Ketan Gori Vs PCIT (ITAT Rajkot)
Purchases Duly Verified, Revision Held Mere Change of Opinion Tribunal Quashes PCIT’s 263 Revision
Assessee filed return declaring income of ₹4.64 lakh for AY 2021-22. His case was selected for CASS scrutiny to verify substantial purchases from suppliers flagged as non-filers, non-business ITR filers, or entities with abnormally low turnover. Assessment was completed u/s 143(3) on 18.12.2022 accepting returned income.
Later, PCIT invoked section 263 alleging that AO failed to verify suspicious purchases, noting that certain suppliers had cancelled GST registrations u/s appeared bogus. According to PCIT, such purchases ought to have been disallowed u/s 69C r.w.s. 115BBE.
Assessee countered that during scrutiny AO had issued notices u/s 142(1) & 133(6), obtained replies & confirmations from suppliers, verified purchase bills, transportation records, GST returns, contra confirmations, u/s bank payment proofs. All these documents were on AO’s record, though not elaborated in the assessment order. Hence, PCIT’s action was only a review of AO’s decision on the same set of facts, which is not permissible u/s 263.
Tribunal agreed with the assessee, noting that Purchases were fully supported by bills, bank payments, transport records & GST filings. AO had examined & accepted confirmations from suppliers; no defects in books were pointed out. PCIT merely differed on AO’s conclusion without bringing new evidence, which amounted to change of opinion.
