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TMI Blog2014 (11) TMI 292X X X X Extracts X X X X X X X X Extracts X X X X ..... whims and caprice of the Commissioner. An incorrect assumption of fact or an incorrect application of law would satisfy the requirement of order being erroneous u/s. 263 - The phrase “prejudicial to the interest of the Revenue” u/s. 263, has to be read in conjunction with the expression “erroneous” order by the AO - every loss of Revenue as a consequence of assessment order cannot be termed as prejudicial to the interest of Revenue - assessment u/s 143(3) of the Act was framed by the AO after obtaining necessary details from the assessee and further it were examined by him - even if, the same has not been spelt elaborately in the assessment order it cannot be said that there is a lack of enquiry or prejudice has been caused to the Revenue, the order of the Commissioner is set aside – Decided in favour of assessee. - ITA No. 2838/MUM/2013 - - - Dated:- 31-10-2014 - Shri Joginder Singh And And Shri N. K. Billaiya,JJ. For the Appellant : Shri Arvind Sonde For the Respondent : Ms. Abha Kala-CIT DR ORDER Per Joginder Singh (JM) : The assessee is aggrieved by the impugned order dated 15/3/2013 of the ld. CIT invoking revisional jurisdiction u/s. 263 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT vs. Development Credit Bank Ltd. (323 ITR 206) (Bom.) v) RCI Ltd. vs. CIT (2010) 40 DTR Mum (Trb.) 186 vi) Reliance Gas Transportation Infrastructure Ltd. vs. CIT(2014) (100 DTR 1)(Mum.)(Trb.) and vii) CIT vs. Anil Kumar Sharma 335 ITR 83(Del.) 2.1 On the other hand the ld. CIT-DR Ms. Abha Kala, strongly defended the conclusion drawn by the ld. CIT, invoking revisional jurisdiction u/s. 263 of the Act, by submitting that a short order has been framed by the Assessing Officer, therefore, it is erroneous as well as prejudicial to the interest of Revenue. 3. We have considered the rival submissions and perused the material available on record. The facts in brief are that the assessee filed e-return declaring total income at ₹ 13,75,080/- on 21/9/2009. Subsequently, the assessee e-filed the revised return declaring income at ₹ 1,58,75,078/-. Later on the case was taken up for scrutiny, therefore, notice u/s. 142(1) alongwith questionnaire was issued and served upon the assessee . In response the assessee attended the assessment proceedings from time to time and furnished the details, called for by the Assessing Officer and the same were placed on record. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Act. The court have time and again held that the supervisory jurisdiction u/s. 263 of the commissioner cannot be exercise if the Assessing Officer while making an assessment examines the accounts and the material on record, makes enquires, applies his mind to the facts and circumstances of the case and determines the income by accepting such accounts and material on record. We further submit that the provisions of section 263 of the Act cannot be invoked when the Assessing Officer after due consideration has taken one of the possible views, when on the same set of facts two view could be possible, and the Commissioner is of the other view. We, therefore, respectfully that the initiation of proceedings u/s. 263 of the Act is not valid in law as the AO has applied his mind and considered the material on record while making the assessment u/s. 143(3) of the Act and hence, the order sought to be revised is neither erroneous so as to be prejudicial to the interest of the Revenue . 3.2 The ld. CIT did not agree with the explanation of the assessee and finally directed the Assessing Officer to frame fresh assessment in the light of the discussion made by him after proper verifi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... TDS and net amount (Pgs 99 to 102 of the paper book), copy of rent agreement in respect of rent received from MTC business Pvt. Ltd. and Shakti Enterprises (Pgs.103 to 108 of the paper book) and books of accounts were also produced. All these documents were made available during assessment proceedings. In view of this fact the observation of the ld. CIT that necessary enquiries were not made or necessary details were not furnished by the assessee or examination of the same by the Assessing Officer is not substantiated. It is further seen that the ld.CIT has not pointed out any error in the order as to how it is erroneous and prejudicial to the interest of Revenue . We are satisfied that requisite details were duly furnished by the assessee and the same were duly examined by the Assessing Officer. We are of the view, that there is a distinction between lack of enquiry and inadequate enquiry . In the present case the Assessing Officer collected necessary details, examined the same and then framed the assessment u/s. 143(3) of the Act. Therefore, in such a situation the decision from Hon'ble High Court of Delhi in CIT vs. Anil Kumar Sharma (2011) 335 ITR 83 (Del.)(supra), clear ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the time of original assessment, the Assessing Officer applied his mind to the material and accepted the view canvassed by the assessee and mere fact that he did not express this in the assessment order, cannot be a ground to conclude that income has escaped assessment, further supports the case of the assessee . Identically, the Hon'ble High Court of Delhi in CIT vs. Ashish Rajpal (320 ITR 674) vide order dt.14/5/2009, decided in favour of the assessee . The Hon'ble Jurisdictional High Court in CIT vs. Gabriel India Ltd. (203 ITR 108) held that there must be material before the Commissioner to satisfy himself that two requisite provided u/s. 263 are present, otherwise power cannot be exercised at the whims and caprice of the Commissioner. We have also seen the order sheets, written by the Assessing Officer (running into six pages) before framing the assessment u/s. 143(3) of the Act and are satisfied that he asked the assessee to furnish the necessary details, therefore, the observation made by the ld. Commissioner is not substantiated as has been alleged in the revisional order. 4. Admittedly, an incorrect assumption of fact or an incorrect application of law would s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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