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TMI Blog2017 (10) TMI 772X X X X Extracts X X X X X X X X Extracts X X X X ..... is erroneous as well as prejudicial to the interest of Revenue, causing loss to the Revenue. The Ld. Assessing Officer was expected to make detailed enquiry into the matter, which was not done. Totality of facts, clearly indicates that the assessment order has been framed without full enquiries, therefore, the ld. Commissioner justifiably invoked revisional jurisdiction. Commissioner has merely directed the Assessing Officer to make proper enquiries and after affording opportunity to the assessee decide in accordance with law, therefore, principally; the assessee should not feel aggrieved, because, if the assessee is in a position to explain the factual matrix, no grievance will be caused to the assessee. At the same time, the mandate of Article 265 of Constitution of India is to levy and collect due taxes. In view of this factual matrix, we affirm the stand of the ld. Commissioner. - Decided against assessee. - ITA NO.2560/Mum/2017 - - - Dated:- 21-8-2017 - Shri Joginder Singh, Judicial Member, And Shri N.K. Pradhan, Accountant Member For The Assessee : Shri S.L. Jain For The Revenue : Shri H. N. Singh -DR ORDER Per Joginder Singh (Judicial Member ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Ld. Commissioner by inviting our attention to the fact that the Ld. Assessing Officer received information from ADIT unit-II(3), Mumbai, that there were hawala transactions/bogus purchases and the Sales Tax Department canceled the TIN numbers of the bogus parties w.e.f 15/01/2007 and the other transactions entered into by the assessee remained unverified, therefore, the order is erroneous as well as prejudicial to the interest of the Revenue with respect to remaining four parties. It was also pleaded that show cause notice was duly issued to the assessee and the same was duly attended by the assessee. 2.2. We have considered the rival submissions and perused the material available on record. The facts, in brief, are that the assessee made hawala purchases/bogus purchases from following parties:- TABLE No.1:- Sl. No. Name of the parties Amount (in Rs.) 1 Bhakti Enterprises 91,23,180 2. M/s Purab Enterprises 92,23,100 3. Bhavika Enterprises 25,38,690 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hese four parties, meaning thereby, the Ld. Assessing Officer totally overlooked the matter to the extent of remaining four parties, thus, the interest of Revenue was jeopardized/affected, consequently, the revisional jurisdiction was rightly invoked. 2.4. Before adverting further, we are expected to analyze section 263 of the Act, therefore, it is reproduced hereunder for ready reference and analysis:- 263. (1) The Principal Commissioner or Commissioner may call for and examine the record of any proceeding under this Act, and if he considers that any order passed therein by the Assessing Officer is erroneous in so far as it is prejudicial to the interests of the revenue, he may, after giving the assessee an opportunity of being heard and after making or causing to be made such inquiry as he deems necessary, pass such order thereon as the circumstances of the case justify, including an order enhancing or modifying the assessment, or cancelling the assessment and directing a fresh assessment. [ Explanation 1 .]-For the removal of doubts, it is hereby declared that, for the purposes of this sub-section,- ( a ) an order passed on or before or after the 1st day of June, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y be passed at any time in the case of an order which has been passed in consequence of, or to give effect to, any finding or direction contained in an order of the Appellate Tribunal, National Tax Tribunal, the High Court or the Supreme Court. Explanation .-In computing the period of limitation for the purposes of sub-section (2), the time taken in giving an opportunity to the assessee to be reheard under the proviso to section 129 and any period during which any proceeding under this section is stayed by an order or injunction of any court shall be excluded. 2.5. If the aforesaid section is analyzed, it speaks that before invoking the revisional jurisdiction, the assessment order should be erroneous as well as prejudicial to the interest of Revenue. It is also noted that explanation-2 was inserted by the Finance Act, 2015 w.e.f. 01/06/2015. Subclause (a) says that if the order is passed without making enquiries or verification, which should have been made the order shall be deem to be erroneous in so far as it is prejudicial to the interest of the Revenue. The totality of facts clearly indicates that the Ld. Assessing Officer at least did not make any enquiry with respect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x. CIT v. Divine Leasing Finance Ltd. [ 2008] 299 ITR 268/[2007] 158 Taxman 440 (Delhi)(para 8), xi. Lotus Capital Financial Services Ltd. v. ITO [IT Appeal No. 479 (Kol.) of 2011] (para 8), xii. CIT v. Lotus Capital Financial Services (P.) Ltd. [ ITAT No. 125 of 2012] (para 8), xiii. CIT v. Dataware (P.) Ltd. [ ITAT No. 263 of 2011] (para 8), xiv. CIT v. Roseberry Mercantile (P.) Ltd. [ G.A. No. 3296 of 2010, dated 10-1-2011] (para 8), xv. CIT v. Sanchati Projects (P.) Ltd. [ ITAT No. 140 of 2011] (para 8), xvi. CIT v. Samir Bio-Tech. (P.) Ltd. [ 2010] 325 ITR 294 (Delhi) (para 8), xvii. CIT v. Kamdhenu Steel Alloys Ltd. [ 2014] 361 ITR 220/[2012] 206 Taxman 254/19 taxmann.com 26 (Delhi) (para 8), xviii. CIT v. Dwarkadhish Capital (P.) Ltd. [ 2011] 330 ITR 298/[2010] 194 Taxman 43 (Delhi) (paras 9, 10), xix. CIT v. Kinetic Capital Finance Ltd. [ 2013] 354 ITR 296/[2011] 202 Taxman 548/14 taxmann.com 150 (Delhi) (paras 9, 10), xx. Zafa Ahmad Co. v. CIT [2013] 214 Taxman 440/30 taxmann.com 267 (All.) (paras 9, 10), xxi. Anil Rice Mills v. CIT [2006] ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... present appeal proper enquiry was not made by the Assessing Officer, therefore, this judicial pronouncements may not help the assessee. Similar is the position in other cases, which are different on facts. 2.8. We have also perused the assessment order, which is a subject matter of revisional jurisdiction u/s 263 and the impugned order passed by the ld. Pr. Commissioner. Admittedly, an incorrect assumption of fact or an incorrect application of law would satisfy the requirement of order being erroneous u/s. 263 of the Act. 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 Assessing Officer. Every loss of Revenue as a consequence of assessment order cannot be termed as prejudicial to the interest of Revenue, meaning thereby, prejudice must be prejudice to the Revenue administration. At the same time, if another view is possible, revision is not permissible. Our view is fortified by the decision from Himachal Pradesh Financial Corp. (186 Taxmann 105)(HP), Bismillah Trading Co. (248 ITR 292)(Ker.) and CIT vs. Green World Corpn. (314 ITR 81)(SC). For invoking revisional jurisdiction u/s. 263 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons/bogus sales, without effecting the actual delivery of goods. The assessee also did not produce these parties for examination to the satisfaction of the Assessing Officer. The Ld. Assessing Officer without making any enquiry with respect to these parties simply accepted the claim of the assessee, meaning thereby, the Ld. Assessing Officer mechanically accepted the claim of the assessee without application of mind or due enquiry, therefore, certainly the assessment order is erroneous as well as prejudicial to the interest of Revenue, causing loss to the Revenue. The Ld. Assessing Officer was expected to make detailed enquiry into the matter, which was not done. Totality of facts, clearly indicates that even in the impugned order, the ld. Assessing Officer was directed to decide afresh after conducting appropriate enquiries and on examining the details after providing due opportunity of being heard before finalizing the assessment, thus, no grievance is caused to the assessee, because the assessee is at liberty to contest the observation made by the ld. Commissioner. Our view is fortified by the decision in Indian Textile vs CIT (157 ITR 112) (Mad.), Gee Vee Enterprises vs Addl. C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... received by assessee and nonapplication of mind - High Court by impugned order held that since assessee with an authorised share capital of ₹ 1.36 crores raised nearly a sum of ₹ 32 crores on account of premium and chose not to go in for increase of authorised share capital merely to avoid payment of statutory fees was an important pointer necessitating investigation and thus, Commissioner was justified in treating assessment order erroneous and prejudicial to interest of revenue - Whether special leave petition filed against impugned order was to be dismissed - Held, yes [Para 2] [In favour of revenue] Even otherwise, the ld. Commissioner has merely directed the Assessing Officer to make proper enquiries and after affording opportunity to the assessee decide in accordance with law, therefore, principally; the assessee should not feel aggrieved, because, if the assessee is in a position to explain the factual matrix, no grievance will be caused to the assessee. At the same time, the mandate of Article 265 of Constitution of India is to levy and collect due taxes. In view of this factual matrix, we affirm the stand of the ld. Commissioner. The appeal of the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X
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