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TMI Blog2013 (10) TMI 701X X X X Extracts X X X X X X X X Extracts X X X X ..... so far as it is prejudicial to the interests of the Revenue, to pass an order upon hearing the assessee and after an enquiry as is necessary, enhancing or modifying the assessment or canceling the assessment and directing a fresh assessment - The key words that are used by section 263 are that the order must be considered by the Commissioner to be "erroneous in so far as it is prejudicial to the interests of the Revenue". The provision "cannot be invoked to correct each and every type of mistake or error committed by the Assessing Officer" and "it is only when an order is erroneous that the section will be attracted" - an incorrect assumption of fact or an incorrect application of law will satisfy the requirement of the order being erro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nses in the immediately preceding year. To elaborate further, the assessee was claiming the entire amount of advertisement expenses incurred in a year as expenditure in that year itself the previous year. In assessment year 2006-07, the assessee had claimed the entire amount of advertisement expenses in that year itself. However, in the succeeding assessment year, i.e., in assessment year 2007-08, the assessee changed the method and claimed the same as deferred revenue expenditure spread over a period of five years. In asst. year 2007-08, the assessee had incurred a sum of Rs.1,03,13,025/- towards advertisement expenses and claimed 1/5th of the same in that year. Accordingly in assessment year 2008-09, i.e., the year under consideration, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d this appeal before us. 6. We have heard the rival contentions. Admittedly, the assessing officer did not discuss anything in the assessment order about the claim of advertisement expenses made in this year. Before us the Ld A.R claimed that the AO did examine this issue during the course of assessment proceedings, but he did not file any material to support his claim. At this juncture, we feel it pertinent to refer to the decision rendered by the Hon'ble Bombay High Court in the case of Grasim Industries Ltd. V CIT (321 ITR 92), wherein the court has discussed about the scope of provisions of section 263 as under: Section 263 of the Income-tax Act, 1961 empowers the Commissioner to call for and examine the record of any proceedings un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 'prejudicial to the interests of the Revenue' has to be read in conjunction with an erroneous order passed by the Assessing Officer. Every loss of revenue as a consequence of an order of the Assessing Officer, cannot be treated as prejudicial to the interests of the Revenue, for example, when an Income-tax Officer adopted one of the courses permissible in law and it has resulted in loss of revenue, or where two views are possible and the Income-tax Officer has taken one view with which the Commissioner does not agree, it cannot be treated as an erroneous order prejudicial to the interests of the Revenue unless the view taken by the Income-tax Officer is unsustainable in law." The principle which has been laid down in Malabar Industrial C ..... X X X X Extracts X X X X X X X X Extracts X X X X
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