- (1.) THIS appeal under Section 260A of the IT Act, 1961 was admitted on 27th Oct., 1999; however, substantial question of law required to be considered in this appeal was not formulated at that relevant time. The substantial question of law stated to be arising for consideration in this appeal by the Revenue has been set out in appeal as under : 'Whether, on the facts and having regard that confirmations from creditors were not filed, the Tribunal was right in holding that the assessment order was not erroneous and consequently in cancelling the order under Section 263 ?'
(2.) WE have heard learned Counsel for the parties and perused the material available on record. The assessment for asst. yr. 1993 -94 in the case of respondent -assessee was completed on 31st Jan., 1996 under Section 143(3). The CIT considering the said order to be erroneous and prejudicial to the interest of Revenue invoked his jurisdiction under Section 263 of the IT Act, 1961, cancelled the assessment order and directed the AO to make a fresh assessment order after making inquiry into the genuineness of fresh deposits made in the capital accounts of the partners, genuineness of cash credits in the names of 26 different persons totalling Rs. 4,22,115, as per Schedule 'B' to the audit report, genuineness of outstanding liability amounting to Rs. 14,16,348 in the names of various persons as per Schedule 'C' and also after examining whether there is any acceptance or repayment of loan or deposit of Rs. 20,000 or more otherwise than by cheque/bank draft and then redetermine the income chargeable to tax.
(3.) THE order of the CIT, dt. 27th March, 1998 was set aside by the Tribunal by its judgment under appeal dt. 7th Aug., 1998.;