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TMI Blog2024 (10) TMI 90X X X X Extracts X X X X X X X X Extracts X X X X ..... ided he reaches to the conclusion that the same is erroneous to the extent that it is prejudice to the interest of the revenue. As observed in MALABAR INDUSTRIAL CO. LTD. [ 2000 (2) TMI 10 - SUPREME COURT] every loss of revenue as a consequence of the order of the AO cannot be treated as prejudice to the interest of the revenue. Thus, if two views are possible to reach to a conclusion and an assessment, merely because the Commissioner does not agree with the view adopted by the AO, cannot be a ground to hold the order as erroneous. The error has to be found from the provisions of law and the order can be set aside only when the view taken by the AO is unsustainable in law. ITAT in appeal while relying on the aforesaid judgment reached to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate Tribunal and vide its order dated 22.10.2010, order passed by the CIT under Section 263 of the Act was set aside and the order of the AO was upheld. It relied on M/s Malabar Industrial Company Limited vs Commissioner of Income Tax, Kerala State 2000 (243) ITR 83 holding that the order passed by the AO could not be said to be erroneous in the eyes of law. 2. Learned counsel for the appellant-revenue submits that the Joint Commissioner while passing order under Section 144A of the Act ought not to have directed the AO to pass order in terms laid down by him and the AO ought to have examined the entire case independently. It was also submitted that the books of accounts were never produced before the Joint Commissioner and, therefore, his ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or that he had not conducted diligent enquiry which is essential for reaching to conclusion and passing of the assessment order. 5. The Commissioner of Income Tax while exercising powers under Section 263 of the Act i.e. suo moto jurisdiction would be entitled to look into the order of the AO provided he reaches to the conclusion that the same is erroneous to the extent that it is prejudice to the interest of the revenue. The twin conditions necessary for interference under Section 263 of the Act have been laid down in M/s Malabar Industrial Company Limited (supra) as under:- (i) the order of Assessing Officer sought to be revised is erroneous; and (ii) it is prejudicial to the interest of the revenue. 6. Both the conditions are, therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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