Case Law Details
Manuj Jain HUF Vs PCIT (ITAT Chandigarh)
In the case of Manuj Jain HUF Vs PCIT (ITAT Chandigarh), the Income Tax Appellate Tribunal (ITAT) Chandigarh deliberated on the dispute arising from the assessment order for the Assessment Year 2017-18. The case involves the dispute between the assessee, Manuj Jain HUF, and the Principal Commissioner of Income Tax (PCIT), Ludhiana-1. The central legal issue revolved around the jurisdiction of PCIT to initiate proceedings under Section 263 of the Income Tax Act, 1961.
Background: The relevant facts indicate that the assessee filed its income tax return, which was selected for scrutiny. Subsequently, the Principal Commissioner of Income Tax (PCIT) examined the assessment records and deemed the order passed by the Assessing Officer (AO) as erroneous and prejudicial to the interests of the revenue. The PCIT issued a show-cause notice under Section 263(1) and directed the AO to pass a fresh order after providing the assessee with a sufficient opportunity of hearing.
Contention of the Assessee: The assessee contested the jurisdiction of the PCIT, arguing that the AO conducted adequate inquiries during the assessment proceedings. The assessee highlighted that the AO examined the source of cash deposits during the demonetization period and accepted the explanation provided. Moreover, the assessee emphasized the absence of any substantial irregularities or lack of inquiry by the AO.
Contention of Revenue: The Revenue, represented by the Principal Commissioner of Income Tax, asserted that the AO failed to conduct necessary inquiries and verifications regarding the cash deposits made during demonetization. It argued that the AO did not adequately examine the source of cash deposits and overlooked critical factors, such as the nature of business activities and the credibility of transactions.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
Author Bio
