By C. N. Vaze
Shailesh Kamdar
Jagdish T. Punja bi
Bhadresh Doshi Chartered Accountants
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Section 263, 271D – Failure of the AO to initiate proceedings u/s. 271D for violation of section 269SS could not be considered as an error calling for revision u/s. 263.
Facts:
Consequent to the search and seizure action u/s. 132 of the Act, at the residential premises of the assessee, notices were issued and assessments made by the Assessing Officer for assessment years 2007-08 to 2011- 12 u/s. 143(3) r.w.s. 153A of the Act.
The CIT on examining the assessment record found that for A.Y. 2007-08 to 2011-12, the assessee had raised/repaid loans in cash, violating the provisions u/s. 269SS/269T which attract penalty leviable u/s. 271D/ 271E of the Act. Since the same, according to him, were not examined by the A.O. the assessments so completed required revision u/s. 263. He issued notices u/s. 263, to the assessee, to show cause why assessments made for all five years under consideration should not be revised.
The CIT, considering the submissions made by the assessee to be not acceptable, passed an order directing the A.O. to redo the same after making detailed inquiries and investigations on the issues pointed out by him in the notices issued u/s. 263.
Aggrieved, the assessee preferred an appeal to the Tribunal.
Held:
The issue under consideration is squarely covered in favour of the assessee by the decision of Kolkata Bench of the Tribunal in the case of M. Dhara & Brothers vs. CIT-XVI (2015-TIOL-482-ITAT-KOL) wherein it was held by the Tribunal by following the decision of the Hon’ble Calcutta High Court in the case of CIT vs. Linotype & Machinery Ltd. 192 ITR 337 (Kol)., that the failure of the A.O. to initiate proceedings u/s. 271D for violation of section 269SS could not be considered as an error calling for revision u/s. 263.
The Tribunal held that there were no errors in the orders passed by the A.O. u/s. 143(3) r.w.s. 153A of the Act for all the five years under consideration which were prejudicial to the interest of the revenue calling for revision by the Learned CIT(A) u/s. 263. The Tribunal set aside the impugned common order passed by the CIT, u/s. 263, for all the five years under consideration and restored the orders passed by the A.O. u/s. 143(3) r.w.s. 153A.
The appeals of the assessee were allowed.
