Case Law Details
Binod Kumar Mahato Vs PCIT (ITAT Kolkata)
The reasons for scrutiny selection through CASS, is to examine the cash deposits in savings bank account, as these are more than the turnover. The Assessing Officer stuck to these reasons and completed the assessment u/s 143(3) of the Act. Aggrieved with this order, the assessee carried the matter in appeal before the ld. First Appellate Authority. The ld. CIT(A) considered this order and granted part relief. On these facts, the question is whether the ld. Pr. CIT is empowered to invoke his powers u/s 263 of the Act for revising the order passed u/s 143(3) of the Act dt. 25/08/2016 and direct verification, examination and determination of income as per the order of the ld. CIT(A) on the issue which is admittedly not the reason scrutiny selection through CASS. The ld. D/R admits that the issue on which the ld. Pr. CIT has invoked his powers u/s 263 of the Act is beyond the scope of reason based on which the case was selected for limited scrutiny. The Assessing Officer could not have travelled beyond these reasons without obtaining the permission of the ld. Pr. CIT as per para 4 of the CBDT Instruction No. 7/2014. The question is whether it can be said that there is error in the order of the Assessing Officer passed u/s 143(3) of the Act, for the reason that the Assessing Officer did not seek the approval of the ld. Pr. CIT to convert the assessment from limited scrutiny to complete scrutiny.
In our view, if the Assessing Officer has not deemed it fit to apply to take approval from the ld. Pr. CIT/CIT, for the conversion of a limited scrutiny case into a complete scrutiny, does it result in the assessment order passed u/s 143(3) of the Act, being erroneous insofar as it is prejudicial to the interest of the revenue. This is at best, an administrative lapse. When the Assessing Officer is prohibited from examining any other issue or matter than what was the reasons for selecting the case for limited scrutiny, then the Assessing Officer cannot be accused of non -application of mind or negligence.
When the Assessing Officer completed assessment u/s 143(3) of the Act, after examining the issues for which the case has been selected for limited scrutiny, then it cannot be held that there is an error in the order of the Assessing Officer, for the reason that he has not sought permissions to examine other reasons . If the Assessing Officer has not examined any other aspect, than the reasons for which the assessment was selected for scrutiny, in our view, no fault can be found with the Assessing Officer. Thus, in our view, non -seeking of permission for conversion of limited scrutiny to complete scrutiny in terms of para 4 of the CBDT Instruction No. 7/2014, does not per se render the assessment order u/s 143(3) of the Act, erroneous.
FULL TEXT OF THE ORDER OF ITAT KOLKATA
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