Kulbhushan Mittal Vs PCIT (ITAT Delhi)
The Income Tax Appellate Tribunal (ITAT), Delhi, allowed the assessee’s appeal against the order passed by the Principal Commissioner of Income Tax (PCIT) under Section 263 of the Income-tax Act, 1961.
The assessee, an individual, had filed the original return of income for Assessment Year 2012-13 on 30.08.2012 declaring total income of ₹2,83,434. The return was processed under Section 143(1) on 24.11.2012. Subsequently, based on information received from the Investigation Wing, Delhi, alleging that the assessee had provided accommodation entries of ₹65,00,000 during Financial Year 2011-12 to two persons and received cash in return, reassessment proceedings were initiated under Section 147. The Assessing Officer completed the reassessment under Sections 147 read with 143(3) on 28.12.2019 and made an addition of ₹65,00,000 under Section 68 of the Act.
Thereafter, the Principal Commissioner invoked revisionary jurisdiction under Section 263 by issuing a show-cause notice. By order dated 28.03.2023, the PCIT held that the reassessment order was erroneous and prejudicial to the interests of the Revenue due to lack of enquiry or verification, as contemplated under Explanation 2 to Section 263. The PCIT observed that the Assessing Officer had failed to examine the applicability of Section 50C with reference to the value of an immovable property and had also not verified cash deposits aggregating to ₹7,25,500 in two bank accounts. The reassessment order was set aside with directions to the Assessing Officer to conduct fresh enquiries on these issues.
