V.L Jewellers vs. Circle-49(1), Delhi – Income Tax Appellate Tribunal Delhi Bench Decision

Case Number: ITA No. 836/Del/2022

Appellant: V.L Jewellers, Delhi
Respondent: Circle-49(1), Delhi
Assessment Year: 2017-18
Decision: Allowed

Summary of Judgment

The appeal bearing case number ITA No. 836/Del/2022 was filed by V.L Jewellers against the order of the Principal Commissioner of Income Tax, Circle-49(1), Delhi. The case pertains to the assessment year 2017-18. The Income Tax Appellate Tribunal’s Delhi Bench, comprising Hon’ble President Shri G.S. Pannu and Hon’ble Judicial Member Shri Challa Nagendra Prasad, heard the arguments from both the appellant and the respondent side.

The issue at hand involved the assessment order passed under section 263 of the Income Tax Act by the Principal Commissioner for the Assessment Year 2017-18, terming it as erroneous and prejudicial to the interest of Revenue. This was challenged by V.L Jewellers, asserting that the order was unfounded and requested its quashing.

After considering the submissions and the evidence provided, the Tribunal found that the Principal Commissioner’s order under section 263 did not adequately address the appellant’s explanations and evidence. It was observed that the essential prerequisite for exercising jurisdiction under section 263, i.e., conducting minimal inquiries to establish the order as erroneous and prejudicial to the interest of the Revenue, was not met.

Therefore, the Tribunal concluded that the assessment order passed by the Assessing Officer was neither erroneous nor prejudicial to the interest of the Revenue. On this basis, the appeal filed by V.L Jewellers was allowed, setting aside the order of the Principal Commissioner.

This judgment highlights the importance of conducting thorough inquiries before invoking the provisions of section 263 of the Income Tax Act and underscores the Tribunal’s role in ensuring justice by meticulously reviewing the cases presented.

V.L Jewellers vs. Circle-49(1), Delhi – ITA No. 836/Del/2022