Case Law Details
Brief of the Case
ITAT Delhi held In the case of A2Z Maintenance and Engineering Services Ltd. vs. CIT that the Hon’ble Jurisdictional High Court in the case of DIT vs Jyoti Foundation 357 ITR 388 (Delhi) held that where the order u/s 263 records that the inquiries were not sufficient and further inquiries or details should have been called for by the Assessing Officer, then in such cases, the inquiry should have been conducted by the Commissioner himself to record the finding that the assessment order was erroneous. The CIT should not have set aside the order and directed the Assessing Officer to conduct the said inquiry. The present case of the assessee squarely falls within the ratio of this judgment. Hence order u/s 263 by CIT is not sustainable being bad in law and void ab initio.
Facts of the Case
The Assessing Officer completed the assessment by passing assessment order u/s 143(3) of the Act on 15.12.2009. The Assessing Officer noticed that the assessee company was engaged in the business of providing maintenance services such as housekeeping security services and the Assessing Officer accepted the returned income of the assessee without making any disallowance or addition in the computation of income furnished by the assessee. Subsequently, on 12.3.12, the CIT issued a show cause notice to the assessee company alleging that the perusal of the balance sheet as on 31.3.2007 shows that the assessee has shown an amount of Rs. 11,98,08,876 as deferred revenue income by changing its method of accounting said to be as per Accounting Standard-7 which has resulted in lowering of profits by the same amount. CIT proceeded to invoke revisional powers available to him u/s 263.
The CIT finally passed impugned order dated 27.3.12 by holding that the order of the Assessing Officer is erroneous and prejudicial to the interest of revenue and he set aside assessment order only to this extent and directed the Assessing Officer to make a fresh assessment order on this aspect.
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