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TMI Blog2014 (3) TMI 1089X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 263, we are of the opinion that order of the Ld. CIT cannot be justified on any reason. Since the entire claim of finance charges has been examined by the A.O. and as he has disallowed the amount to the extent assessee could not furnish the details, any other opinion by the Ld. CIT cannot be justified Not only that there is nothing else to direct the A.O. to examine again when the claim itself was examined in the course of scrutiny and A.O. has came to a conclusion by disallowing part of the amount. No further purpose would be served by setting aside the order to A.O. to examine afresh, when Ld. CIT order did not indicate that there are any issues on which A.O. has not examined. Just because the invoices furnished by assessee conta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the claim of finance charges made by assessee and pass fresh assessment order, after affording a reasonable opportunity to assessee. Assessee is aggrieved by the order of the Ld. CIT. 3. Ld. Counsel submitted that order of the CIT itself is wrong as A.O. has examined the entire issue and made specific disallowance of ₹ 3,07,808/- on the reason that assessee did not furnish evidence with reference to the transaction. Therefore, having examined the issue of finance charges claim, by the A.O., the Ld. CIT order for fresh examination is not correct and the Ld. Counsel relied on the decision of Hon ble Supreme Court in the case of Malabar Industries Company Limited vs. CIT 243 ITR 83 (SC). 4. Further with reference to the so-called ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to furnish complete details in this regard. In response, assessee furnished relevant details and it is observed that majority of these finance charges are incurred towards discounting charges. However, an amount of ₹ 3,07,808/- was also included under these discounting charges paid to M/s. DPJ Viniyog Pvt. Ltd. During the course of assessment proceedings, assessee was required to explain the transaction i.e., the purpose or the utility of the loan obtained from M/s. DPJ Viniyog Pvt. Ltd. and claim of such finance charges on such loan. However, assessee could not furnish any plausible explanation. In the light of this position, the claim of assessee towards finance charges is disallowed to extent of ₹ 3,07,808/- as not pertain ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icial to the interests of the Revenue. If one of them is absent-if the order of the ITO is erroneous but is not prejudicial to the Revenue or if it is not erroneous but is prejudicial to the Revenue-recourse cannot be had to s. 263(1). There can be no doubt that the provision cannot be invoked to correct each and every type of mistake or error committed by the AO; it is only when an order is erroneous that the section will be attracted. An incorrect assumption of facts or an incorrect application of law will satisfy the requirement of the order being erroneous. In the same category fall orders passed without applying the principles of natural justice or without application of mind. The phrase prejudicial to the interests of the Revenue is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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