“limited scrutiny”

Assessment ProceduresSection 143(3)Section 143(3)2,866 judgments

The decision most relied on for limited scrutiny is Vipan Khanna v. CIT (255 ITR 220), cited in 140 judgments on BharatTax.

Leading authorities on limited scrutiny

Vipan Khanna v. CIT

255 ITR 220 · 2002 · High Court

140

citing judgments

Assessment proceedings conclude and become final if a scrutiny notice under Section 143(2) is not served within the prescribed statutory period. This case also clarified the historical position that reassessment under Section 147/148 was restricted to issues for which reasons were recorded, a view superseded by Explanation 3 to Section 147.

Duggal & Co. v. CIT

220 ITR 456 · 1996 · High Court

citing judgments

An assessment order becomes erroneous and prejudicial to the revenue under Section 263 if the Assessing Officer fails to conduct a proper inquiry or investigation, even if the return appears prima facie correct. The Income-tax Officer has a duty to investigate and cannot remain passive.

Amal Kumar Ghosh v. Asstt. CIT

361 ITR 458 · 2014 · High Court

citing judgments

The selection of cases for scrutiny must be completed within the time prescribed by CBDT instructions. The department is bound by its own standards and cannot act with discrimination or selectively apply them.

PCIT v. Weilburger Coatings (India) (P.) Ltd.

155 Taxmann.com 580 · 2023 · High Court

citing judgments

Assessing officers cannot introduce issues for inquiry that were not part of the original limited scrutiny, without adhering to mandatory procedural requirements.

Balvinder Kumar v. PCIT

125 Taxmann.com 83 · 2021 · High Court

citing judgments

An Assessing Officer cannot travel beyond the scope of issues selected for limited scrutiny during the assessment proceedings.

PCIT v. Shark Mines and Minerals (P.) Ltd.

151 Taxmann.com 71 · 2023 · High Court

citing judgments

Revisionary powers under Section 263 cannot be invoked to find fault with an assessment order on an issue not covered by 'limited scrutiny' where the Assessing Officer could not have examined such an issue.

CIT v. Smt. Padmavathi

120 Taxmann.com 187 · 2020 · High Court

citing judgments

An assessment order cannot be held erroneous and prejudicial to revenue if the Assessing Officer (AO) could not have travelled beyond the issues forming the subject matter of 'limited scrutiny'. The Principal Commissioner of Income Tax (PCIT) cannot invoke Section 263 to set aside an assessment on grounds not forming part of the limited scrutiny.

Mahanagar Telephone Nigam Ltd. v. Chairman, Central Board of Direct Taxes and Another

246 ITR 173 · 2000 · High Court

citing judgments

An Assessing Officer can initiate reassessment proceedings under Section 147 even if a scrutiny notice under Section 143(2) was not issued within the prescribed time, provided the conditions for Section 147 are met. An intimation under Section 143(1)(a) does not preclude recourse to Section 147.

Judgments citing limited scrutiny

Devdeep Textiles, Jetpur vs. The Pr. CIT-1, Rajkot

In the result, assessee’s appeal is allowed

ITA 31/RJT/2022[2017-18]Status: DisposedITAT Rajkot20 Apr 2023AY 2017-18

Bench: Shri Waseem Ahmed & Ms. Madhumita Royआयकर अपील सं./I.T.A. No. 31/Rjt/2022 ("नधा"रण वष" / Assessment Year : 2017-18) Devdeep Textiles The Principal बनाम/ Dhoraji Road, Nr. Railway Commissioner Of Income Vs. Fatak, Jetpur, Gujarat - Tax -1 360370 Rajkot-360001 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aahfd7020N .. (अपीलाथ" /Appellant) (""यथ" / Respondent) अपीलाथ" ओर से /Appellant By : Shri Rushit Sheth, A.R. ""यथ" क" ओर से / Shri Shramdeep Sinha, Cit.D.R. Respondent By : सुनवाई क" तार"ख / Date Of 17/04/2023 Hearing घोषणा क" तार"ख /Date Of 20/04/2023 Pronouncement O R D E R Per Ms. Madhumita Roy - Jm: The Instant Appeal At The Instance Of The Assessee Is Directed Against The Order Dated 04.02.2022 Passed Under Section 263 Of The Income Tax Act, 1961 (Hereinafter Referred As To ‘The Act’) By The Principal Commissioner Of Income Tax, Rajkot-1 (Hereinafter Referred To As ‘The Pcit’), Arising Out Of The Order

For Appellant: Shri Rushit Sheth, A.R

Section 142(1)Section 143(2)Section 143(3)Section 263

declaring total income at Rs.4,91,05,510/- after a deduction of Chapter VI-A of Rs.25,500/-. The case was selected for limited scrutiny through Computer aided Scrutiny Selection ( in short ‘CASS’) on the issue of expenses incurred for earning exempt income. Notice under Section ... very threshold of the matter, the Ld. Counsel appearing for the assessee submitted before us that since the matter was selected for limited scrutiny on the issue of expenses incurred for earning exempt income which was, in turn, examined by the Ld. AO and found to be not true

Rajesh Gupta, Kota vs. Income Tax Officer, Ward -2(2), Kota

In the result, appeal of the assessee is allowed

ITA 446/JPR/2022[2016-17]Status: DisposedITAT Jaipur20 Apr 2023AY 2016-17

Bench: SHRI SANDEEP GOSAIN (Judicial Member), SHRI RATHOD KAMLESH JAYANTBHAI (Accountant Member)

For Appellant: Sh. Vipul Jain (CA)For Respondent: Smt Chanchal Meena (Addl. CIT)

Section 131Section 142(1)Section 143(2)Section 143(3)Section 44A

total income at Rs. 71,133/- and exempted income of Rs. 20,15,661/- for the year under consideration. Thereafter, the case selected for limited scrutiny assessment through Computer Aided Scrutiny Selection (CASS) for the issue that “Whether the investment and income relating to securities transactions are duly disclosed

Tpf Getinsa Eurostudios S.L, Gurgaon vs. ACIT, Circle International Taxation, Gurgaon

In the result, the appeal of the assessee on all the grounds is allowed

ITA 2400/DEL/2022[2018-19]Status: DisposedITAT Delhi19 Apr 2023AY 2018-19

Bench: Dr. B. R. R. Kumarsh. Yogesh Kumar Usita No. 2400/Del/2022 : Asstt. Year : 2018-19 Tpf Getinsa Euroestudios S.L., Vs Acit, Unit-305, Suncity Business International Taxation, Tower, Golf Course Road, Gurgaon, Sector-54, Gurgaon-122002 Haryana-122002 (Appellant) (Respondent) Pan No. Aaecg9819Q

For Appellant: Sh. Gaurav Jain, Adv. &For Respondent: Sh. Anshuman Pattnaik, CIT DR

Section 143(2)Section 143(3)Section 40

income on 23.11.2018 declaring total income of Rs.28,07,203/- and claiming a refund of Rs.1,42,97,170/-. The case was selected for limited scrutiny and statutory notice u/s 143(2) of the Income Tax Act, 1961 was issued and duly served upon the assessee. 4 TPF Getinsa Eurostudios

Sanjay Gupta, Delhi vs. ACIT Circle- 59(1), New Delhi

In the result, the appeal of the assessee is allowed

ITA 4916/DEL/2019[2014-15]Status: DisposedITAT Delhi19 Apr 2023AY 2014-15

Bench: Smt Diva Singhdr. B. R. R. Kumar

For Appellant: Sh. Rajat Jain, CA &For Respondent: Sh. Nitin Kumar Jaiman, Sr. DR

Section 10(38)

confirming the addition despite the fact that the order has been passed by the AO without communicating the reasons for initiating limited scrutiny. 5. On the facts and circumstances of the case, the learned CIT(A) has erred both on facts and in law in confirming the addition despite ... fact that the same having been made going beyond the scope of limited scrutiny, without complying the statutory procedure laid down in this regard. 6. On the facts and circumstances of the case, the learned CIT(A) has erred both on facts and in law in confirming the addition

Income Tax Officer (It)-3(2)(1), Mumbai vs. Rustom Fali Mehta, Mumbai

In the result, the cross objection filed by the assessee is partly allowed for statistical purposes

ITA 54/MUM/2023[2016-17]Status: DisposedITAT Mumbai18 Apr 2023AY 2016-17

Bench: Shri Prashant Maharishi & Shri Sandeep Singh Karhail

For Appellant: Shri Madhur Agarwal a/wFor Respondent: Shri Soumendu Kumar Dash

Section 250

revised on 25/05/2016, declaring a total income of Rs.15,06,05,730. The revised return of income filed by the assessee was selected for limited scrutiny for the reason “large long-term capital gain and receipt of large value of foreign remittance” and accordingly statutory notices under section

Ajay Kumar Mishra, Gurgaon vs. DCIT, Circle-1(1), Gurgaon

In the result, the appeal of the assessee is allowed

ITA 1835/DEL/2022[2018-19]Status: DisposedITAT Delhi17 Apr 2023AY 2018-19

Bench: Shri Kul Bharat & Shri M Balaganesh[Assessment Year : 2018-19] Ajay Kumar Mishra, Vs Dcit, B-12, The Icon, Dlf City, Circle-1(1), Phase-5, Gurgaon, Gurgaon. Haryana-122009. Pan-Aowpm7493R Appellant Respondent Appellant By Shri D.K.Pandey, Ca & Shri Manish Pandey, Ca Respondent By Shri Kanv Bali, Sr. Dr Date Of Hearing 11.04.2023 Date Of Pronouncement 17.04.2023

Section 143(3)Section 144BSection 234ASection 90

return of income electronically in ITR-3 on 31.08.2018, disclosing total income of INR 1,08,66,510/-. The case was taken up for limited scrutiny on the issue of Double Taxation Relief u/s 90/91 of the Income Tax Act, 1961 (“the Act”). While framing assessment, the Assessing Officer ... section 143(l)(a) of the Act passed on dated 23.03.2020 DIN CPC/1819/A3/1978194980. Thereafter, the return of income of the assessee was selected for limited scrutiny on the issue: Double Taxation relief u/s 90/91 of the Income Tax Act, 1961. The assessment in the case was completed

Sarvangana Jitendrkumar Jariwala, Surat vs. ITO, Ward 3(1)(5), Surat

Appeal of the Revenue are dismissed

ITA 205/SRT/2020[2016-17]Status: DisposedITAT Surat17 Apr 2023AY 2016-17

Bench: Shri Pawan Singh, Jm & Dr. A.L.Saini, Am आयकर अपीलसं./Ita No.204/Srt/2020 (िनधा"रणवष" / Assessment Year: (2015-16) (Physical Court Hearing) Sarvagana Jitendrakumar Jariwala Income Tax Officer, Ward-3(1)(5), 115, Anavil Business 7/4442, Khumbhar Sheri, Vs. Centre, Adajan Hazira Road, Surat- Galemandir, Surat-395003 395009 "थायीलेखासं./जीआइआरसं./Pan/Gir No.: Ahlpj 3572 E (अपीलाथ" /Assessee ) (""थ" /Respondent)

For Appellant: Shri Rasesh Shah, C.AFor Respondent: Shri Vinod Kumar, Sr-DR

Section 142(1)Section 143(2)Section 143(3)

assessment year (A.Y.) 2015-16, on 21.03.2016, declaring total income to the tune of Rs.4,56,600/- . The case was selected for limited scrutiny under CASS for the reason “cash deposition in saving bank accounts is more than turnover’. Subsequently, a statutory notice ... reproduced as under: “In connection with the assessment proceedings for the A.Y 2015-16, it is stated that your case has been selected for ‘limited scrutiny’; for verification of following reasons:- 1. “Cash deposits in saving bank account is more than the turnover” 2. Thereafter, due to potential escapement

Sarvangana Jitendrkumar Jariwala, Surat vs. ITO, Ward 3(1)(5), Surat

Appeal of the Revenue are dismissed

ITA 204/SRT/2020[2015-16]Status: DisposedITAT Surat17 Apr 2023AY 2015-16

For Appellant: Shri Rasesh Shah, C.AFor Respondent: Shri Vinod Kumar, Sr-DR

Section 142(1)Section 143(2)Section 143(3)

ITO, Ward-3(2)(10), Surat vs. Sarvagana Jitendrabhai Jariwala, Surat

Appeal of the Revenue are dismissed

ITA 182/SRT/2020[2016-17]Status: DisposedITAT Surat17 Apr 2023AY 2016-17

For Appellant: Shri Rasesh Shah, C.AFor Respondent: Shri Vinod Kumar, Sr-DR

Section 142(1)Section 143(2)Section 143(3)

Dharmendra Mehta, Jaipur vs. Principal Commissioner of Income Tax-2, Jaipur

In the result, the appeal of the assessee is allowed

ITA 201/JPR/2022[2012-13]Status: DisposedITAT Jaipur13 Apr 2023AY 2012-13

Bench: DR. S. SEETHALAKSHMI (Judicial Member), SHRI RATHOD KAMLESH JAYANTBHAI (Accountant Member)

For Appellant: Shri Manish Agarwal (C.A.)For Respondent: Shri Avadhesh Kumar (CIT)

Section 143(3)Section 147Section 148Section 263Section 44A

have considered the rival submissions and the facts and circumstances of the case mentioned supra that the case of the assessee was selected for limited scrutiny and accordingly the ld. AO could not travel beyond his jurisdiction. The AO after taking into consideration the evidences and documents filed ... income returned by the assessee. The ld. Pr. CIT has not mentioned that the AO has not examined the issues raised in the limited scrutiny show cause notice. We, therefore, are of the view that the observations made by the ld. Pr. CIT are beyond the points mentioned for limited

Anshu Sharma, Jaipur vs. Income Tax Officer, Ward 1(3), Jaipur

In the result, impugned order is set-aside and appeal by the assessee is allowed

ITA 73/JPR/2023[2017-2018]Status: DisposedITAT Jaipur11 Apr 2023AY 2017-2018

Bench: 30.08.2019. But No Reply Was Filed By The Assessee On The Said Date Of Hearing. Thereafter, One More Opportunity Was Granted To The Assessee Vide This Office Notice U/S 142(1) Dated 01.10.2019 To File Reply On 11.10.2019, But Again No Compliance Was Made By The Assessee.

For Appellant: Sh. Praveen Saraswat (CA)For Respondent: Smt Monisha Chaudhary (Addl. CIT)

Section 129Section 142(1)Section 143(2)Section 143(3)Section 272A(1)Section 272A(1)(d)

that e-return declaring income of Rs. 2,31,510/- was e-filed by the assessee on 28.07.2017. The case was selected for limited scrutiny by CASS. Notice u/s 143(2) was issued to the assessee on 29.09.2018 which was duly served upon the assessee on its registered e-mail

Anand Jhawar, Jaipur vs. PCIT, Jaipur-2, Jaipur

In the result, this appeal of the assessee is allowed

ITA 156/JPR/2022[2016-17]Status: DisposedITAT Jaipur11 Apr 2023AY 2016-17

Bench: SHRI SANDEEP GOSAIN (Judicial Member), SHRI RATHOD KAMLESH JAYANTBHAI (Accountant Member)

For Appellant: Shri R.S. Poonia, CA &For Respondent: Shri Shailendra Sharma, CIT &

Section 12ASection 138Section 139(1)Section 139(5)Section 143(3)Section 263

Assessing Officer u/s 143(3) of the Act was erroneous and prejudicial to the interest of the revenue, as the scrutiny was Limited Scrutiny despite the issues raised having been duly considered by the learned Assessing Officer while framing the assessment u/s 143(3) of the Act. 4. That ... declaring the total income as declared in the original return. The case of the assessee was selected for Limited Scrutiny under CASS by issuing a notice under section 143(2) of the IT Act, 1961 dated 06.07.2017. As per said 4 Shri Anand Jhawar, Jaipur. notice issued under section

Arun Kumar Palawat, Jaipur vs. Pr CIT, Jaipur-1, Jaipur

In the result, this appeal of the assessee is allowed

ITA 144/JPR/2022[2017-18]Status: DisposedITAT Jaipur11 Apr 2023AY 2017-18

Bench: SHRI SANDEEP GOSAIN (Judicial Member), SHRI RATHOD KAMLESH JAYANTBHAI (Accountant Member)

For Appellant: Shri R.K. Bhatra (CA) &For Respondent: Shri Ajey Malik, CIT D/R

Section 139Section 142(1)Section 143(1)Section 143(2)Section 143(3)Section 263

assessment made by the A.O. u/s 143(3) of the I.T. Act, 1961, the ld. A.O. could not have travelled beyond reasons stated in limited scrutiny notice in view of CBDT Instruction No. 7/2014, 20/2015 and 5/2016 and also the CBDT letter dated 13.11.2017 and thus asking further details ... assessee was selected for scrutiny under CASS and a notice under section 143(2) of the I.T. Act, 1961 was issued on 13.08.2018 for Limited Scrutiny. As per said notice issued under section 143(2) the case was selected for limited scrutiny on the following issue : (a) Deduction against income

Sage International Inc., Usa vs. ACIT, Circle Int. Taxation 3(1)(2), Delhi

In the result, the appeal of the assessee is allowed

ITA 2214/DEL/2022[2018-19]Status: DisposedITAT Delhi10 Apr 2023AY 2018-19

Bench: Shri G.S.Pannu & Shri Kul Bharat[Assessment Year : 2018-19] Sage International Inc., Vs Acit, 105, Townline Road, 2 Pmb 332, Circle 3(1)(2), Vernon Hills, Foreign United International States, Usa. Taxation, Delhi. Pan-Aaycs9212R Appellant Respondent Appellant By Shri Pradeep Dinodia, Ca Respondent By Shri Bhuvnesh Kulshrestha, Cit Dr Date Of Hearing 28.02.2023 Date Of Pronouncement 10.04.2023 Order Per Kul Bharat: The Present Appeal Filed By The Assessee Is Directed Against The Order Of Assessing Officer Passed U/S 143(3) R.W.S 144C(13) Of The Income Tax Act, 1961 (“The Act”) Dated 15.07.2022 For The Assessment Year (“Ay”) 2018-19 .

Section 143(3)Section 234ASection 4Section 90

return of income for the year under consideration on 30.10.2018 declaring total income at INR 1,16,81,110/-. The case was selected for limited scrutiny 2 | P a g e for the reason “Double Taxation relief u/s 90/91”. Thereafter, a draft assessment order was passed

Sh. Suresh Kumar Agarwal, B-9, Govind Marg, Raja Park, Jaipur vs. ITO, Ward-6(4), Jaipur

In the result, appeal of the assessee is allowed

ITA 426/JPR/2022[2017-18]Status: DisposedITAT Jaipur03 Apr 2023AY 2017-18

Bench: HON’BLE SHRI SANDEEP GOSAIN (Judicial Member)

For Appellant: Shri P.C. Parwal, C.AFor Respondent: Shri Anoop Singh (Addl.CIT)

Section 115BSection 69A

income under the head salary, profit and gains from business & profession and income from other sources. The case of the assessee was selected for limited scrutiny for the reason of Cash Deposit during the demonetization for the assessment year under consideration. The AO observed that assessee has deposited cash

Vanga Jain Babu, Devarapalli vs. The Income Tax Officer, Ward-1, Tadepalligudem

In the result, appeal of the assessee is allowed

ITA 126/VIZ/2021[2015-16]Status: DisposedITAT Visakhapatnam31 Mar 2023AY 2015-16

Bench: Shri Duvvuru Rl Reddy, Hon’Ble & Shri S Balakrishnan, Hon’Ble

For Appellant: Sri GVN Hari, AdvocateFor Respondent: Sri MN Murthy Naik, CIT-DR

Section 142(1)Section 143(2)Section 263Section 271Section 271(1)(b)Section 274

assessee is running a business / trade in “Cashew Nuts” in the name and style of “Maranatha Cashew and Generals”. The case was selected for limited scrutiny under CASS with a reason to examine “Low Capital Gain with respect to sale consideration (higher of AIR and ITR)”. The Ld. AO issued

North Bihar Power Distrubution Co. Ltd, Patna vs. Pr. CIT-1, Patna

In the result, appeal of the assessee is allowed

ITA 224/PAT/2022[2017-18]Status: DisposedITAT Patna30 Mar 2023AY 2017-18

Bench: Shri Sanjay Garg & Shri Girish Agrawalassessment Year: 2017-18

For Appellant: Shri Ankit Kumar,FCAFor Respondent: Smt. Rinku Singh, Addl. CIT, DR

Section 143(3)Section 263Section 263(1)Section 263(2)

notice which was time barred as Notice under section 263 was issued without jurisdiction as assessment order under section 143(3) issued under CASS (Limited Scrutiny) and as per section 263(2) of Income Tax Act, “No order shall be made under sub-section (1) after the expiry

Anshu Sharma, Jaipur vs. Income Tax Officer, Jaipur

In the result, appeal filed by the assessee is hereby allowed

ITA 45/JPR/2023[2017-2018]Status: DisposedITAT Jaipur30 Mar 2023AY 2017-2018

Bench: DR. S. SEETHALAKSHMI (Judicial Member), SHRI RATHOD KAMLESH JAYANTBHAI (Accountant Member)

For Appellant: Shri Praveen Saraswat (C.A.)For Respondent: Smt Monisha Chaudhary (Addl. CIT) a

Section 129Section 142(1)Section 143(2)Section 143(3)Section 44ASection 69A

that return of income declaring income of Rs. 2,31,510/- was e-filed by the assessee on 28.07.2017. The case was selected for limited scrutiny under CASS. Notice u/s 143(2) was issued to the assessee on 29.09.2018 which was duly served upon the assessee on its registered ... case here is selected under CASS to verify the cash deposits made during the demonetisation period. The case is also under the category of LIMITED SCRUTINY. The AO is not allowed to go beyond the issue on which the case is selected. Therefore, the AO is silent and not made

Neelkamal Cineplex P.Ltd, New Delhi vs. ITO, Ward-18(1), New Delhi

ITA 9701/DEL/2019[2015-16]Status: DisposedITAT Delhi29 Mar 2023AY 2015-16

Bench: Shri Anil Chaturvedi & Shri N.K. Choudhryassessment Year: 2015-16 Neelkamal Cineplex Pvt. Ltd., Versus Income-Tax Officer, 107, 2Nd Floor, Shreshtha Ward 24(3), New Delhi Vihar, New Delhi. Pan: Aaccn3668G (Appellant) (Respondent)

For Appellant: NoneFor Respondent: Sh. Arvind Bansal, Ld. Sr. DR

Section 133(6)Section 250(6)

Appellant declared an income of Rs.14,32,540/-, by e-filing its return of income on dated 25.11.2015 which was taken up for limited scrutiny under CASS and consequently, statutory notices have been issued to the Appellant, in response to which the Appellant attended the proceedings and filed necessary submissions

Mohd. Momineen Qureshi, New Delhi vs. ACIT, Circle- 46(1), New Delhi

In the result, the appeal filed by the Assessee stands partly allowed

ITA 8291/DEL/2019[2015-16]Status: HeardITAT Delhi29 Mar 2023AY 2015-16

Bench: Shri Anil Chaturvedi & Shri N.K. Choudhryassessment Year: 2015-16

For Appellant: Mr. Tariq Nafees, Ld. Adv. &For Respondent: Sh. Jitender Chand, Ld. Sr. DR

Section 143(3)Section 145(3)Section 250(6)Section 263

case, the appellant declared total income of Rs.20,66,940/- by e-filing its return of income on dated 30.09.2015 which was selected for limited scrutiny under CASS for the reasons (i) unsecured loans; (ii) other expenses claimed in the profit & loss account; (iii) low net profit or loss