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TMI Blog2013 (6) TMI 663X X X X Extracts X X X X X X X X Extracts X X X X ..... ut the assessee to inconvenience, and which cannot but be depreciated. As regards the invocation of s. 263 case of Malabar Industrial Co. Ltd. v. CIT [2000 (2) TMI 10 - SUPREME Court] laid down four-way test for invocation of a provision i.e. incorrect assumption of facts, incorrect application of law, without applying the principles of natural justice, and without application of mind. It is the last category, if not perhaps the first one as well, which arise in the instant case. Thus confirming the invocation of section 263 in the instant case, direct the assessing authority to observe the directions of the revisionary authority both in letter and in spirit so as to avoid multiplicity of proceedings. - I.T.A. No. 4147/Mum/2011 - - - D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the A.O. did not examine this issue, and neither was the same raised before him, even as the impact on the book profit, i.e., of following the exclusive method of accounting, had been clearly indicated by the tax auditors, the relevant aspect being a subject matter of the audit report u/s.44AB of the Act, adverting our attention to Annexure-3 thereto, placed at page 12 of the assessee's paper-book (PB). The same clearly shows the net impact on the book profit to be nil. On a further query by the Bench as to whether the plea of section 145A being tax-neutral in its case stood raised before the ld. CIT, she replied in the affirmative; the same forming part of the assessee's objections dated 03/7/2009 to the notice u/s.263 (PB pgs. 8-19). Howe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssment as per law after giving sufficient opportunity to the assessee, so that the arguments being advanced by the ld. AR on the merits of the case would be of no moment. 3. We have heard the parties and perused the material on record. Our first observation in the matter is that section 145A is a non-obstante provision, which, therefore, is to be necessarily followed for the purpose of returning the income under the Act. This is, in fact, what in substance the ld. CIT states when he directs the AO to redo the assessment as per law. If there is no tax impact, which aspect has not been examined by the assessing authority, rendering his order as liable to revision u/s.263, there would be no change in the assessee's income and, consequently ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT in the matter as well as the clear position of the law per by a series of decisions. The A.O. has, firstly, by not discharging his obligations, being duty bound to verify the assessee's return as being in accordance with the law, and then in acting in disregard of the directions by the ld. CIT, has put the assessee to inconvenience, and which cannot but be depreciated. As regards the invocation of s. 263, the apex court in the case of Malabar Industrial Co. Ltd. v. CIT [2000] 243 ITR 83 (SC) has laid down four-way test for invocation of a provision. Succinctly put, these are; incorrect assumption of facts; incorrect application of law; without applying the principles of natural justice; and without application of mind. It is the last ..... X X X X Extracts X X X X X X X X Extracts X X X X
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