Principal Commissioner Of Income Tax, Kolkata-5, Kolkata v. Bajaj Parivahan Private Limited

OD-11 IN THE HIGH COURT AT CALCUTTASpecial Jurisdiction (Income tax)ORIGINAL SIDE IA No.GA 2 of 2017 (Old No.GA 2639 of 2017) In ITAT 283 of 2017 PRINCIPAL COMMISSIONER OF INCOME TAX, KOLKATA-5, KOLKATAVs.BAJAJ PARIVAHAN PRIVATE LIMITED BEFORE: The Hon'ble JUSTICE T. S. SIVAGNANAM ANDThe Hon’ble JUSTICE HIRANMAY BHATTACHARYYADate : 14[th] December, 2021. Appearance:Mr. P.K. Bhowmik, Adv.…for the appellant. The Court : This appeal by the revenue filed under Section 260A ofthe Income Tax Act (the ‘Act’ in brevity) is directed against the order dated21[st] October, 2016 passed by the Income Tax Appellate Tribunal, D-Bench,Kolkata (the ‘Tribunal’) in ITA Nos.1107/Kol/2016 for the Assessment Year2011-12. The revenue has raised the following substantial questions of law forconsideration: i)Whether on the facts and the circumstances of the case theTribunal was justified in law in quashing the order under Section263 of the Income Tax Act, 1961 holding that the Assessing Officerhas rightly adopted @1% of disallowance of such expenses onestimation basis when basis of such meager estimation was notprima facie clear from the material on record and its purportedfindings in this regard are arbitrary, unreasonable and perverse ? ii)Whether the Tribunal was justified in not appreciating that failureon the part of the Assessing Officer to examine in depth the claimof the assessee and his failure to do so is not only erroneous butalso prejudicial to the interest of the revenue, which causes loss ofrevenue, and thus attracts Section 263 of the Income Tax Act,1961 and its purported findings in this regard are arbitrary,unreasonable and perverse? on the part of the Assessing Officer to examine in depth the claimof the assessee and his failure to do so is not only erroneous butalso prejudicial to the interest of the revenue, which causes loss ofrevenue, and thus attracts Section 263 of the Income Tax Act,1961 and its purported findings in this regard are arbitrary,unreasonable and perverse? iii)Whether the Tribunal erred in law is not appreciating that theinstant case falls within the four corners of the clause (a) and (b) ofthe Explanation 2 appended to Section 263 of the Income Tax Act,1961?instant case falls within the four corners of the clause (a) and (b) ofthe Explanation 2 appended to Section 263 of the Income Tax Act,1961? We have heard Mr. P. K. Bhowmik, learned standing Counsel appearingfor the appellant/revenue. The issue involved in the instant appeal is whether the assumption ofjurisdiction by the Commissioner of Income Tax (Appeals) under Section 263was valid though the revenue has raised three questions of law. The sum andsubstance of the issue is whether the exercise of power under Section 263was sustainable. The Tribunal has considered the factual position which wasexamined by the Assessing Officer and noted that the details of particulars ofpayments made on account of warehouse expenses, commissions and claimswere furnished to the Assessing Officer and on perusal of the same, theAssessing Officer found that the assessee had submitted party wise details ofpayments, vehicle number, amount credited and TDS were deducted on suchclaims. Furthermore, the Tribunal noted that these details were furnished tothe Assessing Officer after a notice under Section 143(2) was issued to the assessee calling upon the assessee to produce the accounts and documentsand furnish a reply in writing. Thus, the Tribunal concluded that theassumption of jurisdiction under Section 263 was clearly erroneous. We findthat there is no question of law much less substantial question of law arisingfor consideration in this appeal. In the result, the appeal fails and the same stands dismissed. Theconnected application also stands dismissed. (T. S. SIVAGNANAM, J.) (HIRANMAY BHATTACHARYYA, J.)