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TMI Blog2006 (9) TMI 157X X X X Extracts X X X X X X X X Extracts X X X X ..... law in annulling the order passed by the Commissioner of Income-tax under section 263 of the Income-tax Act, 1961?" 2. The facts noticed by the Tribunal in the statement of case are that: "The assessee held certain machinery and was in possession of a permit obtained from the Textile Commissioner for the working of 1,200 spindles for the manufacture of woollen worsted yarn. The said 1,200 spindles were a part of the machinery to be sold vide an agreement dated July 26, 1974. The assessee sold some machinery which was detailed in annexure 'A' with the said agreement, besides it also sold the permit in respect of 1,200 spindles. The agreement as per which the said machinery and permit were sold, finds place in para 2 of the Tribuna ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Tribunal, the Tribunal placed in its order the agreement, the fact that the assessee had disclosed in Part III of its return sale of spindles and amount of goodwill earned thereon and section 263(1) and also the proforma and held that the Commissioner of Income-tax was in error while assuming jurisdiction under section 263 on the type of objection made by the audit and, therefore, annulled the said order under section 263 in the light of the detailed discussion available in the Tribunal's order.' 3. We have heard learned counsel for the parties and perused the record. 4. Learned counsel for the Revenue submitted that invocation of jurisdiction under section 263 of the Income-tax Act, 1961 (for short "the Act"), was justified as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) to submit that the route permit was a self-generating asset and consideration for its transfer was not assessable as capital gains; CIT v. V. Prakashan [1995] 211 ITR 119 (Ker) to the same effect and Rayon Silk Mills v. CIT [1996] 221 ITR 155 (Guj) to submit that self-generated goodwill did not attract capital gains. 7. A reference to the provisions of section 263 of the Act shows that jurisdiction thereunder can be exercised if the Commissioner of Income-tax finds that the order of the Assessing Officer was erroneous and prejudicial to the interests of the Revenue. Mere audit objection and because a different view could be taken, are not enough to say that the order of the Assessing Officer was erroneous or prejudicial to the interests ..... X X X X Extracts X X X X X X X X Extracts X X X X
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