Jayantilal Rajmal Seth Vs DCIT (ITAT Mumbai)
ITAT Mumbai held that invocation of revisional jurisdiction by PCIT under section 263 of the Income Tax Act justifiable since assessment order suffers from clear lack of inquiry into the matter. Accordingly, revision u/s. 263 upheld.
Facts-
Based on the information that the assessee was a beneficiary of a bogus accommodation entry from M/s Aneri Fincap Ltd. AO issued notice u/s. 148 of the Income Tax Act on 24.06.2021. The reassessment was thereafter completed on 25.02.2022, wherein no addition was made in respect of the alleged accommodation entry from M/s Aneri Fincap Ltd.
Subsequently, PCIT invoking section 263 held that AO had omitted to carry out inquiries and verifications which were warranted in the circumstances of the case.
Conclusion-
Held that the assessment order suffers from a clear lack of inquiry into a matter which went to the root of the issue. Therefore, the invocation of the revisional jurisdiction by the Ld. PCIT under clause (a) of Explanation 2 to section 263 of the Act is fully justified.
Held that we do not agree with the above arguments of the Ld. Counsel for the assessee for the reason that the earlier reassessment order made was under old provisions of section 148 has been rendered infructuous in view of the finding of Hn’ble Supreme court in the case of Ashish Agrawal (suprs) , whereas, the impugned assessment order has been passed under the amended provisions of section 147/148A of the Act. In pre amended section 147 of the Act, before issue of notice under section 148 of the Act, the AO was required to record reason to believe on the basis of information or material received by him.
