Shree Ami Estate Developers, Ahmedabad V. The Asstt. Commissioner of Income Tax, Circle-5(2), Ahmedabad

ITA 1193/AHD/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 8211 (ITAT-AHMEDABAD)
• Duration Of Justice: 5 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-10-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2012-2013
• Appeal Filed On: 15-05-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D P GUPTA
• Assessee Lawyers: J P SHAH
• Keywords: Gift; Assessment record; Right to appeal
• Section: 143(3); 80IB; 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD A BENCH (BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER & SHRI MAHAVIR PRASAD, JUDICIAL MEMBER) ITA. NO: 1193/AHD/2017 (ASSESSMENT YEAR: 2012-13) SHREE AMI ESTATE DEVELOPERS BUNGALOW NO- 11 SAUMIL SOCIETY, DRIVE IN ROAD, MEMNAGAR, AHMEDABAD V/S ASSTT. COMMISSIONER OF INCOME TAX, CIRCLE-5(2), AHMEDABAD (APPELLANT) (RESPONDENT) PAN: ABRFS0385G APPELLANT BY : SHRI J.P. SHAH, AR RESPONDENT BY : SHRI D. P. GUPTA, CIT/ D.R. ( )/ ORDER DATE OF HEARING : 24 -10-201 7 DATE OF PRONOUNCEMENT : 27 -10-2017 PER N.K. BILLAIYA, ACCOUNTANT MEMBER: 1. WITH THIS APPEAL, THE ASSESSEE HAS CHALLENGED THE C ORRECTNESS OF THE ORDER OF THE LD. PRINCIPAL COMMISSIONER, AHMEDABAD-5 DATED 2 7.03.2017 FRAMED U/S. 263 OF THE ACT. ITA NO. 1193 /AHD/2017 . A.Y. 2012-13 2 2. THE ASSESSEE CONTENDS THAT THE LD. PRINCIPAL COMMIS SIONER HAS WRONGLY ASSUMED THE JURISDICTION BESTOWED UPON HIM BY THE P ROVISIONS OF SECTION 263 OF THE ACT VIDE ORDER DATED 25.03.2015. 3. ASSUMING THE JURISDICTION CONFERRED UPON HIM BY THE PROVISIONS OF SECTION 263 OF THE ACT, THE LD. PRINCIPAL COMMISSIONER ISSUED N OTICE TO THE ASSESSEE DATED 10.03.2017 AND THE SAME READS AS UNDER:- SUB.: SHOW CAUSE NOTICE U/S. 263 OF THE INCOME-TAX ACT, 1 961 A.Y. 2012-13-REGARDING..... PLEASE REFER TO THE ASSESSMENT ORDER U/S. 143(3) DA TED 25.03.2015 FOR A.Y. 2012- 13, WHICH WAS FINALIZED BY THE ITO, WARD-5(2)(4), A HMEDABAD, BY ACCEPTING THE RETURNED INCOME AT NIL. THE ASSESSEE HAD CLAIMED DE DUCTION OF RS.13,31,94,893/- U/S 80 IB (10) OF THE ACT. 2. FROM THE RECORDS IT HAS BEEN NOTICED THAT THE AS SESSEE FIRM CAME INTO EXISTENCE VIDE PARTNERSHIP DEED DATED 14.12.2009. AS PARTNERS HIP DEED THE NA LAND WAS CONSIDERED AS STOCK IN TRADE OF THE FIRM WITH EFFEC T FROM 11/2008. THE PLAN/PROJECT FOR DEVELOPMENT WAS APPROVED BY AUTHORITY ON 27.11. 2008 FOR RESIDENTIAL BUILDINGS. IT INDICATES THAT THE APPROVAL OF LOCAL AUTHORITY WAS NOT RECEIVED ON OR BEFORE 31.3.2008 AS REQUIRED UNDER THE PROVISIONS O F SECTION 80IB. THE ASSESSEE FIRM HAD AGAIN SUBMITTED REVISED PLAN FOR RESIDENTI AL BUILDING/PROJECT AND GOT APPROVAL OF LOCAL AUTHORITY ON 21.4.2010 AS WELL AS GOT 'DEVELOPMENT PERMISSION' VIDE LETTER DATED 21.4.2010. THUS THE PERMISSION BY AUTHORITY WAS RECEIVED AFTER PRESCRIBED TIME LIMIT. THE PARTNERS OF THE FORM HAD AGAIN EXECUTED A PARTNERSHIP DEED ON 20.8.2011 WHICH ARE REGISTERED WITH THE SUB REGISTRAR-3, MEMNAGAR, VIDE DEED NUMBER 9590/2011. IN THE SAID DEED, IT WAS ALS O MENTIONED THAT :-...'KEEPING IN MIND THE USE OF LAND FOR BUSINESS PURPOSE, THE D EVELOPMENT PLAN HAS BEEN SUBMITTED TO AUDA AND GET APPROVAL ON 11.6.2008 (PA RA 3, PAGE 5). IT IS FURTHER STATED IN THE REGISTERED PARTNERSHIP DEED THAT 'AFT ER APPROVAL OF DEVELOPMENT OF THE LAND A REVISED PLAN HAS BEEN APPROVED ON 27.11. 2008'. IT INDICATED THAT THE ITA NO. 1193 /AHD/2017 . A.Y. 2012-13 3 PROJECT/PLAN WAS APPROVED BY AUDA ORIGINALLY ON 11. 6.2008 AND DEVISED ON 27.11.2008. BOTH CIRCUMSTANCES CLARIFY THAT THE APP ROVAL OF PROJECT/PLAN IS RECEIVED AFTER THE PRESCRIBED TIME LIMIT OF 31.3.20 08. 3. FURTHER, IT IS OBSERVED THAT THE PROJECT WAS F IRST APPROVED ON 11. 1.2008 AND THE PROJECT WAS ORIGINALLY APPROVED FOR RESIDENTIAL BUNGLOWS. HOWEVER AS PERLAYOUT OF THE PLAN/PROJECT, THE FSI AREA OF GROU ND FLOOR OF BUNGLOW WAS 140.35 SQ MTR WHICH WAS MORE THAN 1500 SQ. FT. THE CONDITION OF MAXIMUM BUILT UP AREA OF 1500 SQ. FT. HAD NOT BEEN COMPLIED AS PRESCRIBED UNDER SECTION 80IB(10). HENCE THE PROJECT AB INITIO WAS NOT ELIGIBLE FOR DE DUCTION. THEREFORE ASSESSEE WAS REQUIRED TO OBTAIN APPROVAL OF AUDA AGAIN IN JUNE 2 008 AND THEREAFTER IN NOVEMBER 2008 FOUR RESIDENTIAL FLATS/APARTMENTS. TH EREFORE THE PROJECT THAT WAS APPROVED IN JANUARY 2008 HAS NOT FULFILLED THE PROV ISIONS OF SECTION 80IB(10). IN VIEW OF THE ABOVE FACT IT CANNOT BE CONSIDERED THAT THE PLAN/PROJECT WAS APPROVED BEFORE 31.3.2008 BY THE LOCAL AUTHORITY FOR PROJECT OF RESIDENTIAL BUILDING AS REQUIRED UNDER SECTION 80IB(10) OF THE ACT. THEREFO RE EXEMPTION OF RS.13,31,94,893/- CLAIMED BY THE ASSESSEE SHOULD NO T BE ALLOWED. 4. FROM THE ABOVE DISCUSSIONS, IT APPEARS THAT TH E SAID ASSESSMENT ORDER DATED 25/03/2015 IS ERRONEOUS AND PREJUDICIAL TO THE INTE REST OF THE REVENUE TO THE EXTENT MENTIONED ABOVE. YOU ARE, THEREFORE, REQUEST ED TO SHOW CAUSE TO WHY THE TOTAL INCOME ASSESSED U/S. 143(3) OF THE ACT SHOULD NOT BE ENHANCED OR MODIFIED U/S. 263 OF THE ACT. 5. IN CASE, YOU HAVE ANY OBJECTION TO THE ACTION PR OPOSED, YOU ARE REQUESTED TO APPEAR BEFORE ME EITHER PERSONALLY OR THROUGH YOUR AUTHORIZED REPRESENTATIVE ON 16.03.2017 AT 3.30 PM AT MY OFFICE SITUATED AT THE ABOVE ADDRESS, ALONG WITH A WRITTEN REPLY TO THIS NOTICE. ITA NO. 1193 /AHD/2017 . A.Y. 2012-13 4 4. IN RESPONSE TO THE AFOREMENTIONED NOTICE, THE ASSES SEE FIELD A DETAILED REPLY EXPLAINING WHY THE ASSESSMENT ORDER IS NEITHER ERRO NEOUS NOR PREJUDICIAL TO THE INTERESTS OF THE REVENUE. THE ASSESSEE BROUGHT TO T HE NOTICE OF THE LD. PRINCIPAL COMMISSIONER THAT THE PROJECT WAS FIRST APPROVED BY THE LOCAL AUTHORITY ON 11.01.2008 WHICH IS BEFORE THE STIPULATED DATE ON 3 1.03.2008. IT WAS FURTHER BROUGHT TO THE NOTICE OF THE LD. PRINCIPAL COMMISSI ONER THAT THE ASSESSEE HAS APPLIED FOR REVISED PLAN WHICH WAS APPROVED ON 27.1 1.2008. DRAWING TO THE ATTENTION OF THE LD. PRINCIPAL COMMISSIONER TO THE EXPLANATION TO SECTION 80IB(10) OF THE ACT, THE ASSESSEE CONTENDED THAT AS PER THE SAID EXPLANATION WHERE THE APPROVAL IN RESPECT OF THE HOUSING PROJEC T IS OBTAINED MORE THAN ONCE, SUCH HOUSING PROJECT SHALL BE DEEMED TO HAVE BEEN APPROVED ON THE DATE ON WHICH THE BUILDING PLAN OF SUCH HOUSING PROJECT IS FIRST APPROVED BY THE LOCAL AUTHORITY. THE ASSESSEE STRONGLY CONTENDED TH AT SINCE THE FIRST APPROVAL WAS GIVEN ON 11.01.2008 WHICH IS PRIOR TO 31.03.200 8, THE SUBSEQUENT REVISED APPROVALS SHOULD ALSO BE CONSIDERED FROM 11.01.2008 . THE ASSESSEE CONCLUDED BY STATING THAT ON THESE FACTS, THE A.O. HAD ALLOWE D THE CLAIM OF DEDUCTION U/S. 80IB(10) OF THE ACT AND, THEREFORE, NEITHER HIS ORD ER IS ERRONEOUS NOR PREJUDICIAL TO THE INTERESTS OF THE REVENUE. 5. AFTER CONSIDERING THE FACTS EXPLAINED BY THE ASSESS EE IN THE LIGHT OF THE ASSESSMENT ORDER, THE LD. PRINCIPAL COMMISSIONER OB SERVED AS UNDER:- 4. THE REPLY OF THE ASSESSEE IS CONSIDERED BUT NOT FOUND ACCEPTABLE. IT IS EVIDENT FROM THE RECORD THAT THE SAID PROJECT WAS FIRST APP ROVED ON 11.01.2008 AND THE PLAN WAS ORIGINALLY APPROVED FOR RESIDENTIAL BUNGLO WS. AS PER THE LAY-OUT OF PLAN/PROJECT, THE FSI AREA OF GROUND FLOOR OF BUNGL OW WAS 140.35 SQ. MT. WHICH WAS MORE THAN 1500 SQ.FT.(.1 SQ. MT = 10.7639 SQ. F T.) THUS, THE REQUIREMENT OF MAXIMUM BUILT-UP AREA OF 1500 SQ. FT. HAD NOT BEEN COMPLIED WITH AS PRESCRIBED UNDER CL. (C) TO SECTION 80IB(10) OF THE ACT. THERE AFTER, THE ASSESSEE HAS APPLIED ITA NO. 1193 /AHD/2017 . A.Y. 2012-13 5 FOR REVISED PLAN WHICH WAS FINALLY APPROVED ON 27/1 1/2008. THE ASSESSEE HAS MENTIONED THAT SOME MODIFICATIONS OF THE LAYOUT PLA N WERE APPROVED SUBSEQUENT TO 31 ST MARCH, 2008, BUT AS PER THE EXPLANATION, THE PRESE NT HOUSING PROJECT SHALL BE DEEMED TO HAVE BEEN APPROVED ON THE DATE ON WHIC H THE BUILDING PLAN OF THE HOUSING PROJECT WAS FIRST APPROVED BY THE LOCAL AUT HORITY, VIZ. 11.01.2008. BUT, THE PROJECT AS PER 1 ST PLAN WAS NOT ELIGIBLE FOR EXEMPTION U/S 80IB(10) O F THE ACT BEING FSI AREA OF UNITS OF PROJECT WAS GREATER THAN 1500 SQ. FEET. THEREFORE, IT IS CLEAR THAT THE FIRST PLAN WAS NOT IN ACCORDANCE WIT H THE PROVISION OF SECTION 80IB(10). FURTHER REVISED PLANS WERE PASSED AFTER T HE DATE SPECIFIED IN SECTION 80IB(10) OF THE ACT. THE PROJECT / APPROVED ON 11.0 1.2008 HAD NOT FULFILLED THE PROVISIONS OF CL.(C) TO SECTION 80IB(10) OF THE I.T . ACT. THEREFORE, TO OBTAIN APPROVAL OF AUDA THE ASSESSEE HAS AGAIN FILED APPLI CATION AND EARLIER GRANTED APPROVAL ON 11.06.2008 WHICH WAS AGAIN REVISED AND APPROVED ON 27.11-.2008; THIS SHOWS THAT THE APPROVAL WAS RECEIVED AFTER PRE SCRIBED TIME LIMIT OF 31.03.2008. THE AO HAS FAILED TO CONDUCT PROPER ENQ UIRIES AND VERIFICATION WITH THIS REGARD AND FAILED TO DISALLOW THE CLAIM OF THE ASSESSEE TO THE EXTENT OF RS. 13,31,94,893/- WHICH WAS NOT ELIGIBLE U/S 80IB(10) OF THE ACT. 6. THE ASSESSEE IS AGGRIEVED BY THIS FINDING OF THE LD . PRINCIPAL COMMISSIONER. THE LD. SENIOR COUNSEL VEHEMENTLY SUBMITTED THAT THE AS SESSING OFFICER DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS HAD MADE SPECI FIC QUERIES TO WHICH THE ASSESSEE HAD FILED A DETAILED REPLY. THE LD. COUNSE L DREW OUR ATTENTION TO THE REPLY DATED 16.03.2015 WHICH IS EXHIBITED AT PAGES 3 & 4 OF THE PAPER BOOK AND POINTED OUT THE RELEVANT REPLY OF THE ASSESSEE. IT IS THE SAY OF THE LD. COUNSEL THAT THE ONLY OBJECTION OF THE LD. PRINCIPAL COMMIS SIONER IS THAT THE PROJECT WAS APPROVED AFTER 31.03.2008 IS BASED UPON WRONG APPRE CIATION OF THE FACTS. THE LD. COUNSEL STATED THAT THE ASSESSEE HAD FILED REVI SED PLANS WHICH WERE SUBSEQUENTLY APPROVED BY THE LOCAL AUTHORITY BUT TH E SAME HAS TO BE CONSIDERED ITA NO. 1193 /AHD/2017 . A.Y. 2012-13 6 IN THE LIGHT OF THE EXPLANATION APPENDED TO SECTION 80IB(10) OF THE ACT AND IF CONSIDERED SO THEN THE ASSESSEE IS VERY MUCH ELIGIB LE FOR THE CLAIM OF DEDUCTION U/S. 80IB(10) OF THE ACT. 7. STRONGLY REBUTTING TO THE SUBMISSIONS MADE BY THE L D. COUNSEL, THE LD. D.R. STATED THAT THE A.O. HAS NOT MADE ANY ENQUIRY WHATS OEVER SO FAR AS THE REVISED PLANS APPROVED SUBSEQUENTLY TO 31.03.2008 IS CONCER NED. IT IS THE SAY OF THE LD. D.R. THAT WHEN THE A.O. DOES NOT MAKE ANY ENQUIRY A ND THE LD. PRINCIPAL COMMISSIONER FINDS THAT THE ASSESSMENT ORDER SO FRA MED IS NOT ONLY ERRONEOUS BUT PREJUDICIAL TO THE INTERESTS OF THE REVENUE THE N THE LD. COMMISSIONER HAS EVERY RIGHT TO REVISE THE SAME BY INVOKING THE PROV ISIONS OF SECTION 263 OF THE ACT. 8. WE HAVE GIVEN A CAREFUL CONSIDERATION TO THE RIVAL SUBMISSIONS AND HAVE PERUSED THE ORDERS OF THE AUTHORITIES BELOW. 9. IT IS TRUE THAT THE REVENUE DOES NOT HAVE ANY RIGHT TO APPEAL TO THE FIRST APPELLATE AUTHORITY AGAINST AN ORDER PASSED BY THE ASSESSING OFFICER. SECTION 263 HAS BEEN ENACTED TO EMPOWER THE LD. COMMISSIONE R TO EXERCISE POWER OF REVISION AND REVISE ANY ORDER PASSED BY THE ASSESSI NG OFFICER, IF TWO CUMULATIVE CONDITIONS ARE SATISFIED. FIRSTLY, THE ORDER SOUGHT TO BE REVISED SHOULD BE ERRONEOUS AND, SECONDLY, IT SHOULD BE PREJUDICIAL T O THE INTERESTS OF THE REVENUE. THE EXPRESSION PREJUDICIAL TO THE INTERES TS OF THE REVENUE IS OF WIDE IMPORT AND IS NOT CONFINED TO MERELY LOSS OF T AX. THE TERM ERRONEOUS MEANS A WRONG/INCORRECT DECISION DEVIATING FROM LAW . THIS EXPRESSION POSTULATES AN ERROR WHICH MAKES AN ORDER UNSUSTAINA BLE IN LAW. ITA NO. 1193 /AHD/2017 . A.Y. 2012-13 7 10. FOR THIS PROPOSITION, WE DRAW SUPPORT FROM THE JUDG MENT OF THE HONBLE HIGH COURT OF DELHI IN THE CASE OF DG HOUSING PROJECTS L TD. 343 ITR 329. 11. IT IS ALSO TRUE THAT THE ASSESSING OFFICER IS BOTH AN INVESTIGATOR AND AN ADJUDICATOR. IF THE ASSESSING OFFICER AS AN ADJUDIC ATOR DECIDES A QUESTION OR ASPECT AND MAKES A WRONG ASSESSMENT WHICH IS UNSUST AINABLE IN LAW, IT CAN BE CORRECTED BY THE LD. COMMISSIONER IN EXERCISE OF RE VISIONARY POWER. IT IS INCUMBENT UPON THE ASSESSING OFFICER TO INVESTIGATE THE FACTS REQUIRED 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 ORDER BECOMES ERRONEOUS WHICH INCLUDES FAILURE TO MAKE THE ENQUIRY. 12. A THOUGHTFUL CONSIDERATION OF THE FACTS ON RECORD S HOW THAT THE PROJECT WAS FIRST APPROVED ON 11.01.2008. THEREAFTER, THE ASSES SEE HAS APPLIED FOR REVISED PLAN WHICH WAS FINALLY APPROVED ON 27.11.2008. THES E FACTS HAVE NOWHERE BEING DISPUTED ANYWHERE. ON THESE FACTS, LET US NOW CONSIDER THE PROVISIONS OF SECTION 80IB(10) READ WITH THE EXPLANATION:- SECTION 80IB(10)- THE AMOUNT OF DEDUCTION IN THE CASE OF AN UNDERTAKI NG DEVELOPING AND BUILDING HOUSING PROJECTS APPROVED BEFORE THE 3 1ST DAY OF MARCH, [2008] BY A LOCAL AUTHORITY SHALL BE HUNDRED PER CENT OF THE PR OFITS DERIVED IN THE PREVIOUS YEAR RELEVANT TO ANY ASSESSMENT YEAR FROM SUCH HOUSING P ROJECT IF, (A) SUCH UNDERTAKING HAS COMMENCED OR COMMENCES DEVELOP MENT AND CONSTRUCTION OF THE HOUSING PROJECT ON OR AFTER THE 1ST DAY OF OCTO BER, 1998 AND COMPLETES SUCH CONSTRUCTION, (I) IN A CASE WHERE A HOUSING PROJECT HAS BEEN APPROVE D BY THE LOCAL AUTHORITY BEFORE THE 1ST DAY OF APRIL, 2004, ON OR BEFORE THE 31ST DAY OF MARCH, 2008; ITA NO. 1193 /AHD/2017 . A.Y. 2012-13 8 (II) IN A CASE WHERE A HOUSING PROJECT HAS BEEN, OR, IS APPROVED BY THE LOCAL AUTHORITY ON OR AFTER THE 1ST DAY OF APRIL, 2004 [B UT NOT LATER THAN THE 31ST DAY OF MARCH, 2005], WITHIN FOUR YEARS FROM THE END OF THE FINANCIAL YEAR IN WHICH THE HOUSING PROJECT IS APPROVED BY THE LOC AL AUTHORITY; (III) IN A CASE WHERE A HOUSING PROJECT HAS BEEN APPROVE D BY THE LOCAL AUTHORITY ON OR AFTER THE 1ST DAY OF APRIL, 2005, W ITHIN FIVE YEARS FROM THE END OF THE FINANCIAL YEAR IN WHICH THE HOUSING PROJ ECT IS APPROVED BY THE LOCAL AUTHORITY.] EXPLANATION.FOR THE PURPOSES OF THIS CLAUSE, (I) IN A CASE WHERE THE APPROVAL IN RESPECT OF THE HOUS ING PROJECT IS OBTAINED MORE THAN ONCE, SUCH HOUSING PROJECT SHALL BE DEEME D TO HAVE BEEN APPROVED ON THE DATE ON WHICH THE BUILDING PLAN OF SUCH HOUSING PROJECT IS FIRST APPROVED BY THE LOCAL AUTHORITY; (II) THE DATE OF COMPLETION OF CONSTRUCTION OF THE HOUS ING PROJECT SHALL BE TAKEN TO BE THE DATE ON WHICH THE COMPLETION CERTIF ICATE IN RESPECT OF SUCH HOUSING PROJECT IS ISSUED BY THE LOCAL AUTHORITY; 13. A PERUSAL OF THE AFOREMENTIONED PROVISION WOULD SHO W THAT THE ASSESSEE IS VERY MUCH ELIGIBLE FOR THE CLAIM OF DEDUCTION U/S. 80IB( 10) OF THE ACT WHICH HAS BEEN RIGHTLY ALLOWED BY THE A.O. THE LD. PRINCIPAL COMMISSIONER HAS NOT APPRECIATED THE FACTS OF THE CASE IN TRUE PERSPECTI VE IN THE LIGHT OF THE AFOREMENTIONED EXPLANATION APPENDED TO SECTION 80IB (10) OF THE ACT. A PERUSAL OF THE NOTICE ISSUED BY THE LD. COMMISSIONE R U/S. 263 OF THE ACT WHICH IS EXHIBITED ELSEWHERE CLEARLY SHOWS THAT ALL THE R EVISED PLANS WERE VERY MUCH AVAILABLE ON THE ASSESSMENT RECORDS WHICH HAVE BEEN CONSIDERED BY THE LD. PRINCIPAL COMMISSIONER WHILE ISSUING THE SHOW CAUSE NOTICE U/S. 263 OF THE ACT. BY NOT APPRECIATING THE LAW ON THE FACTS OF TH E CASE IN HAND, THE LD. PRINCIPAL COMMISSIONER HAS MADE HIS ORDER ERRONEOUS . ITA NO. 1193 /AHD/2017 . A.Y. 2012-13 9 14. THE HONBLE SUPREME COURT IN MALABAR INDUSTRIAL CO. LTD., 243 ITR 83, HAS LAID DOWN THE FOLLOWING RATIO:- 'A BARE READING OF SECTION 263 OF THE INCOME-TAX AC T, 1961, MAKES IT CLEAR THAT THE PREREQUISITE FOR THE EXERCISE OF JURISDICTION B Y THE COMMISSIONER SUO MOTU UNDER IT, IS THAT THE ORDER OF THE INCOME-TAX OFFIC ER IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE. THE CO MMISSIONER HAS TO BE SATISFIED OF TWIN CONDITIONS, NAMELY, (I) THE ORDER OF THE AS SESSING OFFICER SOUGHT TO BE REVISED IS ERRONEOUS; AND (II) IT IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE. IF ONE OF THEM IS ABSENTIF THE ORDER OF THE INCOME-TA X OFFICER IS ERRONEOUS BUT IS NOT PREJUDICIAL TO THE REVENUE OR IF IT IS NOT ERRO NEOUS BUT IS PREJUDICIAL TO THE REVENUE RECOURSE CANNOT BE HAD TO SECTION 263(1) O F THE ACT. THE PROVISION CANNOT BE INVOKED TO CORRECT EACH AND EVERY TYPE OF MISTAKE OR ERROR COMMITTED BY THE ASSESSING OFFICER, IT IS ONLY WHEN AN ORDER IS ERRONEOUS THAT THE SECTION WILL BE ATTRACTED. AN INCORRECT ASSUMPTION OF FACTS OR A N INCORRECT APPLICATION OF LAW WILL SATISFY THE REQUIREMENT OF THE ORDER BEING ERR ONEOUS '. 15. AT THE COST OF REPETITION, WE WOULD ONCE AGAIN LIKE TO REITERATE WHAT THE HONBLE BOMBAY HIGH COURT IN THE CASE OF GABRIEL IN DIA LTD. 203 ITR 108 HAS HELD THE DECISION OF THE ITO CANNOT BE HELD TO BE ERRON EOUS SIMPLY BECAUSE IN HIS ORDER HE DID NOT MAKE AN ELABORATE DISCUSSION IN THAT REGARD . 16. THE HONBLE HIGH COURT OF GUJARAT IN CIT VS. NIRMA CHEMICAL WORKS LTD. 309 ITR 67 HAS OBSERVED THAT IF ASSESSMENT ORDER WE RE TO INCORPORATE THE REASONS FOR UPHOLDING THE CLAIM MADE BY AN ASSESSEE , THE RESULT WOULD BE AN EPITOME AND NOT AN ASSESSMENT ORDER. IN THIS CASE, DURING THE ASSESSMENT PROCEEDINGS FOR BOTH THE ASSESSMENT YEARS, THE ASSE SSING OFFICER ISSUED A QUERY MEMO TO THE ASSESSEE, CALLING UPON HIM TO JUS TIFY THE GENUINENESS OF THE GIFTS. THE RESPONDENT-ASSESSEE RESPONDED TO THE SAM E BY GIVING EVIDENCE OF ITA NO. 1193 /AHD/2017 . A.Y. 2012-13 10 THE COMMUNICATIONS RECEIVED FROM HIS FATHER AND HIS SISTER I.E. THE DONORS OF THE GIFTS ALONG WITH THE STATEMENT OF THEIR BANK AC COUNTS. ON PERUSAL, THE ASSESSING OFFICER WAS SATISFIED ABOUT THE CREDITWOR THINESS/CAPACITY OF THE DONORS, THE SOURCE FROM WHERE THESE FUNDS HAVE COME AND ALSO THE CREDITWORTHINESS/CAPACITY OF THE DONOR. ONCE THE AS SESSING OFFICER WAS SATISFIED WITH REGARD TO THE SAME, THERE WAS NO FUR THER REQUIREMENT ON THE PART OF THE ASSESSING OFFICER TO DISCLOSE HIS SATISFACTI ON IN THE ASSESSMENT ORDER PASSED THEREON. THUS, THIS OBJECTION ON THE PART OF THE REVENUE CANNOT BE ACCEPTED. 17. CONSIDERING THE FACTS IN TOTALITY IN THE LIGHT OF T HE JUDICIAL DECISIONS DISCUSSED HEREINABOVE, IN OUR UNDERSTANDING OF THE LAW, THE A SSESSMENT ORDER IS NEITHER ERRONEOUS NOR PREJUDICIAL TO THE INTEREST OF THE RE VENUE. WE, THEREFORE, SET ASIDE THE IMPUGNED ORDER PASSED BY THE LD. COMMISSIONER U /S. 263 AND RESTORE THAT OF THE ASSESSING OFFICER PASSED U/S. 143(3) OF THE ACT. ORDER PRONOUNCED IN OPEN COURT ON 27- 10- 20 17 SD/- SD/- (MAHAVIR PRASAD) (N. K. BILLAIYA) JUDICIAL MEMBER TRUE COPY ACCOUNTANT MEMBER AHMEDABAD: DATED 27/10/2017 RAJESH COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AHME DABAD