CR RETAIL MALL (INDIA) LTD, MUMBAI V. CIT CITY 6, MUMBAI

ITA 2583/MUM/2015

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 8715 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 5 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-10-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Next Hearing Date: 26-04-2017
• Assessment Year: 2010-2011
• Appeal Filed On: 06-05-2015
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: H N SINGH
• Keywords: Revision of order; Depreciation; Principle of natural justice; Capital receipt; Revenue expenditure
• Section: 143(3); 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH C, MU MBAI BEFORE SHRI B.R. BASKARAN, ACCOUNTANT MEMBER AND SHRI PAWAN SINGH, JUDICIAL MEMBER ITA NO. 2583/MUM/2015 (ASSESSMENT YEAR-2010-11) M/S CR RETAIL MALLS (INDIA) LTD. LOTUS GRANDEUR, 7 TH FLOOR, OPP. GUNDECHA SYMPHONY, VEERA DESAI ROAD, ANDHERI (W), MUMBAI-400069. PAN: AABCC9162F VS. CIT, CITY-6, 501, 5 TH FLOOR, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI- 400020. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI VIJAY MEHTA (AR) REVENUE BY : SHRI H.N. SINGH (CIT DR) DATE OF HEARING : 31.08.2017 DATE OF PRONOUNCEMENT : 25.10.2017 ORDER UNDER SECTION 254(1) OF INCOME TAX ACT PER PAWAN SINGH, JUDICIAL MEMBER: 1. THIS APPEAL BY ASSESSEE UNDER SECTION 253 OF THE IN COME-TAX ACT (THE ACT) IS DIRECTED AGAINST THE ORDER OF LD. PRINCIPL E COMMISSIONER OF INCOME- TAX (FOR SHORT THE LD. PCIT (A)-6), MUMBAI DATED 03 .03.2015 PASSED UNDER SECTION 263 OF THE ACT FOR ASSESSMENT YEAR (AY) 201 0-11. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: 1. THE ORDER PASSED BY THE LEARNED COMMISSIONER OF INC OME TAX U/S 263 OF THE INCOME TAX ACT, 1961 IS VOID AB-INITIO BECAUSE OF L ACK OF JURISDICTION ON THE PART OF THE LEARNED COMMISSIONER OF INCOME TAX IN A S MUCH AS THE ASSESSMENT ORDER SOUGHT TO BE REVISED BY HIM, IS NE ITHER ERRONEOUS NOR PREJUDICIAL TO THE INTEREST OF REVENUE. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE ORD ER OF THE LEARNED COMMISSIONER OF INCOME TAX U/S 263 OF THE IT ACT, 1 961 IS WRONG, INVALID, ILLEGAL & BAD IN LAW. ITA NO. 2583/M/2015 - M/S CR RETAIL MALLS (INDIA) LTD. 2 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE-COMPA NY IS ENGAGED IN FILM EXHIBITION, CINEMA ADVERTISEMENT ETC., FILED ITS RE TURN OF INCOME FOR RELEVANT AY ON 15.10.2010 DECLARING TOTAL INCOME AT RS. 8,26,784/-. THE ASSESSMENT WAS COMPLETED ON 18.03.2013 UNDER SECTIO N 143(3) OF THE ACT. THE ASSESSING OFFICER PASSED THE ASSESSMENT ORDER B Y MAKING CERTAIN ADDITIONS/DISALLOWANCES. SUBSEQUENTLY, THE ASSESSME NT WAS REVISED BY LD. PCIT ON 03.03.2015. NOTICE UNDER SECTION 263 DATED 22.07.2014 WAS SERVED ON THE ASSESSEE. IN THE NOTICE, THE LD. PCIT RAISED THE FOLLOWING ISSUE: (I) THAT ASSESSEE CLAIMED CREDIT OF TDS OF RS. 2,54,69, 821/-. IN SUPPORT OF TDS CREDIT ATTACHED TDS CERTIFICATE. THE CREDIT WAS CLAIMED ON DETAILS AVAILABLE AS PER FORM-26AS. HOWEVER, THE AD VERTISEMENT INCOME IN RESPECT TO THOSE ENTITIES WAS NEITHER OFF ERED TO TAX NOR ANY EXPLANATION WAS GIVEN AS TO WHY CREDIT FOR THOSE TD S SHOWN IN FORM 26AS CLAIMED THROUGH INCOME WAS NOT OFFERED TO TAX. IT WAS FURTHER MENTIONED THAT IT WOULD BE REASONABLE TO INFER THAT FROM THE FACTS ON RECORD, NO EXPLANATION WITH REGARD TO INCOME NOT O FFERED TO TAX OF RS. 61,31,808/- HAS BEEN OBTAINED IN THE COURSE OF ASSESSMENT PROCEEDING. FURTHER, CREDIT BASED ON TDS CERTIFICAT ES WHEN NO CREDIT (LESS CREDIT) IS AVAILABLE IN THE FORM 26AS, HAS BE EN GIVEN WITHOUT DUE AND PROPER VERIFICATION. ITA NO. 2583/M/2015 - M/S CR RETAIL MALLS (INDIA) LTD. 3 (II) THE ASSESSEE CLAIMED DEPRECIATION OF RS. 6,03,92,62 3/- ON CINEMA BUILDING. THE VALUE OF THE LEASE-HOLD BUILDING INCL UDES PREMIUM OF RS. 46,87,50,000/- FOR OBTAINING LEASE OF 900 YEARS , WHICH DOES NOT REQUIRE KNOWLEDGE ROCKET SCIENCE TO CONCLUDE THAT N O BUILDING CAN SURVIVE FOR 900 YEARS. THE PREMIUM HAS BEEN PAID FO R ACQUIRING POSSESSION FOR LAND FOR 900 YEARS ON WHICH SUPERSTR UCTURE HAS BEEN BUILT AND NOT FOR OBTAINING LEASE FOR SUPERSTRUCTU RE, SIMPLICITOR FOR 900 YEARS. THE PAYMENT OF CONSIDERATION OF RS. 46, 87,50,000/- IS PAID AS A PREMIUM FOR OBTAINING LEASE FOR 900 YEARS FOR PURCHASE/POSSESSION OF LAND ALONE. DEPRECIATION OF SUPERSTRUCTURE WOULD AMOUNTS TO GRANTING OF DEPRECIATION ON THE AM OUNT PAID FOR LAND. THE AO FAILED TO CARRY OUT RELEVANT AND MEANI NGFUL ENQUIRY AS WARRANTED BY THE FACTS OF THE CASE WHICH TANTAMOUNT TO ASSESSMENT ORDER BEING ERRONEOUS AND PREJUDICIAL TO THE INTERE ST OF REVENUE. (III) THE ASSESSEE CLAIMED DEDUCTION FOR PORTION OF TICKE T AMOUNT AS ENTERTAINMENT TAX. THE ASSESSEE NOT OFFERED THE SAM E AS INCOME AND TREATED AS CAPITAL RECEIPT COVERED BY CAPITAL SUBSI DY SCHEME OF GOVERNMENT OF MAHARASHTRA FOR MULTIPLEX THEATRE. TH E AO TREATED IT AS REVENUE RECEIPT WITHOUT EXAMINING THE SCHEME. TH E AO CONCLUDED ON THE BASIS OF TICKET ISSUED BY ASSESSEE, WHEREIN NO SEPARATE COLLECTION FOR ENTERTAINMENT TAX. THUS, THERE IS F AILURE ON THE PART OF ITA NO. 2583/M/2015 - M/S CR RETAIL MALLS (INDIA) LTD. 4 AO TO CARRY OUT THIS RELEVANT AND MEANINGFUL ENQUIR Y AND THE ORDER PASSED IS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE. 3. THE ASSESSEE FILED ITS REPLY DATED 05.10.2014. IN THE REPLY THE ASSESSEE CONTENDED THAT THE ASSESSEE HAS ENTERED INTO AGREEM ENT WITH M/S PHOENIX MILLS LTD. ON 22.07.2015 WHEREBY M/S PHOENIX MILLS LTD. GRANTED A SUB- LEASE OF MULTIPLEX CINEMA UNIT TO THE ASSESSEE FOR A PERIOD OF 900 YEARS. AFTER MAKING ALTERATION TO THE MULTIPLEX CINEMA UNI T, INSTALLING THE FIT OUT (FIXTURE) EQUIPMENT AND OTHER ASSET NECESSARY FOR R UNNING MULTIPLEX CINEMA. FROM AY 2009-10, THE ASSESSEE HAS STARTED E XHIBITION OF FILMS FROM THE SAID MULTIPLEX CINEMA. THE ASSESSEE CLAIME D DEPRECIATION TO MULTIPLEX CINEMA UNIT FOR THE FIRST TIME IN 2009-10 AND THEREAFTER REDUCING AMOUNT FROM COST OF MULTIPLEX CINEMA, NET WRITTEN D OWN VALUE (WDV) WAS CARRIED FORWARD TO AY 2010-11. FOR AY 2010-11, THE WDV OF MULTIPLEX CINEMA WAS CARRIED FORWARD AS PER THE PROVISION OF SECTION 43(6) AND DEPRECIATION WAS CLAIMED. DURING THE ASSESSMENT, TH E AO CALLED VARIOUS DETAILS AND PARTICULAR REGARDING THE WORKING OF DEP RECIATION ON FIXED ASSET, WHICH WAS FURNISHED ALONG WITH AUDIT REPORT. DEPREC IATION FOR THE FIRST TIME CLAIMED IN THE YEAR UNDER CONSIDERATION, IS NO T THE FIRST YEAR IN WHICH THE DEPRECIATION FOR BUILDING IS CLAIMED. SUCH CLAI M WAS MADE IN AY 2009- 10. THEREFORE, FOR AY 2010-11, THE AO WAS NOT REQUI RED TO MAKE ANY ENQUIRY IN VIEW OF THE SPECIFIC PROVISION OF SECTIO N 43(6) OF THE ACT DEFINING THE WDV OF DEPRECIABLE ASSET. THE AO HAS SIMPLY TO FOLLOW IT IN THE ITA NO. 2583/M/2015 - M/S CR RETAIL MALLS (INDIA) LTD. 5 FOLLOWING ORDER WHICH THE AO HAS DONE NO ERROR WAS COMMITTED BY THE AO, AS THE AO HAS NO OCCASION TO MAKE SUCH ENQUIRY. IN ALTERNATIVE, THE ASSESSEE HAS ALSO MADE DETAILED NOTE BELOW THE SCHEDULE OF F IXED ASSET IN ITS AUDIT REPORT ABOUT THE CLAIM OF DEPRECIATION AND THE AO B EING SATISFIED THEREWITH HAS THOUGHT IT FIT NOT TO DISCUSS THE SAME ELABORAT ELY IN THE ASSESSMENT ORDER, THE ASSESSEE ALSO PLACED ON RECORD THE COPY OF SUB- LEASE ETC. ON OTHER ISSUE RELATED WITH CLAIM OF TDS, IT WAS CONTENDED THAT TH E ASSESSEE ALSO FILED TDS CERTIFICATE IN FORM-16A. BEFORE REVISING THE ORDER THE REVENUE AUTHORITIES HAS TO SHOW THAT ORDER IS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE. THE SHOW-CAUSE NOTICE DATED 22.07.2014 REV EALS THAT THE AO ERRED IN NOT CONSIDERING THE DIFFERENCE OF INCOME REPORTE D IN FORM 26AS AND CORRESPONDING INCOME OF BOOKS OF ACCOUNT. THE ASSES SEE HAS FURNISHED ALL TDS IN THE FORM OF FORM 16A. THE ASSESSEE FURNISHED PROPER RECONCILIATION OF INCOME AS PER FORM 26AS AND AS PER BOOKS. THE AO HAS NOT COMMITTED ANY ERROR AS HE HAS VERIFIED THE BOOKS AND CERTIFY HIMSELF WITH THE RETURNED INCOME. FOR THIRD ISSUE, WITH REGARD TO TREATING T HE ENTERTAINMENT TAX AS REVENUE RECEIPT, THE ASSESSEE CONTENDED THAT THE AS SESSING OFFICER DECIDED ISSUE AFTER EXAMINING THE NATURE OF SUBSIDY BEING C APITAL IN NATURE. 4. THE CONTENTION OF ASSESSEE WAS NOT ACCEPTED BY LD. PCIT. THE LD PCIT CONCLUDED THAT THE ASSESSEE OBTAINED THE SUB-LEASE FOR 900 YEARS WHICH INCLUDES A BUNDLE OR RIGHT OVER THE PIECE OF LAND W ITH SUPERSTRUCTURE IN FORM OF MULTIPLEX CINEMA UNIT IS CONSTRUCTED. THE ASSESS EE HAS RIGHT TO MORTGAGE, ITA NO. 2583/M/2015 - M/S CR RETAIL MALLS (INDIA) LTD. 6 CHARGE, TRANSFER, ASSIGN, SUB-LET INCOME ENCUMBER, CREATE THIRD PARTY RIGHT OVER THE MULTIPLEX CINEMA UNIT, THE ASSESSEE IS FRE E TO CONSTRUCT WHATEVER SUPERSTRUCTURE THEY WANTS OVER THE LAND DURING THE LEASE PERIOD. ABOUT OF OBJECTION OF ASSESSEE THAT ASSESSEE ALSO CLAIMED DE PRECIATION ON LEASE-HOLD BUILDING DURING THE AY 2009-10. THE LD. PCIT CONCLU DED THAT THE CASE WAS NOT TAKEN UP FOR SCRUTINY FOR AY 2009-10 AND THE ON LY OCCASION WITH THE AO TO EXAMINE WAS IN COURSE OF ASSESSMENT FOR AY 20 10-11. THUS, THE AO WAS DUTY BOUND TO LOOK INTO THE SUBSTANCE OF TRANSA CTION ON FIRST AVAILABLE OCCASION. IT WAS FURTHER CONCLUDED THAT THE AO WAS DUTY BOUND TO EXAMINE THE INCOME OFFERED FOR TAX CORRESPONDING WITH TDS C ERTIFICATE ATTACHED ALONG WITH RETURN OF FORM NO. 26AS. THE AO ACTED IN A MECHANICAL WAY AND FAILED TO CO-RELATE INCOME CORRESPONDING TO TDS CERTIFICATE IN FORM 26AS. THERE IS DISCREPANCY TO THE TUNE OF RS.61,31, 808/-, TO THE DETAILS WHICH WERE GIVEN IN THE SHOW-CAUSE NOTICE. THE AO H AS NOT EXAMINED THE SCHEME OF GOVERNMENT GRANTING SUBSIDY FOR RELIEF TO THE MULTIPLEX THEATER. THE AO ON THE BASIS OF CINEMA TICKET ISSUED BY THE ASSESSEE-COMPANY DISALLOWED THE CLAIM OF DEDUCTION FOR ENTERTAINMENT TAX; THE ASSESSEE HAS SHOWN INCOME NET OF ENTERTAINMENT TAX FROM TICKET SALES. TICKET SALES DO NOT SHOW ANY PORTION TOWARDS ENTERTAINMENT TAX. THU S, ENTIRE AMOUNT WAS REQUIRED TO BE OFFERED FOR TAX, THE AO WAS DUTY BOU ND TO EXAMINE AND BRING THE SAID TAX TO THE INCOME. THE LD. PCIT SET-ASIDE THE ASSESSMENT ORDER AND DIRECTED THE AO TO RE-FRAME THE ASSESSMENT ORDER AF TER EXAMINING ALL THREE ITA NO. 2583/M/2015 - M/S CR RETAIL MALLS (INDIA) LTD. 7 ISSUES. AGGRIEVED BY THE ORDER OF LD. PCIT, THE ASS ESSEE HAS FILED THE PRESENT APPEAL BEFORE US. 5. WE HAVE HEARD THE LD. AUTHORIZED REPRESENTATIVE (AR ) OF THE ASSESSEE AND LD. DEPARTMENTAL REPRESENTATIVE (DR) FOR THE REVENU E AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE LEARNED AR OF THE ASSESSEE ARGUED THAT ASSESSMENT ORDER UNDER SECTION 143 (3) WAS PASSED O N 08.03.2013. THE ASSESSING OFFICER PASSED THE ORDER AFTER EXAMINING ALL THE ISSUE RAISED BY LEARNED PCIT IN ITS NOTICE UNDER SECTION 263. THE O RDER PASSED BY ASSESSING OFFICER IS NEITHER ERRONEOUS NOT PREJUDICIAL TO THE INTEREST OF REVENUE. THE MARE FACTS THAT THE ASSESSMENT ORDER PASSED BY ASSE SSING OFFICER WAS SHORT WOULD NEITHER MEAN FAILURE ON HIS PART IN NOT EXAMI NING THE MATTER AS EXAMINED BY LD PCIT. IT WAS ARGUED THAT LEARNED PCI T CANNOT DELEGATE HIS POWER TO THE ASSESSING OFFICER TO EXAMINE THE ISSUE S. IT IS THE POWER OF LD COMMISSIONER OF INCOME -TAX ONLY TO EXAMINE THE ISS UE HIMSELF, IF THE ORDER IS ERRONEOUS OR IT IS PREJUDICIAL TO THE INTEREST O F THE REVENUE. TO SUPPORT HIS CONTENTION THE LEARNED AR OF THE ASSESSEE RELIED UP ON THE DECISION OF DELHI HIGH COURT IN CASE OF CIT VERSUS VIKAS POLYMERS[201 2] 341 ITR 537 (DELHI). IT WAS ARGUED THAT BEFORE SETTING ASIDE TH E ISSUE THE LEARNED PCIT SHOULD EXAMINE THE ISSUE FIRST AND THEN TO SET ASID E THE SAME TO THE ASSESSING OFFICER. TO SUPPORT HIS SUBMISSION THE LEARNED AR O F THE ASSESSEE RELIED UPON THE DECISION OF TRIBUNAL IN GAURAV MATHRAWALA VS CIT IN ITA 2378/M/2015 DATED 6 JANUARY 2016, AV INDUSTRIES VER SUS ACIT IN ITA ITA NO. 2583/M/2015 - M/S CR RETAIL MALLS (INDIA) LTD. 8 3469/M/2010, HSBC ASSET MANAGEMENT VERSUS DCIT IN ITA 2028/M/2009 DATED 15 JUNE 2001, BHARAT HOMES LTD VS CIT IN ITA 6792/M/2011 DATED 27 MAY 2016 AND THE DECISION OF HONBLE GUJARAT HIGH COURT IN JMC PROJECTS (INDIA) LTD VERSUS ACIT IN I TA 3434 OF 2015 DATED 21 DECEMBER 2015. ON MERIT IT WAS ARGUED THAT ASSES SEE ENTERED INTO AGREEMENT WITH PHOENIX MILLS LTD WHEREBY PHOENIX MI LLS LTD AGREED TO GRANT SUB-LEASE OF MULTIPLEX CINEMA UNIT TO THE ASS ESSEE FOR A TERM OF 900 YEARS. AFTER AVAILING THE SUB-LEASE AND MAKING NECE SSARY IMPROVEMENTS IN MULTIPLEX UNITS AND INSTALLING THE FIT OUTS EQUIPME NT FIXTURE AND OTHER ASSET NECESSARY FOR RUNNING THE MULTIPLEX CINEMA THE ASSE SSEE STARTED ITS BUSINESS OF EXHIBITING FILMS FROM THE SAID MULTIPLEX CINEMA. THE ASSESSEE CLAIMED DEPRECIATION ON MULTIPLEX CINEMA UNIT FOR THE FIRST TIME IN ASSESSMENT YEAR 2009-10 AND THEREAFTER, REDUCING THE DEPRECIATION A MOUNT FROM THE COST OF MULTIPLEX CINEMA UNIT; NET WRITTEN DOWN VALUE WAS C ARRIED FORWARD FOR ASSESSMENT YEAR 2010-11. DURING THE ASSESSMENT PROC EEDINGS THE ASSESSING OFFICER CALLED THE DETAIL PARTICULARS FROM TIME TO TIME ABOUT WORKING OF DEPRECIATION ON FIXED ASSET IN ACCORDANCE WITH THE INCOME-TAX RULES. THE ASSESSEE FILED ALL DETAILS ALONG WITH AUDIT REPORT. THE ASSESSING OFFICER AFTER EXAMINING ALL THE DETAILS ALLOWED THE DEPRECIATION. THE ASSESSEE ALSO FURNISHED THE ALL TDS CERTIFICATES ISSUED IN THE FO RM NO. 16A. WITH REGARD TO THIRD ISSUE RELATING TO ENTERTAINMENT TAX TREATE D AS CAPITAL SUBSIDY, IT WAS ARGUED THAT ASSESSING OFFICER DECIDED THE NATURE OF THE SUBSIDY AFTER ITA NO. 2583/M/2015 - M/S CR RETAIL MALLS (INDIA) LTD. 9 ASCERTAINING FROM THE SCHEME. THE ASSESSING OFFICER WAS CONSCIOUS ABOUT THE NATURE OF SUBSIDY BEING CAPITAL IN NATURE; THE ISSU E WAS PROPERLY EXAMINED BY THE ASSESSING OFFICER WHILE PASSING ASSESSMENT O RDER. IT WAS ARGUED THAT THE ORDER PASSED BY THE ASSESSING OFFICER IS NEITHE R ERRONEOUS NOR PREJUDICIAL TO THE INTEREST OF REVENUE. 6. ON THE OTHER HAND THE LEARNED DR FOR THE REVENUE SU PPORTED THE ORDER OF LEARNED PCIT. IT WAS ARGUED THAT NO DETAILS WERE CA LLED BY ASSESSING OFFICER NOR THE ASSESSING OFFICER EXAMINED SUCH CLAIMS OF T HE ASSESSEE, ON WHICH THE ORDER IS SET-ASIDE. SECTION 263 OF INCOME TAX ACT E MPOWERS THE PR CIT OR CIT TO EXAMINE IF THE ORDER PASSED BY THE ASSESSING OFFICER IS IN ACCORDANCE WITH LAW OR NOT OR THE ASSESSING OFFICER HAS NOT MA DE ADEQUATE ENQUIRY NECESSARY RELATED WITH THE CLAIMS. IT IS NOT NECESS ARY EVEN TO ISSUED NOTICE TO THE ASSESSEE ON A SPECIFIC CHARGE. THE COMMISSIONER OF INCOME TAX HAS TO GIVE OPPORTUNITY OF HEARING BEFORE REVISING THE ORD ER, IN CASE THE ORDER PASSED BY ASSESSING OFFICER IS ERRONEOUS AND PREJUD ICIAL TO THE INTEREST OF REVENUE. IT IS THE DUTY OF PR COMMISSIONER OF INCOM E TAX TO EXAMINE WHETHER THE ASSESSING OFFICER HAS EXAMINED THE ISSU E WHICH WAS INCUMBENT UPON THE ASSESSING OFFICER TO EXAMINE THE SAME. IT WAS FURTHER ARGUED THAT THIS WAS THE FIRST YEAR FOR SCRUTINY ASSESSMENT FOR EXAMINATION OF ALLEGED SUB-LEASE OF MULTIPLEX. THE LEARNED DR FURTHER SUPP ORTED THE ORDER OF PR COMMISSIONER OF INCOME TAX ACT ON THE REMAINING TWO ISSUE REVISED IN THE IMPUGNED ORDER. IN SUPPORT OF HIS SUBMISSION THE LE ARNED DR FOR THE ITA NO. 2583/M/2015 - M/S CR RETAIL MALLS (INDIA) LTD. 10 REVENUE RELIED UPON THE DECISION OF HONBLE SUPREME COURT IN CASE OF CIT VERSUS AMITABH BACHCHAN [2016] 69 TAXMANN.COM 170(S C) AND DECISION OF ANDHRA PRADESH HIGH COURT IN CIT VERSUS VARANASI KH ANTA RAO [2015] 59 TAXMANN.COM 175(ANDHRA PRADESH). 7. WE HAVE CONSIDERED THE RIVAL SUBMISSION OF PARTIES AND HAVE GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. WE HAVE ALSO PERUS ED THE VARIOUS DECISION RELIED BY THE RESPECTIVE LEARNED REPRESENTATIVE OF THE PARTIES. THE PERUSAL OF GROUNDS OF APPEAL RAISED BY ASSESSEE IN THE PRESENT APPEAL REVEALS THAT THE ASSESSEE HAS CHALLENGED ONLY THE VALIDITY OF ORDER PASSED BY LEARNED PCIT UNDER SECTION 263 OF INCOME TAX ACT. THE ASSESSING OFFICER PASSED THE ORDER OF ASSESSMENT UNDER SECTION 143(3) ON 18 MARCH 2013 . THE PERUSAL OF ASSESSMENT ORDER REVEALS THAT ASSESSING OFFICER HAS NOT MADE ANY REFERENCE WITH REGARD TO THE VERIFICATION OF TDS CERTIFICATES AND THE CLAIM OF DEPRECIATION OF ASSET, CLAIMED BY ASSESSEE WITH RES PECT TO SUPERSTRUCTURE OF MULTIPLEX CINEMA. THE PERUSAL OF THE ASSESSMENT ORD ER REVEALS THAT THE ASSESSING OFFICER HAS NOT RAISED ANY QUERY WITH REG ARD TO THE NATURE OF ASSET, LEASE HOLD PERIOD OF BUILDING OF MULTIPLEX THEATER . FURTHER, THE ASSESSEE CLAIMED CREDIT OF TDS OF RS. 2,54,69,821/-, THE ASS ESSING OFFICER HAS NOT MADE ANY INQUIRY NOR VERIFIED THE TDS CERTIFICATES AND THE BOOKS OF ACCOUNT. THE ASSESSEE HAS NOT OFFERED THE ADVERTISEMENT INCO ME TO TAX. THE ASSESSEE CLAIMED DEDUCTION OF PORTION ON TICKET AMOUNT AS EN TERTAINMENT TAX WITHOUT OFFERING IT TO INCOME BY TREATING IT AS CAPITAL REC EIPT. THE ASSESSING OFFICER ITA NO. 2583/M/2015 - M/S CR RETAIL MALLS (INDIA) LTD. 11 ALLOWED THE PAYMENT AS REVENUE EXPENDITURE WITHOUT EXAMINING THE SCHEME OF SUBSIDY OF MAHARASHTRA GOVERNMENT FOR ENTERTAINM ENT TAX VIS A VIS ITS TAXABLITY. THE ASSESSING OFFICER IMPLIEDLY ALLOWED THE RELIEF TO THE ASSESSEE WITHOUT MAKING ANY DISCUSSION ON THE ISSUES. 8. THE ASSESSING OFFICER IS A QUASI JUDICIAL AUTHORITY AND HIS ORDER IS AMENABLE TO APPEAL OR REVISION. IF NAY FINDING OF THE ASSESS ING OFFICER GOES AGAINST THE ASSESSEE, THE ORDER IS AMENABLE TO STATUTORY APPEAL PROVIDED UNDER THE ACT. HOWEVER, IF THE ORDER IS PREJUDICIAL TO THE INTERES T OF REVENUE, THE REMEDY OF APPEAL IS NOT AVAILABLE TO THE REVENUE. THEREFORE S ECTION 263 IS ENACTED TO EMPOWER THE COMMISSIONER TO EXERCISE THE POWER TO I NVOKE JURISDICTION CONFERRED UNDER SECTION 263 OF THE ACT. THEREFORE, THE ORDER PASSED BY ASSESSING OFFICER MUST BE SPEAKING AND SUBSTANTIAL. IF THE ORDER PASSED BY ASSESSING OFFICER IS SUBVERSIVE OF THE ADMINISTRATI ON OF REVENUE, IT MUST BE REGARDED AS ERRONEOUS AND PREJUDICIAL TO THE INTERE ST OF REVENUE. AND THE REVENUE IS BOUND TO SUFFER. IN OUR CONSIDERED VIEW THE ORDER IS PREJUDICIAL TO THE INTEREST OF REVENUE AS PER THE PROVISION OF SEC TION 263; (I) IF THE ORDER SOUGHT TO BE REVISED WAS PASSED WITHOU T CONSIDERING AND REFERRING THE FACTS OR CONTAINS ERROR OF FACTS OR LAW, ON THE FACE OF IT, (II) IF THE ORDER IS BASED ON INCORRECT ASSUMPTION OF LA W OR FACTS OR ALLOWED THE RELIEF SILENTLY, OR (III) IF THE ORDER PASSED BY ASSESSING OFFICER IN A MECHA NICAL WAY THEREBY ACCEPT WHAT THE ASSESSEE HAS STATED WHILE FURNISHIN G THE RETURN OF ITA NO. 2583/M/2015 - M/S CR RETAIL MALLS (INDIA) LTD. 12 INCOME AND FAILED TO MAKE REQUISITE ENQUIRIES OR DO ES NOT EXAMINE THE GENUINENESS OR LEGITIMACY OF THE CLAIM WHICH MAY BE CALLED FOR AS PER THE FACTS OF THE CASE. 9. IN THE PRESENT CASE THE ASSESSING OFFICER MECHANICA LLY ACCEPTED THE CLAIM WITH REGARDS TO THE DEPRECIATION ON FIXED ASSET/ MU LTIPLEX BUILDING AND ON THE ISSUE OF TDS CERTIFICATE, IF THE CORRESPONDING INCOME WAS OFFERED TO TAX AS NO RECONCILIATION WAS MADE. FURTHER THE ASSESSIN G OFFICER WITHOUT CALLING AND EXAMINING THE SCHEME OF GOVERNMENT OF MAHARASHT RA ON ENTERTAINMENT TAX TREATED THE ENTERTAINMENT TAX SAME AS REVENUE R ECEIPT. 10. THE LD. AR FOR THE ASSESSEE ARGUED THAT THE ASSESSI NG OFFICER HAD CONSIDERED THE RELEVANT FACTS AND THE MATERIAL WHILE PASSING T HE ASSESSMENT ORDER. ACCORDING TO LD AR FOR THE ASSESSEE, THE MARE FACT THAT ASSESSMENT ORDER PASSED BY ASSESSING OFFICER WAS SHORT IS NEITHER ME AN FAILURE ON HIS PART IN NOT EXAMINING THE MATTER CAREFULLY NOR WOULD BE ERR ONEOUS SO LONG AS VIEW TAKEN BY HIM WAS POSSIBLE VIEW. IN OUR VIEW THE SUB MISSION OF LD. AR FOR THE ASSESSEE IS NOT CORRECT AND MUST FAIL FOR THE R EASONS WE HAVE EXPLAINED HEREINABOVE. 11. IN MALABAR INDUSTRIAL CO. LTD VS CIT (243 ITR 83) THE HONBLE APEX COURT HELD; THERE CAN BE NO DOUBT THAT THE PROVISION CANNOT BE INVOKED TO CORRECT EACH AND EVERY TYPE OF MISTAKE COMMITTED BY THE ASS ESSING OFFICER, IT IS ONLY WHEN AN ORDER IS ERRONEOUS THAT THE SECTION WI LL BE ATTRACTED. AN INCORRECT ASSUMPTION OF FACTS OR AN INCORRECT APPLI CATION OF LAW WILL ITA NO. 2583/M/2015 - M/S CR RETAIL MALLS (INDIA) LTD. 13 SATISFY THE REQUIREMENT OF THE ORDER BEING ERRONEOU S. IN THE SAME CATEGORY FALLS THE ORDER PASSED WITHOUT APPLYING TH E PRINCIPLES OF NATURAL JUSTICE WITHOUT APPLICATION OF MIND. 12. IN THE PRESENT CASE THE ORDER SOUGHT TO BE REVIVED REFLECTS THAT IT WAS PASSED IN MECHANICAL WAY AND WITHOUT APPLICATION OF MIND B Y ASSESSING OFFICER. THUS, IN VIEW OF THE FORGOING REASONS THE ASSESSMEN T ORDER WAS PASSED WITHOUT MAKING REQUISITE INQUIRIES WILL SATISFY THE CONDITION OF THE ORDER BEING ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE. THE VARIOUS CASE LAW RELIED BY LD AR FOR THE ASSESSEE IS NOT APPLICA BLE ON THE FACTUAL MATRIX OF THE PRESENT CASE. IN THE RESULT THE GROUNDS OF A PPEAL RAISED BY THE ASSESSEE IS DISMISSED. 13. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS DISM ISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 25 TH DAY OF OCTOBER 2017. SD/- SD/- (B.R. BASKARAN) (PAWAN SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI; DATED 25/10/2017 S.K.PS COPY OF THE ORDER FORWARDED TO : BY ORDER, (ASSTT.REGISTRAR) ITAT, MUMBAI 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A), MUMBAI. 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY/