Case Law Details
Nitson & Amitsu Pvt. Ltd Vs ACIT (ITAT Kolkata)
Conclusion: Mere suspicion of likely escapement of income was not a ground for revision by invoking powers u/s 263 of the Act. Such an order was bad in law.
Held: Assessee-company was in the business of trading as well as construction. It filed its return of income for the AY 2013-14. AO passed an order under section 143(3). CIT issued a show-cause notice proposing to revise the assessment order passed under section 143(3). It was held that Pr. CIT should have conducted enquiries and should have verified the accounts and other documents and details himself and pointed out specifically as to where an error had occurred which was prejudicial to the interest of the Revenue and which in his opinion would result in the assessee being not assessed at the correct amount of income and only after such enquiries, examination and verification he could come to a conclusion that there was an error insofar as it was prejudicial to the interest of the Revenue. Pr. CIT was not authorized to simply set aside an assessment order by making certain general observations based on suspicion and wrong working out of the WIP and without specifically pointing out errors which were prejudicial to the interest of the Revenue. Mere suspicion of likely escapement of income was not a ground for revision by invoking powers u/s 263 of the Act. Such an order was bad in law.
FULL TEXT OF THE ORDER OF ITAT KOLKATA
This is an appeal filed by the assessee directed against the order of the Learned Pr. Commissioner of Income Tax-1, Kolkata, [hereinafter the “Pr. CIT”], passed u/s. 263 of the Income Tax Act, 1961 (the ‘Act’), dated 16.03.2018 for the Assessment Year 201314.
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