M/s KBR Township Pvt. Ltd., Kolkata v. ITO-4(4), Kolkata

ITA 396/KOL/2020 | 2010-2011
Pronouncement Date: 05-05-2021 | Result: Allowed

Appeal Details

RSA Number 39623514 RSA 2020
Assessee PAN AABCK0777A
Bench Kolkata
Appeal Number ITA 396/KOL/2020
Duration Of Justice 10 month(s) 9 day(s)
Appellant M/s KBR Township Pvt. Ltd., Kolkata
Respondent ITO-4(4), Kolkata
Appeal Type Income Tax Appeal
Pronouncement Date 05-05-2021
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted B
Tribunal Order Date 05-05-2021
Last Hearing Date 30-03-2021
First Hearing Date 22-04-2021
Assessment Year 2010-2011
Appeal Filed On 26-06-2020
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH B KOLKATA VIRTUAL HEARING [BEFORE SHRI J. SUDHAKAR REDDY HONBLE ACCOUNTANT MEMBER & SHRI ABY T. VARKEY HONBLE JUDICIAL MEMBER] I.T.A. NO. 396/KOL/2020 ASSESSMENT YEAR: 2010-11 M/S. KBR TOWNSHIP PVT. LTD........................APPELLANT ROOM NO. 4 MARTIN BURN BUILDING 1 R.N. MUKHERJEE ROAD KOLKATA 700 001 [PAN : AABCK 0777 A] VS. INCOME TAX OFFICER WARD-4(4) KOLKATA.......................................................................RESPONDENT APPEARANCES BY: SHRI S.M. SURANA ADVOCATE APPEARED ON BEHALF OF THE ASSESSEE. SHRI SANDEEP CHAUBE CIT D/R. APPEARING ON BEHALF OF THE REVENUE. DATE OF CONCLUDING THE HEARING : APRIL 22 ND 2021 DATE OF PRONOUNCING THE ORDER : MAY 5 TH 2021 ORDER PER J. SUDHAKAR REDDY AM:- THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LEARNED PRINCIPAL COMMISSIONER OF INCOME TAX 2 KOLKATA (HEREINAFTER THE LD. PR. CIT) PASSED U/S. 263 OF THE INCOME TAX ACT 1961 (THE ACT) DT. 29/05/2020 FOR THE ASSESSMENT YEAR 2010-11. 2. WE HAVE HEARD RIVAL CONTENTIONS. ON CAREFUL CONSIDERATION OF THE FACTS AND CIRCUMSTANCES OF THE CASE PERUSAL OF THE PAPERS ON RECORD ORDERS OF THE AUTHORITIES BELOW AS WELL AS CASE LAW CITED WE HOLD AS FOLLOWS:- 3. THE ASSESSEE IN THIS CASE HAS DISCLOSED THE COMMODITY PROFIT OF RS.21 92 931/- AS ITS INCOME IN ITS RETURN OF INCOME AND PAID TAXES. THIS IS CLEAR FROM THE ANNUAL ACCOUNTS. THE ASSESSEE HAD ORIGINAL FILED ITS RETURN OF INCOME FOR THE ASSESSMENT YEAR 2010-11 ON 24/09/2010 DECLARING INCOME OF RS.4 61 100/-. THE ASSESSING OFFICER REOPENED THE CASE U/S 147 OF THE ACT ON 30/03/2017. IN THE REASONS FOR REOPENING THE ASSESSING OFFICER STATED AS FOLLOWS:- BASED ON THE ABOVE INVESTIGATION/ENQUIRY AND ANALYSIS OF TRADE LEDGER IT WAS FOUND THAT TRADING WAS DONE THROUGH MEMBER/BROKER OF NMCE WHO WAS PENALIZED/SUSPENDED BECAUSE THEY WERE FOUND TO BE INVOLVED IN ARTIFICIAL TRADING OF SHARES BY MISUSE OF NMCE PLATFORM. AS PER ABOVE OBSERVATION THAT SUMMONS WERE RETURNED UN-SERVED ENTITIES WERE NOT FOUND AT THEIR ADDRESS THE ENTITIES DID NOT FILE INCOME TAX RETURNS IN THE CONCERNED A. Y THE ENTITIES WHO FILED ITR BUT NOT CLAIMED ANY LOSS IN THE FINANCIAL YEAR TRADING WAS DONE THROUGH SUSPENDED /PENALIZED MEMBERS/BROKERS MOST OF THE CLIENT WERE FOUND TO BE DUMMY/ SHELL ENTITIES AND THE STATEMENT OF ENTRY OPERATORS/INDIVIDUALS IN WHICH THEY HAVE ACCEPTED THAT THE LOSS WAS BOOKED WAS BOGUS LOSS TO FACILITATE ACCOMMODATION BOGUS LOSS/PROFIT TO THE BENEFICIARIES. IT IS ESTABLISHED THAT MANY GENUINE CLIENTS USED NMCE TO BOOK CONTRIVED LOSSES THROUGH THESE ABOVE MENTIONED SHELL/ DUMMY ENTITIES. ONE OF THE BENEFICIARY WAS M/S. KBR TOWNSHIP PVT LTD. IN RESPECT OF WHOM IT HAS BEEN INFORMED THAT IT HAD TAKEN ENTRY OF BOGUS PROFIT OF RS. 16.97 650/- THROUGH BROKER RR CONSUMER DURING THE FY 2009-10. THE ASSESSING OFFICER COMPLETED THE ASSESSMENT U/S 143(3) R.W.S. 147 OF THE ACT ON 26/07/2017 AFTER EXAMINING THE NECESSARY DOCUMENTS. THE ASSESSING OFFICER HAD COME TO A CONCLUSION THAT NO INCOME HAD ESCAPED ASSESSMENT AND NO ADDITION NEED TO BE MADE O N ACCOUNT OF COMMODITY TRANSACTIONS. 4. PARA 3 OF THE IMPUGNED ORDER U/S 263 OF THE ACT READS AS FOLLOWS: 3. CONSEQUENCE TO THE ABOVE DISCUSSION A NOTICE U/S 263 OF THE ACT WAS ISSUED TO THE ASSESSEE VIDE DIN & LETTER DATED 06/03/2020 AS UNDER: ON EXAMINATION OF THE ASSESSMENT RECORDS OF ABOVE MENTIONED ASSESSMENT YEAR 2010 APPEARS PRIMA FACIE THAT THERE WAS FAILURE ON PART OF THE A.O. TO ASSESSEE THE INCOME CORRECTLY AND AS SUCH THE INSTANT ORDER U/S 143(3) IS ERRONEOUS IS SO FAR AS IT IS P TO THE INTEREST OF THE REVENUE WITHIN THE AMBIT OF SEC. 263 OF THE INCOME TAX ACT 1961. IN THIS REGARD THE FOLLOWING DISCREPANCIES HAVE BEEN OBSERVED: THE CASE WAS RE ACCOMMODATION ARRANGEMENT BY THE ASSESSEE FOR SHOWING BOGUS COMMODITY PROFIT OF RS.21 92 931/- BUT CLAIM OF THE ASSESSEE WAS ACCEPTED WITHOUT MAKING ANY INQUIRY/VERIFICATION. 5. W E ARE OF THE CONSIDERED OPINION THAT THERE IS NO ERROR IN THE ORDER OF THE ASSESSING OFF ICER TO THE EXTENT IT WAS PREJUDICIAL TO THE INTEREST OF THE REVENUE WARRANTING THE REVISION OF THE ASSESSMENT ORDER PASSED U/S 147 R.W.S. 143(3) OF THE ACT ON 26/07/2017 BY THE LD. PR. CIT. WHEN THE ASSESSEE ITSELF HAS DECLARED THE COMMODITY PROFIT AS INCOME IN ITS ORIGINAL RETURN OF INCOME AND PAID TAXES THEREON ADDING IT ONCE AGAIN DOES NOT ARISE AS IT WOULD TANTAMOUNT TO DOUBLE ADDITION. THIS IS THE EXACT REASON FOR WHICH THE ASSESSING OFFICER DID NOT MAKE ANY ADDITION IN THE ASSESSME NT THOUGH THE REASON FOR REOPENING WAS TO EXAMINE THE TRANSACTIONS RELATED TO TRADING ON NMCE PLATFORM. THIS IS NOT A CASE OF NON MIND BY THE ASSESSING OFFICER IN THE ORIGINAL ASSESSMENT PROCEEDINGS. THE ASSESSING OFFIC ER HAS TAKEN A POSSIBLE VIEW. 6. THE HONEBLE ANDHRA PRADESH HIGH COURT IN THE CASE OF PVT. LTD. V CIT (AP) 354 ITR 35 EXERCISE OF JURISDICTION U/S 263 OF THE ACT BY THE PRINCI AND CULLED OUT VARIOUS PRINCIPLES LAID DOWN IN BELOW : 24. IN MALABAR INDUSTRIAL CO.LTD. ( 2 SUPRA) THAT A BARE READING OF SEC.263 MAKES IT CLEAR THAT THE PREREQUISITE FOR THE EXERCISE OF JURISDICTION BY THE COMMISSIONER SUOMOTU UNDER IT IS THE ORDER OF THE INCOME TAX OFFICER IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTE RESTS OF THE REVENUE. THE COMMISSIONER HAS TO BE SATISFIED OF TWIN CONDITIONS NAMELY (I) THE ORDER OF THE ASSESSING OFFICER SOUGHT TO BE REVISED IS ERRONEOUS; AND (II) IT IS PREJUDICIAL TO THE INTERESTS OF THE 2 THE ASSESSING OFFICER COMPLETED THE ASSESSMENT U/S 143(3) R.W.S. 147 OF THE ACT ON 26/07/2017 AFTER EXAMINING THE NECESSARY DOCUMENTS. THE ASSESSING OFFICER HAD COME TO A CONCLUSION THAT NO INCOME HAD ESCAPED ASSESSMENT AND NO ADDITION NEED TO BE N ACCOUNT OF COMMODITY TRANSACTIONS. PARA 3 OF THE IMPUGNED ORDER U/S 263 OF THE ACT READS AS FOLLOWS: 3. CONSEQUENCE TO THE ABOVE DISCUSSION A NOTICE U/S 263 OF THE ACT WAS ISSUED TO THE ASSESSEE VIDE DIN & LETTER DATED 06/03/2020 AS UNDER: - EXAMINATION OF THE ASSESSMENT RECORDS OF ABOVE MENTIONED ASSESSMENT YEAR 2010 APPEARS PRIMA FACIE THAT THERE WAS FAILURE ON PART OF THE A.O. TO ASSESSEE THE INCOME CORRECTLY AND AS SUCH THE INSTANT ORDER U/S 143(3) IS ERRONEOUS IS SO FAR AS IT IS P TO THE INTEREST OF THE REVENUE WITHIN THE AMBIT OF SEC. 263 OF THE INCOME TAX ACT 1961. IN THIS REGARD THE FOLLOWING DISCREPANCIES HAVE BEEN OBSERVED: THE CASE WAS RE - OPENED ON THE BASIS OF INVESTIGATION REPORT IN REGARD TO ARRANGEMENT BY THE ASSESSEE FOR SHOWING BOGUS COMMODITY PROFIT OF BUT CLAIM OF THE ASSESSEE WAS ACCEPTED WITHOUT MAKING ANY E ARE OF THE CONSIDERED OPINION THAT THERE IS NO ERROR IN THE ORDER OF THE ICER TO THE EXTENT IT WAS PREJUDICIAL TO THE INTEREST OF THE REVENUE WARRANTING THE REVISION OF THE ASSESSMENT ORDER PASSED U/S 147 R.W.S. 143(3) OF THE ACT ON 26/07/2017 BY THE LD. PR. CIT. WHEN THE ASSESSEE ITSELF HAS DECLARED THE COMMODITY IN ITS ORIGINAL RETURN OF INCOME AND PAID TAXES THEREON ADDING IT ONCE AGAIN DOES NOT ARISE AS IT WOULD TANTAMOUNT TO DOUBLE ADDITION. THIS IS THE EXACT REASON FOR WHICH THE ASSESSING OFFICER DID NOT MAKE ANY ADDITION IN THE NT THOUGH THE REASON FOR REOPENING WAS TO EXAMINE THE TRANSACTIONS RELATED TO TRADING ON NMCE PLATFORM. THIS IS NOT A CASE OF NON - VERIFICATION OR NON APPLICATION OF BY THE ASSESSING OFFICER IN THE ORIGINAL ASSESSMENT PROCEEDINGS. THE ASSESSING ER HAS TAKEN A POSSIBLE VIEW. THE HONEBLE ANDHRA PRADESH HIGH COURT IN THE CASE OF SPECTRA SHARES AND SCRIPS PVT. LTD. V CIT (AP) 354 ITR 35 HAD CONSIDERED A NUMBER OF JUDGMENTS ON THIS ISSUE OF EXERCISE OF JURISDICTION U/S 263 OF THE ACT BY THE PRINCI PAL COMMISSIONER OF INCOME TAX PRINCIPLES LAID DOWN IN DIFFERENT JUDGMENTS BY THE COURTS MALABAR INDUSTRIAL CO.LTD. ( 2 SUPRA) THE SUPREME COURT HELD THAT A BARE READING OF SEC.263 MAKES IT CLEAR THAT THE PREREQUISITE FOR THE EXERCISE OF JURISDICTION BY THE COMMISSIONER SUOMOTU UNDER IT IS THE ORDER OF THE INCOME TAX OFFICER IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE RESTS OF THE REVENUE. THE COMMISSIONER HAS TO BE SATISFIED OF TWIN CONDITIONS NAMELY (I) THE ORDER OF THE ASSESSING OFFICER SOUGHT TO BE REVISED IS ERRONEOUS; AND (II) IT IS PREJUDICIAL TO THE INTERESTS OF THE I.T.A. NO. 396/KOL/2020 ASSESSMENT YEAR: 2010-11 M/S. KBR TOWNSHIP PVT. LTD. THE ASSESSING OFFICER COMPLETED THE ASSESSMENT U/S 143(3) R.W.S. 147 OF THE ACT ON 26/07/2017 AFTER EXAMINING THE NECESSARY DOCUMENTS. THE ASSESSING OFFICER HAD COME TO A CONCLUSION THAT NO INCOME HAD ESCAPED ASSESSMENT AND NO ADDITION NEED TO BE PARA 3 OF THE IMPUGNED ORDER U/S 263 OF THE ACT READS AS FOLLOWS: - 3. CONSEQUENCE TO THE ABOVE DISCUSSION A NOTICE U/S 263 OF THE ACT WAS ISSUED TO EXAMINATION OF THE ASSESSMENT RECORDS OF ABOVE MENTIONED ASSESSMENT YEAR 2010 -11 IT APPEARS PRIMA FACIE THAT THERE WAS FAILURE ON PART OF THE A.O. TO ASSESSEE THE INCOME CORRECTLY AND AS SUCH THE INSTANT ORDER U/S 143(3) IS ERRONEOUS IS SO FAR AS IT IS P REJUDICIAL TO THE INTEREST OF THE REVENUE WITHIN THE AMBIT OF SEC. 263 OF THE INCOME TAX ACT 1961. OPENED ON THE BASIS OF INVESTIGATION REPORT IN REGARD TO ARRANGEMENT BY THE ASSESSEE FOR SHOWING BOGUS COMMODITY PROFIT OF BUT CLAIM OF THE ASSESSEE WAS ACCEPTED WITHOUT MAKING ANY E ARE OF THE CONSIDERED OPINION THAT THERE IS NO ERROR IN THE ORDER OF THE ICER TO THE EXTENT IT WAS PREJUDICIAL TO THE INTEREST OF THE REVENUE WARRANTING THE REVISION OF THE ASSESSMENT ORDER PASSED U/S 147 R.W.S. 143(3) OF THE ACT ON 26/07/2017 BY THE LD. PR. CIT. WHEN THE ASSESSEE ITSELF HAS DECLARED THE COMMODITY IN ITS ORIGINAL RETURN OF INCOME AND PAID TAXES THEREON THE QUESTION OF ADDING IT ONCE AGAIN DOES NOT ARISE AS IT WOULD TANTAMOUNT TO DOUBLE ADDITION. THIS IS THE EXACT REASON FOR WHICH THE ASSESSING OFFICER DID NOT MAKE ANY ADDITION IN THE NT THOUGH THE REASON FOR REOPENING WAS TO EXAMINE THE TRANSACTIONS RELATED TO VERIFICATION OR NON APPLICATION OF BY THE ASSESSING OFFICER IN THE ORIGINAL ASSESSMENT PROCEEDINGS. THE ASSESSING SPECTRA SHARES AND SCRIPS HAD CONSIDERED A NUMBER OF JUDGMENTS ON THIS ISSUE OF PAL COMMISSIONER OF INCOME TAX BY THE COURTS AS THE SUPREME COURT HELD THAT A BARE READING OF SEC.263 MAKES IT CLEAR THAT THE PREREQUISITE FOR THE EXERCISE OF JURISDICTION BY THE COMMISSIONER SUOMOTU UNDER IT IS THE ORDER OF THE INCOME TAX OFFICER IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE RESTS OF THE REVENUE. THE COMMISSIONER HAS TO BE SATISFIED OF TWIN CONDITIONS NAMELY (I) THE ORDER OF THE ASSESSING OFFICER SOUGHT TO BE REVISED IS ERRONEOUS; AND (II) IT IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE. IF ONE OF THEM IS ABSENT ERRONEOUS BUT IS NOT PREJUDICIAL TO THE REVENUE OR IF IT IS NOT ERRONEOUS BUT IT IS PREJUDICIAL TO THE REVENUE THE ACT. IT ALSO HELD AT PG 'THE PHRASE 'PREJUDICIAL 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 REV EXAMPLE WHEN AN INCOME PERMISSIBLE IN LAW AND IT HAS RESULTED IN LOSS OF REVENUE: OR WHERE TWO VIEWS ARE POSSIBLE AND THE INCOME WHICH THE COMMISSIONER DOES NOT AGREE IT ERRONEOUS ORDER PREJUDICIAL TO THE INTERESTS OF THE REVENUE UNLESS THE VIEW TAKEN BY THE INCOME THIS COURT THAT WHERE A SUM NOT EARNED BY A PERSON IS ASSESSED AS INCOME IN H IS HANDS ON HIS SO OFFERING THE ORDER PASSED BY THE ASSESSING OFFICER ACCEPTING THE SAME AS SUCH WILL BE ERRONEOUS AND PREJUDICIAL TO THE INTERESTS OF THE REVENUE. RAMPYARIDEVISARAOGI V. CIT (1968) 67 ITR 84 (SC) AND IN SMT. TARA DEVI AGGARWAL V. CIT (197 25. IN MAX INDIA LTD. INDUSTRIAL CO.LTD. CONSEQUENCE OF AN ORDER OF THE ASSESSING OFFICER CANNOT BE TREATED AS PREJUDICIAL TO THE INTERES 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 INTERESTS OF THE REVENUE UNLESS THE VIEW TAKEN BY THE INCOME TAX OFFICER IS UNSUSTAINABLE IN LAW. ON THE FACTS OF THAT CASE SEC.80HHC(3) AS IT THEN STOOD WAS INTERPRETED BY THE ASSE THAT IN VIEW OF THE 2005 AMENDMENT WHICH IS CLARIFICATORY AND RETROSPECTIVE IN NATURE THE VIEW OF THE ASSESSING OFFICER WAS UNSUSTAINABLE IN LAW AND THE COMMISSIONER WAS CORRECT IN INVOKING SEC.263. BUT THE SUPREME WHEN THE COMMISSIONER PASSED HIS ORDER DISAGREEING WITH THE VIEW OF THE ASSESSING OFFICER THERE WERE TWO VIEWS ON THE WORD 'PROFITS' IN THAT SECTION; THAT THE SAID SECTION WAS AMENDED ELEVEN TIMES; THAT DIF VIEWS EXISTED ON THE DAY WHEN THE COMMISSIONER PASSED HIS ORDER; THAT THE MECHANICS OF THE SECTION HAD BECOME SO COMPLICATED OVER THE YEARS THAT TWO VIEWS WERE INHERENTLY POSSIBLE; AND THEREFORE THE SUBSEQUENT AMENDMENT IN 2005 EVEN THOUGH RETROSPE PROVISION OF SEC.263. 26. IN VIKAS POLYMERS OF SUOMOTU REVISION EXERCISABLE BY THE COMMISSIONER UNDER THE PROVISIONS OF SEC.263 IS SUPERVISORY IN NATURE; THAT AN 'ERRONEOUS JUD ONE WHICH IS NOT IN ACCORDANCE WITH LAW; THAT IF AN INCOME TAX OFFICER ACTING IN ACCORDANCE WITH LAW MAKES A CERTAIN ASSESSMENT THE SAME CANNOT BE BRANDED AS 'ERRONEOUS' BY THE COMMISSIONER SIMPLY BECAUSE ACCORDING TO HIM THE ORDER SHOULD H ELABORATELY; THAT THE SECTION DOES NOT VISUALIZE THE SUBSTITUTION OF THE JUDGMENT OF THE COMMISSIONER FOR THAT OF THE INCOME TAX OFFICER WHO PASSED THE ORDER UNLESS THE DECISION IS NOT IN ACCORDANCE WITH THE LAW; THAT TO INVOKE SUOMOTU REVISIONAL POWERS TO REOPEN A CONCLUDED ASSESSMENT UNDER SEC.263 THE COMMISSIONER MUST GIVE REASONS; THAT A 3 REVENUE. IF ONE OF THEM IS ABSENT IF THE O RDER OF THE INCOME TAX OFFICER IS ERRONEOUS BUT IS NOT PREJUDICIAL TO THE REVENUE OR IF IT IS NOT ERRONEOUS BUT IT IS PREJUDICIAL TO THE REVENUE RECOURSE CANNOT BE HAD TO SEC.263 (1) OF THE ACT. IT ALSO HELD AT PG -88 AS FOLLOWS: '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 REV 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 INTERESTS OF THE REVENUE UNLESS THE VIEW TAKEN BY THE INCOME - TAX OFFICER IS UNSUSTAINABLE IN LAW. IT HAS BEEN HELD BY THIS COURT THAT WHERE A SUM NOT EARNED BY A PERSON IS ASSESSED AS INCOME IS HANDS ON HIS SO OFFERING THE ORDER PASSED BY THE ASSESSING OFFICER ACCEPTING THE SAME AS SUCH WILL BE ERRONEOUS AND PREJUDICIAL TO THE INTERESTS OF THE REVENUE. RAMPYARIDEVISARAOGI V. CIT (1968) 67 ITR 84 (SC) AND IN SMT. TARA DEVI AGGARWAL V. CIT (197 3) 88 ITR 323 (SC)'. MAX INDIA LTD. (3 SUPRA) REITERATED THE VIEW IN INDUSTRIAL CO.LTD. (2 SUPRA) AND OBSERVED THAT EVERY LOSS OF REVENUE AS A CONSEQUENCE OF AN ORDER OF THE ASSESSING OFFICER CANNOT BE TREATED AS PREJUDICIAL TO THE INTERES TS 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 INTERESTS OF THE REVENUE UNLESS THE VIEW TAKEN BY THE INCOME TAX OFFICER IS UNSUSTAINABLE IN LAW. ON THE FACTS OF THAT CASE SEC.80HHC(3) AS IT THEN STOOD WAS INTERPRETED BY THE ASSE SSING OFFICER BUT THE REVENUE CONTENDED THAT IN VIEW OF THE 2005 AMENDMENT WHICH IS CLARIFICATORY AND RETROSPECTIVE IN NATURE THE VIEW OF THE ASSESSING OFFICER WAS UNSUSTAINABLE IN LAW AND THE COMMISSIONER WAS CORRECT IN INVOKING SEC.263. BUT THE SUPREME COURT REJECTED THE SAID CONTENTION AND HELD THAT WHEN THE COMMISSIONER PASSED HIS ORDER DISAGREEING WITH THE VIEW OF THE ASSESSING OFFICER THERE WERE TWO VIEWS ON THE WORD 'PROFITS' IN THAT SECTION; THAT THE SAID SECTION WAS AMENDED ELEVEN TIMES; THAT DIF VIEWS EXISTED ON THE DAY WHEN THE COMMISSIONER PASSED HIS ORDER; THAT THE MECHANICS OF THE SECTION HAD BECOME SO COMPLICATED OVER THE YEARS THAT TWO VIEWS WERE INHERENTLY POSSIBLE; AND THEREFORE THE SUBSEQUENT AMENDMENT IN 2005 EVEN THOUGH RETROSPE CTIVE WILL NOT ATTRACT THE PROVISION OF SEC.263. VIKAS POLYMERS (4 SUPRA) THE DELHI HIGH COURT HELD THAT THE POWER OF SUOMOTU REVISION EXERCISABLE BY THE COMMISSIONER UNDER THE PROVISIONS OF SEC.263 IS SUPERVISORY IN NATURE; THAT AN 'ERRONEOUS JUD GMENT' MEANS ONE WHICH IS NOT IN ACCORDANCE WITH LAW; THAT IF AN INCOME TAX OFFICER ACTING IN ACCORDANCE WITH LAW MAKES A CERTAIN ASSESSMENT THE SAME CANNOT BE BRANDED AS 'ERRONEOUS' BY THE COMMISSIONER SIMPLY BECAUSE ACCORDING TO HIM THE ORDER SHOULD H AVE BEEN WRITTEN DIFFERENTLY OR MORE ELABORATELY; THAT THE SECTION DOES NOT VISUALIZE THE SUBSTITUTION OF THE JUDGMENT OF THE COMMISSIONER FOR THAT OF THE INCOME TAX OFFICER WHO PASSED THE ORDER UNLESS THE DECISION IS NOT IN ACCORDANCE WITH THE LAW; TO INVOKE SUOMOTU REVISIONAL POWERS TO REOPEN A CONCLUDED ASSESSMENT UNDER SEC.263 THE COMMISSIONER MUST GIVE REASONS; THAT A I.T.A. NO. 396/KOL/2020 ASSESSMENT YEAR: 2010-11 M/S. KBR TOWNSHIP PVT. LTD. RDER OF THE INCOME TAX OFFICER IS ERRONEOUS BUT IS NOT PREJUDICIAL TO THE REVENUE OR IF IT IS NOT ERRONEOUS BUT RECOURSE CANNOT BE HAD TO SEC.263 (1) OF 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 REV ENUE. FOR TAX OFFICER ADOPTED ONE OF THE COURSES PERMISSIBLE IN LAW AND IT HAS RESULTED IN LOSS OF REVENUE: OR WHERE TWO TAX OFFICER HAS TAKEN ONE VIEW WITH CANNOT BE TREATED AS AN ERRONEOUS ORDER PREJUDICIAL TO THE INTERESTS OF THE REVENUE UNLESS THE VIEW TAX OFFICER IS UNSUSTAINABLE IN LAW. IT HAS BEEN HELD BY THIS COURT THAT WHERE A SUM NOT EARNED BY A PERSON IS ASSESSED AS INCOME IS HANDS ON HIS SO OFFERING THE ORDER PASSED BY THE ASSESSING OFFICER ACCEPTING THE SAME AS SUCH WILL BE ERRONEOUS AND PREJUDICIAL TO THE INTERESTS OF THE REVENUE. RAMPYARIDEVISARAOGI V. CIT (1968) 67 ITR 84 3) 88 ITR 323 (SC)'. REITERATED THE VIEW IN MALABAR (2 SUPRA) AND OBSERVED THAT EVERY LOSS OF REVENUE AS A CONSEQUENCE OF AN ORDER OF THE ASSESSING OFFICER CANNOT BE TREATED AS TS 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 INTERESTS OF THE REVENUE UNLESS THE VIEW TAKEN BY THE INCOME TAX OFFICER IS UNSUSTAINABLE IN LAW. ON THE FACTS OF THAT CASE SEC.80HHC(3) AS IT THEN SSING OFFICER BUT THE REVENUE CONTENDED THAT IN VIEW OF THE 2005 AMENDMENT WHICH IS CLARIFICATORY AND RETROSPECTIVE IN NATURE THE VIEW OF THE ASSESSING OFFICER WAS UNSUSTAINABLE IN LAW AND THE COMMISSIONER WAS CORRECT IN INVOKING COURT REJECTED THE SAID CONTENTION AND HELD THAT WHEN THE COMMISSIONER PASSED HIS ORDER DISAGREEING WITH THE VIEW OF THE ASSESSING OFFICER THERE WERE TWO VIEWS ON THE WORD 'PROFITS' IN THAT SECTION; THAT THE SAID SECTION WAS AMENDED ELEVEN TIMES; THAT DIF FERENT VIEWS EXISTED ON THE DAY WHEN THE COMMISSIONER PASSED HIS ORDER; THAT THE MECHANICS OF THE SECTION HAD BECOME SO COMPLICATED OVER THE YEARS THAT TWO VIEWS WERE INHERENTLY POSSIBLE; AND THEREFORE THE SUBSEQUENT CTIVE WILL NOT ATTRACT THE (4 SUPRA) THE DELHI HIGH COURT HELD THAT THE POWER OF SUOMOTU REVISION EXERCISABLE BY THE COMMISSIONER UNDER THE PROVISIONS GMENT' MEANS ONE WHICH IS NOT IN ACCORDANCE WITH LAW; THAT IF AN INCOME TAX OFFICER ACTING IN ACCORDANCE WITH LAW MAKES A CERTAIN ASSESSMENT THE SAME CANNOT BE BRANDED AS 'ERRONEOUS' BY THE COMMISSIONER SIMPLY BECAUSE AVE BEEN WRITTEN DIFFERENTLY OR MORE ELABORATELY; THAT THE SECTION DOES NOT VISUALIZE THE SUBSTITUTION OF THE JUDGMENT OF THE COMMISSIONER FOR THAT OF THE INCOME TAX OFFICER WHO PASSED THE ORDER UNLESS THE DECISION IS NOT IN ACCORDANCE WITH THE LAW; TO INVOKE SUOMOTU REVISIONAL POWERS TO REOPEN A CONCLUDED ASSESSMENT UNDER SEC.263 THE COMMISSIONER MUST GIVE REASONS; THAT A BARE REITERATION BY HIM THAT THE ORDER OF THE INCOME TAX OFFICER IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTERESTS OF NOT SUFFICE; THAT THE REASONS MUST BE SUCH AS TO SHOW THAT THE ENHANCEMENT OR MODIFICATION OF THE ASSESSMENT OR CANCELLATION OF THE ASSESSMENT OR DIRECTIONS ISSUED FOR A FRESH ASSESSMENT WERE CALLED FOR AND MUST IRRESISTIBLY LEAD TO THE OFFICER WAS NOT ONLY ERRONEOUS BUT WAS PREJUDICIAL TO THE INTERESTS OF THE REVENUE. THUS WHILE THE INCOME TAX OFFICER IS NOT CALLED UPON TO WRITE AN ELABORATE JUDGMENT GIVING DETAILED REASONS IN RESPECT OF EACH DISALLOWANCE DEDUCTION ETC. IT IS INCUMBENT UPON THE COMMISSIONER NOT TO EXERCISE HIS SUOMOTU REVISIONAL POWERS UNLESS SUPPORTED BY ADEQUATE REASONS FOR DOING SO; THAT IF A QUERY IS RAISED DURING THE COURSE OF THE SCRUTINY BY THE ASSESSING OFF OF THE ASSESSING OFFICER BUT NEITHER THE QUERY NOR THE ANSWER WERE REFLECTED IN THE ASSESSMENT ORDER THIS WOULD NOT BY ITSELF LEAD TO THE CONCLUSION THAT THE ORDER OF THE ASSESSING OFFICER CALLED FOR INTERFERE AND REVISION. 27. IN SUNBEAM AUTO LTD. ASSESSING OFFICER IN THE ASSESSMENT ORDER IS NOT REQUIRED TO GIVE A DETAILED REASON IN RESPECT OF EACH AND EVERY ITEM OF DEDUCTION ETC.; THAT WHETHER THERE WAS APPLI HAS TO BE SEEN; THAT IF THERE WAS AN INQUIRY EVEN INADEQUATE THAT WOULD NOT BY ITSELF GIVE OCCASION TO THE COMMISSIONER TO PASS ORDERS UNDER SEC.263 MERELY BECAUSE HE HAS A DIFFERENT OPINION IN TH ONLY IN CASES OF LACK OF INQUIRY THAT SUCH A COURSE OF ACTION WOULD BE OPEN; THAT AN ASSESSMENT ORDER MADE BY THE INCOME TAX OFFICER CANNOT BE BRANDED AS ERRONEOUS BY THE COMMISSIONER SIMPLY BECAUSE ACCORDING TO HIM THE ORDER SHOULD SOME PRIMA FACIE MATERIAL ON RECORD TO SHOW THAT THE TAX WHICH WAS LAWFULLY EXIGIBLE HAS NOT BEEN IMPOSED OR THAT BY THE APPLICATION OF THE RELEVANT STATUTE ON AN INCORRECT OR INCOMPLETE INTERPRETATION A L THAN WHAT WAS JUST HAS BEEN IMPOSED. IN THAT CASE THE DELHI HIGH COURT HELD THAT THE COMMISSIONER IN THE EXERCISE OF REVISIONAL POWER COULD NOT HAVE OBJECTED TO THE FINDING OF THE ASSESSING OFFICER THAT EXPENDITURE ON TOOLS AND DIES BY THE ASSE EXPENDITURE WHERE THE SAID CLAIM WAS ALLOWED BY THE LATTER ON BEING SATISFIED WITH THE EXPLANATION OF THE ASSESSEE AND WHERE THE SAME ACCOUNTING PRACTICE FOLLOWED BY THE ASSESSEE FOR NUMBER OF YEARS WITH THE AP PROVAL OF THE INCOME TAX AUTHORITIES. IT HELD THAT THE ASSESSING OFFICER HAD CALLED FOR EXPLANATION ON THE VERY ITEM FROM THE ASSESSEE AND THE ASSESSEE HAD FURNISHED ITS EXPLANATION. MERELY BECAUSE THE ASSESSING OFFICER IN HIS ORDER DID NOT MAKE AN ELABORA HIS ORDER CANNOT BE TERMED AS ERRONEOUS. THE OPINION OF THE ASSESSING OFFICER IS ONE OF THE POSSIBLE VIEWS AND THERE WAS NO MATERIAL BEFORE THE COMMISSIONER TO VARY THAT OPINION AND ASK FOR FRESH INQUIRY. 28. IN GABRIEL INDIA CONSIDERATION OF THE COMMISSIONER AS TO WHETHER AN ORDER IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE MUST BE BASED ON MATERIALS ON THE RECORD OF THE PROCEEDINGS CALLED FOR NO MATERIALS ON RECORD ON THE BASIS OF WHICH IT CAN BE SAID THAT THE COMMISSIONER ACTING IN A REASONABLE MANNER COULD HAVE COME TO SUCH A CONCLUSION THE VERY INITIATION OF PROCEEDINGS BY HIM WILL BE ILLEGAL AND WITHOUT JURISDICTION. I PROCEEDINGS WITH A VIEW TO START FISHING AND ROVING INQUIRIES IN MATTERS OR 4 BARE REITERATION BY HIM THAT THE ORDER OF THE INCOME TAX OFFICER IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE WILL NOT SUFFICE; THAT THE REASONS MUST BE SUCH AS TO SHOW THAT THE ENHANCEMENT OR MODIFICATION OF THE ASSESSMENT OR CANCELLATION OF THE ASSESSMENT OR DIRECTIONS ISSUED FOR A FRESH ASSESSMENT WERE CALLED FOR AND MUST IRRESISTIBLY LEAD TO THE CONCLUSION THAT THE ORDER OF THE INCOME TAX OFFICER WAS NOT ONLY ERRONEOUS BUT WAS PREJUDICIAL TO THE INTERESTS OF THE REVENUE. THUS WHILE THE INCOME TAX OFFICER IS NOT CALLED UPON TO WRITE AN ELABORATE JUDGMENT GIVING DETAILED REASONS IN RESPECT OF EACH DISALLOWANCE DEDUCTION ETC. IT IS INCUMBENT UPON THE COMMISSIONER NOT TO EXERCISE HIS SUOMOTU REVISIONAL POWERS UNLESS SUPPORTED BY ADEQUATE REASONS FOR DOING SO; THAT IF A QUERY IS RAISED DURING THE COURSE OF THE SCRUTINY BY THE ASSESSING OFF ICER WHICH WAS ANSWERED TO THE SATISFACTION OF THE ASSESSING OFFICER BUT NEITHER THE QUERY NOR THE ANSWER WERE REFLECTED IN THE ASSESSMENT ORDER THIS WOULD NOT BY ITSELF LEAD TO THE CONCLUSION THAT THE ORDER OF THE ASSESSING OFFICER CALLED FOR INTERFERE SUNBEAM AUTO LTD. ( 5 SUPRA) THE DELHI HIGH COURT HELD THAT THE ASSESSING OFFICER IN THE ASSESSMENT ORDER IS NOT REQUIRED TO GIVE A DETAILED REASON IN RESPECT OF EACH AND EVERY ITEM OF DEDUCTION ETC.; THAT WHETHER THERE WAS APPLI CATION OF MIND BEFORE ALLOWING THE EXPENDITURE IN QUESTION HAS TO BE SEEN; THAT IF THERE WAS AN INQUIRY EVEN INADEQUATE THAT WOULD NOT BY ITSELF GIVE OCCASION TO THE COMMISSIONER TO PASS ORDERS UNDER SEC.263 MERELY BECAUSE HE HAS A DIFFERENT OPINION IN TH E MATTER; THAT IT IS ONLY IN CASES OF LACK OF INQUIRY THAT SUCH A COURSE OF ACTION WOULD BE OPEN; THAT AN ASSESSMENT ORDER MADE BY THE INCOME TAX OFFICER CANNOT BE BRANDED AS ERRONEOUS BY THE COMMISSIONER SIMPLY BECAUSE ACCORDING TO HIM THE ORDER SHOULD HAVE BEEN WRITTEN MORE ELABORATELY; THERE MUST BE SOME PRIMA FACIE MATERIAL ON RECORD TO SHOW THAT THE TAX WHICH WAS LAWFULLY EXIGIBLE HAS NOT BEEN IMPOSED OR THAT BY THE APPLICATION OF THE RELEVANT STATUTE ON AN INCORRECT OR INCOMPLETE INTERPRETATION A L THAN WHAT WAS JUST HAS BEEN IMPOSED. IN THAT CASE THE DELHI HIGH COURT HELD THAT THE COMMISSIONER IN THE EXERCISE OF REVISIONAL POWER COULD NOT HAVE OBJECTED TO THE FINDING OF THE ASSESSING OFFICER THAT EXPENDITURE ON TOOLS AND DIES BY THE ASSE SSEE A MANUFACTURER OF CAR PARTS IS REVENUE EXPENDITURE WHERE THE SAID CLAIM WAS ALLOWED BY THE LATTER ON BEING SATISFIED WITH THE EXPLANATION OF THE ASSESSEE AND WHERE THE SAME ACCOUNTING PRACTICE FOLLOWED BY THE ASSESSEE FOR NUMBER OF YEARS WITH THE PROVAL OF THE INCOME TAX AUTHORITIES. IT HELD THAT THE ASSESSING OFFICER HAD CALLED FOR EXPLANATION ON THE VERY ITEM FROM THE ASSESSEE AND THE ASSESSEE HAD FURNISHED ITS EXPLANATION. MERELY BECAUSE THE ASSESSING OFFICER IN HIS ORDER DID NOT MAKE AN ELABORA TE DISCUSSION IN THAT REGARD HIS ORDER CANNOT BE TERMED AS ERRONEOUS. THE OPINION OF THE ASSESSING OFFICER IS ONE OF THE POSSIBLE VIEWS AND THERE WAS NO MATERIAL BEFORE THE COMMISSIONER TO VARY THAT OPINION AND ASK FOR FRESH INQUIRY. GABRIEL INDIA LTD. (6 SUPRA) THE BOMBAY HIGH COURT HELD THAT A CONSIDERATION OF THE COMMISSIONER AS TO WHETHER AN ORDER IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE MUST BE BASED ON MATERIALS ON THE RECORD OF THE PROCEEDINGS CALLED FOR BY HIM. IF THERE ARE NO MATERIALS ON RECORD ON THE BASIS OF WHICH IT CAN BE SAID THAT THE COMMISSIONER ACTING IN A REASONABLE MANNER COULD HAVE COME TO SUCH A CONCLUSION THE VERY INITIATION OF PROCEEDINGS BY HIM WILL BE ILLEGAL AND WITHOUT JURISDICTION. I T HELD THAT THE COMMISSIONER CANNOT INITIATE PROCEEDINGS WITH A VIEW TO START FISHING AND ROVING INQUIRIES IN MATTERS OR I.T.A. NO. 396/KOL/2020 ASSESSMENT YEAR: 2010-11 M/S. KBR TOWNSHIP PVT. LTD. BARE REITERATION BY HIM THAT THE ORDER OF THE INCOME TAX OFFICER IS THE REVENUE WILL NOT SUFFICE; THAT THE REASONS MUST BE SUCH AS TO SHOW THAT THE ENHANCEMENT OR MODIFICATION OF THE ASSESSMENT OR CANCELLATION OF THE ASSESSMENT OR DIRECTIONS ISSUED FOR A FRESH ASSESSMENT WERE CALLED FOR AND CONCLUSION THAT THE ORDER OF THE INCOME TAX OFFICER WAS NOT ONLY ERRONEOUS BUT WAS PREJUDICIAL TO THE INTERESTS OF THE REVENUE. THUS WHILE THE INCOME TAX OFFICER IS NOT CALLED UPON TO WRITE AN ELABORATE JUDGMENT GIVING DETAILED REASONS IN RESPECT OF EACH AND EVERY DISALLOWANCE DEDUCTION ETC. IT IS INCUMBENT UPON THE COMMISSIONER NOT TO EXERCISE HIS SUOMOTU REVISIONAL POWERS UNLESS SUPPORTED BY ADEQUATE REASONS FOR DOING SO; THAT IF A QUERY IS RAISED DURING THE COURSE OF THE ICER WHICH WAS ANSWERED TO THE SATISFACTION OF THE ASSESSING OFFICER BUT NEITHER THE QUERY NOR THE ANSWER WERE REFLECTED IN THE ASSESSMENT ORDER THIS WOULD NOT BY ITSELF LEAD TO THE CONCLUSION THAT THE ORDER OF THE ASSESSING OFFICER CALLED FOR INTERFERE NCE ( 5 SUPRA) THE DELHI HIGH COURT HELD THAT THE ASSESSING OFFICER IN THE ASSESSMENT ORDER IS NOT REQUIRED TO GIVE A DETAILED REASON IN RESPECT OF EACH AND EVERY ITEM OF DEDUCTION ETC.; THAT WHETHER CATION OF MIND BEFORE ALLOWING THE EXPENDITURE IN QUESTION HAS TO BE SEEN; THAT IF THERE WAS AN INQUIRY EVEN INADEQUATE THAT WOULD NOT BY ITSELF GIVE OCCASION TO THE COMMISSIONER TO PASS ORDERS UNDER E MATTER; THAT IT IS ONLY IN CASES OF LACK OF INQUIRY THAT SUCH A COURSE OF ACTION WOULD BE OPEN; THAT AN ASSESSMENT ORDER MADE BY THE INCOME TAX OFFICER CANNOT BE BRANDED AS ERRONEOUS BY THE COMMISSIONER SIMPLY BECAUSE ACCORDING TO HAVE BEEN WRITTEN MORE ELABORATELY; THERE MUST BE SOME PRIMA FACIE MATERIAL ON RECORD TO SHOW THAT THE TAX WHICH WAS LAWFULLY EXIGIBLE HAS NOT BEEN IMPOSED OR THAT BY THE APPLICATION OF THE RELEVANT STATUTE ON AN INCORRECT OR INCOMPLETE INTERPRETATION A L ESSER TAX THAN WHAT WAS JUST HAS BEEN IMPOSED. IN THAT CASE THE DELHI HIGH COURT HELD THAT THE COMMISSIONER IN THE EXERCISE OF REVISIONAL POWER COULD NOT HAVE OBJECTED TO THE FINDING OF THE ASSESSING OFFICER THAT EXPENDITURE ON SSEE A MANUFACTURER OF CAR PARTS IS REVENUE EXPENDITURE WHERE THE SAID CLAIM WAS ALLOWED BY THE LATTER ON BEING SATISFIED WITH THE EXPLANATION OF THE ASSESSEE AND WHERE THE SAME ACCOUNTING PRACTICE FOLLOWED BY THE ASSESSEE FOR NUMBER OF YEARS WITH THE PROVAL OF THE INCOME TAX AUTHORITIES. IT HELD THAT THE ASSESSING OFFICER HAD CALLED FOR EXPLANATION ON THE VERY ITEM FROM THE ASSESSEE AND THE ASSESSEE HAD FURNISHED ITS EXPLANATION. MERELY BECAUSE THE ASSESSING TE DISCUSSION IN THAT REGARD HIS ORDER CANNOT BE TERMED AS ERRONEOUS. THE OPINION OF THE ASSESSING OFFICER IS ONE OF THE POSSIBLE VIEWS AND THERE WAS NO MATERIAL BEFORE THE (6 SUPRA) THE BOMBAY HIGH COURT HELD THAT A CONSIDERATION OF THE COMMISSIONER AS TO WHETHER AN ORDER IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE MUST BE BASED ON BY HIM. IF THERE ARE NO MATERIALS ON RECORD ON THE BASIS OF WHICH IT CAN BE SAID THAT THE COMMISSIONER ACTING IN A REASONABLE MANNER COULD HAVE COME TO SUCH A CONCLUSION THE VERY INITIATION OF PROCEEDINGS BY HIM WILL BE ILLEGAL AND T HELD THAT THE COMMISSIONER CANNOT INITIATE PROCEEDINGS WITH A VIEW TO START FISHING AND ROVING INQUIRIES IN MATTERS OR ORDERS WHICH ARE ALREADY CONCLUDED; THAT THE DEPARTMENT CANNOT BE PERMITTED TO BEGIN FRESH LITIGATION BECAUSE OF NEW VIEWS THEY ENTERTA FACTS OR NEW VERSIONS WHICH THEY PRESENT AS TO WHAT SHOULD BE THE INFERENCE OR PROPER INFERENCE EITHER OF THE FACTS DISCLOSED OR THE WEIGHT OF THE CIRCUMSTANCE; THAT IF THIS IS PERMITTED LITIGATION WOULD HAVE NO END EXCEPT WHEN LEGAL INGENUITY IS EX ARGUMENT INTO TWO AND MULTIPLY THE LITIGATION. IT HELD THAT CASES MAY BE VISUALIZED WHERE THE INCOME TAX OFFICER WHILE MAKING AN ASSESSMENT EXAMINES THE ACCOUNTS MAKES INQUIRIES APPLIES HIS MIND TO THE FACTS AND CI RCUMSTANCES OF THE CASE AND DETERMINES THE INCOME EITHER BY ACCEPTING THE ACCOUNT OR BY MAKING SOME ESTIMATE HIMSELF; THAT THE COMMISSIONER ON PERUSAL OF THE RECORD MAY BE OF THE OPINION THAT THE ESTIMATE MADE BY THE OFFICER CONCERNED WAS ON THE LOWER SI HE WOULD HAVE ESTIMATED THE INCOME AT A FIGURE HIGHER THAN THE ONE DETERMINED BY THE INCOME TAX OFFICER; BUT THAT WOULD NOT VEST THE COMMISSIONER WITH POWER TO REEXAMINE THE ACCOUNTS AND DETERMINE THE INCOME HIMSELF AT A HIG RECORD CALLED FOR BY THE COMMISSIONER TO SATISFY HIM PRIMA FACIE THAT THE ORDER IS BOTH ERRONEOUS AND PREJUDICIAL TO THE INTERESTS OF THE REVENUE. OTHERWISE IT WOULD AMOUNT TO GIVING UNBRIDLED AND ARBITR THE REVISING AUTHORITY TO INITIATE PROCEEDINGS FOR REVISION IN EVERY CASE AND START RE- EXAMINATION AND FRESH INQUIRY IN MATTERS WHICH HAVE ALREADY BEEN CONCLUDED UNDER LAW. 29. IN M.S. RAJU COMMISSIONER UNDER SEC.263 (1) IS NOT LIMITED ONLY TO THE MATERIAL WHICH WAS AVAILABLE BEFORE THE ASSESSING OFFICER AND IN ORDER TO PROTECT THE INTERESTS OF THE REVENUE THE COMMISSIONER IS ENTITLED TO EXAMINE ANY OTHER RECORDS WHICH ARE AVAILABLE AT THE TO TAKE INTO CONSIDERATION EVEN THOSE EVENTS WHICH AROSE SUBSEQUENT TO THE ORDER OF ASSESSMENT. 30. IN RAMPYARI DEVI SARAOGI REVISIONAL POWERS CANCELLED ASSESSEES ASSESSMENT FOR T TO 1960- 61 BECAUSE HE FOUND THAT THE INCOME TAX OFFICER WAS NOT JUSTIFIED IN ACCEPTING THE INITIAL CAPITAL THE GIFT RECEIVED AND SALE OF JEWELLERY THE INCOME FROM BUSINESS ETC. WITHOUT ANY ENQUIRY OR EVIDENCE WHATSOEVER . HE DIRECTED THE INCOME TAX OFFICER TO DO FRESH ASSESSMENT AFTER MAKING PROPER ENQUIRY AND INVESTIGATION IN REGARD TO THE JURISDICTION. THE ASSESSEE COMPLAINED BEFORE THE SUPREME COURT THAT NO FAIR OR REASONABLE OPPORTUNITY WAS GIVEN TO HER. THE SUPREME COURT HELD THAT AMPLE MATERIAL TO SHOW THAT THE INCOME TAX OFFICER MADE THE ASSESSMENTS IN UNDUE HURRY; THAT HE HAD PASSED A SHORT STEREO TYPED ASSESSMENT ORDER FOR EACH ASSESSMENT YEAR; THAT ON THE FACE OF THE RECORD THE ORDERS WERE PRE- JUDICIAL TO THE INTERE THE ASSESSEE ON ACCOUNT OF FAILURE OF THE COMMISSIONER TO INDICATE THE RESULTS OF THE ENQUIRY MADE BY HIM AS SHE WOULD HAVE A FULL OPPORTUNITY FOR SHOWING TO THE INCOME TAX OFFICER WHETHER HE HAD JURISDICT AND WHETHER THE INCOME TAX ASSESSED IN THE ASSESSMENT YEARS WHICH WERE ORIGINALLY PASSED WERE CORRECT OR NOT' 31. FROM THE ABOVE DECISIONS THE FOLLOWING PRINCIPLES AS TO EXERCISE OF JURISDICTION BY THE COMMISSIONER U/S.263 OF THE ACT CAN BE CUL A) THE COMMISSIONER HAS TO BE SATISFIED OF TWIN CONDITIONS NAMELY (I) THE ORDER OF THE ASSESSING OFFICER SOUGHT TO BE REVISED IS ERRONEOUS; AND (II) IT IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE. IF ERRONEOUS BUT IS NOT 5 ORDERS WHICH ARE ALREADY CONCLUDED; THAT THE DEPARTMENT CANNOT BE PERMITTED TO BEGIN FRESH LITIGATION BECAUSE OF NEW VIEWS THEY ENTERTA FACTS OR NEW VERSIONS WHICH THEY PRESENT AS TO WHAT SHOULD BE THE INFERENCE OR PROPER INFERENCE EITHER OF THE FACTS DISCLOSED OR THE WEIGHT OF THE CIRCUMSTANCE; THAT IF THIS IS PERMITTED LITIGATION WOULD HAVE NO END EXCEPT WHEN LEGAL INGENUITY IS EX HAUSTED; THAT TO DO SO IS TO DIVIDE ONE ARGUMENT INTO TWO AND MULTIPLY THE LITIGATION. IT HELD THAT CASES MAY BE VISUALIZED WHERE THE INCOME TAX OFFICER WHILE MAKING AN ASSESSMENT EXAMINES THE ACCOUNTS MAKES INQUIRIES APPLIES HIS MIND TO THE FACTS AND RCUMSTANCES OF THE CASE AND DETERMINES THE INCOME EITHER BY ACCEPTING THE ACCOUNT OR BY MAKING SOME ESTIMATE HIMSELF; THAT THE COMMISSIONER ON PERUSAL OF THE RECORD MAY BE OF THE OPINION THAT THE ESTIMATE MADE BY THE OFFICER CONCERNED WAS ON THE LOWER SI DE AND LEFT TO THE COMMISSIONER HE WOULD HAVE ESTIMATED THE INCOME AT A FIGURE HIGHER THAN THE ONE DETERMINED BY THE INCOME TAX OFFICER; BUT THAT WOULD NOT VEST THE COMMISSIONER WITH POWER TO REEXAMINE THE ACCOUNTS AND DETERMINE THE INCOME HIMSELF AT A HIG HER FIGURE; THERE MUST BE MATERIAL AVAILABLE ON THE RECORD CALLED FOR BY THE COMMISSIONER TO SATISFY HIM PRIMA FACIE THAT THE ORDER IS BOTH ERRONEOUS AND PREJUDICIAL TO THE INTERESTS OF THE REVENUE. OTHERWISE IT WOULD AMOUNT TO GIVING UNBRIDLED AND ARBITR ARY POWER TO THE REVISING AUTHORITY TO INITIATE PROCEEDINGS FOR REVISION IN EVERY CASE AND EXAMINATION AND FRESH INQUIRY IN MATTERS WHICH HAVE ALREADY BEEN CONCLUDED UNDER LAW. M.S. RAJU (15 SUPRA) THIS COURT HAS HELD THAT THE POWER OF THE COMMISSIONER UNDER SEC.263 (1) IS NOT LIMITED ONLY TO THE MATERIAL WHICH WAS AVAILABLE BEFORE THE ASSESSING OFFICER AND IN ORDER TO PROTECT THE INTERESTS OF THE REVENUE THE COMMISSIONER IS ENTITLED TO EXAMINE ANY OTHER RECORDS WHICH ARE AVAILABLE AT THE TIME OF EXAMINATION BY HIM AND TO TAKE INTO CONSIDERATION EVEN THOSE EVENTS WHICH AROSE SUBSEQUENT TO THE ORDER OF ASSESSMENT. RAMPYARI DEVI SARAOGI (21 SUPRA) THE COMMISSIONER IN EXERCISE OF REVISIONAL POWERS CANCELLED ASSESSEES ASSESSMENT FOR T HE YEARS 1952 61 BECAUSE HE FOUND THAT THE INCOME TAX OFFICER WAS NOT JUSTIFIED IN ACCEPTING THE INITIAL CAPITAL THE GIFT RECEIVED AND SALE OF JEWELLERY THE INCOME FROM BUSINESS ETC. WITHOUT ANY ENQUIRY OR EVIDENCE WHATSOEVER . THE INCOME TAX OFFICER TO DO FRESH ASSESSMENT AFTER MAKING PROPER ENQUIRY AND INVESTIGATION IN REGARD TO THE JURISDICTION. THE ASSESSEE COMPLAINED BEFORE THE SUPREME COURT THAT NO FAIR OR REASONABLE OPPORTUNITY WAS GIVEN TO HER. THE SUPREME COURT HELD THAT AMPLE MATERIAL TO SHOW THAT THE INCOME TAX OFFICER MADE THE ASSESSMENTS IN UNDUE HURRY; THAT HE HAD PASSED A SHORT STEREO TYPED ASSESSMENT ORDER FOR EACH ASSESSMENT YEAR; THAT ON THE FACE OF THE RECORD THE ORDERS WERE JUDICIAL TO THE INTERE ST OF THE REVENUE; AND NO PREJUDICE WAS CAUSED TO THE ASSESSEE ON ACCOUNT OF FAILURE OF THE COMMISSIONER TO INDICATE THE RESULTS OF THE ENQUIRY MADE BY HIM AS SHE WOULD HAVE A FULL OPPORTUNITY FOR SHOWING TO THE INCOME TAX OFFICER WHETHER HE HAD JURISDICT AND WHETHER THE INCOME TAX ASSESSED IN THE ASSESSMENT YEARS WHICH WERE ORIGINALLY PASSED WERE CORRECT OR NOT' 31. FROM THE ABOVE DECISIONS THE FOLLOWING PRINCIPLES AS TO EXERCISE OF JURISDICTION BY THE COMMISSIONER U/S.263 OF THE ACT CAN BE CUL A) THE COMMISSIONER HAS TO BE SATISFIED OF TWIN CONDITIONS NAMELY (I) THE ORDER OF THE ASSESSING OFFICER SOUGHT TO BE REVISED IS ERRONEOUS; AND (II) IT IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE. IF ERRONEOUS BUT IS NOT I.T.A. NO. 396/KOL/2020 ASSESSMENT YEAR: 2010-11 M/S. KBR TOWNSHIP PVT. LTD. ORDERS WHICH ARE ALREADY CONCLUDED; THAT THE DEPARTMENT CANNOT BE PERMITTED TO BEGIN FRESH LITIGATION BECAUSE OF NEW VIEWS THEY ENTERTA IN ON FACTS OR NEW VERSIONS WHICH THEY PRESENT AS TO WHAT SHOULD BE THE INFERENCE OR PROPER INFERENCE EITHER OF THE FACTS DISCLOSED OR THE WEIGHT OF THE CIRCUMSTANCE; THAT IF THIS IS PERMITTED LITIGATION WOULD HAVE NO END HAUSTED; THAT TO DO SO IS TO DIVIDE ONE ARGUMENT INTO TWO AND MULTIPLY THE LITIGATION. IT HELD THAT CASES MAY BE VISUALIZED WHERE THE INCOME TAX OFFICER WHILE MAKING AN ASSESSMENT EXAMINES THE ACCOUNTS MAKES INQUIRIES APPLIES HIS MIND TO THE FACTS AND RCUMSTANCES OF THE CASE AND DETERMINES THE INCOME EITHER BY ACCEPTING THE ACCOUNT OR BY MAKING SOME ESTIMATE HIMSELF; THAT THE COMMISSIONER ON PERUSAL OF THE RECORD MAY BE OF THE OPINION THAT THE ESTIMATE MADE BY DE AND LEFT TO THE COMMISSIONER HE WOULD HAVE ESTIMATED THE INCOME AT A FIGURE HIGHER THAN THE ONE DETERMINED BY THE INCOME TAX OFFICER; BUT THAT WOULD NOT VEST THE COMMISSIONER WITH POWER TO REEXAMINE THE ACCOUNTS AND DETERMINE THE HER FIGURE; THERE MUST BE MATERIAL AVAILABLE ON THE RECORD CALLED FOR BY THE COMMISSIONER TO SATISFY HIM PRIMA FACIE THAT THE ORDER IS BOTH ERRONEOUS AND PREJUDICIAL TO THE INTERESTS OF THE REVENUE. ARY POWER TO THE REVISING AUTHORITY TO INITIATE PROCEEDINGS FOR REVISION IN EVERY CASE AND EXAMINATION AND FRESH INQUIRY IN MATTERS WHICH HAVE ALREADY (15 SUPRA) THIS COURT HAS HELD THAT THE POWER OF THE COMMISSIONER UNDER SEC.263 (1) IS NOT LIMITED ONLY TO THE MATERIAL WHICH WAS AVAILABLE BEFORE THE ASSESSING OFFICER AND IN ORDER TO PROTECT THE INTERESTS OF THE REVENUE THE COMMISSIONER IS ENTITLED TO EXAMINE ANY TIME OF EXAMINATION BY HIM AND TO TAKE INTO CONSIDERATION EVEN THOSE EVENTS WHICH AROSE SUBSEQUENT TO THE (21 SUPRA) THE COMMISSIONER IN EXERCISE OF HE YEARS 1952 -1953 61 BECAUSE HE FOUND THAT THE INCOME TAX OFFICER WAS NOT JUSTIFIED IN ACCEPTING THE INITIAL CAPITAL THE GIFT RECEIVED AND SALE OF JEWELLERY THE INCOME FROM BUSINESS ETC. WITHOUT ANY ENQUIRY OR EVIDENCE WHATSOEVER . THE INCOME TAX OFFICER TO DO FRESH ASSESSMENT AFTER MAKING PROPER ENQUIRY AND INVESTIGATION IN REGARD TO THE JURISDICTION. THE ASSESSEE COMPLAINED BEFORE THE SUPREME COURT THAT NO FAIR OR REASONABLE OPPORTUNITY WAS GIVEN TO HER. THE SUPREME COURT HELD THAT THERE WAS AMPLE MATERIAL TO SHOW THAT THE INCOME TAX OFFICER MADE THE ASSESSMENTS IN UNDUE HURRY; THAT HE HAD PASSED A SHORT STEREO TYPED ASSESSMENT ORDER FOR EACH ASSESSMENT YEAR; THAT ON THE FACE OF THE RECORD THE ORDERS WERE ST OF THE REVENUE; AND NO PREJUDICE WAS CAUSED TO THE ASSESSEE ON ACCOUNT OF FAILURE OF THE COMMISSIONER TO INDICATE THE RESULTS OF THE ENQUIRY MADE BY HIM AS SHE WOULD HAVE A FULL OPPORTUNITY FOR SHOWING TO THE INCOME TAX OFFICER WHETHER HE HAD JURISDICT ION OR NOT AND WHETHER THE INCOME TAX ASSESSED IN THE ASSESSMENT YEARS WHICH WERE 31. FROM THE ABOVE DECISIONS THE FOLLOWING PRINCIPLES AS TO EXERCISE OF JURISDICTION BY THE COMMISSIONER U/S.263 OF THE ACT CAN BE CUL LED OUT: A) THE COMMISSIONER HAS TO BE SATISFIED OF TWIN CONDITIONS NAMELY (I) THE ORDER OF THE ASSESSING OFFICER SOUGHT TO BE REVISED IS ERRONEOUS; AND (II) IT IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE. IF ERRONEOUS BUT IS NOT PREJUDICIAL TO THE RE THE REVENUE B) EVERY LOSS OF REVENUE AS A CONSEQUENCE OF AN ORDER OF THE ASSESSING OFFICER CANNOT BE TREATED AS PREJUDICIAL TO THE INTERESTS OF THE EXAMPLE WHEN AN INCOME PERMISSIBLE IN LAW AND IT HAS RESULTED IN LOSS OF REVENUE: OR WHERE TWO VIEWS ARE POSSIBLE AND THE INCOME WHICH THE COMMISSIONER DOES NOT AGREE ERRONEOUS ORDER PREJUDICIAL TO THE INTERESTS OF THE REVENUE UNLESS THE VIEW TAKEN BY THE INCOME C) TO INVOKE SUOMOTU REVISIONAL POWERS TO REOPEN A CONCLUDED ASSESSMENT UNDER SEC.263 THE CO REITERATION BY HIM THAT THE ORDER OF THE INCOME TAX OFFICER IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE WILL NOT SUFFICE; THAT THE REASONS MUST BE SUCH AS TO SHOW THAT THE AND MUST LEAD TO THE CONCLUSION THAT THE ORDER OF THE INCOME TAX OFFICER WAS NOT ONLY ERRONEOUS BUT WAS PREJUDICIAL TO THE INTERESTS OF THE REVENUE. THUS WHILE THE INCOME TAX OFFICER IS NOT CALLED UPON TO WRITE AN ELABORATE JUDGMENT GIVING DETAILED RE DISALLOWANCE DEDUCTION ETC. IT IS INCUMBENT UPON THE COMMISSIONER NOT TO EXERCISE HIS SUOMOTU REVISIONAL POWERS UNLESS SUPPORTED BY ADEQUATE REASONS FOR DOING SO; THAT IF A QUERY IS RAISED DURING THE COURSE OF THE SCRU TINY BY THE ASSESSING OFFICER WHICH WAS ANSWERED TO THE SATISFACTION OF THE ASSESSING OFFICER BUT NEITHER THE QUERY NOR THE ANSWER WERE REFLECTED IN THE ASSESSMENT ORDER THIS WOULD NOT BY ITSELF LEAD TO THE CONCLUSION THAT THE ORDER OF THE ASSESSING OFF AND REVISION. E) THE COMMISSIONER CANNOT INITIATE PROCEEDINGS WITH A VIEW TO START FISHING AND ROVING INQUIRIES IN MATTERS OR ORDERS WHICH ARE ALREADY CONCLUDED; THAT THE DEPARTMENT CANNOT BE PERMITTED TO BEGIN FRESH LITIGATION BECAUSE OF NEW VIEWS THEY ENTERTAIN ON FACTS OR NEW CIRCUMSTANCE; THAT IF THIS IS PERMITTED LITIGATION WOULD HAVE NO END EXCEPT WHEN LEGAL INGENUITY IS EXHAUSTED F) WHETHER THERE WAS APPLICATION OF MIND BEFORE ALLOWING THE EXPENDITURE IN QUESTION HAS TO THAT WOULD NOT BY ITSELF GIVE OCCASION TO THE COMMISSIONER TO PASS ORDERS UNDER SEC.263 MERELY BECAUSE HE HAS A DIFFERENT OPINION IN THE MATTER; THAT IT IS ONLY IN CASES OF LACK OF INQUIRY THAT SUCH A BE OPEN; THAT AN ASSESSMENT ORDER MADE BY THE INCOME TAX OFFICER CANNOT BE BRANDED AS ERRONEOUS BY THE COMMISSIONER SIMPLY BECAUSE ACCORDING TO HIM THE ORDER SHOULD HAVE BEEN WRITTEN MORE ELABORATELY; THERE MUST BE SOME PRIMA FACIE LAWFULLY EXIGIBLE HAS NOT BEEN IMPOSED OR THAT BY THE APPLICATION OF THE RELEVANT STATUTE ON AN INCORRECT OR INCOMPLETE INTERPRETATION A LESSER TAX THAN WHAT WAS JUST HAS BEEN IMPOSED. G) THE POWER OF TH IS ENTITLED TO EXAMINE ANY OTHER RECORDS WHICH ARE AVAILABLE AT THE TIME OF EXAMINATION BY HIM AND TO TAKE INTO CONSIDERATION EVEN THOSE EVENTS WHICH AROSE SUBSEQUENT TO THE ORDER OF ASSESSMENT. 10.1. NOW WE EXAMINE JUDGEMENTS . :- DIRECTOR OF INCOME TAX VS. JYOTI FOUNDATION 357 ITR 388 (DELHI HIGH COURT ) 6 PREJUDICIAL TO THE RE VENUE OR IF IT IS NOT ERRONEOUS BUT IT IS PREJUDICIAL TO RECOURSE CANNOT BE HAD TO SEC.263 (1) OF THE ACT. B) EVERY LOSS OF REVENUE AS A CONSEQUENCE OF AN ORDER OF THE ASSESSING OFFICER CANNOT BE TREATED AS PREJUDICIAL TO THE INTERESTS OF THE 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 INTERESTS OF THE REVENUE UNLESS THE VIEW TAKEN BY THE INCOME -TAX OFFICER IS UNSUSTAINABLE IN LAW. C) TO INVOKE SUOMOTU REVISIONAL POWERS TO REOPEN A CONCLUDED ASSESSMENT UNDER SEC.263 THE CO MMISSIONER MUST GIVE REASONS; THAT A BARE REITERATION BY HIM THAT THE ORDER OF THE INCOME TAX OFFICER IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE WILL NOT SUFFICE; THAT THE REASONS MUST BE SUCH AS TO SHOW THAT THE AND MUST LEAD TO THE CONCLUSION THAT THE ORDER OF THE INCOME TAX OFFICER WAS NOT ONLY ERRONEOUS BUT WAS PREJUDICIAL TO THE INTERESTS OF THE REVENUE. THUS WHILE THE INCOME TAX OFFICER IS NOT CALLED UPON TO WRITE AN ELABORATE JUDGMENT GIVING DETAILED RE ASONS IN RESPECT OF EACH AND EVERY DISALLOWANCE DEDUCTION ETC. IT IS INCUMBENT UPON THE COMMISSIONER NOT TO EXERCISE HIS SUOMOTU REVISIONAL POWERS UNLESS SUPPORTED BY ADEQUATE REASONS FOR DOING SO; THAT IF A QUERY IS RAISED DURING THE COURSE OF THE TINY BY THE ASSESSING OFFICER WHICH WAS ANSWERED TO THE SATISFACTION OF THE ASSESSING OFFICER BUT NEITHER THE QUERY NOR THE ANSWER WERE REFLECTED IN THE ASSESSMENT ORDER THIS WOULD NOT BY ITSELF LEAD TO THE CONCLUSION THAT THE ORDER OF THE ASSESSING OFF ICER CALLED FOR INTERFERENCE E) THE COMMISSIONER CANNOT INITIATE PROCEEDINGS WITH A VIEW TO START FISHING AND ROVING INQUIRIES IN MATTERS OR ORDERS WHICH ARE ALREADY CONCLUDED; THAT THE DEPARTMENT CANNOT BE PERMITTED TO BEGIN FRESH BECAUSE OF NEW VIEWS THEY ENTERTAIN ON FACTS OR NEW CIRCUMSTANCE; THAT IF THIS IS PERMITTED LITIGATION WOULD HAVE NO END EXCEPT WHEN LEGAL INGENUITY IS EXHAUSTED F) WHETHER THERE WAS APPLICATION OF MIND BEFORE ALLOWING THE EXPENDITURE IN QUESTION HAS TO BE SEEN; THAT IF THERE WAS AN INQUIRY EVEN INADEQUATE THAT WOULD NOT BY ITSELF GIVE OCCASION TO THE COMMISSIONER TO PASS ORDERS UNDER SEC.263 MERELY BECAUSE HE HAS A DIFFERENT OPINION IN THE MATTER; THAT IT IS ONLY IN CASES OF LACK OF INQUIRY THAT SUCH A COURSE OF ACTION WOULD BE OPEN; THAT AN ASSESSMENT ORDER MADE BY THE INCOME TAX OFFICER CANNOT BE BRANDED AS ERRONEOUS BY THE COMMISSIONER SIMPLY BECAUSE ACCORDING TO HIM THE ORDER SHOULD HAVE BEEN WRITTEN MORE ELABORATELY; THERE MUST BE SOME PRIMA FACIE MATERIAL ON RECORD TO SHOW THAT THE TAX WHICH WAS LAWFULLY EXIGIBLE HAS NOT BEEN IMPOSED OR THAT BY THE APPLICATION OF THE RELEVANT STATUTE ON AN INCORRECT OR INCOMPLETE INTERPRETATION A LESSER TAX THAN WHAT WAS JUST HAS BEEN IMPOSED. G) THE POWER OF TH E COMMISSIONER UNDER SEC.263 (1) IS NOT COMMISSIONER IS ENTITLED TO EXAMINE ANY OTHER RECORDS WHICH ARE AVAILABLE AT THE TIME OF EXAMINATION BY HIM AND TO TAKE INTO CONSIDERATION EVEN THOSE EVENTS WHICH AROSE SUBSEQUENT TO THE ORDER OF ASSESSMENT. NOW WE EXAMINE THE PRINCIPLES LAID DOWN IN THE FOLLOWING DIRECTOR OF INCOME TAX VS. JYOTI FOUNDATION 357 ITR 388 (DELHI HIGH COURT ) I.T.A. NO. 396/KOL/2020 ASSESSMENT YEAR: 2010-11 M/S. KBR TOWNSHIP PVT. LTD. VENUE OR IF IT IS NOT ERRONEOUS BUT IT IS PREJUDICIAL TO RECOURSE CANNOT BE HAD TO SEC.263 (1) OF THE ACT. B) EVERY LOSS OF REVENUE AS A CONSEQUENCE OF AN ORDER OF THE ASSESSING REVENUE. FOR TAX OFFICER ADOPTED ONE OF THE COURSES PERMISSIBLE IN LAW AND IT HAS RESULTED IN LOSS OF REVENUE: OR WHERE TWO TAX OFFICER HAS TAKEN ONE VIEW WITH IT CANNOT BE TREATED AS AN ERRONEOUS ORDER PREJUDICIAL TO THE INTERESTS OF THE REVENUE UNLESS THE VIEW C) TO INVOKE SUOMOTU REVISIONAL POWERS TO REOPEN A CONCLUDED ASSESSMENT MMISSIONER MUST GIVE REASONS; THAT A BARE REITERATION BY HIM THAT THE ORDER OF THE INCOME TAX OFFICER IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE WILL NOT SUFFICE; THAT THE REASONS MUST BE SUCH AS TO SHOW THAT THE AND MUST IRRESISTIBLY LEAD TO THE CONCLUSION THAT THE ORDER OF THE INCOME TAX OFFICER WAS NOT ONLY ERRONEOUS BUT WAS PREJUDICIAL TO THE INTERESTS OF THE REVENUE. THUS WHILE THE INCOME TAX OFFICER IS NOT CALLED UPON TO WRITE AN ELABORATE ASONS IN RESPECT OF EACH AND EVERY DISALLOWANCE DEDUCTION ETC. IT IS INCUMBENT UPON THE COMMISSIONER NOT TO EXERCISE HIS SUOMOTU REVISIONAL POWERS UNLESS SUPPORTED BY ADEQUATE REASONS FOR DOING SO; THAT IF A QUERY IS RAISED DURING THE COURSE OF THE TINY BY THE ASSESSING OFFICER WHICH WAS ANSWERED TO THE SATISFACTION OF THE ASSESSING OFFICER BUT NEITHER THE QUERY NOR THE ANSWER WERE REFLECTED IN THE ASSESSMENT ORDER THIS WOULD NOT BY ITSELF LEAD TO THE ICER CALLED FOR INTERFERENCE E) THE COMMISSIONER CANNOT INITIATE PROCEEDINGS WITH A VIEW TO START FISHING AND ROVING INQUIRIES IN MATTERS OR ORDERS WHICH ARE ALREADY CONCLUDED; THAT THE DEPARTMENT CANNOT BE PERMITTED TO BEGIN FRESH BECAUSE OF NEW VIEWS THEY ENTERTAIN ON FACTS OR NEW CIRCUMSTANCE; THAT IF THIS IS PERMITTED LITIGATION WOULD HAVE NO END EXCEPT F) WHETHER THERE WAS APPLICATION OF MIND BEFORE ALLOWING THE EXPENDITURE BE SEEN; THAT IF THERE WAS AN INQUIRY EVEN INADEQUATE THAT WOULD NOT BY ITSELF GIVE OCCASION TO THE COMMISSIONER TO PASS ORDERS UNDER SEC.263 MERELY BECAUSE HE HAS A DIFFERENT OPINION IN THE MATTER; COURSE OF ACTION WOULD BE OPEN; THAT AN ASSESSMENT ORDER MADE BY THE INCOME TAX OFFICER CANNOT BE BRANDED AS ERRONEOUS BY THE COMMISSIONER SIMPLY BECAUSE ACCORDING TO HIM THE ORDER SHOULD HAVE BEEN WRITTEN MORE ELABORATELY; THERE MUST MATERIAL ON RECORD TO SHOW THAT THE TAX WHICH WAS LAWFULLY EXIGIBLE HAS NOT BEEN IMPOSED OR THAT BY THE APPLICATION OF THE RELEVANT STATUTE ON AN INCORRECT OR INCOMPLETE INTERPRETATION A LESSER TAX E COMMISSIONER UNDER SEC.263 (1) IS NOT COMMISSIONER IS ENTITLED TO EXAMINE ANY OTHER RECORDS WHICH ARE AVAILABLE AT THE TIME OF EXAMINATION BY HIM AND TO TAKE INTO CONSIDERATION EVEN THOSE EVENTS THE FOLLOWING IT WAS HELD THAT REVISIONARY POWER U/S 263 IS CONFERRED ON THE COMMISSIONER/DIRECTOR OF INCOME TAX WHEN AN ORDER PASSED BY THE LOWER AUTHORITY IS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE. ARE PASSED WITHOUT INQUIRY OR INVESTIGA PREJUDICIAL TO THE INTEREST OF THE REVENUE BUT ORDERS WHICH ARE PASSED AFTER INQUIRY/INVESTIGATION ON THE QUESTION/ISSUE ARE NOT PER SE OR NORMALLY TREATED AS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE BECAU AUTHORITY FEELS AND OPINES THAT FURTHER INQUIRY/INVESTIGATION WAS REQUIRED OR DEEPER OR FURTHER SCRUTINY SHOULD BE UNDERTAKEN. INCOME TAX OFFICER VS. DG HOUSING PROJECTS LTD343 ITR 329 (DELHI) REVENUE DOES NOT HAVE ANY RIGHT TO APPEAL AN ORDER PASSED BY THE ASSESSING OFFICER. S. 263 HAS BEEN ENACTED TO EMPOWER THE CIT TO EXERCISE POWER OF REVISION AND REVISE ANY ORDER PASSED BY THE ASSESSING OFFICER IF TWO CUMULATIVE CONDITIONS ARE SATISFIED. FI REVISED SHOULD BE ERRONEOUS AND SECONDLY IT SHOULD BE PREJUDICIAL TO THE INTEREST OF THE REVENUE. THE EXPRESSION 'PREJUDICIAL TO THE INTEREST OF THE REVENUE' IS OF WIDE IMPORT AND IS NOT CONFINED TO MERELY LOSS OF TAX. THE TE A WRONG/INCORRECT DECISION DEVIATING FROM LAW. THIS EXPRESSION POSTULATES AN ERROR WHICH MAKES AN ORDER UNSUSTAINABLE IN LAW. THE ASSESSING OFFICER IS BOTH AN INVESTIGATOR AND AN ADJUDICATOR. IF THE ASSESSING OFFICER AS AN ADJUDICATOR ASSESSMENT WHICH IS UNSUSTAINABLE IN LAW IT CAN BE CORRECTED BY THE COMMISSIONER IN EXERCISE OF REVISIONARY POWER. AS AN INVESTIGATOR IT IS INCUMBENT UPON THE ASSESSING OFFICER TO INVESTIGATE THE FACTS REQUI VERIFIED TO COMPUTE THE TAXABLE INCOME. IF THE ASSESSING OFFICER FAILS TO CONDUCT THE SAID INVESTIGATION HE COMMITS AN ERROR AND THE WORD 'ERRONEOUS' INCLUDES FAILURE TO MAKE THE ENQUIRY. IN SUCH CASES THE ORDER BECOMES ERRONEOUS B OR VERIFICATION HAS NOT BEEN MADE AND NOT BECAUSE A WRONG ORDER HAS BEEN PASSED ON MERITS . THUS IN CASES OF WRONG OPINION OR FINDING ON MERITS THE CIT HAS TO COME TO THE CONCLUSION AND HIMSELF DECIDE THAT THE ORDER IS ERRONEOUS BY CONDUCTING NECESSARY ENQUIRY IF REQUIRED AND NECESSARY BEFORE THE ORDER UNDER S. 263 IS PASSED. IN SUCH CASES THE ORDER PASSED IS NOT SUSTAINABLE IN LAW AND THE SAID FINDING MUST BE RECORDED. CIT CANNOT REMAND THE MATTER TO THE ASSESSING OFFICER TO DECIDE WHETHER THE FINDINGS RECORDED ARE ERRONEOUS. NOT LACK OF ENQUIRY AGAIN THE CIT MUST GIVE AND RECORD A FINDING THAT THE ORDER/INQUIRY MADE IS ERRONEOUS. THIS CAN HAPPEN IF AN ENQUIRY AND VERIFICATION IS CONDUCTED BY THE CIT AND HE IS ABLE TO ESTABLISH AND SH MADE BY THE ASSESSING OFFICER MAKING THE ORDER UNSUSTAINABLE IN LAW. IN SOME CASES POSSIBLY THOUGH RARELY THE CIT CAN ALSO SHOW AND ESTABLISH THAT THE FACTS ON RECORD OR INFERENCES DRAWN FROM FACTS ON RECORD PER SE FURTHER ENQUIRY OR INVESTIGATION BUT THE ASSESSING OFFICER HAD ERRONEOUSLY NOT UNDERTAKEN THE SAME. HOWEVER THE SAID FINDING MUST BE CLEAR UNAMBIGUOUS AND NOT DEBATABLE. THE MATTER CANNOT BE REMITTED FOR A FRESH DECISION TO THE ASSESSING OFFICER TO CONDUCT FURTHER ENQUIRIES WITHOUT A FINDING THAT THE ORDER IS ERRONEOUS. FINDING THAT THE ORDER IS ERRONEOUS IS A CONDITION OR REQUIREMENT WHICH MUST BE SATISFIED FOR EXERCISE OF JURISDICTION UNDER S. 263 OF THE ACT. IN SUCH MATTERS TO REMAND THE MATTE HAS NOT EXAMINED AND DECIDED WHETHER OR NOT THE ORDER IS ERRONEOUS BUT HAS DIRECTED THE ASSESSING OFFICER TO DECIDE THE ASPECT/QUESTION. THIS DISTINCTION MUST BE KEPT IN MIND BY THE CIT WHILE EX UNDER S. 263 OF THE ACT AND IN THE ABSENCE OF THE FINDING THAT THE ORDER IS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE EXERCISE OF JURISDICTION UNDER THE SAID SECTION IS NOT SUSTAINABLE. INVESTIGATION' IT WILL BE DIFFICULT TO HOLD THAT THE ORDER OF THE ASSESSING OFFICER WHO HAD CONDUCTED ENQUIRIES AND HAD ACTED AS AN INVESTIGATOR IS ERRONEOUS WITHOUT CIT CONDUCTING VERIFICATION/INQUIRY. THE ORDER OF THE ASSESSING OFFICER MAY BE OR MAY BUT ONLY WHEN THE ORDER IS ERRONEOUS. 7 IT WAS HELD THAT REVISIONARY POWER U/S 263 IS CONFERRED ON THE COMMISSIONER/DIRECTOR OF INCOME TAX WHEN AN ORDER PASSED BY THE LOWER AUTHORITY IS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE. ARE PASSED WITHOUT INQUIRY OR INVESTIGA TION ARE TREATED AS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE BUT ORDERS WHICH ARE PASSED AFTER INQUIRY/INVESTIGATION ON THE QUESTION/ISSUE ARE NOT PER SE OR NORMALLY TREATED AS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE BECAU SE THE REVISIONARY AUTHORITY FEELS AND OPINES THAT FURTHER INQUIRY/INVESTIGATION WAS REQUIRED OR DEEPER OR FURTHER SCRUTINY SHOULD BE UNDERTAKEN. INCOME TAX OFFICER VS. DG HOUSING PROJECTS LTD343 ITR 329 (DELHI) REVENUE DOES NOT HAVE ANY RIGHT TO APPEAL TO THE FIRST APPELLATE AUTHORITY AGAINST AN ORDER PASSED BY THE ASSESSING OFFICER. S. 263 HAS BEEN ENACTED TO EMPOWER THE CIT TO EXERCISE POWER OF REVISION AND REVISE ANY ORDER PASSED BY THE ASSESSING OFFICER IF TWO CUMULATIVE CONDITIONS ARE SATISFIED. FI RSTLY THE ORDER SOUGHT TO BE REVISED SHOULD BE ERRONEOUS AND SECONDLY IT SHOULD BE PREJUDICIAL TO THE INTEREST OF THE REVENUE. THE EXPRESSION 'PREJUDICIAL TO THE INTEREST OF THE REVENUE' IS OF WIDE IMPORT AND IS NOT CONFINED TO MERELY LOSS OF TAX. THE TE RM 'ERRONEOUS' MEANS A WRONG/INCORRECT DECISION DEVIATING FROM LAW. THIS EXPRESSION POSTULATES AN ERROR WHICH MAKES AN ORDER UNSUSTAINABLE IN LAW. THE ASSESSING OFFICER IS BOTH AN INVESTIGATOR AND AN ADJUDICATOR. IF THE ASSESSING OFFICER AS AN ADJUDICATOR DECIDES A QUESTION OR ASPECT AND MAKES A WRONG ASSESSMENT WHICH IS UNSUSTAINABLE IN LAW IT CAN BE CORRECTED BY THE COMMISSIONER IN EXERCISE OF REVISIONARY POWER. AS AN INVESTIGATOR IT IS INCUMBENT UPON THE ASSESSING OFFICER TO INVESTIGATE THE FACTS REQUI RED TO BE EXAMINED AND VERIFIED TO COMPUTE THE TAXABLE INCOME. IF THE ASSESSING OFFICER FAILS TO CONDUCT THE SAID INVESTIGATION HE COMMITS AN ERROR AND THE WORD 'ERRONEOUS' INCLUDES FAILURE TO MAKE THE ENQUIRY. IN SUCH CASES THE ORDER BECOMES ERRONEOUS B ECAUSE ENQUIRY OR VERIFICATION HAS NOT BEEN MADE AND NOT BECAUSE A WRONG ORDER HAS BEEN PASSED THUS IN CASES OF WRONG OPINION OR FINDING ON MERITS THE CIT HAS TO COME TO THE CONCLUSION AND HIMSELF DECIDE THAT THE ORDER IS ERRONEOUS BY CONDUCTING NECESSARY ENQUIRY IF REQUIRED AND NECESSARY BEFORE THE ORDER UNDER S. 263 IS PASSED. IN SUCH CASES THE ORDER OF THE ASSESSING OFFICER WILL BE ERRONEOUS BECAUSE THE ORDER PASSED IS NOT SUSTAINABLE IN LAW AND THE SAID FINDING MUST BE RECORDED. CIT CANNOT REMAND THE MATTER TO THE ASSESSING OFFICER TO DECIDE WHETHER THE FINDINGS RECORDED ARE ERRONEOUS. IN C ASES WHERE THERE IS INADEQUATE ENQUIRY BUT NOT LACK OF ENQUIRY AGAIN THE CIT MUST GIVE AND RECORD A FINDING THAT THE ORDER/INQUIRY MADE IS ERRONEOUS. THIS CAN HAPPEN IF AN ENQUIRY AND VERIFICATION IS CONDUCTED BY THE CIT AND HE IS ABLE TO ESTABLISH AND SH OW THE ERROR OR MISTAKE MADE BY THE ASSESSING OFFICER MAKING THE ORDER UNSUSTAINABLE IN LAW. IN SOME CASES POSSIBLY THOUGH RARELY THE CIT CAN ALSO SHOW AND ESTABLISH THAT THE FACTS ON RECORD OR INFERENCES DRAWN FROM FACTS ON RECORD PER SE JUSTIFIED AND M FURTHER ENQUIRY OR INVESTIGATION BUT THE ASSESSING OFFICER HAD ERRONEOUSLY NOT UNDERTAKEN THE SAME. HOWEVER THE SAID FINDING MUST BE CLEAR UNAMBIGUOUS AND THE MATTER CANNOT BE REMITTED FOR A FRESH DECISION TO THE ASSESSING TO CONDUCT FURTHER ENQUIRIES WITHOUT A FINDING THAT THE ORDER IS ERRONEOUS. FINDING THAT THE ORDER IS ERRONEOUS IS A CONDITION OR REQUIREMENT WHICH MUST BE SATISFIED FOR EXERCISE OF JURISDICTION UNDER S. 263 OF THE ACT. IN SUCH MATTERS TO REMAND THE MATTE R/ISSUE TO THE ASSESSING OFFICER WOULD IMPLY AND MEAN THE CIT HAS NOT EXAMINED AND DECIDED WHETHER OR NOT THE ORDER IS ERRONEOUS BUT HAS DIRECTED THE ASSESSING OFFICER TO DECIDE THE ASPECT/QUESTION. THIS DISTINCTION MUST BE KEPT IN MIND BY THE CIT WHILE EX ERCISING JURISDICTION UNDER S. 263 OF THE ACT AND IN THE ABSENCE OF THE FINDING THAT THE ORDER IS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE EXERCISE OF JURISDICTION UNDER THE SAID SECTION IS NOT SUSTAINABLE. IN MOST CASES OF ALLEGED 'INADEQUATE INVESTIGATION' IT WILL BE DIFFICULT TO HOLD THAT THE ORDER OF THE ASSESSING OFFICER WHO HAD CONDUCTED ENQUIRIES AND HAD ACTED AS AN INVESTIGATOR IS ERRONEOUS WITHOUT CIT CONDUCTING VERIFICATION/INQUIRY. THE ORDER OF THE ASSESSING OFFICER NOT BE WRONG. CIT CANNOT DIRECT RECONSIDERATION ON THIS GROUND BUT ONLY WHEN THE ORDER IS ERRONEOUS. AN ORDER OF REMIT CANNOT BE PASSED BY THE I.T.A. NO. 396/KOL/2020 ASSESSMENT YEAR: 2010-11 M/S. KBR TOWNSHIP PVT. LTD. IT WAS HELD THAT REVISIONARY POWER U/S 263 IS CONFERRED ON THE COMMISSIONER/DIRECTOR OF INCOME TAX WHEN AN ORDER PASSED BY THE LOWER AUTHORITY IS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE. ORDERS WHICH TION ARE TREATED AS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE BUT ORDERS WHICH ARE PASSED AFTER INQUIRY/INVESTIGATION ON THE QUESTION/ISSUE ARE NOT PER SE OR NORMALLY TREATED AS SE THE REVISIONARY AUTHORITY FEELS AND OPINES THAT FURTHER INQUIRY/INVESTIGATION WAS REQUIRED OR TO THE FIRST APPELLATE AUTHORITY AGAINST AN ORDER PASSED BY THE ASSESSING OFFICER. S. 263 HAS BEEN ENACTED TO EMPOWER THE CIT TO EXERCISE POWER OF REVISION AND REVISE ANY ORDER PASSED BY THE ASSESSING RSTLY THE ORDER SOUGHT TO BE REVISED SHOULD BE ERRONEOUS AND SECONDLY IT SHOULD BE PREJUDICIAL TO THE INTEREST OF THE REVENUE. THE EXPRESSION 'PREJUDICIAL TO THE INTEREST OF THE REVENUE' IS OF RM 'ERRONEOUS' MEANS A WRONG/INCORRECT DECISION DEVIATING FROM LAW. THIS EXPRESSION POSTULATES AN THE ASSESSING OFFICER IS BOTH AN INVESTIGATOR AND AN ADJUDICATOR. IF THE ASSESSING DECIDES A QUESTION OR ASPECT AND MAKES A WRONG ASSESSMENT WHICH IS UNSUSTAINABLE IN LAW IT CAN BE CORRECTED BY THE COMMISSIONER IN EXERCISE OF REVISIONARY POWER. AS AN INVESTIGATOR IT IS INCUMBENT RED TO BE EXAMINED AND VERIFIED TO COMPUTE THE TAXABLE INCOME. IF THE ASSESSING OFFICER FAILS TO CONDUCT THE SAID INVESTIGATION HE COMMITS AN ERROR AND THE WORD 'ERRONEOUS' INCLUDES FAILURE ECAUSE ENQUIRY OR VERIFICATION HAS NOT BEEN MADE AND NOT BECAUSE A WRONG ORDER HAS BEEN PASSED THUS IN CASES OF WRONG OPINION OR FINDING ON MERITS THE CIT HAS TO COME TO THE CONCLUSION AND HIMSELF DECIDE THAT THE ORDER IS ERRONEOUS BY CONDUCTING NECESSARY ENQUIRY IF REQUIRED AND NECESSARY BEFORE THE ORDER UNDER S. 263 IS THE ORDER OF THE ASSESSING OFFICER WILL BE ERRONEOUS BECAUSE THE ORDER PASSED IS NOT SUSTAINABLE IN LAW AND THE SAID FINDING MUST BE RECORDED. CIT CANNOT REMAND THE MATTER TO THE ASSESSING OFFICER TO DECIDE WHETHER THE ASES WHERE THERE IS INADEQUATE ENQUIRY BUT NOT LACK OF ENQUIRY AGAIN THE CIT MUST GIVE AND RECORD A FINDING THAT THE ORDER/INQUIRY MADE IS ERRONEOUS. THIS CAN HAPPEN IF AN ENQUIRY AND VERIFICATION IS OW THE ERROR OR MISTAKE MADE BY THE ASSESSING OFFICER MAKING THE ORDER UNSUSTAINABLE IN LAW. IN SOME CASES POSSIBLY THOUGH RARELY THE CIT CAN ALSO SHOW AND ESTABLISH THAT THE FACTS ON JUSTIFIED AND M ANDATED FURTHER ENQUIRY OR INVESTIGATION BUT THE ASSESSING OFFICER HAD ERRONEOUSLY NOT UNDERTAKEN THE SAME. HOWEVER THE SAID FINDING MUST BE CLEAR UNAMBIGUOUS AND THE MATTER CANNOT BE REMITTED FOR A FRESH DECISION TO THE ASSESSING TO CONDUCT FURTHER ENQUIRIES WITHOUT A FINDING THAT THE ORDER IS ERRONEOUS. FINDING THAT THE ORDER IS ERRONEOUS IS A CONDITION OR REQUIREMENT WHICH MUST BE SATISFIED FOR EXERCISE OF JURISDICTION UNDER S. 263 OF THE ACT. IN SUCH MATTERS TO R/ISSUE TO THE ASSESSING OFFICER WOULD IMPLY AND MEAN THE CIT HAS NOT EXAMINED AND DECIDED WHETHER OR NOT THE ORDER IS ERRONEOUS BUT HAS ERCISING JURISDICTION UNDER S. 263 OF THE ACT AND IN THE ABSENCE OF THE FINDING THAT THE ORDER IS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE EXERCISE OF JURISDICTION UNDER IN MOST CASES OF ALLEGED 'INADEQUATE INVESTIGATION' IT WILL BE DIFFICULT TO HOLD THAT THE ORDER OF THE ASSESSING OFFICER WHO HAD CONDUCTED ENQUIRIES AND HAD ACTED AS AN INVESTIGATOR IS ERRONEOUS WITHOUT CIT CONDUCTING VERIFICATION/INQUIRY. THE ORDER OF THE ASSESSING OFFICER NOT BE WRONG. CIT CANNOT DIRECT RECONSIDERATION ON THIS GROUND AN ORDER OF REMIT CANNOT BE PASSED BY THE CIT TO ASK THE ASSESSING OFFICER TO DECIDE WHETHER THE ORDER WAS ERRONEOUS. THIS IS NOT PERMISSIBLE. AN ORDER IS REASONS WHY IT IS ERRONEOUS. AN ORDER WILL NOT BECOME ERRONEOUS BECAUSE ON REMIT THE ASSESSING OFFICER MAY DECIDE THAT THE ORDER IS ERRONEOUS. THEREFORE CIT MUST AFTER RECORDING REASONS HOLD THAT THE ORDER I PRECONDITION STIPULATED IS THAT THE CIT MUST COME TO THE CONCLUSION THAT THE ORDER IS ERRONEOUS AND IS UNSUSTAINABLE IN LAW. IT MAY BE NOTICED THAT THE MATERIAL WHICH THE CIT CAN RELY INCLUDES NOT ONLY THE RECORD AS IT STAND THE ORDER IN QUESTION WAS PASSED BY THE ASSESSING OFFICER BUT ALSO THE RECORD AS IT STANDS AT THE TIME OF EXAMINATION BY THE CIT. NOTHING BARS/PROHIBITS THE CIT FROM COLLECTING AND RELYING UPON NEW/ADDITIONAL MATERIAL/EVIDENCE TO SHOW AN THAT THE ORDER OF THE ASSESSING OFFICER IS ERRONEOUS. COMMISSIONER OF INCOME TAX VS. J. L. MORRISON (INDIA) LTD. 366 ITR AS REGARD THE SUBMISSION ON BEHALF OF THE REVENUE THAT POWER UNDER SECTION 263 OF THE ACT CAN BE EXERCISED EVEN IN A CASE THAT THE CASE OF CIT VS. M. M. KHAMBHATWALA WAS NOT APPLICABLE. THE OBSERVATION THAT THE COMMISSIONER CAN EXERCISE POWER UNDER SECTION 263 OF THE ACT EVEN IN A CASE WERE THE ISSUE IS DEBATABLE WAS A MERE PASSING R CONTRARY TO THE VIEW TAKEN BY THE APEX COURT IN THECASE OF MALABAR INDUSTRIAL COMPANY LTD. & MAX INDIA LTD. IF THE ASSESSING OFFICER HAS TAKEN A POSSIBLE VIEW IT CANNOT BE SAID THAT THE VIEW TAKEN BY HIM IS ERRONEOUS NOR THE ORDER OF ASSESSING OFFICER IN THAT CASE CAN BE SET ASIDE IN REVISION. IT HAS TO BE SHOWN UNMISTAKABLY THAT THE ORDER OF THE ASSESSING OFFICER IS UNSUSTAINABLE. ANYTHING SHORT OF THAT WOULD NOT CLOTHE THE CIT WITH JURISDICTION TO EXERCISE POWER UNDER SECTION 263 OF THE ACT. CIT VS. M. M. KHAMBHATWALA REPORTED IN 198 ITR 144; CIT VS. RALSON INDUSTRIES LTD. REPORTED IN 288 ITR 322 (SC) NOT APPLICABLE; MALABAR INDUSTRIAL CO. LTD. V. CIT REPORTED IN 243 ITR 83 RELIED ON. (PARA 72) AS REGARD THE THIRD QUESTION AS TO THE ASSESSING OFFICER WITHOUT APPLICATION OF MIND IT WAS HELD THAT THE COURT HAS TO START WITH THE PRESUMPTION THAT THE ASSESSMENT ORDER WAS REGULARLY PASSED. THERE IS EVIDENCE TO SHOW THAT THE ASSESSING OFFICER 17 QUESTIONS AND TO FILE DOCUMENTS IN REGARD THERETO. IT IS DIFFICULT TO PROCEED ON THE BASIS THAT THE 17 QUESTIONS RAISED BY HIM DID NOT REQUIRE APPLICATION OF MIND. WITHOUT APPLICATION OF MIND THE QUESTIONS RAISED BY UNDER SECTION 142 (1) OF THE ACT COULD NOT HAVE BEEN FORMULATED. THE ASSESSING OFFICER WAS REQUIRED TO EXAMINE THE RETURN FILED BY THE ASSESSEE IN ORDER TO ASCERTAIN HIS INCOME AND TO LEVY APPROPRIATE TAX ON THAT BASIS. WHEN T ASSESSING OFFICER WAS SATISFIED THAT THE RETURN FILED BY THE ASSESSEE WAS IN ACCORDANCE WITH LAW HE WAS UNDER NO OBLIGATION TO JUSTIFY AS TO WHY WAS HE SATISFIED. ON THE TOP OF THAT THE ASSESSING OFFICER BY HIS ORDER DATED 28 2008 DID NOT AD THE ASSESSEE PREJUDICED. HE WAS AS SUCH UNDER NO OBLIGATION IN LAW TO GIVE REASONS. THE FACT THAT ALL REQUISITE PAPERS WERE SUMMONED AND THEREAFTER THE MATTER WAS HEARD FROM TIME TO TIME HIM IS NOT SHOWN BY THE REVENUE TO BE ERRONEOUS AND WAS ALSO CONSIDERED BOTH BY THE TRIBUNAL AS ALSO BY US TO BE A POSSIBLE VIEW STRENGTHENS THE PRESUMPTION UNDER CLAUSE (E) OF SECTION 114 OF THE EVIDENCE ACT. BASIS OF THE AFORESAID PRESUMPTION IS THUS CONVERTED INTO A CONCLUSIVE PROOF OF THE FACT THAT THE ORDER WAS PASSED BY THE ASSESSING OFFICER AFTER DUE APPLICATION OF MIND. MEERUT ROLLER FLOUR MILLS PVT. LTD. VS. C.I.T. ITA N VS. INFOSYS TECHNOLOGIES LTD. 341 ITR 293 (KARNATAKA); S.N. MUKHERJEE VS. UNION OF INDIA AIR 1990 SC 1984; A. A. DOSHI VS. JCIT 256 ITR 685; HINDUSTHAN TIN WORKS LTD. VS. CIT 275 ITR 43 (DEL) DISTINGUISHED. (PARAS 90- 92 102) COMMISSIONER OF INCOME TAX VS. SOHANA WOOLLEN MILLS 296 ITR 238 (P&H HC) A REFERENCE TO THE PROVISIONS OF S. 263 SHOWS THAT JURISDICTION THEREUNDER CAN BE EXERCISED IF THE CIT FINDS THAT THE ORDER OF THE AO WAS ERRONEOUS AND PREJUDICIAL TO 8 CIT TO ASK THE ASSESSING OFFICER TO DECIDE WHETHER THE ORDER WAS ERRONEOUS. THIS IS NOT PERMISSIBLE. AN ORDER IS NOT ERRONEOUS UNLESS THE CIT HOLD AND RECORDS REASONS WHY IT IS ERRONEOUS. AN ORDER WILL NOT BECOME ERRONEOUS BECAUSE ON REMIT THE ASSESSING OFFICER MAY DECIDE THAT THE ORDER IS ERRONEOUS. THEREFORE CIT MUST AFTER RECORDING REASONS HOLD THAT THE ORDER I S ERRONEOUS. THE JURISDICTIONAL PRECONDITION STIPULATED IS THAT THE CIT MUST COME TO THE CONCLUSION THAT THE ORDER IS ERRONEOUS AND IS UNSUSTAINABLE IN LAW. IT MAY BE NOTICED THAT THE MATERIAL WHICH THE CIT CAN RELY INCLUDES NOT ONLY THE RECORD AS IT STAND S AT THE TIME WHEN THE ORDER IN QUESTION WAS PASSED BY THE ASSESSING OFFICER BUT ALSO THE RECORD AS IT STANDS AT THE TIME OF EXAMINATION BY THE CIT. NOTHING BARS/PROHIBITS THE CIT FROM COLLECTING AND RELYING UPON NEW/ADDITIONAL MATERIAL/EVIDENCE TO SHOW AN THAT THE ORDER OF THE ASSESSING OFFICER IS ERRONEOUS. COMMISSIONER OF INCOME TAX VS. J. L. MORRISON (INDIA) LTD. 366 ITR 593 AS REGARD THE SUBMISSION ON BEHALF OF THE REVENUE THAT POWER UNDER SECTION 263 OF THE ACT CAN BE EXERCISED EVEN IN A CASE WHERE THE ISSUE IS DEBATABLE IT WAS HELD THAT THE CASE OF CIT VS. M. M. KHAMBHATWALA WAS NOT APPLICABLE. THE OBSERVATION THAT THE COMMISSIONER CAN EXERCISE POWER UNDER SECTION 263 OF THE ACT EVEN IN A CASE WERE THE ISSUE IS DEBATABLE WAS A MERE PASSING R EMARK WHICH IS AGAIN CONTRARY TO THE VIEW TAKEN BY THE APEX COURT IN THECASE OF MALABAR INDUSTRIAL COMPANY LTD. & MAX INDIA LTD. IF THE ASSESSING OFFICER HAS TAKEN A POSSIBLE VIEW IT CANNOT BE SAID THAT THE VIEW TAKEN BY HIM IS ERRONEOUS NOR THE ORDER OF ASSESSING OFFICER IN THAT CASE CAN BE SET ASIDE IN REVISION. IT HAS TO BE SHOWN UNMISTAKABLY THAT THE ORDER OF THE ASSESSING OFFICER IS UNSUSTAINABLE. ANYTHING SHORT OF THAT WOULD NOT CLOTHE THE CIT WITH JURISDICTION TO EXERCISE POWER UNDER OF THE ACT. CIT VS. M. M. KHAMBHATWALA REPORTED IN 198 ITR 144; CIT VS. RALSON INDUSTRIES LTD. REPORTED IN 288 ITR 322 (SC) NOT APPLICABLE; MALABAR INDUSTRIAL CO. LTD. V. CIT REPORTED IN 243 ITR 83 RELIED ON. AS REGARD THE THIRD QUESTION AS TO WHETHER THE ASSESSMENT ORDER WAS PASSED BY THE ASSESSING OFFICER WITHOUT APPLICATION OF MIND IT WAS HELD THAT THE COURT HAS TO START WITH THE PRESUMPTION THAT THE ASSESSMENT ORDER WAS REGULARLY PASSED. THERE IS EVIDENCE TO SHOW THAT THE ASSESSING OFFICER HAD REQUIRED THE ASSESSEE TO ANSWER 17 QUESTIONS AND TO FILE DOCUMENTS IN REGARD THERETO. IT IS DIFFICULT TO PROCEED ON THE BASIS THAT THE 17 QUESTIONS RAISED BY HIM DID NOT REQUIRE APPLICATION OF MIND. WITHOUT APPLICATION OF MIND THE QUESTIONS RAISED BY HIM IN THE ANNEXURE TO NOTICE UNDER SECTION 142 (1) OF THE ACT COULD NOT HAVE BEEN FORMULATED. THE ASSESSING OFFICER WAS REQUIRED TO EXAMINE THE RETURN FILED BY THE ASSESSEE IN ORDER TO ASCERTAIN HIS INCOME AND TO LEVY APPROPRIATE TAX ON THAT BASIS. WHEN T ASSESSING OFFICER WAS SATISFIED THAT THE RETURN FILED BY THE ASSESSEE WAS IN ACCORDANCE WITH LAW HE WAS UNDER NO OBLIGATION TO JUSTIFY AS TO WHY WAS HE SATISFIED. ON THE TOP OF THAT THE ASSESSING OFFICER BY HIS ORDER DATED 28 2008 DID NOT AD VERSELY AFFECT ANY RIGHT OF THE ASSESSEE NOR WAS ANY CIVIL RIGHT OF THE ASSESSEE PREJUDICED. HE WAS AS SUCH UNDER NO OBLIGATION IN LAW TO GIVE REASONS. THE FACT THAT ALL REQUISITE PAPERS WERE SUMMONED AND THEREAFTER THE MATTER WAS HEARD FROM TIME TO TIME COUPLED WITH THE FACT THAT THE VIEW TAKEN BY HIM IS NOT SHOWN BY THE REVENUE TO BE ERRONEOUS AND WAS ALSO CONSIDERED BOTH BY THE TRIBUNAL AS ALSO BY US TO BE A POSSIBLE VIEW STRENGTHENS THE PRESUMPTION UNDER CLAUSE (E) OF SECTION 114 OF THE EVIDENCE ACT. A PRIMA FACIE EVIDENCE ON THE BASIS OF THE AFORESAID PRESUMPTION IS THUS CONVERTED INTO A CONCLUSIVE PROOF OF THE FACT THAT THE ORDER WAS PASSED BY THE ASSESSING OFFICER AFTER DUE APPLICATION OF MIND. MEERUT ROLLER FLOUR MILLS PVT. LTD. VS. C.I.T. ITA N O. 116 /COCH/ 2012; CIT VS. INFOSYS TECHNOLOGIES LTD. 341 ITR 293 (KARNATAKA); S.N. MUKHERJEE VS. UNION OF INDIA AIR 1990 SC 1984; A. A. DOSHI VS. JCIT 256 ITR 685; HINDUSTHAN TIN WORKS LTD. VS. CIT 275 ITR 43 (DEL) DISTINGUISHED. 92 102) COMMISSIONER OF INCOME TAX VS. SOHANA WOOLLEN MILLS 296 ITR 238 (P&H HC) A REFERENCE TO THE PROVISIONS OF S. 263 SHOWS THAT JURISDICTION THEREUNDER CAN BE EXERCISED IF THE CIT FINDS THAT THE ORDER OF THE AO WAS ERRONEOUS AND PREJUDICIAL TO I.T.A. NO. 396/KOL/2020 ASSESSMENT YEAR: 2010-11 M/S. KBR TOWNSHIP PVT. LTD. CIT TO ASK THE ASSESSING OFFICER TO DECIDE WHETHER THE ORDER WAS ERRONEOUS. THIS IS NOT ERRONEOUS UNLESS THE CIT HOLD AND RECORDS REASONS WHY IT IS ERRONEOUS. AN ORDER WILL NOT BECOME ERRONEOUS BECAUSE ON REMIT THE ASSESSING OFFICER MAY DECIDE THAT THE ORDER IS ERRONEOUS. THEREFORE CIT MUST S ERRONEOUS. THE JURISDICTIONAL PRECONDITION STIPULATED IS THAT THE CIT MUST COME TO THE CONCLUSION THAT THE ORDER IS ERRONEOUS AND IS UNSUSTAINABLE IN LAW. IT MAY BE NOTICED THAT THE MATERIAL S AT THE TIME WHEN THE ORDER IN QUESTION WAS PASSED BY THE ASSESSING OFFICER BUT ALSO THE RECORD AS IT STANDS AT THE TIME OF EXAMINATION BY THE CIT. NOTHING BARS/PROHIBITS THE CIT FROM COLLECTING AND RELYING UPON NEW/ADDITIONAL MATERIAL/EVIDENCE TO SHOW AN D STATE AS REGARD THE SUBMISSION ON BEHALF OF THE REVENUE THAT POWER UNDER SECTION 263 WHERE THE ISSUE IS DEBATABLE IT WAS HELD THAT THE CASE OF CIT VS. M. M. KHAMBHATWALA WAS NOT APPLICABLE. THE OBSERVATION THAT THE COMMISSIONER CAN EXERCISE POWER UNDER SECTION 263 OF THE ACT EVEN IN A EMARK WHICH IS AGAIN CONTRARY TO THE VIEW TAKEN BY THE APEX COURT IN THECASE OF MALABAR INDUSTRIAL COMPANY LTD. & MAX INDIA LTD. IF THE ASSESSING OFFICER HAS TAKEN A POSSIBLE VIEW IT CANNOT BE SAID THAT THE VIEW TAKEN BY HIM IS ERRONEOUS NOR THE ORDER OF THE ASSESSING OFFICER IN THAT CASE CAN BE SET ASIDE IN REVISION. IT HAS TO BE SHOWN UNMISTAKABLY THAT THE ORDER OF THE ASSESSING OFFICER IS UNSUSTAINABLE. ANYTHING SHORT OF THAT WOULD NOT CLOTHE THE CIT WITH JURISDICTION TO EXERCISE POWER UNDER OF THE ACT. CIT VS. M. M. KHAMBHATWALA REPORTED IN 198 ITR 144; CIT VS. RALSON INDUSTRIES LTD. REPORTED IN 288 ITR 322 (SC) NOT APPLICABLE; MALABAR WHETHER THE ASSESSMENT ORDER WAS PASSED BY THE ASSESSING OFFICER WITHOUT APPLICATION OF MIND IT WAS HELD THAT THE COURT HAS TO START WITH THE PRESUMPTION THAT THE ASSESSMENT ORDER WAS REGULARLY PASSED. THERE HAD REQUIRED THE ASSESSEE TO ANSWER 17 QUESTIONS AND TO FILE DOCUMENTS IN REGARD THERETO. IT IS DIFFICULT TO PROCEED ON THE BASIS THAT THE 17 QUESTIONS RAISED BY HIM DID NOT REQUIRE APPLICATION OF MIND. HIM IN THE ANNEXURE TO NOTICE UNDER SECTION 142 (1) OF THE ACT COULD NOT HAVE BEEN FORMULATED. THE ASSESSING OFFICER WAS REQUIRED TO EXAMINE THE RETURN FILED BY THE ASSESSEE IN ORDER TO ASCERTAIN HIS INCOME AND TO LEVY APPROPRIATE TAX ON THAT BASIS. WHEN T HE ASSESSING OFFICER WAS SATISFIED THAT THE RETURN FILED BY THE ASSESSEE WAS IN ACCORDANCE WITH LAW HE WAS UNDER NO OBLIGATION TO JUSTIFY AS TO WHY WAS HE SATISFIED. ON THE TOP OF THAT THE ASSESSING OFFICER BY HIS ORDER DATED 28 TH MARCH VERSELY AFFECT ANY RIGHT OF THE ASSESSEE NOR WAS ANY CIVIL RIGHT OF THE ASSESSEE PREJUDICED. HE WAS AS SUCH UNDER NO OBLIGATION IN LAW TO GIVE REASONS. THE FACT THAT ALL REQUISITE PAPERS WERE SUMMONED AND THEREAFTER THE COUPLED WITH THE FACT THAT THE VIEW TAKEN BY HIM IS NOT SHOWN BY THE REVENUE TO BE ERRONEOUS AND WAS ALSO CONSIDERED BOTH BY THE TRIBUNAL AS ALSO BY US TO BE A POSSIBLE VIEW STRENGTHENS THE PRESUMPTION A PRIMA FACIE EVIDENCE ON THE BASIS OF THE AFORESAID PRESUMPTION IS THUS CONVERTED INTO A CONCLUSIVE PROOF OF THE FACT THAT THE ORDER WAS PASSED BY THE ASSESSING OFFICER AFTER DUE APPLICATION OF O. 116 /COCH/ 2012; CIT VS. INFOSYS TECHNOLOGIES LTD. 341 ITR 293 (KARNATAKA); S.N. MUKHERJEE VS. UNION OF INDIA AIR 1990 SC 1984; A. A. DOSHI VS. JCIT 256 ITR 685; HINDUSTHAN TIN COMMISSIONER OF INCOME TAX VS. SOHANA WOOLLEN MILLS 296 ITR 238 (P&H HC) A REFERENCE TO THE PROVISIONS OF S. 263 SHOWS THAT JURISDICTION THEREUNDER CAN BE EXERCISED IF THE CIT FINDS THAT THE ORDER OF THE AO WAS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE. MERE AUDIT OBJECTION AND MERELY BECAUSE A DIFFERENT VIEW COULD BE TAKEN WERE NOT ENOUGH TO SAY THAT THE ORDER OF THE AO WAS ERRONEOUS OR PREJUDICIAL TO THE INTEREST OF THE REVENUE. THE JURISDICTION COULD BE EXERCISED IF THE CIT WA S SATISFIED THAT THE BASIS FOR EXERCISE OF JURISDICTION EXISTED. NO RIGID RULE COULD BE LAID DOWN ABOUT THE SITUATION WHEN THE JURISDICTION CAN BE EXERCISED. WHETHER SATISFACTION OF THE CIT FOR EXERCISING JURISDICTION WAS CALLED FOR OR NOT HAS TO BE DECID ED HAVING REGARD TO A GIVEN FACT SITUATION. IN THE PRESENT CASE THE TRIBUNAL HAS HELD THAT THE ASSESSEE HAD DISCLOSED THAT OUT OF SALE CONSIDERATION A SUM OF RS. 1 LAKH WAS TO BE RECEIVED FOR SALE OF PERMIT. IF THAT IS SO THERE WAS NO ERROR IN THE VIEW JURISDICTION UNDER S. 263. 7. APPLYING THE PROPOSITIONS OF LAW LAID DOWN IN THE ABOVE CASE THE CASE ON HAND WE HAVE TO NECESSARILY ALLOW THIS APPEAL OF THE ASSESSEE. 8. IN THE RESULT APPEAL OF THE ASSESSEE IS ALLOWED. KOLKATA THE SD/- [ ABY T. VARKEY ] JUDICIAL MEMBER DATED : 05.05.2021 {SC SPS} CO PY OF THE ORDER FORWARDED TO: 1. M/S. KBR TOWNSHIP PVT. LTD ROOM NO. 4 MARTIN BURN BUILDING 1 R.N. MUKHERJEE ROAD KOLKATA 700 001 2. INCOME TAX OFFICER WARD- 4(4) KOLKATA 3. CIT(A)- 4. CIT- 5 . CIT(DR) KOLKATA BENCHES KOLKATA. 9 THE INTEREST OF REVENUE. MERE AUDIT OBJECTION AND MERELY BECAUSE A DIFFERENT VIEW COULD BE TAKEN WERE NOT ENOUGH TO SAY THAT THE ORDER OF THE AO WAS ERRONEOUS OR PREJUDICIAL TO THE INTEREST OF THE REVENUE. THE JURISDICTION COULD BE EXERCISED IF THE S SATISFIED THAT THE BASIS FOR EXERCISE OF JURISDICTION EXISTED. NO RIGID RULE COULD BE LAID DOWN ABOUT THE SITUATION WHEN THE JURISDICTION CAN BE EXERCISED. WHETHER SATISFACTION OF THE CIT FOR EXERCISING JURISDICTION WAS CALLED FOR OR NOT ED HAVING REGARD TO A GIVEN FACT SITUATION. IN THE PRESENT CASE THE TRIBUNAL HAS HELD THAT THE ASSESSEE HAD DISCLOSED THAT OUT OF SALE CONSIDERATION A SUM OF RS. 1 LAKH WAS TO BE RECEIVED FOR SALE OF PERMIT. IF THAT IS SO THERE WAS NO ERROR IN THE VIEW TAKEN BY THE AO AND NO CASE WAS MADE OUT FOR INVOKING JURISDICTION UNDER S. 263. APPLYING THE PROPOSITIONS OF LAW LAID DOWN IN THE ABOVE CASE - LAW TO THE FACTS OF THE CASE ON HAND WE HAVE TO NECESSARILY QUASH THE ORDER PASSED U/S 263 OF THE ACT AND ALLOW THIS APPEAL OF THE ASSESSEE. IN THE RESULT APPEAL OF THE ASSESSEE IS ALLOWED. KOLKATA THE 5 TH DAY OF MAY 2021 S D [ J. SUDHAKAR REDDY ACCOUNTANT MEMBER PY OF THE ORDER FORWARDED TO: 4(4) KOLKATA . CIT(DR) KOLKATA BENCHES KOLKATA. ASSISTANT REGISTRAR ITAT KOLKATA BENCHES I.T.A. NO. 396/KOL/2020 ASSESSMENT YEAR: 2010-11 M/S. KBR TOWNSHIP PVT. LTD. THE INTEREST OF REVENUE. MERE AUDIT OBJECTION AND MERELY BECAUSE A DIFFERENT VIEW COULD BE TAKEN WERE NOT ENOUGH TO SAY THAT THE ORDER OF THE AO WAS ERRONEOUS OR PREJUDICIAL TO THE INTEREST OF THE REVENUE. THE JURISDICTION COULD BE EXERCISED IF THE S SATISFIED THAT THE BASIS FOR EXERCISE OF JURISDICTION EXISTED. NO RIGID RULE COULD BE LAID DOWN ABOUT THE SITUATION WHEN THE JURISDICTION CAN BE EXERCISED. WHETHER SATISFACTION OF THE CIT FOR EXERCISING JURISDICTION WAS CALLED FOR OR NOT ED HAVING REGARD TO A GIVEN FACT SITUATION. IN THE PRESENT CASE THE TRIBUNAL HAS HELD THAT THE ASSESSEE HAD DISCLOSED THAT OUT OF SALE CONSIDERATION A SUM OF RS. 1 LAKH WAS TO BE RECEIVED FOR SALE OF PERMIT. IF THAT IS SO THERE WAS NO TAKEN BY THE AO AND NO CASE WAS MADE OUT FOR INVOKING LAW TO THE FACTS OF QUASH THE ORDER PASSED U/S 263 OF THE ACT AND D /- J. SUDHAKAR REDDY ] ACCOUNTANT MEMBER TRUE COPY BY ORDER ASSISTANT REGISTRAR ITAT KOLKATA BENCHES