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TMI Blog2022 (4) TMI 1056X X X X Extracts X X X X X X X X Extracts X X X X ..... gs Ld PCIT yet again conducted an enquiry into the claim of the appellant based on the like material and sitting on the same fence displaced with the views of Ld AO and directed for modification of assessment by additional disallowance which is ostensibly impermissible under a law following the ration laid in down by Hon ble Jurisdictional High Court in CIT Vs Gabriel India Ltd. [ 1993 (4) TMI 55 - BOMBAY HIGH COURT] and the Hon ble Apex Court in Malabar Industrial Co Ltd. Vs CIT [ 2000 (2) TMI 10 - SUPREME COURT] - Ergo,in the above context, we find the order of Ld PCIT is unsustainable in law, consequently we set aside the 263 revisionary order and restore the order of assessment passed u/s 143(3). - Appeal of assessee allowed. - ITA No. 181/NAG/2017 (Assessment Year :-2012-2013) - - - Dated:- 18-2-2022 - SHRI RAVISH SOOD, JUDICIAL MEMBER AND SHRI JAMLAPPA D. BATTULL, ACCOUNTANT MEMBER Assessee by : Shri S. G. Gandhi Revenue by : Shri Pradeep Headoo ORDER PER JAMLAPPA D. BATTULL, AM; Against the revisionary order of Principal of Commissioner of Income Tax, Nagpur [for short PCIT ] passed u/s 263of the Income-tax Act, 1961 [for short ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rticular manner (para 4.12 of CIT s order) particularly in the circumstances that in most of the decisions higher authorities have followed the instruction. 4. The facts as accentuated from the records of the case pithily are; 4.1 The assessee is a registered commercial co-operative bank, engaged in the business of banking, had for the assessment year [for short AY ] 2012-2013 filed its e-return on 29/09/2012 declaring the total income of ₹ 14,49,92,887/-. The case of the appellant was selected for scrutiny under CASS and the assessment u/s 143(3) was completed on 21/01/2015 with an addition of ₹ 25,00,000/- dislodging the claim of loss of investment u/s 37(1). 4.2 Not concurring with the action of assessing officer, Ld PCIT invoked the revisionary powers vested in him by virtue of section 263(1)and by an order directed the Ld AO to modify the assessment with an additional disallowance of ₹ 1,87,01,808/-with respect to excess bad debts debited to Profit Loss Account [for short P L ] and ₹ 1,21,08,495towards disallowance of amortisation of premium on investment in security arisen on account of reclassification of / change in the category of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of revisionary jurisdiction was triggered viz; a. Non-disallowance of amount of provision of ₹ 1,56,43,495/- out of provision for IDRF, as an unascertained liability and b. Excess provision of ₹ 4,27,90,200/- for bad debts claimed u/s 36(1)(viia) of the Act. 6.4 In this count, the appellant bank demonstrated before the bench that, during263 proceedings before Ld PCIT, has substantiated its claim for provision for diminution in the value of securities on change of investment category from Available for Sale [for short AFS ] to Held for Maturity [for short HTM ] and the allowability of its claim u/s 36(1)(viia)by placing the copies of like submission made before the Ld AO and also be sought the application of the principle of consistency before the Ld PCIT. 6.5 The counsel for the appellant [for short AR ] relied upon catena of judicial pronouncement in support of meritorious as well legal grounds raised in the appeals, whereas the Ld departmental representative [for short DR ] supported the 263 order and by way of alternate submission intreated for reminding back the file to the Ld AO for de-nova consideration for the limited purpose. 6.6 At this jun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of law or passing an order without application of mind or without applying the principle of natural justice, shall discretely be sufficient to hold the order being erroneous. Albeit the term prejudicial to the interests of the revenue is not at all defined in the Act, but is needs to be understood in its ordinary meaning and it is of wide import and is not confined to mere loss to ex-chequer. 7.5 Having said so, where the revisionary proceedings are concluded entirely on invariable submission of the assessee which were the part of assessment records, shall clearly establishes the jeopardy to the independence of assessment proceedings, which is never been the intent of 263 legislation. 7.6 In the light of ration laid down by Hon ble Supreme Court of India on the subject matter, we have the audacity to summarise the inferential but harmonious analysis of revisionary provision laid in section 263 of the Act, into a five steps Queen Principle , falling the case into it shall debark the tax authorities from assuming revisionary jurisdiction u/s 263, and these steps are; a. There must be an explicit query from the adjudicating tax authority as regards to any claim made includ ..... X X X X Extracts X X X X X X X X Extracts X X X X
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