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TMI Blog2022 (8) TMI 1311X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessing authority having taken a possible view on a given set of facts and circumstances, the Pr.CIT cannot use his powers of revision for imposing his view over that of the AO. ii) That the ld. Pr.CIT has not done any enquiry before passing of the order u/s.263 of the Act. 4. In reply, ld.CIT-DR submitted that the assessee is engaged in the business of coal washery. There was a search on the premises of Hira Group of Companies in which the assessee is one of the sister concern on 29.07.2015. In the course of search, Shri B.L.Agrawal, CMD of Hira Group of Companies had offered undisclosed income of Rs.45,04,78,000/- on account of bogus share capital and the share premium received from Kolkata based companies in respect of eight (8) companies, which were the group of Hira Group of companies. It was the submission that in respect of the assessee-company for the assessment year 2009-2010, the surrendered amount was Rs.2,05,00,000/-. It was the submission that for the assessment year 2010-2011, the assessee had not offered the surrendered amount of Rs.1,19,00,000/- but the AO has added the same. It was the submission that this has been recognised by the ld. Pr.CIT in his order at p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9, order dated 28.01.2020, wherein in para 7 the Tribunal has relied on the decision of the Hon‟ble Delhi High Court in the case of Gee Vee Enterprises Vs. Addl. CIT, reported in 99 ITR 375, wherein it has been held as follows :- "It is not necessary for the Commissioner to make further enquiries before canceling the assessment order of the Assessing Officer. The Commissioner can regard the order as erroneous on the ground that in the circumstances of the case the Assessing Officer should have made further inquiries before accepting the statements made by the assessee in his return. The reason is obvious. Unlike the civil court which is neutral to give a decision on the basis of evidence produced before it, an Assessing Officer is not only an adjudicator but is also an investigator. He cannot remain passive in the face of a return which is apparently in order but calls for further enquiry. It is his duty to ascertain the truth of the facts stated in the return when the circumstances of the case are such as to provoke an inquiry. The meaning to be given to the word "erroneous‟ in section 263 emerges out of this context. The word "erroneous‟ in that section includ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it is not necessary for the Pr.CIT to make further enquiry before cancelling the assessment order of the AO. He also drew our attention to the provisions of Section 263(1) of the Act, which reads as under :- Revision of orders prejudicial to revenue. 263. (1) The [ [Principal Chief Commissioner or Chief Commissioner or 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 [or the Transfer Pricing Officer, as the case may be,] 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,- (i) an order enhancing or modifying the assessment or cancelling the assessment and directing a fresh assessment; or (ii) an order modifying the order under section 92CA; or (iii) an order cancelling the order under section 92CA and directing a fresh order under the said section]. 9. It was the submission that the provisions of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hall be judged without being heard, comes into play and on account of the simple but absolute principle of natural justice, demands that the assessee be put to notice in respect of the proceedings that are being initiated against him, the assessee should be heard. (f) after making or causing to be made such enquiry as Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner deems necessary. Therefore, after putting the assessee to notice in regard to the proceedings being taken up against him the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner shall make or caused to make such enquiry as he deems necessary in respect of the issues which he has considered as causing the order to be erroneous and prejudicial to the interest of revenue in respect of the order from such records that he has called for; (g) after Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner makes or causes to make such enquiry as he has deemed necessary then he shall pass the order thereon u/s.263 of the act as the circumstances in the case may justify. Such order could be an order directin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he CIT u/s.263 of the Act nor it had given any explanation as to why he did not file appeal against the order u/s.263 of the Act nor any exceptional circumstances were shown to persuade the Hon‟ble High Court to depart from normal rule that writ petition complaining against order of Commissioner would not be entertained in absence of such adequate explanation by petitioner. 15. However, our view finds support from the decision of the Hon‟ble Jurisdictional High Court of Orissa in the case of Orissa State Police Housing & Welfare Corporation Ltd., reported in [2022] 139 taxmann.com 207 (Orissa), wherein the Hon‟ble High Court in para 14 has held as under :- 14. Section 263 of the Act requires the CIT, after hearing the Assessee, to pass an order by making "such enquiry as he deems necessary". The purpose of such an enquiry would be to arrive at a subjective view that the order of the AO was erroneous in so far as it is prejudicial to the interest of Revenue. Even if such enquiry may not be mandatory, there has to be some basis on which the CIT can form such a view. In the present case, the basis for forming a view that the profit element in the WIP was not accou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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