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TMI Blog2015 (2) TMI 1113X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the assessee and without applying his mind. In our opinion, this failure of the Ld. CIT, however, does not constitute any legal infirmity to make the order passed by him under section 263 invalid or void abinitio as sought to be made out by the assessee in the ground raised in these appeals. We are of the view that it would be just and proper in the facts and circumstances of the case, to set aside the impugned order of the Ld. CIT passed under section 263 and remit the matter back to him with a direction to pass fresh order under section 263 after duly taking into consideration the explanation offered by the assessee and after applying his mind. - Decided in favour of assessee for statistical purposes. - ITA.No.1102 & 1103/Hyd/2014 - - - Dated:- 20-2-2015 - SHRI P. M. JAGTAP, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER For the Respondent : Mr. D. Sudhakar Rao ORDER PER P.M. JAGTAP, A.M. These two appeals filed by the assessee are directed against the common order passed by Ld. CIT under section 263, dated 27.03.2014 for A.Ys. 2005-06 and 2006- 07. Since the issue involved in these appeals is common, the same have been heard together and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sq. Yds for 6,09,000/- which works out to 5,845/- per Sq. Yd. Compliance of Sec.50C is not verifiable as the document was not registered. In a similar case of Sri Kailash Chand Gupta, the rate adopted was ₹ 14,485/- per Sq.Yd. At this rate the Capital gains Should work out to ₹ 62,66,395/- (432.55 Sq.Yds. surrendered x 14,485/-). (ii) Also, the assessee claimed exemption u/s 54F in respect of Flat No. 505 andFlatNo.105. As the assessee is eligible for exemption for 1 flat only u/s 54F there is excess allowance of claim u/s S4F which was allowed to the assessee. These facts have not been verified during the assessment proceedings. 3. Accordingly, show cause notices were issued by the Ld. CIT requiring the assessee to explain as to why the assessment orders passed by the A.O. should not be revised under section 263 of the Act. In reply to the said notices, the following explanation was offered by the assessee in writing. A. Y. 2005-06 Assessee's reply dated 24.03.2014 is as under: Registration of Development Agreement: You may note that the endorsement of registration behind the development agreement (as per the seized material on page 352 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e done. We reiterate that the flat was sold for ₹ 934.58/- per sft only and the AO has correctly taken the value of Land on date of agreement. Hence, the cost so arrived (Rs. 5,845 per sq. yd) cannot be assigned to the land for determining the sale consideration. The sale consideration actually computed is on the basis of cost of construction (5350 sq. ft* ₹ 650/- per sqtt) of built-up area developed and received by the assessee in exchange of land given for development. All these facts have been considered by the A.O and have been clarified already and all the above workings were given in detail. With respect to the rate arrived (Rs.1 ,485/- per sq.yd) in case of Sri Kailash Chand Gupta, it is not a comparable situation because the consideration received for the sale of flat (305) in case of Sri Kailash Chand Gupta was ₹ 29,00,000/- and hence the cost of undivided share in land admeasuring 104.18 (balancing figure) will certainly be higher. Explanation w.r.t Exemption claimed u/s.54F: As per Sec 54F of Income Tax Act, if the sale consideration of the long term assets (other than residential house) if invested for purchase/construction of a resident ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... para 4 of the order. 4. I have gone through the submission of the assessee. It is evident from the assessment orders that the issues raised in the notices for the above referred assessment years were not examined by the Assessing Officer in the proper perspective and the assessment orders were passed. It was held in number of cases that it is well established that where the Assessing Officer fails to make the necessary enquiries which he is legally required to make and decide the issues without making such enquiries then the order of the Assessing Officer would be erroneous in Law. This was so held in the case of Desai Brothers Ltd. Vs. DCIT, Pune Tribunal. Similar view was also taken by many other Tribunals and High Courts wherein it was held that on failure of Assessing Officer to make enquiry as expected, Commissioner was justified in invoking provision of Section 263 because the orders passed as such by the Assessing Officer was erroneous as well as prejudicial to the interest of Revenue. Reference in this regard can also be made to the decision of Special Bench, !TAT, Chennai reported in 313 !TR (AT) 182, Chennai S8 wherein it was observed that it is not necessary for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e not properly enquired into or examined by the A.O. during the course of assessment proceedings. In reply to the said notices, a detailed submission was filed by the assessee explaining as to how the issues raised by the Ld. CIT in the notices issued under section 263 were not relevant for the purpose of completing the assessments in the case of the assessee for all the four years under consideration. On the basis of this explanation offered in respect of each and every issue, it was contended on behalf of the assessee before the Ld. CIT that it was not the case of assessments having been completed by the A.O. without making proper and adequate enquiries as required in the facts and circumstances of the case. A perusal of the operative portion of the Ld. CIT s impugned order however shows that he has neither considered this explanation of the assessee nor made any comment/ observation thereon pointing out specifically that it was still a case of failure on the part of the A.O. to make proper and adequate enquiries before completing the assessments as were required in the facts and circumstances of the case. He has not pointed out specifically even a single enquiry which A.O. ought ..... X X X X Extracts X X X X X X X X Extracts X X X X
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