid facts, it was observed by the Assessing Officer that the Form 26AS revealed the status booking as “U” i.e., unmatched booking, which supported the claim of the assessee that the turnover shown as per Form 26AS was not correct. As regards the impugned cash transactions of Rs.23,81,000/-, the Assessing Officer after verifying the bank statements of the assessee observed that there were no such transactions carried out by the assessee during the year. Observing, that the total turnover of the assessee amounting to Rs.1,42,39,963/- had duly been disclosed by him in his return of income on the basis of which he had revealed his income u/s.44AE of the Act at Rs.5,68,400/-, the Assessing Officer accepted the income of the assessee at Rs.4,98,280/- i.e. as returned.
After culmination of the assessment proceedings the Pr. CIT called for assessment records of the assessee. Observing, that the Assessing Officer had not 5 Ashfhaque Quamar Vs. Pr. CIT conducted any enquiry regarding the genuineness of the claim of the assessee qua the issues on the basis of which his was reopened, the Pr. CIT holding the order passed by the him u/s. 147 r.w.s. 143(3), dated 05.12.2018 as erroneous in so far it was prejudicial to the interest of the revenue u/s.263 of the Act, therein, set- aside the same with a direction to him to pass a fresh assessment order after conducting necessary enquiries and affording a reasonable opportunity of being heard to the assessee.
Aggrieved, the assessee has assailed the order passed by the Pr. CIT u/s. 263 of the Act, dated 09.03.2021 before us.
We have heard the Ld. Authorized Representatives of both the parties, perused the orders of the lower authorities and the material available on record, as well as considered the judicial pronouncements that have been pressed into service by them to drive home their contentions. Admittedly, it is a matter of fact borne from the record that the case of the assessee was reopened u/s.147 of the Act, for the reason, that though the assessee as per information gathered by the Assessing officer had carried out cash transactions of Rs.23,81,000/- and was in receipt of contract payments of Rs.2,74,03,668/-, however, he had failed to file his return of income for the year under consideration. On being confronted qua the issues on the basis of which his case was reopened, it was claimed by the assessee that the turnover aggregating to Rs.2,74,03,668/- in Form 26AS, viz. (i) turnover/
6 Ashfhaque Quamar Vs. Pr. CIT contract receipts from M/s. Shafi Ahmed: Rs.2,71,25,900/- and (ii) M/s. Singh Transporters: Rs.2,77,768/- were incorrect. On a perusal of the assessment records, we find that the assessee in order to substantiate his aforesaid claim had placed on record confirmations of M/s. Shafi Ahmed (supra) which revealed that the contract receipt/turnover of the assessee qua the said contractor at Rs.1,19,62,195/-. Also, the aforesaid claim of the assessee was found by the Assessing Officer to be correct in context of the bank statements which in the course of the assessment proceedings were placed on record by him. As regards the impugned cash transactions of Rs.23,81,00/- (supra) which also, inter alia, formed the basis for reopening of the assessee’s case, it was noticed by the Assessing Officer that there were no such transactions in the bank statement of the assessee as were filed before him. Observing, that the assessee had disclosed a total turnover/contract receipts at Rs.1,42,39,963/- in his return of income and, on the basis of the same computed his deemed income u/s.44AE at Rs.5,68,400/-, the Assessing Officer refrained from drawing any adverse inferences qua the issues on the basis of which the case of the assessee was reopened and accepted his returned income.
In our considered view, the aforesaid facts reveals beyond doubt that the Assessing Officer had in the course of the assessment proceedings applied his mind as regards the reasons on the basis of which the case of the assessee was reopened by him and, had only after finding the claim/explanation of the assessee
7 Ashfhaque Quamar Vs. Pr. CIT in order and to his satisfaction accepted the same. As observed by us, hereinabove, the Assessing Officer had duly verified the aforesaid claim of the assessee that his contract receipts/turnover qua the contractor, viz. M/s. Shafi Ahmed (supra) amounted to Rs.1,19,62,195/-, and had only after vetting the said claim on the basis of the latter’s confirmations that were placed on his record ( Page 29 of APB) and the bank statements of the assessee which duly supported his aforesaid claim, had accepted the same. In so far the cash transaction of Rs.23,81,000/- (supra) which, inter alia, had formed one of the reason for reopening of the assessee’s case, we find that the Assessing Officer after duly verifying the bank statements of the assesee, had concluded that there were no such transactions carried out by the assesee during the year under consideration.
On the basis of the aforesaid facts, we are unable to persuade ourselves to subscribe to the view taken by the Pr. CIT that the Assessing Officer had summarily accepted the claim of the assessee on the aforesaid issue in question. In our considered view, as the Assessing Officer while framing assessment vide his order passed u/s.147 r.w.s. 143(3) of the Act, dated 05.12.2018 had carried out necessary verifications, the same, even if are to be held to be “inadequate” would by no means justify the invoking of the revisional jurisdiction by the Pr. CIT u/s. 263 of the Act. On the basis of our aforesaid deliberations, we are unable to concur with the view taken by the Pr. CIT that de hors necessary verifications on the part of the Assessing Officer as regards the reasons on the basis of which the 8 Ashfhaque Quamar Vs. Pr. CIT case of the assessee was reopened u/s.147 of the Act, his order passed u/s.147 r.w.s. 143(3) of the Act was rendered as erroneous in so far it was prejudicial to the interest of the revenue within the meaning of “ Explanation-2” to Section 263 of the Act. We, thus, in terms of our aforesaid observations set-aside the order passed by the Pr. CIT u/s.263 of the Act, dated 09.03.2021 and restore the order of the Assessing Officer passed u/s. 147 r.w.s. 143(3) of the Act, dated 05.12.2018.
In the result, appeal of the assessee is allowed in terms of our aforesaid observations. Order pronounced in the open court on 06th day of April 2022.
Sd/- Sd/- JAMLAPPA D BATTULL RAVISH SOOD (ACCOUNTANT MEMBER) (JUDICIAL MEMBER) रायपुर/ RAIPUR ; �दनांक / Dated : 06th April, 2022 SB आदेशक���त�ल�पअ�े�षत / Copy of the Order forwarded to :
1. 1. अपीलाथ� / The Appellant. 2. ��यथ� / The Respondent.
3. The Pr. CIT, Raipur-1 (C.G) 4. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण,रायपुर ब�च, रायपुर / DR, ITAT, Raipur Bench, Raipur. गाड�फ़ाइल / Guard File. 5. आदेशानुसार / BY ORDER, // True Copy // �नजी स�चव / Private Secretary आयकर अपील�य अ�धकरण, रायपुर / ITAT, Raipur.
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Date 1 Draft dictated on 30.03.2022 Sr.PS/PS 2 Draft placed before author 31.03.2022 Sr.PS/PS 3 Draft proposed and placed JM/AM before the second Member 4 Draft discussed/approved by AM/JM second Member 5 Approved draft comes to the Sr. Sr.PS/PS PS/PS 6 Kept for pronouncement on Sr.PS/PS 7 Date of uploading of order Sr.PS/PS 8 File sent to Bench Clerk Sr.PS/PS 9 Date on which the file goes to the Head Clerk 10 Date on which file goes to the A.R
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11 Date of dispatch of order