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TMI Blog2012 (8) TMI 94X X X X Extracts X X X X X X X X Extracts X X X X ..... rder unsustainable in law as the finding of the CIT must be clear, unambiguous and not debatable - in favour of assessee. X X X X Extracts X X X X X X X X Extracts X X X X ..... has observed as under: "The Assessee's submission has been considered and cross verification in respect of certain sales and purchases was carried out particularly in respect of the period after the date of survey. In this connection, verification in respect of valuation of closing stock shown in the trading account on 31.3.2005 was also carried out. As a result of verification and taking into account the assessee's submission, the book result declared by the assessee is accepted." 8. From the perusal of the records it is clear that the AO while framing the assessment order the AO had considered the submissions of the assessee and carried out cross verification of certain sales and purchases particularly in respect of the period after the date of survey. It thus appears that the AO had examined the aspect of valuation of closing stock and had applied his mind and after being satisfied passed the assessment order. In response to the show cause notice of CIT. assessee vide his written submission dated 18.10.2008 submitted that if the closing stock as worked out in the show cause notice is considered, the Gross profit of the assessee would be on a higher side i.e approximately 27. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rejudicial to the interests of the Revenue. But that by itself would not be enough to vest the Commissioner with the power of suo motu revision because the first requirement, namely, that the order is erroneous, is absent. Similarly if an order is erroneous but not prejudicial to the interests of the Revenue, then the power of suo motto revision cannot be exercised. Any and every erroneous order cannot be the subject-matter of revision because the second requirement must be fulfilled." 10. It is also well-settled that order passed by the Assessing Officer would be erroneous only if the Assessing Officer has not considered all materials or had not done proper examination or enquiry or verification or if the Assessing Officer had completely omitted the issue, in question, from consideration and made the assessment in an arbitrary manner. In the case of CIT VS Hero auto ltd (2012) 343 ITR 342 (Del), the H'ble Delhi High Court has held as under: (page 344) "Thereafter, he has referred to the second claim of the respondent assessee and has observed that there was lack of inquiry and this vitiated the assessment order. Reference was made to the decision of this court in Gee Vee Enterpr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... record per se justified and mandated further enquiry or investigation but the AO had erroneously not undertaken the same. However, the said finding must be clear, unambiguous and not debatable. The matter cannot be remitted for a fresh decision to the AO to conduct further inquiries without a finding that the order is erroneous. Finding that the order is erroneous is a condition or requirement which must be satisfied for exercise of jurisdiction u/s. 263 of the Act. In such matters, to remand the matter /issue to the AO would imply and mean the CIT has not examined and decided whether or not the order is erroneous but has directed the AO to decide the aspect/question. This distinction must be kept in mind by the CIT while exercising jurisdiction u/s.263 of the Act and in the absence of the finding that the order is erroneous and prejudicial to the interest of the Revenue, exercise of jurisdiction under the said section is not sustainable. In most cases of alleged "inadequate investigation", it will be difficult to hold that the order of the AO, who had conducted enquiries and had acted as an investigator, is erroneous, without the CIT conducting verification /inquiry. The order o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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