Case Law Details
Kapil Mehta Vs PCIT (ITAT Delhi)
CIT had supervisory jurisdiction to correct an error prejudicial to interest of Revenue even if approved by Joint Commissioner
Conclusion: CIT had power to correct an error, which was prejudicial to the interest of the Revenue in the order of AO, even if it was approved by the Joint Commissioner, who was also falling below the rank of the Pr. Commissioner. Whatever was to be excluded by the law had already been provided under that Section and the only exception were the issues ‘decided and considered’ in the appellate orders.
Held: Pr. CIT had called for assessment records in the case of assessee and noted that there was an information of seizure of cash amounting to Rs.2 Crores by the Police and, therefore, a search & seizure action u/s 132 & 132A was carried out in the case of the assessee. Pr. CIT further noted that assessee had claimed during the assessment proceedings that this cash of Rs.2 Crores belonged to his deceased father, Late Sh. Satish Mehta and that the source of this cash was agricultural income of his father which had been duly declared in the father’s return of income for Assessment Year 2017-18. Pr. CIT also noted that it was the assessee’s submissions before AO that assessee had received 2 Crores in cash after the demise of his father and it was the same cash which had been deposited in assessee’s bank accounts and had been seized by the Department. It was held that the power of the Commissioner under Section 263 was in the nature of supervisory jurisdiction. This power was granted to correct an error, which was prejudicial to the interest of the Revenue in the order of AO, even if it is approved by the Joint Commissioner, who was also falling below the rank of the Pr. Commissioner. Therefore, on provisions of Section 263 gave un-fettered right to the Commissioner of Income Tax to revise any order passed by AO. Whatever was to be excluded by the law had already been provided under that Section and the only exception were the issues ‘decided and considered’ in the appellate orders. Therefore, the impugned order passed u/s 263 was illegally sustainable and no interference was called for.
FULL TEXT OF THE ORDER OF ITAT DELHI
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