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02-01-2019, Birla Cotsyn (India), Section 263, 153A, Tribunal Mumbai

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5 months 1 week ago #8273 by amit
Section - 263, 153A, 25, 24
Order Date - 02-01-2019
Favouring - Partly
Court - Tribunal Mumbai
Appellant - Birla Cotsyn (India) Limited
Respondent - PCIT
Justice - C.N. PRASAD, JM & MANOJ KUMAR AGGARWAL, AM
Citation - 119Taxpundit70
Appeal No. - I .T.A. No.3504/Mum/2018
Asstt. Year - 2010-11

Order

PER : Manoj Kumar Aggarwal

1. Aforesaid appeals by assessee for Assessment Years [AY] 2009- 10 and 2010-11 contest invocation of revisional jurisdiction u/s 263 by appropriate authority. Since, common issues are involved and identical worded grounds have been raised in both the appeals, we proceed to dispose-off the same by way of this common order for the sake of convenience & brevity. First, we take up ITA No. 3503/Mum/2018 for AY 2009-10 which contest the order of Ld. Pr. Commissioner of Income-Tax Central-2, Mumbai [Pr.CIT], dated 22/03/2018 in invoking jurisdiction u/s 263. The effective grounds raised by the assessee reads as under: - Order u/s 263 dated 22/03/2018 setting aside the assessment order u/s. !53A dated 28/03/2016 and directing the AO to make a fresh assessment order

1. On the facts and in the circumstances of the case and in law, the Id. Pr. Commissioner of Income-tax - Central 2, Mumbai (Pr. CIT) has erred in passing an
order u/s.263 of the Income Tax Act, 1961, dated 22/03/2018, without giving proper, reasonable and appropriate opportunity of hearing to the assessee and without providing requisite details/information as asked and required by the assessee to enable it to make its submissions on merits of the case, which is against the principles of natural justice and equity and is illegal, unreasonable, arbitrary unjustified, irrational, legally and factually incorrect, bad in law and are liable to be and should be set aside.

2. On the facts and in the circumstances of the case and in law, the Id. Pr. Commissioner of Income-tax - Central 2, Mumbai (Pr. CIT) has erred in passing an order u/s.263 of the Income Tax Act 1961, dated 22/03/2018, setting aside the assessment order dated 28/03/2016 u/s. 153A passed by DCIT-CC-4(1), Mumbai, holding that the said assessment order is erroneous and prejudicial to the interest of revenue, in as much as, according to the Id. Pr. CIT, the assessee has made purchases from M/s. Utkantha Trading Pvt. Ltd. [PAN: AAACU6984E] to the tune of Rs.2,11,87,420/- and M/s. Realstone Exports Ltd. [PAN: AACCR8504K] to the tune of Rs. 12,47,51,521/- during the previous year 2008-09, relevant to assessment year 2009-10 who were allegedly indulging in providing accommodations entry/bogus bills etc., without considering assessee's request for providing details/information/documents related to the above mentioned purchase transactions which was unearthed during the survey proceedings and on the basis of which the Id. Pr, CIT has come to such conclusion, which is without any basis and factually and legally incorrect and therefore it is not a good/valid reason for invoking the provisions of section 263 of the Income Tax Act, 1961 and the order passed thereunder is therefore, illegal, unreasonable, arbitrary, unjustified, irrational, contrary to various judicial authorities, bad in law and is liable to be and should be set aside.

3. Any other grounds of appeal which your appellant may raise with the permission of the Hon'ble Income Tax Appellate Tribunal, Mumbai.”

2.1 Facts leading to the same are that the assessee being resident corporate entity stated to be engaged in the business of yarn & oil was assessed for impugned AY u/s 153A read with Section 143(3) on 28/03/2016 by Ld. Deputy Commissioner of Income Tax, Central Circle4(1), Mumbai [AO]. The aforesaid assessment got triggered during the course of search action u/s 132 in the case of Yashovardhan Birla group of companies on 07/01/2014 wherein the assessee was subjected to survey u/s 133A and accordingly, notice u/s 153A was issued to the assessee. In response, the assessee offered returned loss of Rs.1147.53 Lacs under normal provisions and income of Rs.326.45 Lacs u/s 115JB which was duly accepted by the revenue. Since the returned income was accepted, apparently, no further appeal has been filed by the assessee against the same and therefore, the assessment had already attained finality. The original assessment was completed in scrutiny assessment u/s 143(3) on 15/11/2011 wherein the loss was determined at Rs.1147.95 Lacs.

2.2 Subsequently after perusal of case records, this order was subjected to revision u/s 263 by Ld. Pr.CIT vide order dated 22/03/2018 on the ground that certain information was received from DGIT (investigation) that the assessee made alleged bogus purchases for Rs.211.87 Lacs from an entity namely M/s Utkantha Trading Pvt. Ltd. & Rs.1247.51 Lacs from another entity namely M/s Realstone Exports Limited. The Ld. Pr. CIT, upon perusal of record, opined that AO did not examine the above issue and no verification was carried out with regard to above accommodation entries aggregating to Rs.1459.38 Lacs procured by the assessee which made the order erroneous as well as prejudicial to the interest if the revenue. Accordingly, a show-cause notice dated 28/02/2018 was issued to the assessee which was responded to by the assessee vide submissions dated 09/03/2018

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