INCOME TAX ACT, 1961

Section 263

Revision under section 263 - Erroneous and prejudicial order - Necessary enquiry made by AO -

CIT exercised revisionary jurisdiction under section 263 on the premise that admitted undisclosed income during search over and above the regular income on account of inflated expenses and other undisclosed income for assessment year 2012-13 had not been offered by assessee in return of income filed by assessee under section 153A and AO completed assessment without carrying out necessary enquiry in the matter as to why income disclosed at the time of search was not incorporated in return of income.Held: As evident, AO by way of issue of notice under section 142(1) during original assessment proceedings under section 153A/143(3) sought following documents and details information such as, 'Mines development' expenses, Amount debited under the head 'Incentive on sale'. Amount claimed in profit and loss account, Rs. 4 crores as loss ad damage expenses and advertisement expense along with proof of TDS on the same, etc. Assessee submitted the documents and details and AO based thereon framed original assessment under section 153A/143(3) and same was cancelled by first order passed under section 263. During second assessment under section 143(3) read with section 263, (in pursuance of first 263 order), assessee submitted books of accounts. balance-sheet, profit and loss account, details of various expenses as askde by AO, details of creditors/debtors, etc., AO himself acknowledted books of accounts, documents and evidences submitted by assessee during second assessment and having satisfied himself about correctness of same and explanation of assessee in regard to expenses, completed assessment. Hence, there was no reason to say that AO failed to conduct necessary enquiry before accepting claim of assessee and even if CIT did not agree with results of such enquiries, resultant order could not be subected to revision proceedings again.

REFERRED :

FAVOUR : In assessee's favour.

A.Y. : 2012-13

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