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TMI Blog2014 (1) TMI 800X X X X Extracts X X X X X X X X Extracts X X X X ..... preciation chart filed by the assessee - The AO must have been satisfied with the claim of depreciation vis-à-vis set up of business vis-à-vis business income - The order of the AO may be brief and cryptic but that by itself is not sufficient reason to brand the assessment order as erroneous and prejudicial to the interest of the Revenue - Writing an order in detail may be a legal requirement but the order not fulfilling this requirement cannot be said to be erroneous and prejudicial to the interest of the Revenue. The AO has adopted a course permissible in law backed by facts and judicial decisions and the AO has taken one view with which the Commissioner does not agree - The order of the assessment cannot be treated as erroneous order and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the claim of depreciation of the assessee u/s. 32 of the Act. According to the Ld. CIT, in order to claim depreciation an assessee has to prove the ownership as well as usage of the asset during the previous year for the purpose of assessee's business. In the instant case, the AO has failed in verifying the claim that has rendered the order erroneous. The assessee attended the proceedings u/s. 263 of the Act and furnished all the details as and when called by Ld. CIT. It was contended that assessee's business stood set up during the year under consideration and once it is established that the business is set up the assessee is entitled for all business expenses and allowances. The depreciation allowance being a statutory allowance was ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e order is erroneous because the AO has not done the enquiries expected of him before the grant of depreciation for pipelines and went on to set aside the assessment to look into this aspect of grant of depreciation. 5. Aggrieved by this, the assessee is before us. The Ld. Senior Counsel for the assessee vehemently argued that during the course of the scrutiny assessment proceedings, the AO has called for necessary details in respect of fixed assets which is evident from the order sheet entries dt. 6.9.2011. The assessee furnished complete details vide its reply dt. 19.9.2011 wherein it was also explained the details of income from transportation of natural gas. It is the say of the Ld. Counsel that if the assessee is showing income from t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... osing his view on the view of the AO which is against the canons of the settled position of law. 6. Per contra, the Ld. Departmental Representative strongly supporting the findings of the Ld. CIT, argued that it is not a case of two views and CIT is not substituting his view with that of AO. It is the say of the Ld. DR that the AO has not made any further enquiry which has resulted into his order erroneous inasmuch as it is prejudicial to the interest of the Revenue. The Ld. DR relied upon the decisions of the Hyderabad Bench in the case of DCIT Vs Coromandal Bio Tech Industries (I) Ltd 20 taxamnn.com 520 (Hyd) and in the case of Linkwell Telesystems (P) Ltd 32 taxmann. Com 369 and also on the decision of Allahabad High Court in the case o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the AO and the CIT has also not controverted to this finding of the AO. Once the business income has been accepted, it proves beyond all reasonable doubts that the business has been set up. Once the business has been set up, the assessee is lawfully entitled to claim all business expenditure and allowances. The AO has allowed depreciation after examining the depreciation chart filed by the assessee. Obviously, the AO must have been satisfied with the claim of depreciation vis-à-vis set up of business vis-à-vis business income. Now at this stage, the Commissioner is of the opinion that the AO should have made some more enquiries. The order of the AO may be brief and cryptic but that by itself is not sufficient reason to brand ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent of revenue which is taken care of by other provisions in the Act. In the garb of exercising power under Section 263, the Commissioner cannot initiate proceedings with a view to starting fishing and roving enquiries in matters or orders which are already concluded. 7.2. In the present case, the evidences brought on record clearly suggest that the AO did make enquiry regarding assessee's business income and its claim of expenditure. The AO did allow all the business expenses and depreciation and after satisfying himself the AO has completed the assessment u/s. 143(3) of the Act. The CIT's observation at para-15 that any claim of depreciation it is necessary that the assessee must have used the asset, notwithstanding that a business is se ..... X X X X Extracts X X X X X X X X Extracts X X X X
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