Pr.CIt invoked jurisdiction under section 263 and directed AO to make fresh assessment deciding on chargeability 'sundry creditors for raw material and expenses undr section 68 or 41(1).Held: As apparent, Pr. CIT himself was not sure as to whether the addition can be made under section 68 or under section 41(1) of the Act. Accordingly, Pr. CIT was not justified in setting aside assessment order to AO for passing fresh, when Pr.CIT himself was not able to form an opinion.
IN THE ITAT, CUTTACK BENCH
C.M. GARG, J.M. & L.P. SAHU, A.M.
Sri Purna Chandra Biswal v. Pr. CIT
I.T.A. No. 200/CTK/2018
15 November, 2019
Assessee by: S.K. Sarangi, AR
Revenue by: S.M. Keshkamat, CIT DR
L.P. Sahu, A.M.
Challenging the order of the Principal CIT, Cuttack, dated 30-3-2018, passed under section 263 of the Act, the assessee has filed this present appeal on the following grounds :--
1. Under the facts and circumstances, the learned Pr. CIT is erred in law as well as facts and principles by considering Rs. 16,164 of sundry Accounts written off as separate income, which in fact has originated from works contract income. The action of the learned CIT was wholly unreasonable, uncalled for and bad in law.
2. The learned Pr. CIT is erred in law as well as in facts by proposing the addition of amount of sundry creditors, amounting to Rs. 2,69,16,055 considering the fact that the assessment was completed by estimating profit under section 145(3) of the Income Tax Act in absence of books of accounts. More over the detail list of sundry creditors with address provided to the Pr. CIT as well as the assessing officer at the time of hearing indicates that the sundry creditors relate to the earlier assessment year and after considering these details the learned assessing officer has completed the assessment by estimating the profit under section 145(3). Thus the action of the learned Pr. CIT is unlawful, unjustified and unwarranted.