IN THE INCOME TAX APPELLATE TRIBUNAL, RANCHI BENCH, RANCHI BEFORE SHRI GEORGE MATHAN, JUDICIAL MEMBER AND SHRI RATNESH NANDAN SAHAY, ACCOUNTANT MEMBER I.T.A. No. 47/Ran/2022 (Assessment Year-2017-18)

(Virtual Hearing)

Shiv Shambhu Iron & Steel Private Pr.CIT, Limited, Ranchi.

Vs.

Draupadi Bhawan, Station Road, Jugsalai, Jamshedpur-831001.

PAN No. AALCS 7663 M Appellant/ Assessee Respondent/ Revenue Assessee represented by Shri Akshay Ringasia, C.A.

Department represented by Shri Shrawan Kumar, CIT-DR Date of hearing 05/03/2025 Date of pronouncement 28/03/2025

O R D E R

PER: BENCH

1. This appeal by the appellant is directed against the order of the learned Principal Commissioner of Income Tax, Ranchi [in short, the ld. PCIT] passed under Section 263 of the Income Tax Act, 1961 (in short, the Act) dated 03/03/2022 for the Assessment Year (AY) 2017-18 by raising following grounds of appeal:

"1. ThattheLd.PCITerredinlawandinfactinsettingasidetheorderofthe Ld. AO under Section143(3) by invoking revisionary jurisdiction under section263.

2. ThattheLd.PCITerredininvokingrevisionaryjurisdictionundersection

263onthebasisofaproposalsenttohimwithoutsuomotucallingforand examiningtherecordofassessment.

3. That the Ld. PCIT erred in concluding the assessment order to be erroneouswithrespecttotruckexpensesofINR9,62,826/-whenallthe necessaryrecordsandproofsthereofwassubmittedbeforehimbysimply observingthatnorecordsweresubmitted.

4. That the Ld. PCIT erred in directing the AO to make enquiry into the unsecuredloanwhenthesamewasneverapartofshowcausenoticeand evenfailstofindreferenceintheorderofLd.PCITwhatsoever.

5. Thatintermsofabovegrounds,theorderoftheLd.PCITundersection

263,settingasidetheoriginalassessmentundersection143(3)isbadin lawanddeservestobequashedintoto

6. Thattheassesseecleavetoadd,alteroramendanygroundbeforeorat thetimeofhearing."

2. Facts of the case, in brief, are that the appellant filed its return of income for the A.Y. 2017-18 electronically on 21/10/2017 declaring income at ₹ 65,97,030/-. It is mentioned in the assessment order passed under Section 143(3) of the Act dated 09/12/2019 that during the year under consideration, the appellant was doing business of wholesale and retail trade of iron and scrap. Return was processed under Section 143(1) of the Act and thereafter case was selected for complete scrutiny assessment through Computer Assisted Scrutiny Selection (CASS). After issuance of statutory notices under Section 143(2) and 142(1) of the Act, the income of appellant was assessed on the same income of ₹ 65,97,030/- as declared by the appellant. Subsequently, the ld. PCIT vide impugned order passed under Section 263 of the Act dated 03/03/2022, set aside the assessment order passed by the AO under Section 143(3) of the Act dated 09/12/2019 with a direction to the AO to make fresh assessment order after making proper enquiries in respect of 'truck expenses' and 'unsecured loans' on the grounds that the Assessing Officer has failed to verify the same without conducting any enquiry and therefore, the assessment order passed under Section 143(3) of the Act was erroneous and prejudicial to the interests of revenue.

3. Aggrieved by the order under Section 263 of the Act dated 03/03/2022, the appellant has raised the above grounds of appeal. During the course of hearing before us, it was submitted by the appellant that the ld. PCIT has erred in assuming jurisdiction under Section 263 of the Act without taking suo motu cognizance and without calling and examining the assessment record and claimed that all necessary documents and evidences regarding the truck expenses were submitted before him. Regarding unsecured loan, the same was never part of show cause notice and even failed to find reference in the order of the ld. PCIT. According to the ld. AR of the appellant, Section 263 provides that the PCIT may call for and examine the record of any proceeding under this Act, if he considers that any order passed therein by the Assessing Officer i