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TMI Blog2011 (5) TMI 956X X X X Extracts X X X X X X X X Extracts X X X X ..... had also claimed deduction of ` 3,83,43,000/- as payment for obtaining the rights for usage of the Brand Name and Logo namely, CCC , Triple C and UGA and the rights for the usage of the name Consolidated Construction Consortium . This payment was made to M/s Samruddhi Hlldings, a firm related to the assessee company. Subsequently, the ld. CIT called for the records of this assessment and show caused the assessee u/s 263 of the Act. The ld. CIT was of the opinion that the Assessing Officer has not considered as to whether the payment of ` 3,83,43,000/- was of capital or revenue in nature. He also observed that regarding payment made to M/s Spark Capital Advisors(India) P. Ltd, the Assessing Officer has disallowed an amount of 1.45 crores but service tax component was not disallowed. So, according to him, since the Assessing Officer has not considered the above two aspects of the matter while completing the assessment on 18.11.2008, the order was erroneous and prejudicial to the interests of the Revenue. In response to the show cause notice, written submission was filed on 8.9.2010 stating therein that (i) The assets were not owned by the assessee at all; (ii) The partne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - 600034 dated 27-10-2010 in C.No.218(20)/CIT1/263/2010-11 in assuming jurisdiction under section 263 of the Act and passing the order in setting aside the assessment order dated 29-12-2008 is contrary to law, facts, and in the circumstances of the case. 2. The CIT erred in assuming jurisdiction under section 263 of the Act and passing the order in setting aside the assessment order dated 29-12-2008 on the facts and in the circumstances of the case without assigning proper reasons and justification. 3. The CIT failed to appreciate that the conditions prescribed for assuming jurisdiction under section 263 of the Act were not fulfilled concurrently on the facts of the case and hence the consequential revision order was invalid. 4. The CIT failed to appreciate that the revision order under consideration was passed out of time, invalid, passed without jurisdiction and not sustainable both on facts and in law. 5. The CIT failed to appreciate that the facts relating to the issue raised in para 2 of the impugned order were part of the assessment records/proceedings and hence the findings recorded in this regard in the impugned order were wrong, incorrect, unjustified, erroneo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... prejudice caused to the Revenue co-exist. 5. The subject of revision under section 263 has been vastly examined and analysed by various Courts including that of Hon ble Apex Court. The revisional power conferred on the CIT vide section 263 is of vide amplitude. It enables the CIT to call for and examine the records of any proceeding under the Act. It empowers the CIT to make or cause to be made such an enquiry as he deems necessary in order to find out if any order passed by Assessing Officer is erroneous in so far as it is prejudicial to the interest of the Revenue. The only limitation on his powers is that he must have some material(s) which would enable him to form a prima facie opinion that the order passed by the Officer is erroneous in so far as it is prejudicial to the interest of the Revenue. Once he comes to the above conclusions on the basis of the material that the order of the Assessing Officer is erroneous and also prejudicial to the interests of the Revenue, the CIT is empowered to pass an order as the circumstances of the case may warrant. He may pass an order enhancing the assessment or he may modify the assessment. He is also empowered to cancel the assessm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder section 263, is not permitted to substitute his estimate of income in place of the income estimated by the Assessing Officer. (vii) The Assessing Officer exercise quasi-judicial power vested in him and if he exercise such power in accordance with law and arrives as a conclusion, such conclusion cannot be termed to be erroneous simply because the CIT does not feel satisfied with the conclusion. (viii) The CIT, before exercising his jurisdiction under section 263, must have material on record to arrive at a satisfaction. (ix) If the Assessing Officer has made enquiries during the course of assessment proceedings on the relevant issues and the assessee has given detailed explanation be a letter in writing and the Assessing Officer allowed the claim on being satisfied with the explanation of the assessee, the decision of the Assessing Officer cannot be held to be erroneous simply because in his order he does not make an elaborate discussion in that regard. 6. Reverting back to the facts of this case, it was found that during assessment proceedings, the entire details were produced and explained before the Assessing Officer in regard to both the issues under dispute. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... considers that according to him(CIT), it should be a capital payment unless it is contrary to law. Regarding the provisions of section 40A(2)(b), we find the explanation of the assessee; and the action of the Assessing Officer to be quiet justified. The Assessing Officer has appreciated this issue in proper perspective inasmuch as this aspect was examined during the course of assessment proceedings and the explanation offered by the assessee was accepted as satisfactory by him. There was no failure to enquire into the different facets of this claim while passing the assessment order. In that view of the matter, the decisions on which the ld. CIT has relied on are distinguishable. In those cases the Assessing Officer had not applied his mind at all to the aspects of controversial issues. Once the Assessing Officer has applied his mind to a particular issue of income from different angles, the order cannot be said to be erroneous and it cannot be said that the Assessing Officer has not applied his mind. It is not the length of the order but the strength of the order that matters.[emphasis supplied]. 7. Regarding the service tax component, we find that the assessee has not claim ..... 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