Sec. 263 revision justified as AO passed order without examining financial statements: ITAT
- Blog|News|Income Tax|
- 2 Min Read
- By Taxmann
- |
- Last Updated on 27 September, 2022
Latest from Taxmann
Case Details: L.A. Developers v. CIT - [2022] 142 taxmann.com 280 (Cuttack-Trib.)
Judiciary and Counsel Details
-
- George Mathan, Judicial Member & Arun Khodpia, Accountant Member
- P.C. Sethi, AR for the Appellant.
- M.K. Gautam, CIT (DR) for the Respondent.
Facts of the Case
Assessee filed its return of income under section 153C and the same was completed under section 143(3). Thereafter, the assessment was reopened by the issue of a notice under section 148 and a reassessment order was passed by the Assessing Officer.
The Commissioner noted that there was a glaring difference in the valuation of current assets and current liabilities as shown in assessee’s balance sheet as compared to its cash flow statement. AO didn’t consider this during reassessment proceedings. Thus, he invoked the provision of section 263 in order to set aside/modify the assessment order passed by AO. Assessee approached tribunal against such revision.
ITAT Held
The Tribunal has ruled that AO had called for details regarding differences arising in books of account. However, he had not applied his mind to the issue or formed any opinion towards the same. Thus, there was failure on part of AO to examine or make addition in respect of the difference between cash flow and balance sheet. This had made the assessment order erroneous and consequently prejudicial to the interest of revenue. Accordingly, the Commissioner was right in invoking his powers under section 263.
List of Cases Referred to
-
- Sesa Starlite Ltd. v. CIT [2021] 123 taxmann.com 217/277 Taxman 443/430 ITR 121 (Bom.) (para 8).
Disclaimer: The content/information published on the website is only for general information of the user and shall not be construed as legal advice. While the Taxmann has exercised reasonable efforts to ensure the veracity of information/content published, Taxmann shall be under no liability in any manner whatsoever for incorrect information, if any.
Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.
The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:
- The statutory material is obtained only from the authorized and reliable sources
- All the latest developments in the judicial and legislative fields are covered
- Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
- Every content published by Taxmann is complete, accurate and lucid
- All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
- The golden rules of grammar, style and consistency are thoroughly followed
- Font and size that’s easy to read and remain consistent across all imprint and digital publications are applied
Sign Up
To subscribe to our weekly newsletter please log in/register on Taxmann.com
Latest Books
Everything on Tax and Corporate Laws of India
To subscribe to our weekly newsletter please log in/register on Taxmann.com
CA | CS | CMA
