Case Law Details

Case Name : Shri Sita Ram Swami Vs ITO (ITAT Jaipur)
Appeal Number : ITA No. 73/JP/2020
Date of Judgement/Order : 27/02/2020
Related Assessment Year : 2015-16
Courts : All ITAT (7209) ITAT Jaipur (218)

Sita Ram Swami Vs ITO (ITAT Jaipur)

Conclusion: Addition made u/s 69 was liable to be quashed as the order passed by AO would be nullity as he couldn’t convert limited scrutiny into complete scrutiny in absence of requisite approval from the competent authority.

Held: Assessee had challenged the jurisdiction of AO by passing the impugned order u/s 143(3) for the reason that case was initially selected for limited scrutiny and without seeking permission from the competent authority to convert limited scrutiny into complete scrutiny, the addition had been made by AO in respect of another transaction towards unexplained investment in purchase of property whereas no addition had been made towards the transaction pertaining to sale of immovable property for which the matter was initially selected for limited scrutiny. It was held that AO neither in the assessment order nor in the assessment proceedings had stated that he had sought and had been granted any approval by the appropriate authority for converting the limited scrutiny into complete scrutiny or travelling beyond the matter for which the matter was initially selected for limited scrutiny. Further, nothing had been brought to our notice during the course of hearing that such approval was sought by the AO and had been granted by the appropriate authority. Therefore, AO had taken up the fresh issue of unexplained investment for purchase of immovable property, which had no connection with the issue of sale of immovable property for which the matter was selected for limited scrutiny, without seeking prior approval of the competent authority. The addition so made u/s 69 was liable to be quashed as the order passed by AO would be nullity as beyond his jurisdiction in absence of requisite approval from the competent authority.

FULL TEXT OF THE ITAT JUDGEMENT

This is an appeal filed by the assessee against the order of ld. CIT(A)-2, Jaipur dated 15.11.2019 wherein the assessee has taken following grounds of appeal:-

“1. The impugned additions made in the order u/s 143(3) of the Act, dated 23.12.2017 is bad in law and on facts of the case, for want o f jurisdiction, principal of natural justice and various other statutory reasons and hence, kindly be deleted.

2. The Ld.CIT(A) erred in law as well as on the facts of the case in confirming action of the AO in making addition of Rs. 10,00,000/- by alleging that investment made in the property is unexplained investment u/s 69. The addition so made and confirmed by the CIT(A) is illegal, excessive and deserves to be deleted in full.

3. The Ld. CIT(A) erred in law as well as on the facts of the case in invoking the provision of sec 115BBE. The action of the AO in invoking the provisions of sec 1115BBE and confirmed by the CIT(A) is illegal, excessive and deserves to be quashed.”

2. Briefly stated, the facts of the case are that the assessee is an individual engaged in the business of wholesale trading and repairs of electronic items. He filed his return of income declaring total income of Rs. 2,05,830/- which was selected for limited scrutiny under CASS and thereafter assessment was completed u/s 143(3) dated 23rd December, 2017 wherein the addition of Rs. 10,00,000/- was made being unexplained investment in property u/s 69 of the Act. On appeal, the addition so made has been sustained by the ld. CIT(A) and against the said finding, the assessee is in appeal before us.

3. During the course of hearing, the ld. AR submitted that the case of the assessee was selected for limited scrutiny through CASS on the issue of “whether any capital gain/loss on sale of property has been correctly shown in the return of income by assessee” and in this regard, our reference was drawn to the order sheet entry dated 20.09.2017. It was submitted that the assessee did not sell any property during the year, hence question of earning any capital gains and showing in his return of income did not arise at all and submission was accordingly filed with the Assessing Officer along with the copy of ITR/computation and copy of bank statement which was taken on record and admitted by the Assessing Officer. It was further submitted that on 19.12.2017, the assessee was asked whether any immovable property was purchased by him and ultimately, addition was made u/s 69 of the Act. In this regard, it was submitted that if a case was selected for limited scrutiny under CASS, the Assessing Officer cannot exceed his jurisdiction beyond the one which has been carved out by himself in the notice issued for limited scrutiny. It was submitted that CBDT has issued various instructions on this issue and in the instant year also, the CBDT issued Instruction No. 5 of 2016 dated 14.07.2016 as per which, for converting a limited scrutiny into complete scrutiny, approval of ld CIT was required to be taken by the Assessing Officer which has not been taken in the present case. It was accordingly submitted that in view of the specific direction given by CBDT, once the AO has taken up the case for limited scrutiny, he cannot travel beyond the issue selected for scrutiny and making addition u/s 69 of the Act. It was submitted that the issue of scrutiny was relating to gain/loss on sale of property whereas the addition has been made on purchase of property. Therefore, making the addition u/s 69 and even making any inquiry and asking questions concerning with the issue of purchase without requisite approvals was an improper exercise of jurisdiction by the AO and therefore, the present proceedings should be quashed for want of requisite jurisdiction. In support, reliance was placed on the decisions in the case of Late Smt. Gurbachan Kaur vs DCIT (in ITA No. 692/JP/2019 vide order dated 05.12.2019), Manju Kaushik vs. DCIT (in ITA No. 1419/JP/2019 vide order dated 09.12.2019), Ravi Prakash Khandelwal vs. DCIT (in ITA No. 665/LKW/2017 dated 08.11.2019) and Shashi Bhushan Majoor vs. ITO (in ITA No. 1590/Pune/2018 dated 04.04.2019).

4. It was further submitted that due to non appearance on the last scheduled date of hearing fixed for 07.11.2019, the ld. CIT(A) had decided the appeal without giving any final opportunity of hearing to the assessee. Further even on merits, the matter has not been decided by the ld. CIT(A) wherein the limited scrutiny was initiated under CASS to examine correctness capital gains/loss on sale of property whereas addition has been made u/s 69 treating the investment in immovable property as unexplained investment.

5. Per contra, the ld. DR is heard who has submitted that it is not in dispute that the matter was selected for limited scrutiny for examining capital gains on sale of property. However, the matter of purchase of the property is also emanating from the same issue for which the matter was selected for limited scrutiny as ultimately the assessee will be making the investment in the purchase of property from the sale consideration so received. It was further submitted that the assessee has not raised any such objection before the Assessing Officer and even before the ld. CIT(A) and therefore, the contention so advanced by the assessee should not be accepted. It was further submitted that sufficient opportunity have been provided by the ld. CIT(A). However, the assessee through its AR has sought adjournment from time to time and therefore, the ld. CIT(A) has passed the order ex-parte qua the assessee basis material available on record. She accordingly supported the findings of the lower authorities.

6. We have heard the rival submissions and perused the material available on record.

7. In Ground no. 1, the assessee has challenged the jurisdiction of Assessing officer by passing the impugned order u/s 143(3) for the reason that case was initially selected for limited scrutiny and without seeking permission from the competent authority to convert limited scrutiny into complete scrutiny, the addition has been made by the Assessing officer in respect of another transaction towards unexplained investment in purchase of property whereas no addition has been made towards the transaction pertaining to sale of immovable property for which the matter was initially selected for limited scrutiny.

8. In this regard, the undisputed facts which are emerging from the records are that the matter was selected for limited scrutiny to examine capital gain on sale of property as it apparent from the following narrations by the Assessing officer in the assessment order dated 23.12.2017 which reads as under:

“3. During the course of assessment proceedings, the issue on which case was selected for limited scrutiny was informed to the assessee, which is as under:

(i) Whether capital gains/loss of sale of property has been correctly shown in the return of income.

Assessee was further asked to explain above reasons with supporting evidence. During the course of assessment proceeding, assessee submitted a copy of return of income, computation of income, bank statement. The assessee also submitted that he have not sold any immovable property during the year under consideration. Hence the question of declaring long term capital gain does not arise. However, during proceedings vide order sheet entry dated 19.12.2017, it was asked whether any immovable property was purchased in the year under consideration both assessee as well as AR denied for purchase of immovable property. However, on request to last adjournmen t was granted for 20.12.2017. But on given date no compliance was made. On being heard, notice issued u/s 142(1) along with a show cause fina l opportunity letter on 20.12.2017 and assessee was asked to explain the source of investment made in immovable property.”

9. Thereafter, the assessee submitted before the Assessing officer that he has not sold any immoveable property during the year, the Assessing Officer has taken the said submissions on record and has not recorded any adverse findings in this regard. In other words, the Assessing officer has accepted the explanation of the assessee that there was no transaction of any sale of immovable property by the assessee during the financial year relevant to impugned assessment year and therefore, the question of earning any capital gain and not showing the same in return of income did not arise at all. The matter for which limited scrutiny was taken up, therefore, attained finality and no addition was made by the Assessing officer.

10. The Assessing officer has thereafter proceeded to examine whether the assessee has purchased any immovable property as apparent from the order sheet entry dated 19.12.2017 and an addition of Rs 10 lacs has thereafter been made u/s 69 of the Act towards unexplained investment in the property. We find that this transaction of purchase of property is not emanating from the same issue for which the matter was selected for limited scrutiny as the assessee has not sold any immoveable property during the year and therefore, the question of making the investment in the purchase of property from the sale consideration so received doesn’t arise and there is nothing on record which support such contention as so advanced by the ld DR. Therefore, it is an independent transaction of purchase of property for which addition has been made u/s 69 of the Act.

11. The question that arise for consideration is where the Assessing Officer wishes to expand the scope of enquiry beyond the matter for which the case of the assessee was selected for limited scrutiny, whether he has taken the requisite permission from the competent authority for converting a limited scrutiny into complete scrutiny or proceeding beyond the matter for which the case of the assessee was selected for limited scrutiny. In the instant case, we find that the Assessing Officer neither in the assessment order nor in the assessment proceedings (as apparent from the notings in the order sheet place on record) has stated that he has sought and has been granted any approval by the appropriate authority for converting the limited scrutiny into complete scrutiny or travelling beyond the matter for which the matter was initially selected for limited scrutiny. Further, nothing has been brought to our notice during the course of hearing by the ld DR that such approval was sought by the Assessing officer and has been granted by the appropriate authority. Therefore, we find that the AO has taken up the fresh issue of unexplained investment for purchase of immovable property, which has no connection with the issue of sale of immovable property for which the matter was selected for limited scrutiny, without seeking prior approval of the competent authority. The addition so made u/s 69 is liable to be quashed as the order passed by the AO would be nullity as beyond his jurisdiction in absence of requisite approval from the competent authority. The instructions issued by CBDT from time to time are clear on this point. During the course of hearing, our reference was drawn to CBDT Instructions no. 5 of 2016 dated 14.07.2016, the contents thereof read as under:

“Subject: Direction regarding scope of enquiry in cases under ‘Limited Scrutiny’ selected through CASS 2015 & 2016-regd.-

Vide Instruction No. 20/2015 dated 29.12.2015 in file of even number, Board has laid down Standard Operating Procedure for handling of cases under ‘Limited Scrutiny’ which were selected through Computer Aided Scrutiny Selection in ‘CASS Cycle 2015’. In these cases, it was stated that the general scope of enquiry in scrutiny proceedings should be restricted to the relevant parameters which formed the basis for selecting the case for scrutiny. However, in revenue potential cases, it was further provided that ‘Complete Scrutiny’ could be conducted, if there was potentia l escapement of income above a prescribed monetary limit, subject to the approval of administrative Pr. CIT/CIT/Pr. DIT/DIT.

2. In order to ensure that maximum objectivity is maintained in converting a case falling under ‘Limited Scrutiny’ into a ‘Complete Scrutiny’ case, the matter has been further examined and in partia l modification to Para 3(d) of the earlier order dated 29.12.2015, Board hereby lays down that while proposing to take up ‘Complete Scrutiny’ in a case which was originally earmarked for ‘Limited Scrutiny’, the Assessing Officer (‘AO’) shall be required to form a reasonable view that there is possibility of under assessment of income if the case is not examined under ‘Complete Scrutiny’. In this regard, the monetary limits and requirement of administrative approval from Pr. CIT/CIT/Pr. DIT/DIT, as prescribed in Para 3(d) of earlier Instruction dated 29.12.2015, shall continue to remain applicable.

3. Further, while forming the reasonable view, the Assessing Officer would ensure that:

a. there exists credible material or information available on record for forming such view;

b. this reasonable view should not be based on mere suspicion, conjecture or unreliable source; and

c. there must be a direct nexus between the available material and formation of such view.

4. It is further clarified that in cases under ‘Limited Scrutiny’, the scrutiny assessment proceedings would initially be confined only to issues under ‘Limited Scrutiny’ and questionnaires, enquiry, investigation etc. would be restricted to such issues. Only upon conversion of case to ‘Complete Scrutiny’ after following the procedure outlined above, the AO may examine the additional issues besides the issue(s) involved in ‘Limited Scrutiny’. The AO shall also expeditiously intimate the taxpayer concerned regarding conducting ‘Complete Scrutiny’ in such cases.

5. It is also clarified that once a case has been converted to ‘Complete Scrutiny’, the AO can deal with any issue emerging from ongoing scrutiny proceedings notwithstanding the fact that the reason for such issue have not been included in the Note.

6. To ensure proper monitoring in cases which have been converted from ‘Limited Scrutiny’ to ‘Complete Scrutiny’, it is suggested, that provisions of section 144A of the Act may be invoked in suitable cases. To prevent possibility of fishing and roving enquiries in such cases, it is desirable that these cases should invariably be picked up while conducting Review or Inspection by the administrative authorities.

7. The above Instruction shall be applicable from the date of its issue and would cover the cases selected under CASS 2015 which are pending scrutiny cases as well as cases selected/being selected under the CASS 2016.

8. The contents of this Instruction may be brought to the notice of all for necessary compliance.

9. Hindi version to follow.

(Rohit Garg)
Deputy Secretary to the Government of India ”

12. A perusal of the aforesaid instruction shows that in cases under ‘Limited Scrutiny’, the scrutiny assessment proceedings would initially be confined only to issues under ‘Limited Scrutiny’ and only upon conversion of case to ‘Complete Scrutiny’ after following the procedure laid down and seeking prior approval from the competent authority, the AO may examine the additional issues besides the issue(s) involved in ‘Limited Scrutiny’. The Assessing Officer can thus widen the scope of scrutiny where the matter was initially selected for scrutiny assessment. However, the condition precedent for such action of the Assessing Officer is that he has to follow the procedure so laid down and seek prior approval of the competent authorities. In the instant case, it is an admitted fact that no such approval has been taken by the Assessing officer. It is therefore, a case where the CBDT Instructions which are binding on the Assessing officer have not been followed by him.

13. Further, we find that it is a consistent position taken by various Benches of the Tribunal including Jaipur Benches that where the Assessing officer has taken up fresh issue without converting limited scrutiny to complete scrutiny by taking prior approval of the competent authority, then the said order passed by the Assessing officer will be nullity as beyond his jurisdiction. In this regard, we refer to recent decision of this Bench in the case of Late Smt. Gurbachan Kaur vs. DCIT (supra) wherein the relevant findings read as under:-

“7. Once the issue taken up by the A.O. was beyond the scope of limited scrutiny under CASS then until and unless the limited scrutiny is converted into comprehensive scrutiny by taking an approval of the competent authority, the said issue of determination of fair market value of the property as on 01/04/1081 is beyond the jurisdiction of the A.O. under the limited scrutiny. Since this issue was not raised by the assessee before the lower authorities and it requires verification of the assessment record to ascertain whether the A.O. obtained the approva l of the competent authority for conversion of the limited scrutiny to the comprehensive scrutiny. If the issue of determination of fair market value as on 01/04/1981 is taken up by the A.O. without expansion or conversion of the limited scrutiny to comprehensive scrutiny then such act of the A.O. is beyond his jurisdiction and the order passed by the A.O. U/s 154 r.w.s 155(15) of the Act would be illegal and void ab initio. This Tribunal has taken a consistent view on this issue in a series o f decisions relied upon by the ld. Counsel for the assessee. In the case o f CBS International Projects P. Ltd. Vs CIT (supra), the Delhi Benches o f the Tribunal has considered relevant instructions issued by the CBDT for limited scrutiny under CASS and held in para 13 to 16 as under:

“13. CBDT Instruction No. 20/2015 is as under:

“Scrutiny Assessments-some important issues and scope of scrutiny in cases selected through Computer Aided Scrutiny Selection (‘CASS)’-reg.

The Central Board of Direct Taxes (‘CBDT)’, vide Instruction No.7/2014 dated 26.09.2014 had clarified the extent of enquiry in certain category of cases specified therein, which are selected for scrutiny through CASS. Further clarifications have been sought regarding the scope and applicability of the aforesaid Instruction to cases being scrutinized.

2. In order to facilitate the conduct of scrutiny assessments and to bring further clarity on some of the issues emerging from the aforesaid Instruction, following clarifications are being made:

i. Year of applicability: As stated in the Instruction No. 7/2014, the said Instruction is applicable only in respect of the cases selected for scrutiny through CASS-2014.

ii. Whether the said Instruction is applicable to all cases selected under CASS: The said Instruction is applicable where the case is selected for scrutiny under CASS only on the parameter(s) of AIR/CIB/26AS data. I f a case has been selected under CASS for any other reason(s)/parameter(s) besides the AIR/CIB/26AS data, then the said Instruction would not apply.

iii. Scope of Enquiry: Specific issue based enquiry is to be conducted only in those scrutiny cases which have been selected on the parameter(s) of AIR/CIB/26AS data. In such cases, the Assessing Officer, shall also confine the Questionnaire only to the specific issues pertaining to AIR/CIB/26AS data. Wider scrutiny in these cases can only be conducted as per the guidelines and procedures stated in Instruction No. 7/2014.

iv. Reason for selection: In cases under scrutiny for verification of AIR/CIB/26AS data, the Assessing Officer has to intimate the reason for selection of case for scrutiny to the assessee concerned.

3. As far as the returns selected for scrutiny through CASS-2015 are concerned, two type of cases have been selected for scrutiny in the current Financial Year– one is ‘Limited Scrutiny’ and other is ‘Complete Scrutiny’. The assessees concerned have duly been intimated about their cases falling either in ‘Limited Scrutiny’ or ‘Complete Scrutiny’ through notices issued under section 143(2) of the Income-tax Act, 1961 (‘Act)’. The procedure for handling ‘Limited Scrutiny’ cases shall be as under:

a. In ‘Limited Scrutiny’ cases, the reasons/issues shall be forthwith communicated to the assessee concerned.

b. The Questionnaire under section 142 (1) of the Act in ‘Limited Scrutiny’ cases shall remain confined only to the specific reasons/issues for which case has been picked up for scrutiny. Further, the scope o f enquiry shall be restricted to the ‘Limited Scrutiny’ issues.

c. These cases shall be completed expeditiously in a limited number o f hearings.

d. During the course of assessment proceedings in ‘Limited Scrutiny ’ cases, if it comes to the notice of the Assessing Officer that there is potential escapement of income exceeding Rs. five lakhs (for metro charges, the monetary limit shall be Rs. ten lakhs) requiring substantial verification on any other issue(s), then, the case may be taken up for ‘Complete Scrutiny’ with the approval of the Pr. CIT/CIT concerned. However, such an approval shall be accorded by the by the Pr. CIT/CIT in writing after being satisfied about merits of the issue(s) necessitating ‘Complete Scrutiny’ in that particular case. Such cases shall be monitored by the Range Head concerned. The procedure indicated at points (a), (b) and (c) above shall no longer remain binding in such cases. (For the present purpose, ‘Metro charges’ would mean Delhi, Mumbai, Chennai, Kolkata, Bengaluru, Hyderabad and Ahmedabad).

4. The Board further desires that in all cases under scrutiny, where the Assessing Officer proposes to make additions or disallowances, the assessee would be given a fair opportunity to explain his position on the proposed additions/disallowances in accordance with the principle o f natural justice. In this regard, the Assessing Officer shall issue an appropriate show-cause notice duly indicating the reasons for the proposed additions/disallowances along with necessary evidences/reasons forming the basis of the same. Before passing the final order against the proposed additions/disallowances, due consideration shall be given to the submissions made by the assessee in response to the show-cause notice.

5. The contents of this Instruction should be immediately brought to the notice of all concerned for strict compliance.

6. Hindi version to follow.

Sd/- (Ankita Pandey)
Under Secretary to Government of India”

14. With Instruction 7 of 2014, the Board has made it specifically clear that the scope of enquiry should be limited to verification of the particular aspects only. It has also been directed that an approval is required from the PCIT/DIT, in writing, after being specific about the merits of the other issues for comprehensive scrutiny.

15. The said instruction reads as under:
Instruction No. 7/2014

Government of India

Ministry of Finance

Department of Revenue (CBDT)

Room No. 143E, North-Block, New-Delhi

Dated the 26th of September, 2014

To AU Pr. Chief-Commissioners of Income-tax/Chief Commissioners of Income-tax A

All Pr. Directors-General of Income-tax/Directors-General of Income-tax Sir/Madam,

Subject: – Scope of enquiry in cases selected for scrutiny during the Financia l Year 2014-2015 on basis of AIR/C1B /26AS mismatch regarding

It has come to the notice of the Board that during the scrutiny assessment proceedings some of the AOs are routinely calling for information which is not relevant, for enquiry into the issues to be considered. This has been causing undue harassment to the taxpayers and has also drawn adverse criticism from several quarters. Further, feedback and analysis of such orders indicates that many times the core issues, which formed the basis of selection of the case for scrutiny were not examined properly. Such instances primarily occurred in cases selected for scrutiny under Computer Aided Scrutiny Selection (‘CASS’) for verification of specific information obtained from third party sources which apparently did not match with the details submitted by the tax aver in the return of-income.

2. Therefore, for proper administration of the Income-tax Act, 1961 (‘Act’), Central Board of Direct Taxes, by virtue of its powers under sect on 119 of the Act, in supersession of earlier instructions/guidelines on this subject, hereby directs that the cases selected for scrutiny during the Financial Year 2014­20(15 under CASS, on the basis of either AIR data or CIB information or for non re-conciliation with 26AS data the scope of enquiry should be limited to verification of these are particular aspects only. Therefore, in such cases, an Assessing Officer hall confine the questionnaire and subsequent enquiry or verification only to these specific point(s) on the basis of which the particular return has been selected for scrutiny.

3. The reason(s) for selection of cases under CASS are displayed to the Assessing Officer in AST application and notice u/s 143(2), after genera ion from AST, is issued to the taxpayer with the remark ‘Selected under Computer Aided Scrutiny Selection (CASS)”. The functionality in AST is being modified suitably to flag the reasons for scrutiny selection in AIR/CIB/26AS cases. This functionality is expected to be operationalised by 15th October, 2014. Further, the Assessing Officer while issuing notice under section 142(1) of the Act which is enclosed with the first questionnaire would proceed to verify only the specific aspects requiring examination/verification. In such cases, all efforts would be mad to ensure that assessment proceedings are completed expeditiously in minimum possible number of hearings without unnecessarily dragging the case till the time-baring date.

4. In case, during the course of assessment proceedings it is found that there is potential escapement of income exceeding Rs. 10 lakhs (f non -metro charges, the monetary limit shall be Rs. 5 lakhs) on any other issue(s) apart from the AIR/CIB/26AS information based on 14 which the case was elected under CASS requiring substantial verification, the case may be taken up for comprehensive scrutiny with the approval of the Pr. CIT/DIT concerned. However, such an approval shall be accorded by the Pr. CIT/DIT in writing after being satisfied about merits of the issue(s) necessitating wider and detailed scrutiny in the case. Cases so taken up for detailed scrutiny shall be monitored by the it. CIT/Addl. CIT concerned.

5. The contents of this Instruction should be immediately brought to the notice of all concerned for strict compliance.

6. Hindi version to follow.

(Rohit Garg)

Deputy Secretary to the Government of India”

16. A perusal of the aforesaid instruction shows that the Assessing Officer can widen the scope of scrutiny even if it is selected for scrutiny assessment under CASS. However, the condition precedent for such action of the Assessing Officer is that he has to seek prior approval of the higher authorities. A perusa l of the assessment order shows that the Assessing Officer has not mentioned as to when the permission from the PCIT was sought to make further enquiries in the case of the assessee. Considering the facts of the case in totality, in the light of the CBDT Instructions mentioned hereinabove, qua notice u/s 143(2) o f the Act, we are of the considered opinion that the 15 assessment order so framed by the Assessing Officer is not in consonance with Instruction of the CBDT and, therefore deserves to be quashed. The order of the ld. CIT(A) is accordingly set aside.”

Thus, if the A.O. has taken up the issue of determining fair market value of the property in question as on 01/4/1981 without converting the limited scrutiny to comprehensive scrutiny by taking the prior approval o f the competent authority then the said order passed by the A.O. will be nullity as beyond his jurisdiction. The AO neither in the assessment order nor in the assessment proceedings sheet has mentioned about any proposal of converting the limited scrutiny to comprehensive scrutiny and consequential approval of the Competent Authority being Principa l CIT/DIT. The ld. Counsel for the assessee has produced the certified copy of the assessment proceedings sheet which does not contain any such proposal of the AO for expanding the limited scrutiny to complete scrutiny. Further, the revenue has also not produced anything to show that the AO has obtained the necessary approval from the Competent ITA 692/JP/2019_ Late Smt. Gurbachan kaur Vs DCIT 13 Authority for conversion of the limited scrutiny to comprehensive scrutiny. Accordingly, the issue which is taken up by the AO in the proceedings under section 154 is illegal and void being beyond his jurisdiction to frame the limited scrutiny assessment. Accordingly, we set aside and quash the order passed by the AO under section 154 of the Act.”

14. In light of the above discussions and in the entirety of facts and circumstances of the case, we set aside and quash the order passed by the AO u/s 143(3) of the Act and ground no. 1 of the assessee’s appeal is allowed.

15. In light of above discussions, where we have set aside and quash the order passed by the AO, ground no. 2 & 3 on merits becomes academic and are not adjudicated upon, and thus dismissed as infructuous.

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