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TMI Blog2020 (1) TMI 129X X X X Extracts X X X X X X X X Extracts X X X X ..... lication of mind by Ld. AO on the issues which formed subject matter of revisional jurisdiction u/s 263. Therefore, we do not find any illegality in the action of Ld. Pr.CIT in exercising the said jurisdiction. Final directions of Ld. Pr.CIT to be erroneous to some extent. It is noted that there was blanket set-aside of the quantum assessment order overlooking the fact that the addition of 7.50 Lacs as made by Ld.AO in the quantum assessment order had already attained finality and there would be no occasion to revisit the same in revisional jurisdiction since the quantum assessment order could not be said to be prejudicial to the interest of the revenue, to that extent. AO is directed not to delve into the verification of loan of 7.50 Lacs stated to be obtained from M/s Reiva Sarees. Proceeding further, we are of the considered opinion that it was incumbent on the part of Ld. Pr.CIT to appreciate the assessee s submissions in the correct perspective. Pr. CIT, in the show-cause notice, has observed that unsecured loans obtained from certain entities remained to be verified. However, the loan obtained from Anuj Gems (wrongly referred to as Anju Gems) was only a brought forward loan w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he PCIT erred in concluding that the Assessing Officer has allowed the relief for TDS of ₹ 92,000/- without enquiring into the claim. 1.2 The learned Authorized Representative for Assessee (AR), at the outset, submitted written submissions in support of the appeal. On the other hand, Ld. CIT-DR drawing our attention to the orders of lower authorities, placed reliance on various judicial pronouncements to support the submissions that revisional jurisdiction u/s 263 were validly invoked since it was a case of lack of inquiry. We have carefully heard the rival arguments, duly considered the submissions made before us and deliberated on judicial pronouncements as relied upon by respective representatives. 2.1 Facts on record would reveal that the assessee being resident individual was assessed for year under consideration u/s 143(3) on 26/12/2016 wherein the assessee was saddled with sole addition of unsecured loans of ₹ 7.50 Lacs stated to be received from an entity i.e. Reiva Sarees since it could not file any confirmation from the said party. The perusal of record would, prima-facie, reveal that the assessee has accepted the quantum assessment order and did not prefer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Aggrieved by aforesaid directions, the assessee is under further appeal before us challenging revisional jurisdiction u/s 263. 3. The Ld. Authorized Representative for Assessee (AR), in its written submissions, as placed on page nos. 1-5 of the paper book, has submitted that requisite details were already placed before Ld. AO during the course of regular assessment proceedings, which were duly verified before passing the quantum assessment order. The Ld. AR has also submitted that it was erroneous conclusion that unsecured loans taken from 4 parties remained unverified. Regarding applicability of Sec. 2(22)(e), it has been submitted that the loan was not taken during the year under consideration and therefore the said provisions were not applicable. In similar manner, the Ld. AR has asserted that there is no question of grant of excess TDS credit. On the contrary, Ld. CIT-DR, drawing our attention to the queries raised during assessment proceedings and assessee's replies thereto, submitted that there was no application of mind on the stated issues which was evident from the fact that annexure to notice u/s 142(1) was never issued to the assessee. In the above background, Ld. CIT-D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dustrial Co. Ltd. V/s CIT [243 ITR 83 10/02/2000] & noted by Hon'ble Delhi High Court in CIT V/s Vikas Polymers [194 Taxman 57 16/08/2010]. The Hon'ble Supreme Court in Malabar Industrial Co. Ltd. V/s CIT (supra) has held that the phrase 'prejudicial to the interests of the revenue' has to be read in conjunction with an erroneous order passed by the Assessing Officer. Every loss of revenue as a consequence of an order of the Assessing Officer cannot be treated as prejudicial to the interests of the revenue. For example, when an Income-tax Officer adopted one of the courses permissible in law and it has resulted in loss of revenue; or where two views are possible and the Income-tax Officer has taken one view with which the Commissioner does not agree, it cannot be treated as an erroneous order prejudicial to the interest of the revenue, unless the view taken by the Income-tax Officer is unsustainable in law. The said principal has been reiterated by Hon'ble Court in its subsequent judgement titled as CIT V/s Max India Ltd. (295 ITR 282). Similar principal has been followed by jurisdictional High Court in Grasim Industries Ltd. V/s CIT (321 ITR 92). 4.3 The Hon'ble Delhi Hi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rder should have been written more elaborately. This section does not visualize a case of substitution of the judgment of the Commissioner for that of the Income-tax Officer, who passed the order unless the decision is held to be erroneous. Cases may be visualized where the Income-tax Officer while making an assessment examines the accounts, makes enquiries, applies his mind to the facts and circumstances of the case and determines the income either by accepting the accounts or by making some estimate himself. The Commissioner, on perusal of the records, may be of the opinion that the estimate made by the officer concerned was on the lower side and left to the commissioner he would have estimated the income at a figure higher than the one determined by the Income-tax Officer. That would not vest the Commissioner with power to re-examine the accounts and determine the income himself at a higher figure. It is because the Income-tax Officer has exercised the quasi-judicial power vested in him in accordance with law and arrived at conclusion and such a conclusion cannot be termed to be erroneous simply because the Commissioner does not feel satisfied with the conclusion. x x x x T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rned, we find that the case law of Hon'ble Bombay High Court in CIT V/s Fine Jewellery (I) Ltd. (ITA No.296 of 2013 dated 03/02/2015) deal with a situation wherein the assessment order was passed by Ld.AO with due application of mind. Similar are the facts in the decision of Mumbai Tribunal in Small Wonder Industries Ltd. V/s CIT (ITA No. 2464/Mum/2013 dated 24/02/2017). The case law of Hon'ble Bombay High Court in Idea Cellular Ltd. V/s DCIT (301 ITR 407) is concerned with reassessment u/s 147 and do not deal with revisional jurisdiction u/s 263. Therefore, the case laws being cited by Ld. AR are clearly not applicable to the factual matrix. 5.1 Having said so, we find the final directions of Ld. Pr.CIT to be erroneous to some extent. It is noted that there was blanket set-aside of the quantum assessment order overlooking the fact that the addition of ₹ 7.50 Lacs as made by Ld.AO in the quantum assessment order had already attained finality and there would be no occasion to revisit the same in revisional jurisdiction since the quantum assessment order could not be said to be prejudicial to the interest of the revenue, to that extent. Therefore, Ld. AO is directed not to de ..... X X X X Extracts X X X X X X X X Extracts X X X X
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