A.V. INDUSTRIES, MUMBAI V. ACIT 24(3), MUMBAI

ITA 3469/MUM/2010

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 2737 (ITAT-MUMBAI)
• Duration Of Justice: 5 year(s) 6 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-11-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 23-07-2015
• Assessment Year: 2005-2006
• Appeal Filed On: 03-05-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANJAY SINGH
• Assessee Lawyers: K SHIVARAM
• Keywords: Depreciation; Rectification of order; Opportunity of being heard; Assessment record; Revenue expenditure; Capital expenditure
• Section: 143(3); 142(1); 80G; 263; 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH A, MUMBAI BEFORE SHRI G.S. PANNU, ACCOUNTANT MEMBER AND SHRI SANJAY GARG, JUDICIAL MEMBER ITA NO.3469/M/2010 ASSESSMENT YEAR: 2005-06 M/S. A.V. INDUSTRIES, 201, BHAGTANI KRISHNA, A WING, DATTARAY ROAD, SANTACRUZ (W), MUMBAI 400 054 PAN: AAFFA 1100L VS. ASSTT. COMMISSIONER OF INCOME TAX -24(3), MUMBAI (APPELLANT) (RESPONDENT) PRESENT FOR: ASSESSEE BY : SHRI K. SHIVARAM, A.R. REVENUE BY : SHRI SANJAY SINGH, D.R. DATE OF HEARING : 23.07.2015 DATE OF PRONOUNCEMENT : 06.11.2015 O R D E R PER SANJAY GARG, JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE ASSES SEE AGAINST THE ORDER DATED 25.03.2010 OF THE COMMISSIONER OF INCOME TAX [HEREINAFTER REFERRED TO AS THE CIT] RELEVANT TO ASSESSMENT YEAR 2005-06, PASSED UNDER SECTION 263 OF THE ACT WHEREBY HE HAS ANNULLED THE ASSESSMENT M ADE U/S 143(3) OF THE ACT BY THE ASSESSING OFFICER (HEREINAFTER REFERRED TO AS THE AO) AND HAS DIRECTED THE AO FOR DENOVO ASSESSMENT IN THE CASE O F THE ASSESSEE. 2. THE FACTS IN BRIEF ARE THAT THE LD. CIT EXERCISI NG HIS REVISIONAL JURISDICTION UNDER SECTION 263 CALLED FOR AND EXAMI NED THE ASSESSMENT RECORDS AND WAS OF THE VIEW THAT THE ORDER OF THE AO WAS ER RONEOUS IN SO FAR AS IT WAS PREJUDICIAL TO THE INTEREST OF REVENUE ON THE FOLLO WING GROUNDS: ITA NO.3469/M/2010 M/S. A.V. INDUSTRIES 2 (1) PURCHASE OF TOOLS AND IMPLEMENTS OF RS.62,44,8 02/-, WHICH WAS IN THE NATURE OF CAPITAL EXPENDITURE, WAS DEBITED IN THE P ROFIT & LOSS ACCOUNT AS REVENUE EXPENDITURE AND SAME WAS ALLOWED BY THE ASSESSING OFFICER WITHOUT ANY VERIFICATION. (2) ASSESSEE HAD CLAIMED DEPREDATION ON DIES AT THE RATE OF 40% AND SAME WAS ALLOWED BY THE ASSESSING OFFICER IN ASSESSMENT WITHOUT ANY EXAMINATION, ALTHOUGH THE DEPRECIATION ALLOWABLE AS PER THE I. T . RULES WAS 25%. (3) THE TOTAL DEPRECIATION ALLOWABLE ON MOTOR CAR A S PER THE DETAILS FILED WAS RS.7,53,906/- WHEREAS THE ASSESSEES CLAIM OF DEPRE CIATION OF RS.9,42,382/- WAS ALLOWED WITHOUT ANY VERIFICATION. (4) THE DEDUCTION CLAIMED U/S.80G OF THE I. T. ACT ON A CCOUNT OF DONATION WAS ALLOWED BY THE ASSESSING OFFICER ALTHOUGH THE ASSES SEE HAD NOT FILED ANY EVIDENCE. 3. IN VIEW OF THE ABOVE, THE LD. CIT ISSUED SHOW CA USE NOTICE DATED 11.03.10 TO THE ASSESSEE ASKING HIM TO SUBMIT AN EX PLANATION AS TO WHY NOT THE ORDER PASSED BY THE AO BE NOT REVISED/SET ASIDE AS PER PROVISIONS OF SECTION 263 OF THE ACT. IN COMPLIANCE TO THE SAID NOTICE, THE ASSESSEE FILED WRITTEN SUBMISSIONS AND EXPLAINED THAT SO FAR AS TH E EXPENDITURE INCURRED ON TOOLS AND IMPLEMENTS WAS CONCERNED, THE ASSESSEE WAS IN THE BUSINESS OF MANUFACTURE OF AUTOMOBILE PARTS MADE OF RUBBER A ND SOME OF THE RAW MATERIALS USED FOR PRODUCTION OF AUTOMOBILE PARTS W AS OF REVENUE NATURE AND AS SUCH THE SAME WAS DEBITED IN THE PROFIT AND LOSS ACCOUNT. THE ASSESSEE ALSO RELIED UPON THE DECISION IN THE CASE OF CIT VS. MYSORE SPUN CONCRETE PIPE (P) LTD. 194 ITR 159 (KAR.) AND CIT VS. JAGATJIT INDUSTRIES LTD. 241 ITR 556 (DEL.). IN RESPECT OF DEPRECIATION ON DYES AND MOULDS THE ASSESSEE EXPLAINED THAT THE SAME AT THE RATE OF 40% WAS RIGHTLY CLAIMED. THE ASSESSEE SUBMITTED A DEPRECIA TION CHART IN THIS RESPECT. IN RESPECT OF THE THIRD ITEM I.E. DEPRECI ATION ALLOWABLE ON MOTOR CAR, THE ASSESSEE SUBMITTED THAT DEPRECIATION HAD R IGHTLY BEEN CLAIMED AT RS.9,42,382/- AND SUBMITTED THE REQUIRED DETAILS IN THIS RESPECT. ITA NO.3469/M/2010 M/S. A.V. INDUSTRIES 3 SO FAR AS THE FOURTH ISSUE IN RELATION TO THE DEDU CTION UNDER SECTION 80G WAS CONCERNED, THE ASSESSEE SUBMITTED THAT HE H AD NOT GIVEN ANY SUCH DONATION. HOWEVER, THE ASSESSEE HAD GIVEN AN AMOUNT OF RS.601/- TOWARDS SUBSCRIPTION TO VARIOUS PERSONS AT THE TIME OF FESTIVALS ETC. AND THE SAME HAD RIGHTLY BEEN CLAIMED AS BUSINESS EXPEN DITURE. IT WAS ALSO SUBMITTED BEFORE HIM THAT ALL THE REQUIRED DETAILS WERE SUBMITTED BEFORE THE AO AND THE AO, AFTER DULY EXAMINING THE ACCOUNT S AND RECORDS OF THE ASSESSEE, HAS PASSED THE ASSESSMENT ORDER. 4. THE LD. CIT, AFTER CONSIDERING THE SUBMISSIONS MADE BY THE LD. A.R. OF THE ASSESSEE, OBSERVED THAT THE AO HAD NOT MADE PRO PER VERIFICATION OF THE CLAIMS MADE BY THE ASSESSEE IN THE RETURN OF INCOME IN RELATION TO THE ABOVE STATED ISSUES. HE OBSERVED THAT ON PROPER VERIFICA TION, CERTAIN CLAIMS OF THE ASSESSEE MAY BE FOUND ALLOWABLE OR DISALLOWABLE EIT HER IN PART OR FULL. BUT IF SUCH VERIFICATION HAS NOT BEEN MADE AT THE TIME OF ASSESSMENT, SUCH ASSESSMENT IS LIABLE TO BE TREATED AS ERRONEOUS IN SO FAR AS I T IS PREJUDICIAL TO THE INTEREST OF REVENUE. THE AO SHOULD HAVE GIVEN A SPECIFIC FINDI NG AS TO WHETHER THE PARTICULAR CLAIM OF THE ASSESSEE WAS ALLOWABLE OR D ISALLOWABLE. HOWEVER, NO SUCH FINDING WAS GIVEN BY THE AO. HE, THEREFORE, C ONCLUDED THAT THE CLAIM OF THE ASSESSEE HAS NOT BEEN ALLOWED AFTER PROPER VERI FICATION. HE, THEREFORE, TREATED THE ASSESSMENT MADE BY THE AO AS ERRONEOUS IN SO FAR AS IT WAS PREJUDICIAL TO THE INTEREST OF REVENUE. HE ACCORDI NGLY SET ASIDE THE ASSESSMENT WITH A DIRECTION TO DO IT DENOVO. BEING AGGRIEVED BY THE ORDER OF THE LD. CIT, THE ASSESSEE HAS COME IN APPEAL BEFORE US. 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND HAVE ALS O GONE THROUGH THE RECORDS. TO ARRIVE AT THE CORRECT CONCLUSION OF TH E CASE, WE DEEM IT NECESSARY TO REPRODUCE THE RELEVANT PROVISIONS OF SECTION 263 OF THE ACT. ITA NO.3469/M/2010 M/S. A.V. INDUSTRIES 4 SECTION 263(1) IN THE INCOME- TAX ACT: (1) THE COMMISSIONER MAY CALL FOR AND EXAMINE THE R ECORD OF ANY PROCEEDING UNDER THIS ACT, AND IF HE CONSIDERS THAT ANY ORDER PASSED THEREIN BY THE 2 ASSESSING] OFFICER IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE, HE, MAY, AFTER GIVING THE ASSESSEE AN OPPORTUNITY OF BEING H EARD AND AFTER MAKING OR CAUSING TO BE MADE SUCH INQUIRY AS HE DEEMS NECESSARY, PASS SUCH ORDER THEREON AS THE CIRCUMSTANCES OF THE CASE JUSTIFY, INCLUDING AN ORD ER ENHANCING OR MODIFYING THE ASSESSMENT, OR CANCELLING THE ASSESSMENT AND DIRECT ING A FRESH ASSESSMENT. 6. THE SUM AND SUBSTANCE OF THE ABOVE REPRODUCED SE CTION 263(1) CAN BE SUMMARIZED IN THE FOLLOWING POINTS: 1) THE COMMISSIONER MAY CALL FOR AND EXAMINE THE RE CORD OF ANY PROCEEDING UNDER THE ACT; 2) IF HE CONSIDERS THAT THE ORDER PASSED BY THE AO IS (I) ERRONEOUS; AND (II) IS PREJUDICIAL TO THE INTEREST OF REVENUE; 3) HE HAS TO GIVE AN OPPORTUNITY OF HEARING IN THIS RESPECT TO THE ASSESSEE; AND 4) HE HAS TO MAKE OR CAUSE TO MAKE SUCH ENQUIRY AS HE DEEMS NECESSARY; 5) HE MAY PASS SUCH ORDER THEREON AS THE CIRCUMSTAN CES OF THE CASE JUSTIFY INCLUDING, (I) AN ORDER ENHANCING OR, (II) MODIFYING THE ASSESSMENT OR (III) CANCELLING THE ASSESSMENT AND DIRECTING A FRE SH ASSESSMENT. 7. NOW IN THE LIGHT OF ABOVE WORDS, WE HAVE TO EXAM INE AS TO WHETHER THE ORDER OF THE LD. CIT IS A VALID ORDER IN THE LIGHT OF THE ABOVE STATED POINTS/PROVISIONS OF SECTION 263 OF THE ACT. IN THE CASE IN HAND, THE ASSESSEE HAD SUBMITTED ALL THE REQUISITE DETAILS BE FORE THE AO. IT HAS BEEN MENTIONED IN THE ASSESSMENT ORDER THAT THE BOOKS OF THE ACCOUNTS WERE ITA NO.3469/M/2010 M/S. A.V. INDUSTRIES 5 PRODUCED AND WERE SUBJECTED TO TEST CHECK. THE CAS E WAS DISCUSSED WITH THE ASSESSEE. THEREAFTER, THE AO PROCEEDED TO MAKE CERTAIN DISALLOWANCES AND ASSESSED THE INCOME OF THE ASSESS EE AT RS.1,98,14,370/- AGAINST THE RETURNED INCOME OF RS.1,95,45,368/-. T HE LD. A.R. OF THE ASSESSEE HAS DRAWN OUR ATTENTION TO THE NOTICE ISSU ED BY THE AO UNDER SECTION 142(1) DATED 22.01.07 IN RELATION TO THE SC RUTINY ASSESSMENT PROCEEDINGS UNDER SECTION 143(3) OF THE ACT. WE FI ND THAT THE AO VIDE LETTER DATED 22.01.07 HAD CALLED FOR THE FOLLOWING DETAILS FROM THE ASSESSEE. 1. NATURE OF BUSINESS ACTIVITY 2. DETAILS IN RESPECT OF AIR FREIGHT, COURIER CHARG ES, DONATION, DIE & REPAIRS, INSURANCE, ELECTRICAL MAINTENANCE & REPAIR S. 3. DETAILS OF FACTORY MAINTENANCE AND REPAIRS, FORE IGN AGENCY COMMISSION, FREIGHT OUTWARD, TOOLS AND IMPLEMENTS, MACHINERY REPAIRS, TOUR ABROAD ETC. 4. DETAILS IN RESPECT OF BUSINESS PROMOTION. 5. CAPITAL ACCOUNT OF PARTNERS 6. DETAILS OF BANK ACCOUNTS HELD WITH ACCOUNT NUMBE RS AND THEIR RESPECTIVE BALANCES 7. PHOTOCOPIES OF BILLS TO BE FURNISHED IN RESPECT OF ADDITION TO FIXED ASSETS 8. DETAILS OF EXPENSES LIKE TELEPHONE EXPENSES WITH TELEPHONE NUMBERS AND PLACE OF INSTALLATION. 9. COMPLETE DETAILS OF SUNDRY DEBTORS AND CREDITORS WITH NAME, ADDRESS AND AMOUNT. 10. DETAILS OF OTHER MAJOR HEADS OF EXPENSES. 11. DETAILS OF TDS OUTSTANDING WITH GROSS AMOUNT AN D DATE OF PAYMENT IN TREASURY. 12. COPY OF BANK ACCOUNT TO BE FURNISHED WITH BANK RECONCILIATION STATEMENT. 8. THE ASSESSEE SUBMITTED THE REQUIRED DETAILS INCL UDING LEDGER ACCOUNT OF TOOLS AND IMPLEMENTS AND COPIES OF BILLS ETC. THE LD. A.R. OF THE ASSESSEE HAS FURTHER INVITED OUR ATTENTION TO C OPIES OF THE VARIOUS OTHER LETTERS ADDRESSED TO THE AO TO SHOW THAT FROM TIME TO TIME THE AO CALLED FOR VARIOUS RECORDS WHICH WERE DULY SUBMITTED AND T HE RELEVANT ITA NO.3469/M/2010 M/S. A.V. INDUSTRIES 6 EXPLANATION WAS GIVEN TO THE AO. AFTER DULY EXAMIN ING THE RECORDS OF THE ASSESSEE, THE AO PROCEEDED TO PASS THE ASSESSME NT ORDER. THE LD. A.R. HAS FURTHER INVITED OUR ATTENTION TO T HE COPY OF LETTER DATED 05.03.08 ADDRESSED TO THE AO, THE CONTENTS OF THE S AID LETTER REVEAL THAT THE ASSESSEE IN THE SAID LETTER HAS EXPLAINED THAT THE ASSESSEE HAD NOT CLAIMED ANY SPECIAL RATE OF DEPRECIATION ON THE PLA NTS AND MACHINERY PURCHASED DURING THE YEAR BUT HAD CLAIMED THE SAME ONLY ON MOULDS PURCHASED DURING THE YEAR AND THAT THERE WAS NO MIS TAKE OR ERROR IN THE ORDER PASSED UNDER SECTION 143(3) WHILE ALLOWING TH E CLAIM OF DEPRECIATION TO THE ASSESSEE. THE CONTENTS OF THE LETTER REVEAL THAT AFTER THE PASSING OF THE ASSESSMENT ORDER DATED 26.07.07, THE AO PERHAPS SOUGHT TO AMEND THE ORDER AS HE WAS OF THE VIEW THA T THE EXCESS CLAIM OF DEPRECIATION ON PLANT MACHINERY HAS BEEN ALLOWED TO THE ASSESSEE. HOWEVER, THE ASSESSEE EXPLAINED THAT HE HAD MADE A CORRECT CLAIM. PURSUANT TO THAT NO RECTIFICATION ORDER UNDER SECTI ON 154 WAS PASSED BY THE AO. THE LD. A.R. HAS FURTHER INVITED OUR ATTENT ION TO THE NOTICE ISSUED BY THE LD. CIT IN RELATION TO THE PROCEEDINGS UNDER SECTION 263 RAISING THE FOLLOWING QUERIES: I) YOU HAVE DEBITED AN AMOUNT OF RS.62,44,802/- UN DER THE HEAD TOOLS & IMPLEMENTS. SINCE THESE ARE IN THE NATURE OF CAPI TAL EXPENDITURE, ONLY THE DEPRECIATION PART ON THE SAID EXPENSES COU LD ONLY BE ALLOWED AS REVENUE EXPENDITURE. THIS AMOUNT SHOULD HAVE BEEN I NCLUDED IN THE BLOCK OF ASSETS UNDER THE HEAD PLANT & MACHINERY OR DIES & TOOLS EQUIPMENTS. II) YOU HAVE CLAIMED DEPRECIATION ON DIES & MOULDS @40%. HOWEVER , DEPRECIATION ON DIES IS ALLOWABLE ONLY @25%. THE AS SESSING OFFICER HAS ALLOWED THE SAME @40% AS CLAIMED IN REFUND. III) DEPRECIATION ON MOTOR CARS IS CLAIMED AND ALLO WED AT RS.9,42,382/-. - HOWEVER, AS PER THE PROVISIONS OF LAW, DEPRECIATION ALLOWABLE IS RS.7,53,906/ - ONLY. IV) EVEN THOUGH YOU HAVE CLAIMED DEDUCTION U/S.80-G FOR THE ITA NO.3469/M/2010 M/S. A.V. INDUSTRIES 7 DONATION OF RS.601/- NO VALID RECEIPT WAS SUBMITTED BY YOU. THEREFORE, NO DEDUCTION CAN BE ALLOWED ON THIS PAYMENT. V) YOU HAVE CLAIMED DEPRECIATION ON 'FACTORY LAND & BUILDING'. FOR LAND, NO DEPRECIATION CAN BE ALLOWED. 9. IN RESPONSE TO THE ABOVE STATED QUERIES, THE ASS ESSEE FILED A DETAILED WRITTEN REPLY DATED 19.03.10 WHEREIN THE ASSESSEE D ULY EXPLAINED THE GENUINENESS OF THE CLAIM MADE AND THAT THE CLAIM WA S RIGHTLY ALLOWED BY THE AO. THE ASSESSEE NOT ONLY EXPLAINED ABOUT EACH AND EVERY CLAIM/QUERY BUT ALSO PRODUCED THE NECESSARY DETAILS , CHARTS ETC. JUSTIFYING HIS CLAIM IN THIS RESPECT. THE LD. CIT HAS ALSO MENTIONED IN THE IMPUGNED ORDER THAT THE ASSESSEE HAD GIVEN THE EXPLANATION R EGARDING THE ITEMS OF CLAIM DISPUTED BY THE LD. CIT. 10. AS PER THE PROVISIONS OF SECTION 263 AS ENUMERATED ABOVE, AFTER GETTING THE EXPLANATION FROM THE ASSESSEE, THE LD. CIT WAS SUPPOSED TO EXAMINE THE CONTENTION OF THE ASSESSEE. BEFORE PAS SING AN ORDER OF MODIFYING, ENHANCING OR CANCELLING THE ASSESSMENT, HE WAS SUPP OSED EITHER TO HIMSELF MAKE OR CAUSE TO MAKE SUCH AN ENQUIRY AS HE DEEMS N ECESSARY. THE WORDS AS HE DEEMS NECESSARY, IN OUR VIEW, DO NOT MEAN THAT THE LD. CIT IS LEFT WITH A CHOICE EITHER TO MAKE OR NOT TO MAKE AN ENQUIRY. A S PER THE RELEVANT PROVISIONS OF SECTION 263, IT WAS INCUMBENT UPON THE LD. CIT TO MAKE OR CAUSE TO MAKE AN ENQUIRY. SO FAR AS THE WORDS AS HE DEEMS NECESSARY ARE CONCERNED, THE SAID WORDS SUGGEST THAT THE ENQUIRIE S WHICH ARE NECESSARY TO FORM A VIEW AS TO WHETHER THE ORDER OF THE AO IS ER RONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE OR NOT? A PERUSAL OF THE AB OVE REPRODUCED QUERIES NUMBERING (I) TO (V) REVEALS THAT THE LD. CIT HAD A SKED THE ASSESSEE ABOUT THE GENUINENESS/VALIDITY OF VARIOUS CLAIMS TO WHICH THE ASSESSEE HAD GIVEN A DETAILED REPLY. ONCE A POINT WISE REPLY WAS GIVEN BY THE ASSESSEE, THEN A DUTY ITA NO.3469/M/2010 M/S. A.V. INDUSTRIES 8 WAS CAST UPON THE LD. CIT TO EXAMINE THE REPLY OF T HE ASSESSEE AND FORM A PRIMA-FACIE OPINION AS TO WHETHER THE ORDER OF THE AO WAS ERRONEOUS SO FAR AS IT WAS PREJUDICIAL TO THE INTEREST OF REVENUE. WE FURTHER NOTE THAT THE LD. CIT DID NOT RAISE ANY QUERY AS TO WHAT ENQUIRIES WERE M ADE BY THE AO BEFORE PROCEEDING TO PASS THE ASSESSMENT ORDER IN QUESTION . THE LD. CIT, IN FACT, HAD MADE QUERIES REGARDING THE VALIDITY OF THE CLAIM OF THE ASSESSEE UNDER DIFFERENT HEADS, HOWEVER, HAS PROCEEDED TO HOLD THAT THE ORDE R OF THE AO IS ERRONEOUS SO FAR AS ITS PREJUDICIAL TO THE INTEREST OF REVENUE O N THE GROUND THAT THE AO HAD NOT MADE PROPER ENQUIRIES IN THIS RESPECT. IN OUR VIEW, ONCE THE LD. CIT HAD PROCEEDED TO MAKE AN ENQUIRY REGARDING THE GENUINEN ESS OF THE CLAIM OF THE ASSESSEE, HE WAS SUPPOSED TO MAKE A PRIMA-FACIE OPI NION WHICH MAY NOT BE A CONCLUDING OPINION TO HOLD THAT THE ORDER OF THE AO IN HIS VIEW WAS ERRONEOUS SO FAR AS IT WAS PREJUDICIAL TO THE INTEREST OF REV ENUE. THE OPINION OF THE COMMISSIONER THAT THE AO HAD NOT MADE PROPER ENQUIR IES OR VERIFICATIONS SHOULD BE BASED ON HIS OBJECTIVE SATISFACTION AND N OT A SUBSTANTIVE SATISFACTION FROM THE ASSESSMENT ORDER. MERELY BECAUSE, THE ASS ESSMENT ORDER IN QUESTION IS NOT A DETAILED ORDER AND THE AO HAS NOT MENTIONE D ITEM WISE FINDINGS REGARDING THE CLAIMS OF THE ASSESSEE, THAT ITSELF, DOES NOT MEAN THAT THE AO HAD NOT MADE ENQUIRIES IN THIS RESPECT. AS PER THE REL EVANT PROVISIONS AS THEY STOOD DURING THE RELEVANT PERIOD I.E. FOR A.Y. 2005-06, W HATEVER REQUIRED BY THE AO WAS TO LOOK INTO THE CLAIM OF THE ASSESSEE. ADMITT EDLY, THE AO ASKED THE ASSESSEE TO FURNISH THE NECESSARY DETAILS FROM TIME TO TIME WHICH WERE DULY FURNISHED BY THE ASSESSEE AND AFTER CONSIDERING THE SAME THE AO PASSED THE ASSESSMENT ORDER. 11. IT IS PERTINENT TO MENTION HERE THAT A DEEMING FICTION HAS BEEN CREATED IN SECTION 263 OF THE ACT BY THE AMENDMENT MADE BY FIN ANCE ACT, 2015 W.E.F. 01.06.15 WHEREIN IT HAS BEEN MENTIONED THAT WHERE T HE COMMISSIONER IS OF THE ITA NO.3469/M/2010 M/S. A.V. INDUSTRIES 9 OPINION THAT THE AO HAD PASSED THE ORDER WITHOUT MA KING ENQUIRIES OR A CLAIM HAS BEEN ALLOWED WITHOUT ENQUIRING INTO THE CLAIM O R THAT THE SAME IS NOT IN ACCORDANCE WITH ANY ORDER OR DIRECTION OR INSTRUCTI ON ISSUED BY CBDT, THAT SHALL BE DEEMED TO BE ERRONEOUS IN SO FAR AS ITS PR EJUDICIAL TO THE INTEREST OF REVENUE. THE SAID DEEMING PROVISIONS, IN OUR VIEW, ARE NOT APPLICABLE FOR THE ASSESSMENT YEAR UNDER CONSIDERATION. 12. IN OUR VIEW, WHEN THE ASSESSEE SHOWS FROM THE R ECORD THAT THE NECESSARY ENQUIRIES WERE MADE BY THE AO AND THE AO HAD APPLIE D HIS MIND AND THE VIEW ADOPTED BY HIM WAS ONE OF THE POSSIBLE VIEWS, THEN IT CANNOT BE SAID THAT THE ORDER OF THE AO IS ERRONEOUS. 13. IN THE CASE IN HAND, AFTER GETTING THE NECESSAR Y DETAILS AND EXPLANATION FROM THE ASSESSEE, THE LD. CIT HAS NOT GIVEN HIS OP INION REGARDING THE VALIDITY OR GENUINENESS OF THE CLAIMS MADE BY THE ASSESSEE. HE HAS SIMPLY OPINED THAT THE AO HAD NOT MADE THE NECESSARY ENQUIRES. HE HAS NEITHER ASKED THE ASSESSEE TO SHOW AS TO WHAT ENQUIRIES WERE MADE BY THE AO NOR HIMSELF HAS LOOKED INTO THE EXPLANATIONS SUBMITTED BY THE ASSES SEE. 14. NOW COMING TO THE VARIOUS CASE LAWS RELIED UPON BY BOTH THE PARTIES. 15. THE LD. D.R. HAS RELIED UPON THE FOLLOWING AUTH ORITIES TO STRESS THE POINT THAT IF THE COMMISSIONER FINDS THAT THERE WAS A LAC K OF ENQUIRY ON THE PART OF THE AO REGARDING THE CLAIM MADE BY THE ASSESSEE, TH E ORDER CAN BE TREATED AS ERRONEOUS AND THE COMMISSIONER EXERCISING HIS POWER S UNDER SECTION 263 CAN DIRECT THE AO TO MAKE APPROPRIATE ENQUIRIES/VERIFIC ATIONS ETC.: (I) CIT VS. INFOSYS TECHNOLOGIES LTD. (2012) 17 TAX MANN.COM 203 (KARNATAKA HC). (II) CIT VS. MAITHAN INTERNATIONAL (2015) 56 TAXMAN N.COM 283 (CALCUTTA) (III) MALABAR INDUSTRIAL CO. LTD. VS. CIT (2000) 10 9 TAXMAN 66 (SC). ITA NO.3469/M/2010 M/S. A.V. INDUSTRIES 10 (IV) MANMOHAK PROPERTIES (P.) LTD. VS. CIT (2013) 3 9 TAXMANN.COM 105 (MUMBAI TRIB.) 16. THE LD. A.R., ON THE OTHER HAND, HAS RELIED UPO N THE FOLLOWING AUTHORITIES TO STRESS THAT THERE IS A DIFFERENCE BE TWEEN LACK OF ENQUIRIES AND INADEQUATE ENQUIRIES. THE COMMISSIONER MUST GIVE A FINDING OF FACT OR OF LAW THAT THE ORDER IS ERRONEOUS SO FAR AS IT IS PREJUDI CIAL TO THE INTEREST OF REVENUE BY MAKING PROPER ENQUIRIES AFTER SEEKING EXPLANATIO N FROM THE ASSESSEE. (I) CIT VS. SUNBEAM AUTO LTD. 227 CTR 133 (DELHI HC) (II) CIT VS. VIKAS POLYMERS (2010) 194 TAXMAN 57 (DELHI HC) (III) CIT VS. GUPTA SPINNING MILLS LTD. ITA NO.410 OF 200 3 DATED 13.09.2013 (IV) CIT VS. AMIT CORPORATION (2013) 213 TAXMAN 19 (MAG) (GUJARAT- HC) 17. THE LD. A.R. HAS FURTHER RELIED UPON THE FOLLOW ING CASE LAWS TO STRESS THAT WHERE THE AO HAS APPLIED HIS MIND AND THE VIEW TAKEN BY HIM IS ONE OF THE POSSIBLE VIEWS, THEN THE ORDER CANNOT BE SAID T O BE ERRONEOUS OR PREJUDICIAL TO THE INTEREST OF REVENUE, EVEN, IF THE COMMISSION ER HAS A DIFFERENT VIEW FROM THAT OF THE AO; WHERE THE AO HAS MADE ENQUIRIES IN RESPECT OF THE CLAIM OF THE ASSESSEE, ORDER CANNOT BE SAID TO BE ERRONEOUS EVEN IF THE DETAILS OF ENQUIRIES MADE DO NOT FIND MENTION IN THE ASSESSMENT ORDER. (I) CIT VS. FINE JEWELLERY (I) LTD. (2015) 372 ITR 303 (MUMBAI-HC) (II) CIT VS. ASHISH RAJPAL (2010) 320 ITR 674 (DEL HI-HC) (III) CIT VS. SUNBEAM AUTO LTD. (2011) 332 ITR 167 (DELHI-HC) (IV) CIT VS. GABRIEL INDIA (1993) 203 ITR 108 (BOM BAY-HC) (V) GRASIM IND. LTD. VS. CIT (2010) 321 ITR 92 (BOMBAY- HC) (VI) CIT VS. MALABAR INDUSTRIES (1993) 203 ITR 108 (BOMB AY-HC) (VII) MALABAR INDUSTRIAL CO. LTD. VS. CIT (2000) 109 TAXM AN 66 (SC) (VIII) CIT VS. ARVIND JEWELLERS (2002) 124 TAXMAN 615 (GUJ .-HC) (IX) CIT VS. VIKAS POLYMERS (2010) 194 TAXMAN 57 (DELHI HC) (X) ITO VS. DG HOUSING PROJECTS LTD. (2012) 343 ITR 329 (DELHI HC) (XI) CIT VS. GOETZ (I) LTD. 2014 361 ITR 505 (DELHI HC ) ITA NO.3469/M/2010 M/S. A.V. INDUSTRIES 11 18. WE HAVE HEARD THE RIVAL CONTENTIONS AND HAVE AL SO GONE THROUGH THE THE RELEVANT CASE LAWS SUBMITTED BY THE LD. REPRESENTAT IVES OF THE PARTIES. FIRSTLY, WE DISCUSS THE CASE LAWS RELIED UPON BY THE LD. D.R . THERE IS NO DOUBT THAT THE HONBLE KARNATAKA HIGH C OURT IN THE CASE OF INFOSYS TECHNOLOGY (SUPRA) HAS HELD THAT WHERE TH E AO HAS NOT MADE IT EXPLICIT AS TO THE ENTITLEMENT OF A CLAIM OF THE AS SESSEE, THE COMMISSIONER HAS THE JURISDICTION IN DIRECTING THE AO TO MAKE ENQUIR IES IN THE MATTER AND GIVE A SPECIFIC FINDING IN THIS RESPECT. FURTHER, IN THE CASE OF MAITHAN INTERNATIONAL (SUPRA) THE HONBLE CALCUTTA HIGH COURT HAS HELD TH AT WHERE IT WAS ESTABLISHED ON RECORD THAT CREDITS SHOWN BY THE ASSESSEE WERE B ASED ON LOAN FROM PARTIES WHO WERE NOT POSSESSED OF SUFFICIENT MEANS AND THE AO HAD NOT MADE SUFFICIENT ENQUIRIES REGARDING THE CREDITWORTHINESS OF THE PARTIES THEN THE COMMISSIONER WAS JUSTIFIED IN EXERCISING HIS POWER UNDER SECTION 263 AND DIRECTING THE AO TO MAKE ENQUIRIES ABOUT THE CREDIT WORTHINESS OF THE PARTIES. IN THE CASE OF MANMOHAK PROPERTIES (P.) LTD. (SUP RA), THE MUMBAI TRIBUNAL HAS HELD THAT THE ABSENCE OR LACK OF ENQUIRY, OR NO T SO, IS A MATTER OF FACT AND WHERE THE COMMISSIONER ON AN EXAMINATION OF THE REC ORD ISSUED DEFINITE FINDING OF THE FACT WHICH CLEARLY EXHIBITED THAT TH E ASSESSEE MAY BE TRADING IN SHARES AND THAT HE COULD NOT BE REGARDED AS AN INVE STOR WITHOUT FURTHER ENQUIRY IN THE MATTER, BRINGING FURTHER MATERIAL ON RECORD, THE CIT WAS JUSTIFIED IN EXERCISING HIS JURISDICTION UNDER SECTION 263. THE LD. D.R. HAS ALSO RELIED UPON THE DECISION OF THE HONBLE SUPREME COURT IN T HE CASE OF MALABAR INDUSTRIAL CO. LTD. (SUPRA) WHICH INCIDENTALLY HAS ALSO BEEN RELIED UPON THE LD. A.R. WHICH WE WILL DISCUSS IN THE SUBSEQUENT PA RAS OF THIS ORDER. 19. NOW COMING TO THE CASE LAWS RELIED UPON BY THE LD. A.R. THE HONBLE DELHI HIGH COURT IN THE CASE OF SUNBEA M AUTO LTD. (SUPRA) HAS HELD THAT THERE IS A DISTINCTION BETWEEN LACK OF EN QUIRY AND INADEQUATE ENQUIRY. ITA NO.3469/M/2010 M/S. A.V. INDUSTRIES 12 IF THERE IS AN ENQUIRY EVEN INADEQUATE THAT WOULD N OT BY ITSELF GIVE OCCASION TO THE CIT TO PASS ORDER UNDER SECTION 263 MERELY BECA USE HE HAS A DIFFERENT OPINION IN THE MATTER. THE AO IS NOT REQUIRED TO G IVE DETAILED REASONING IN RESPECT OF EACH AND EVERY ITEM OF DEDUCTION IN THE ASSESSMENT ORDER. WHERE THE AO HAD CALLED FOR AN EXPLANATION REGARDING THE CLAIM MADE BY THE ASSESSEE AND THE ASSESSEE HAD FURNISHED ITS EXPLANATION, THE N IT CANNOT BE SAID TO BE A CASE OF LACK OF ENQUIRY. IN THE CASE OF VIKAS POLYMERS (SUPRA) THE HONBLE DELHI HIGH COURT HAS HELD THAT FOR EXERCISING POWERS UNDER SECTION 263, IT IS PRE-REQUISITE THAT COMMISSIONER MUST GIVE REASONS TO JUSTIFY EXERCISE OF REVISIONAL POWERS UNDER SECTION 263 TO REOPEN A CONCLUDED ASSESSMENT. THE EXERCISE OF THE POWER BEING QUASI JUDICIAL IN NATURE, THE REASONS MUST BE SUCH AS TO SHOW THAT THE ENHANCEMENT OR MODIFICATION OF THE ASSESSMENT OR CA NCELLATION OF THE ASSESSMENT OR DIRECTIONS ISSUED FOR A FRESH ASSESSM ENT WAS CALLED FOR AND MUST IRRESISTIBLY LEAD TO THE CONCLUSION THAT THE ORDER OF THE AO WAS NOT ONLY ERRONEOUS BUT WAS ALSO PREJUDICIAL TO THE INTEREST OF THE REVENUE. THE HONBLE HIGH COURT HAS OBSERVED THAT THE PROVISIONS OF SECT ION 263 WHEN READ AS A COMPOSITE WHOLE MAKE IT INCUMBENT UPON THE COMMISSI ONER BEFORE EXERCISING REVISIONAL POWERS TO (I) CALL FOR AND EXAMINE THE R ECORD AND (II) GIVE THE ASSESSEE AN OPPORTUNITY OF BEING HEARD AND THEREAFT ER, TO MAKE OR CAUSE TO MAKE SUCH AN ENQUIRY AS HE DEEMS NECESSARY. IT IS ONLY ON FULFILLMENT OF THESE TWIN CONDITIONS THAT THE COMMISSIONER MAY PASS AN O RDER EXERCISING POWERS OF REVISION, THE ASSESSEE MUST BE CALLED FOR, HIS EXPL ANATION SOUGHT FOR AND EXAMINATION BY THE COMMISSIONER AND THEREAFTER IF T HE COMMISSIONER STILL FEELS THAT THE ORDER IS ERRONEOUS AND PREJUDICIAL T O THE INTEREST OF THE REVENUE THEN HE MAY PASS THE REVISIONAL ORDERS. THE HONBLE BOMBAY HIGH COURT IN THE CASE OF GABRI EL INDIA LTD. (SUPRA) HAS HELD THAT THE COMMISSIONER CANNOT INITIATE PROC EEDINGS WITH A VIEW TO ITA NO.3469/M/2010 M/S. A.V. INDUSTRIES 13 STARTING FISHING AND ROWING ENQUIRIES IN MATTERS OR ORDERS WHICH ARE ALREADY CONCLUDED. THERE MUST BE MATERIAL ON RECORD TO SHO W THAT TAX WHICH WAS LAWFULLY EXIGIBLE HAS NOT BEEN IMPOSED IF THE CLAIM WAS ALLOWED BY THE INCOME TAX OFFICER (ITO). ON BEING SATISFIED WITH THE EXP LANATION OF THE ASSESSEE, SUCH DECISION OF THE ITO CANNOT BE HELD TO BE ERRO NEOUS SIMPLY BECAUSE IN HIS ORDER HE DID NOT MAKE AN ELABORATE DISCUSSION I N THAT RECORD. THE HONBLE BOMBAY HIGH COURT OBSERVED IN THE SAID CASE THAT WH EN THE CIT HIMSELF , EVEN AFTER INITIATING PROCEEDINGS FOR REVISION AND HEARI NG THE ASSESSE, COULD NOT SAY THAT THE ALLOWANCE OF THE CLAIM OF THE ASSESSEE WAS ERRONEOUS,..HE SIMPLY ASKED THE AO TO REEXAMINE THE MATTER; THAT WAS NOT PERMISSIBLE. ALMOST SIMILAR PROPOSITION HAS BEEN LAID DOWN IN THE CASE OF GUPTA SPINNING MILLS LTD. (SUPRA) AND AMIT CORPORATION (SUPRA) THAT C OMMISSIONER HAS TO GIVE A DEFINITE FINDING THAT THE ORDER OF THE AO IS ERRONE OUS AND THAT INADEQUATE ENQUIRIES BY ITSELF WILL NOT MAKE THE ORDER AS ERRO NEOUS. 20. WE FIND THAT THE HONBLE DELHI HIGH COURT IN TH E CASE OF CIT VS. GOETZ (I) LTD. (SUPRA) HAS ELABORATELY DISCUSSED THE VAR IOUS CASE LAWS REGARDING THE POWERS OF THE COMMISSIONER UNDER SECTION 263 INCLUD ING CIT VS. NAGESH KNITWARS PVT. LTD. (2012) 345 ITR 135 (DELHI HC) AND OF THE HONBLE BOMBAY HIGH COURT IN THE CASE OF GABRIEL INDIA LTD . (SUPRA) AND ALSO OF THE HONBLE DELHI HIGH COURT IN THE CASE OF SUNBEAM AU TO LTD. (SUPRA) AND HAS REACHED TO THE CONCLUSION THAT THE COMMISSIONER SHO ULD BE ABLE DEMONSTRATE THAT THE VIEW TAKEN BY THE AO WAS NOT POSSIBLE BEIN G LEGALLY UNSUSTAINABLE AND INCORRECT AND THIS FINDING MUST BE RECORDED. THE C OMMISSIONER CANNOT REMAND THE MATTER TO THE AO TO DECIDE WHETHER THE FINDINGS RECORDED ARE ERRONEOUS. IN CASES WHERE THERE IS INADEQUATE ENQUIRY BUT NOT LAC K OF ENQUIRY, THE COMMISSIONER MUST GIVE AND RECORD A FINDING THAT TH E ORDER/ENQUIRY MADE IS ERRONEOUS. THIS CAN HAPPEN IF AN ENQUIRY AND VERIF ICATION IS CONDUCTED BY THE ITA NO.3469/M/2010 M/S. A.V. INDUSTRIES 14 COMMISSIONER AND HE IS ABLE TO ESTABLISH AND SHOW T HE ERROR OR MISTAKE MADE BY THE AO MAKING THE ORDER UNSUSTAINABLE IN LAW. T HE MATTER CANNOT BE REMITTED FOR A FRESH DECISION TO THE AO TO CONDUCT FURTHER ENQUIRIES WITHOUT A FINDING THAT THE ORDER IS ERRONEOUS AND THE COMMISS IONER FURTHER MUST ALSO SATISFY THE SECOND LIMB OF THE PROVISION THAT THE O RDER IS ALSO PREJUDICIAL TO THE INTEREST OF THE REVENUE. THE HONBLE SUPREME COURT IN THE CASE OF CIT VS. G.M. MITTAL STAINLESS STEEL (P) LTD. (2003) 263 IT R 255 HAS OBSERVED THAT THE SATISFACTION BY THE COMMISSIONER MUST BE ONE OBJECT IVELY JUSTIFIABLE AND BASED ON MATERIAL EITHER LEGAL OR FACTUAL WHEN AVAILABLE, IT CANNOT BE MERE IPSE DIXIT OF THE COMMISSIONER. NOW COMING TO THE DECISION OF THE APEX COURT IN THE CASE OF MALABAR INDUSTRIAL CO. LTD. VS. CIT (2000) 109 TAXMAN 66 ( SC) WHICH HAS BEEN RELIED BY BOTH THE PARTIES, THE LD. A.R. OF THE ASSESSEE HAS STRONGLY RELIED UPON THE OBSERVATION OF THE HONBLE SUPREME COURT THAT WHERE TWO VIEWS ARE POSSIBLE AND THE AO ADOPTS ONE OF THE VIEWS PERMISSIBLE IN L AW, THEN THE ORDER CANNOT BE TREATED AS ERRONEOUS OR PREJUDICIAL TO THE INTER EST OF REVENUE, UNLESS THE VIEW TAKEN BY THE ITO IS UNSUSTAINABLE IN LAW. ON THE OTHER HAND, THE LD. D.R. HAS STRESSED UPON THE FINDING OF THE HONBLE SUPREM E COURT THAT WHERE THE AO HAD ACCEPTED ENTRY IN THE STATEMENT OF ACCOUNT FILE D BY THE ASSESSEE IN THE ABSENCE OF ANY SUPPORTING MATERIAL WITHOUT MAKING A NY ENQUIRY, EXERCISE OF JURISDICTION BY COMMISSIONER UNDER SECTION 263(1) O F THE ACT WAS JUSTIFIED. THE FACTS BEFORE THE HONBLE SUPREME COURT WERE THA T THE ASSESSEE COMPANY ENTERED INTO AN AGREEMENT FOR SALE OF ESTATE OF RUB BER PLANTATION. THE SALE CONSIDERATION WAS AGREED TO BE PAID IN INSTALLMENTS . THE PURCHASER COULD NOT ADHERE TO THE SCHEDULE AND ON HIS REQUEST THE PARTI ES AGREED TO THE EXTENSION OF TIME FOR PAYMENT OF THE INSTALLMENTS ON CONDITION O F VENDEE PAYING COMPENSATION/DAMAGE FOR LOSS OF AGRICULTURAL INCOME AND OTHER LIABILITIES. ACCORDINGLY, THE PURCHASER PAID THE DAMAGES TO THE ASSESSEE COMPANY. IN THE ITA NO.3469/M/2010 M/S. A.V. INDUSTRIES 15 RETURN FILED, THE ASSESSEE COMPANY CLAIMED THE SAID COMPENSATION AND DAMAGES RECEIVED AS AGRICULTURAL INCOME. THE AO ACCEPTED T HE SAME. THE COMMISSIONER, HOWEVER, EXERCISING HIS JURISDICTION UNDER SECTION 263 HELD THAT THE SAID AMOUNT WAS UNCONNECTED WITH ANY AGRICULTUR AL OPERATION ACTIVITY AND WAS LIABLE TO BE TAXED UNDER THE HEAD INCOME FROM OTHER SOURCES. THE MATTER ULTIMATELY TRAVELLED TO THE HONBLE SUPREME COURT. THE HONBLE SUPREME COURT HELD THAT AS PER THE PROVISIONS OF SECTION 26 3(1) THE COMMISSIONER HAS TO BE SATISFIED WITH TWIN CONDITIONS NAMELY; (I) THE O RDER OF THE AO SOUGHT TO BE REVISED IS ERRONEOUS, (II) IT IS PREJUDICIAL TO THE INTEREST OF REVENUE. IF ONE OF THEM IS ABSENT, VIZ., IF THE ORDER OF THE ITO IS NOT ERRONEOUS BUT IT IS PREJUDICIAL TO THE INTEREST OF REVENUE OR IF IT IS ERRONEOUS BU T IS NOT PREJUDICIAL TO THE INTEREST OF REVENUE, RECOURSE CANNOT BE HAD TO SECT ION 263(1). 21. FROM THE ABOVE FACTS, IT IS REVEALED THAT EVEN IN THE CASE MALABAR INDUSTRIAL CO. LTD. (SUPRA), THE CIT HAD MADE ENQUI RIES AND THEREAFTER CONCLUDED THAT THE INCOME RECEIVED BY THE ASSESSEE ON ACCOUNT OF COMPENSATION DAMAGES FOR EXTENDING THE PERIOD OF IN STALLMENTS WAS NOT AN AGRICULTURAL INCOME. THE LD. CIT, IN FACT, HAD EXA MINED THE CONTENTION OF THE ASSESSEE AND WAS OF THE VIEW THAT THE CLAIM MADE BY THE ASSESSEE WAS NOT RIGHT, AND THAT UNDER THESE CIRCUMSTANCES, IT WAS HELD THA T THE ORDER OF THE AO WAS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENU E. 22. THERE IS NO DOUBT ABOUT THE PROPOSITION OF LAW LAID DOWN IN THE OTHER CASE LAWS RELIED UPON BY THE LD. AR THAT WHERE THERE ARE TWO VIEWS POSSIBLE AND THE VIEW TAKEN BY THE AO IS ONE OF THE POSSIBLE VIEWS, THE COMMISSIONER IS NOT JUSTIFIED IN EXERCISING THE POWER UNDER SECTION 263 OF THE ACT ONLY BECAUSE HE IS OF THE DIFFERENT VIEW. ITA NO.3469/M/2010 M/S. A.V. INDUSTRIES 16 23. IN VIEW OF THE ABOVE DISCUSSION OF THE VARIOUS CASE LAWS, WE FIND THAT EXCEPT IN THE LONE DECISION OF THE HONBLE KARNATAK A HIGH COURT IN THE CASE OF INFOSYS TECHNOLOGY ( SUPRA), THE HONBLE SUPREME COURT AND VARIOUS OTHER HIGH COURTS INCLUDING OUR JURISDICTIONAL HIGH COURT HAVE BEEN ALMOST UNANIMOUS IN HOLDING THAT BEFORE ENHANCING OR ANNUL LING OR MODIFYING OR CANCELLING THE ASSESSMENT WHILE EXERCISING HIS POWE RS UNDER SECTION 263 OF THE ACT, THE COMMISSIONER MUST RECORD A FINDING OF FACT OR OF LAW THAT THE ORDER OF THE AO IS ERRONEOUS AND IS ALSO PREJUDICIAL TO THE INTEREST OF REVENUE AS DISCUSSED ABOVE. IN THE CASE IN HAND, AS DISCUSSED ABOVE, THIS PREREQUISITE CONDITION HAS NOT BEEN SATISFIED AS THE COMMISSIONE R AFTER CALLING FOR THE EXPLANATION FROM THE ASSESSEE HAS FAILED TO MAKE NE CESSARY EXERCISE IN EXAMINING OR CAUSE TO EXAMINE THE EXPLANATION/DETAI LS SUBMITTED BY THE ASSESSEE FOR THE JUSTIFICATION OF ITS CLAIM. HENCE , IN THE LIGHT OF THE VARIOUS CASE LAWS AS ANALYZED ABOVE, THE ORDER OF THE COMMI SSIONER EXERCISING JURISDICTION UNDER SECTION 263 OF THE ACT CANNOT BE HELD TO BE SUSTAINABLE IN LAW AND THE SAME IS ACCORDINGLY SET ASIDE. 24. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS HE REBY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 06.11.2015. SD/- SD/- (G.S. PANNU) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 06.11.2015. * KISHORE, SR. P.S. COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT (A) CONCERNED, MUMBAI ITA NO.3469/M/2010 M/S. A.V. INDUSTRIES 17 THE DR CONCERNED BENCH //TRUE COPY// [ BY ORD ER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.