PENNZOIL QUAKER STATE INDIA LIMITED, MUMBAI V. PRINCIPAL COMMISSIONER OF INCOME TAX - 1, MUMBAI

ITA 3561/MUM/2018

• Counselvise Citation: [2018] 118 COUNSELVISE.COM (IT) 8066 (ITAT-MUMBAI)
• Duration Of Justice: 6 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-12-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2008-2009
• Appeal Filed On: 24-05-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: H N SINGH
• Assessee Lawyers: MDHUR AGARWAL
• Keywords: Depreciation; Retrospective amendment; Capital expenditure
• Section: 143(3); 142(1); 115JB; 40(a)(ia); 263

Judgement Text

1 PENNZOIL QUAKER STATE INDIA LTD IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH C, MUMBAI BEFORE SHRI G MANJUNATHA (ACCOUNTANT MEMBER) AND SHRI RAVISH SOOD (JUDICIAL MEMBER) ITA NO 3561MUM/2018 (ASSESSMENT YEAR 2008-09) PENNZOIL QUAKER STATE INDIA LTD, PLOT NO.T-5, MIDC TALOJA INDUSTRIAL AREA, PANVEL RAIGAD DIST. MAHARASHTRA 410 208 PAN : AAACP7143C VS PRINCIPAL COMMISSIONER OF INCOME-TAX- 1, MUMBAI APPELLANT RESPONDEDNT APPELLANT BY SHRI MDHUR AGARWAL RESPONDENT BY SHRI HN SINGH DATE OF HEARING 09-10-2018 DATE OF PRONOUNCEMENT 21-12-2018 O R D E R PER G MANJUNATHA, AM : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER OF THE PRINCIPAL CIT-1, MUMBAI DATED 28-03-2018 U/S 263 OF THE I.T. ACT, 1961 FOR THE ASSESSMENT YEAR 2008-09. THE ASSESSEE HAS RAISED T HE FOLLOWING GROUNDS OF APPEAL:- GROUNDS OF APPEAL 1 . GENERAL 1.1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED PRIN. CIT HAS LEGALLY ERRED IN ASSUMING JURISDICTION UNDE R SECTION 263 OF THE ACT. 2 PENNZOIL QUAKER STATE INDIA LTD 1 .2. THE LEARNED PRIN. CLT HAS FAILED TO APPRECIAT E THAT THE ASSESSMENT ORDER UNDER SECTION 143(3) R.W.S 263 PASSED BY THE INCOME TAX O FFICER - 1(2) (3), MUMBAI (' AO') WAS NEITHER ERRONEOUS NOR PREJUDICIAL TO THE INTERE ST OF THE REVENUE. 1 .3 . THE LEARNED PRIN. CIT FURTHER FAILED TO APPR ECIATE THAT THE ASSESSMENT ORDER PASSED BY THE AO WAS PURSUANT TO THE DIRECTIONS OF THE THEN COMMISSIONER OF INCOME TAX-1, MUMBAI (*CIT). 1 .4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED PRIN. CIT HAS LEGALLY ERRED IN SETTING ASIDE THE RELIEF G RANTED BY THE AO BASED ON THE DIRECTIONS OF THE THEN CIT, AS NO ADVERSE INFERENCE S WERE CONSIDERED ON THOSE ISSUES. 1 .5. THE LEARNED PRIN. CIT FAILED TO APPRECIATE TH AT ALL THE ISSUES INVOLVED HAVE BEEN EXAMINED BY THE AO IN DETAIL DURING THE PROCEEDING BEFORE HIM FOR GIVING EFFECT TO THE THEN CIT'S ORDER AND THE SAME WERE NOT OVERLOOK ED BY HIM. 1 .6. THE LEARNED PRIN. CIT ERRED IN SETTING ASIDE THE ORDER OF THE AO AND DIRECTING TO UNDERTAKE FRESH ASSESSMENT ON ISSUES WHICH WERE ALR EADY EXAMINED BY THE AO. 2. LIABILITY OF CONTINGENT NATURE OF RS 1,13,20,765 2.1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED PRIN. CIT HAS ERRED IN DIRECTING THE AO TO EXAMINE THE DI SALLOWANCE ON ACCOUNT OF CONTINGENT LIABILITY AND ITS EFFECT ON COMPUTATION UNDER THE NORMAL PROVISIONS OF THE ACT AND ALSO UNDER SECTION 1 15JB OF THE ACT ON THE GROUND THAT AO HAS NOT EXAMINED FACTS PROPERLY. 2.2. THE LEARNED PRIN. CIT FAILED TO APPRECIA TE THAT THE APPELLANT HAD ALREADY SUO- MOTO DISALLOWED THE AMOUNT OF CONTINGENT LIABILITY ACCRU ED (NET) FOR AY 2008-09 AMOUNTING TO RS 1,13,20,765 IN ITS COMPUTATION OF I NCOME UNDER NORMAL AS WELL AS MAT PROVISIONS OF THE ACT 3. CAPITAL EXPENDITURE DEBITED TO PROFIT & LOSS ACC OUNT OF RS 135,05,595 3.1, ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED PRIN. CIT HAS ERRED IN DIRECTING THE AO TO EXAMINE THE DISALL OWANCE ON ACCOUNT OF CAPITAL EXPENDITURE BEING FIXED ASSETS WRITTEN OFF AND OTHE R FIXED ASSETS DEBITED TO PROFIT & LOSS ACCOUNT. THE LEARNED PRIN. CIT FAILED TO APPRECIATE THAT THE APPELLANT HAD ALREADY SITO-MOTO DISALLOWED THE AMOUNT OF FIXED ASSETS WRITTEN OFF A MOUNTING TO RS 1,34,52,148 AND OTHER FIXED ASSETS OF RS 53,447 IN ITS COMPUTATION OF INC OME UNDER NORMAL PROVISIONS OF THE ACT. 4. DISALLOWANCE UNDER SECTION 40(A)(IA) OF RS 24,13,850 4.1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED PRIN. CIT HAS ERRED IN DIRECTING THE AO TO EXAMINE THE ALLOWA BILITY OF EXPENSES IN TERMS OF SECTION 40(A)(IA) OF THE ACT ON THE PREMISE THAT THE EXPENS ES HAD BEEN WRONGLY ALLOWED WHILE COMPUTING THE INCOME 4.2. WITHOUT PREJUDICE TO THE ABOVE, THE LEARNED PRIN. CIT FAILED TO APPRE CIATE THAT THE AMENDMENT MADE TO SECTION 40(A)(IA) OF THE ACT BY F INANCE ACT, 2010 RELAXING THE TIME LIMIT TO DEPOSIT TAX UPTO THE DATE OF FILING OF RET URN IS TO BE CONSTRUED AS HAVING RETROSPECTIVE EFFECT AND ACCORDINGLY, NO DISALLOWAN CE COULD BE MADE. 5. EXCESS DEDUCTION UNDER SECTION 43(6) OF RS. 1,21 ,80,653 5.1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED PRIN. CIT HAS ERRED IN DIRECTING THE AO TO EXAMINE THE ALLOWA BILITY OF DEDUCTION UNDER SECTION 43(6) OF THE ACT ON THE PREMISE THAT THE EXPENSES H AD BEEN WRONGLY ALLOWED WHILE COMPUTING THE INCOME. 5.2. WITHOUT PREJUDICE TO THE ABOVE, THIS ISSUE WAS NEVER A POINT OF VERIF ICATION / DISALLOWANCE DURING THE REVISION PROCEEDINGS INITIA TED BY THE EARLIER CIT. FURTHER NO DIRECTIONS WERE GIVEN BY THE THEN CIT WITH REGARD T O DEDUCTION CLAIMED UNDER SECTION 43(6) OF THE ACT AND HENCE, THIS IS TO BE CONSIDERE D AS FRESH OBSERVATION OF THE PRIN. CIT IN THE ASSESSMENT ORDER DATED 22 OCTOBER 2012 PASSE D UNDER SECTION 143(3) R.W.S.!44C(13) OF THE ACT. 3 PENNZOIL QUAKER STATE INDIA LTD ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LEARNED PRIN. CIT HAS LEGALLY ERRED IN INITIATING REVISION PROCEEDINGS ON THE SAID ISSUE WHICH IS TIME BARRED AND UNWARRANTED. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E COMPANY FILED ITS RETURN OF INCOME FOR AY 2008-09 ON 26-09-2008 DECLARING TO TAL INCOME AT RS. NIL. THE ASSESSMENT WAS COMPLETED U/S 143(3) R.W.S. 144C(13) OF THE I.T. ACT, 1961 ON 22-10-2012 DETERMINING TOTAL INCOME UNDER NORMAL PR OVISIONS OF THE ACT, AT NIL AND BOOK PROFIT U/S 115JB OF THE I.T. ACT, 1961 AT RS.7,09,43,856. THEREAFTER, REVISION PROCEEDINGS U/S 263 WERE INITIATED BY THE THEN CIT-1 VIDE NOTICE DATED 03-07-2014. THE CIT, PASSED ORDER U/S 263 ON 11-03 -2015 AND HELD THAT THE ASSESSMENT ORDER PASSED U/S 143(3) R.W.S. 144C(13) IS ERRONEOUS INSOFAR AS IT IS PREJUDICIAL TO THE INTEREST OF THE REVENUE. IN THE SAID ORDER, THE LD.CIT HAS DISCUSSED SIX ISSUES AND DIRECTED THE AO TO EXAMINE THE ISSUES IN THE LIGHT OF DISCUSSIONS BROUGHT OUT IN HIS ORDER U/S 263. CONS EQUENT TO ORDER U/S 263, THE AO ISSUED NOTICE U/S 142(1) CALLING UPON THE ASSESS EE TO FILE NECESSARY EXPLANATION WITH REGARD TO ALL SIX ISSUES DISCUSSED BY THE CIT IN HIS ORDER U/S 263. IN RESPONSE, THE ASSESSEE HAS FILED DETAILED SUBMISSIONS AND ARGUED THAT THE ISSUES DISCUSSED BY THE CIT HAVE ALREADY BEEN E XAMINED BY THE AO AND ALSO THERE IS NO PREJUDICE CAUSED TO THE REVENUE AND ACC ORDINGLY, NO ADDITION WAS CALLED FOR. THE AO, AFTER CONSIDERING RELEVANT SUB MISSIONS OF THE ASSESSEE AND ALSO BY TAKING INTO ACCOUNT OBSERVATIONS OF THE LD. CIT IN HIS ORDER U/S 263 PASSED ORDER DATED 29-02-2016 AND MADE ADDITIONS TO WARDS EXCISE DUTY NOT 4 PENNZOIL QUAKER STATE INDIA LTD PAID OF RS.24,67,762 AND CLAIM OF REVERSAL PROVISIO N FOR RS.2,78,96,822. BUT, REMAINING FOUR ISSUES QUESTIONED BY THE LD.CIT IN H IS ORDER U/S 263 HAVE BEEN EXAMINED AND HELD THAT NO OBSERVATIONS OR FINDING H AS COME TO LIGHT THAT WARRANTED ADDITION OR DISALLOWANCE AND AS SUCH, NO ADVERSE INFERENCE WAS CONSIDERED NECESSARY ON THOSE ISSUES. 3. THE PRINCIPAL COMMISSIONER OF INCOME-TAX-1, MUMB AI ISSUED A SHOW CAUSE NOTICE U/S 263 AND ASKED AS TO WHY THE ASSESS MENT ORDER PASSED BY THE AO U/S 143(3) R.W.S. 263 DATED 29-02-2016 SHALL NOT BE REVISED FOR THE REASONS STATED IN HIS NOTICE. THE PRINCIPAL CIT PROPOSED T O REVISE THE ASSESSMENT ORDER ON THE GROUND THAT THE AO HAS FAILED TO EXAMINE CER TAIN ISSUES AS PER THE FINDINGS OF INTERNAL AUDIT PARTY WHICH MADE THE ORD ER PASSED BY THE AO DATED 29-02-2016 ERRONEOUS INSOFAR AS IT IS PREJUDICIAL T O THE INTEREST OF THE REVENUE. THE PRINCIPAL CIT AGAIN QUESTIONED SIX ISSUES, AS P ER WHICH, THE AO HAS FAILED TO EXAMINE LIABILITY OF CONTINGENT NATURE, CAPITAL EXP ENDITURE DEBITED TO P&L ACCOUNT / FIXED ASSETS WRITTEN OFF, NO DISALLOWANCE U/S 40(A)(IA) EVEN THOUGH THERE IS A DELAY IN REMITTANCE OF TDS WITHIN THE PR ESCRIBED DATE, EXCESS CLAIM OF DEDUCTION U/S 43(6) AND WRONG WORKING OF BOOK PROFI T U/S 115JB. THE PCIT FURTHER OBSERVED THAT THE AO OUGHT TO HAVE CARRIED OUT REQUIRED ENQUIRIES, BUT FAILED TO EXAMINE THE ISSUES IN THE LIGHT OF FACTS BROUGHT OUT BY THE INTERNAL AUDIT PARTY WHICH RESULTED IN PREJUDICE CAUSED TO T HE INTEREST OF THE REVENUE 5 PENNZOIL QUAKER STATE INDIA LTD AND ACCORDINGLY, ISSUED A SHOW CAUSE NOTICE AND CAL LED UPON THE ASSESSEE TO EXPLAIN AS TO WHY THE ASSESSMENT ORDER PASSED U/S 1 43(3) R.W.S. 263 DATED 29- 02-2016 SHALL NOT BE REVISED. 4. IN RESPONSE TO NOTICE, THE ASSESSEE, VIDE LETTER DATE 27-03-2018 FILED A DETAILED SUBMISSION OPPOSING REVISION OF ASSESSMENT ORDER ON THE GROUND THAT THE ASSESSMENT ORDER PASSED BY THE AO U/S 143(3) R. W.S. 263 IS NEITHER ERRONEOUS NOR PREJUDICIAL TO THE INTEREST OF THE RE VENUE. THE ASSESSEE HAS FILED DETAILED SUBMISSIONS WHICH HAVE BEEN REPRODUCED AT PARA 4 ON PAGES 2 TO 8 OF LD.PCITS ORDER. THE ASSESSEE, PRIMARILY OBJECTED FOR REVISION OF ASSESSMENT ORDER ON THE GROUND THAT EARLIER 263 PROCEEDINGS HA VE BEEN INITIATED ON SIMILAR ISSUE BY THE THEN CIT-1, MUMBAI AND THE AO, ON THE BASIS OF DIRECTIONS ISSUED BY THE PRINCIPAL CIT IN HIS ORDER U/S 263 EXAMINED ALL ISSUES THOROUGHLY IN LIGHT OF SUBMISSIONS MADE BY THE AO TO MAKE ADDITION TOWA RDS TWO ISSUES, I.E. EXCISE DUTY NOT PAID AND CLAIM OF REVERSAL OF PROVI SION. HOWEVER, REMAINING FOUR ISSUES HAVE BEEN THOROUGHLY EXAMINED AND AFTER VERIFICATION OF SUBMISSIONS, HELD THAT NO OBSERVATION OR FINDING HA S COME TO LIGHT THAT WARRANTS ADDITION OR DISALLOWANCE IN RESPECT OF THO SE FOUR ITEMS INCLUDING LIABILITY OF CONTINGENT NATURE, CAPITAL EXPENDITURE DEBITED TO P&L ACCOUNT, DISALLOWANCE U/S 40(IA) AND WRONG WORKING OF BOOK P ROFIT U/S 115JB OF THE I.T. ACT. THE LD.AR FURTHER SUBMITTED THAT EVEN OTHERWI SE, THE ASSESSEE ITSELF, IN ITS 6 PENNZOIL QUAKER STATE INDIA LTD STATEMENT OF TOTAL INCOME, HAS SUO MOTO DISALLOWED THE AMOUNT OF CONTINGENT LIABILITY FOR AY 2008-09 AMOUNTING TO RS.1,13,20,76 5. THE LD.AR FURTHER SUBMITTED THAT EVEN ON CAPITAL EXPENDITURE, THE ASS ESSEE HAS MADE DISALLOWANCE IN HIS STATEMENT OF TOTAL INCOME IN RE SPECT OF CAPITAL EXPENDITURE DEBITED TO P&L ACCOUNT. SIMILARLY, DISALLOWANCE U/ S 40(A)(IA) FOR LATE REMITTANCE OF TDS, THE FINANCE ACT, 2010 RELAXING T HE TIME LIMIT TO DEPOSIT TAX UPTO THE DATE OF FILING OF RETURN IS TO BE CONSIDER ED AS HAVING RETROSPECTIVE EFFECT AND ACCORDINGLY, NO DISALLOWANCE COULD BE MA DE. 5. THE LD.AR ON THE ISSUE OF EXCESS DEDUCTION U/S 4 3(6) SUBMITTED THAT THERE WAS NO SUCH DIRECTION IN THE REVISION PROCEED INGS INITIATED BY THE EARLIER CIT, EVEN THOUGH THE ISSUE HAS BEEN SUBJECT MATTER OF SHOW CAUSE NOTICE ISSUED U/S 263, THEREFORE, ON SAME SET OF FACTS, TH E LD.PCIT HAS ERRED IN DIRECTING THE AO TO ONCE AGAIN RE-EXAMINE THE ISSUE . THE LD.AR FURTHER SUBMITTED THAT IN ORDER TO INVOKE THE PROVISIONS OF SECTION 263, TWIN CONDITIONS PRESCRIBED UNDER THE SAID PROVISION ARE REQUIRED TO BE SATISFIED, I.E. THE ORDER OF THE AO SOUGHT TO BE REVISED IS ERRONEOUS AND IT IS PREJUDICIAL TO THE INTEREST OF THE REVENUE. THUS, U/S 263, THE ORDER MUST BE B OTH ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE. IF AT ALL ORDER IS ERRONEOUS, BUT THERE IS NO LOSS TO THE REVENUE OR IF THE ORDER IS NOT ER RONEOUS, BUT THERE IS LOSS TO REVENUE, THEN SECTION 263 CANNOT BE INVOKED. IN SU PPORT OF HIS CONTENTION, HE 7 PENNZOIL QUAKER STATE INDIA LTD RELIED UPON THE DECISION OF HONBLE SUPREME COURT I N THE CASE OF MALABAR INDUSTRIAL CO LTD VS CIT (2000) 243 ITR 83 (SC). 6. THE LD.PCIT, AFTER CONSIDERING RELEVANT SUBMISSI ONS OF THE ASSESSEE HELD THAT THE ORDER PASSED BY THE AO U/S 143(3) R.W.S. 2 63 IS ERRONEOUS INSOFAR AS IT IS PREJUDICIAL TO THE INTEREST OF THE REVENUE AS TH E AO HAS FAILED TO CARRY OUT NECESSARY ENQUIRIES, WHICH HE OUGHT TO HAVE CARRIED OUT IN ACCORDANCE WITH THE PROVISIONS OF THE ACT, IN LIGHT OF FACTS BROUGHT OU T BY THE INTERNAL AUDIT PARTY. THEREFORE, HE OPINED THAT THE ORDER PASSED U/S 143( 3) R.W.S. 263 NEEDS TO BE REVISED IN THE LINES OF DISCUSSIONS, IN HIS ORDER. ACCORDINGLY, HE DIRECTED THE AO TO REDO THE ASSESSMENT DENOVO IN ACCORDANCE WITH TH E STATUTORY PROVISIONS AS WELL AS CASE LAWS APPLICABLE TO THE CLAIMS MADE BY THE ASSESSEE. THE RELEVNAT OBSERVATIONS OF THE PCIT ARE AS UNDER:- 10 THE ASSESSEE'S OBJECTIONS AS ABOVE WERE DISPOSE D OFF BY WAY OF A SPEAKING ORDER DATED 27.03.2018, A COPY OF WHICH WAS SERVED BY E-MAIL ON THE ADDRESS GIVEN BY THE AR OF THE ASSESSEE. FURTHER, THE A.R. ALSO SEND AND E-RNAIL DT.28/03/2018 RECEIVED AT 2.25 P.M., WHICH HAS BEEN CONSIDERED AND THE AO IS DIRECTED TO TAKE COGNIZANCE OF SAME WHILE PASSING A SPEAKING ORDER.(THIS COPY IS ALSO FORWARDED LO AO FOR HIS CONSIDERATION] 11. NO FURTHER SUBMISSIONS HAVE BEEN MADE BY THE AS SESSEE. 1 HAVE AISO GONE THROUGH THE FACTS OF THE CASE AND DO NOT I'IND ANY FORCE IN ASSESSEE'S SUBMISSION FOR THE FOLLOWING REASONS: A. THE AO NEEDS AGAIN TO EXAMINE THE SHORT DISALLO WANCES OF CONTINGENT LIABILITY OF RS. 88,7068/-. B. THE ISSUE OF FIXED ASSETS WRITTEN OFF IN THE P & L ACCOUNT, AMOUNTING TO RS.I,35,05,595/- AND WHET HER THESE ARE REQUIRED TO BE ADJUSTED TO THE BLOCK OF ASSETS FOR GRANT OF DEPRECIATION NEED TO BE EXAMINED BY AO. C. THE ISSUE OF NON-DISALLOWANCE O F TDS AMOUNT OF RS.24,13.850/-, WHICH WAS DEPOSITED LATE, IN THE LI GHT OF THE !TAT SPECIAL BENCH DECISION WHICH HAS HELD THAT THE AMENDMENT, T O THE PROVISIONS OF SEC.40(A)(IA) ARE NOT RETROSPECTIVE, NEEDS TO BE EX AMINED BY THE AO. D. THE ISSUE OF EXCESS CLAIM OF DEDUCTION U/S. 43(6} OF R S. 13.94,044/ CONSEQUENT TO WRITE OFF OF ASSET OF RS. 1.21,80,653/- AS PER T HE 1 T ACT BY THE ASSESSEE. NEEDS TO BE EXAMINED AGAIN BY THE AO. C. THE ISSUE OF WRONG 8 PENNZOIL QUAKER STATE INDIA LTD WORKING OF BOOK PROFIT U/S. 115JB, BY RS.88,76.068/-, CONSEQUENT TO THE DISCREPANCY IN ADDING OF THE PROV ISION FOR CONTINGENT LIABILITIES WHILE COMPUTING BOOK PROFIT, NEEDS TO BE EXAMINED BY THE AO. 12. IN THE LIGHT OF THE DISCUSSION IN THE PRECEDING PARA I. AM OF OPINION THAT ORDER PASSED ON 29/02/2016 U/S. 143(3) RWS 263 FOR THE AS SESSMENT YEAR 2008-09 IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INT ERESTS OF THE REVENUE. THE HON. SUPREME COURT IN THE CASE OF THE MALABAR INDUSTRIAL CO. LID. VS. CIT ; KERALA (243ITR 83) HAS HELD THAT ' IF DUE TO AN ERRONEOUS ORDER OF THE INCOME TAX OFFICER, THE REVENUE IS LOSING TAX LAWFULLY PAYABLE BY A PERSON, IF WILL CERTAINLY BE PREJUDICIAL TO THE INTERESTS OF THE REVENUE.' HENCE THE SAID ORDER OF THE AO IS SET ASIDE U/S. 263 OF THE INCOME TAX ACT, 1961 TO BE DO NE AFRESH DE NOVO. THE AO WILL PASS AN ORDER IN ACCORDANCE WITH THE STATUTORY ' PROVISIONS AS WELL AS CASE LAWS APPLICABLE TO THE CLAIMS MADE BY THE ASSESSEE. THE AO SHALL GIVE THE ASSESSEE SUFFICIENT OPPORTUNITY OF HEARING BEFORE PASSING HI S ORDER. 7. THE LD.AR FOR THE ASSESSEE SUBMITTED THAT THE LD . CIT(A), ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE ERRED IN ASSUM ING JURISDICTION U/S 263 OF THE ACT, TO REVISE ASSESSMENT ORDER PASSED U/S 143( 3) R.W.S. 263 OF THE INCOME- TAX ACT, 1961. THE LD.AR FURTHER SUBMITTED THAT TH E PCIT FAILED TO APPRECIATE THAT THE ASSESSMENT ORDER PASSED BY THE AO WAS PURS UANT TO THE DIRECTION OF THE THEN CIT-1, MUMBAI AND THE AO, ON THE BASIS OF DIRECTIONS OF THE THEN CIT- 1, MUMBAI, HAS CATEGORICALLY OBSERVED IN HIS ORDER DATED 29-02-2016 THAT NO ADVERSE INFERENCE WERE CALLED FOR IN RESPECT OF FOU R ISSUES. THE LD.AR FURTHER SUBMITTED THAT THE AO HAS CARRIED OUT DETAILED EXAM INATION OF BOOKS OF ACCOUNT AND SUBMISSIONS MADE BY THE ASSESSEE IN LIG HT OF FACTS BROUGHT OUT BY THE THEN CIT-1, MUMBAI IN HIS 263 PROCEEDINGS AND A FTER CONSIDERING RELEVANT FACTS, MADE ADDITION IN RESPECT OF TWO ISSUES AND D ROPPED REMAINING FOUR ISSUES BY STATING THAT NO ADDITION IS CALLED FOR. THE PCIT ONCE AGAIN TAKEN UP 9 PENNZOIL QUAKER STATE INDIA LTD SIMILAR ISSUES FOR VERIFICATION IN THE GARB OF INAD EQUATE ENQUIRY BY THE AO SO AS TO INVOKE THE JURISDICTION U/S 263 OF THE ACT WITHO UT BRINGING OUT ANY FRESH ISSUES WHICH RESULTED IN THE ORDER PASSED BY THE AO U/S 143(3) R.W.S. 263 IS ERRONEOUS INSOFAR AS IT IS PREJUDICIAL TO THE INTER EST OF THE REVENUE. THE LD.AR FURTHER SUBMITTED THAT THE ISSUES QUESTIONED BY THE PCIT , I.E. LIABILITY OF CONTINGENT IN NATURE, CAPITAL EXPENDITURE DEBITED T O P&L ACCOUNT, DISALLOWANCE U/S 40(A)(IA) AND EXCESS DEDUCTION U/S 43(6) WAS ALREADY SUBJECT MATTER OF FIRST REVISION PROCEEDINGS. THE LD.AR FU RTHER SUBMITTED THAT EVEN ON MERITS, THERE IS NO PREJUDICE CAUSED TO THE REVENUE ON ACCOUNT OF THOSE FOUR ITEMS AS THE ASSESSEE HAS ALREADY SUO MOTO DISALLOW ED LIABILITY OF CONTINGENT NATURE, CAPITAL EXPENDITURE DEBITED TO P&L ACCOUNT. INSOFAR AS DISALLOWANCE U/S 40(A)(IA), THE ASSESSEE HAS PAID TDS DEDUCTED B EFORE DUE DATE OF FILING RETURN OF INCOME. THE AMENDMENT BROUGHT TO SECTION 40(A)(IA) BY THE FINANCE ACT 2010 RELAXING THE TIME LIMIT TO DEPOSIT TAX UPT O THE DATE OF FILING OF RETURN IS HELD TO BE RETROSPECTIVE IN NATURE AND ACCORDING LY NO DISALLOWANCE COULD BE MADE U/S 40(A)(IA) FOR NOT DEPOSITING TAX WITHIN TH E DUE DATE PRESCRIBED UNDER THE RESPECTIVE PROVISIONS OF ACT. AS REGARDS EXCES S DEDUCTION U/S 43(6), THE ASSESSEE HAS GIVEN RIGHT TREATMENT IN RESPECT OF DE DUCTION CLAIMED U/S 43(6) WHICH DID NOT RESULT IN ANY LOSS OF REVENUE. THERE FORE, THE PCIT WAS ERRED IN ASSUMING JURISDICTION U/S 263 OF I.T. ACT, 1961. I N THIS REGARD, HE RELIED UPON 10 PENNZOIL QUAKER STATE INDIA LTD THE DECISION OF HONBLE SUPREME COURT IN THE CASE O F MALABAR INDUSTRIAL CO LTD VS CIT (SUPRA) AND THE DECISION OF HONBLE BOMBAY H IGH COURT IN THE CASE OF CIT VS GABRIEL INDIA LTD (1993) 203 ITR 108 (BOM). 8. THE LD.DR, ON THE OTHER HAND, STRONGLY SUPPORTIN G THE ORDER OF PCIT SUBMITTED THAT THE AO HAS FAILED TO CARRY OUT REQUI RED ENQUIRIES, HE OUGHT TO HAVE CARRIED OUT ENQUIRIES AS PER THE PROVISIONS OF THE ACT, IN LIGHT OF OBSERVATIONS MADE BY INTERNAL AUDIT PARTY IN RESPEC T OF SIX ISSUES DISCUSSED BY THE LD.PCIT IN HIS PROCEEDINGS. THEREFORE, THE PCI T WAS VERY WELL WITHIN HIS JURISDICTION TO REVISE ASSESSMENT ORDER PASSED U/S 143(3) R.W.S. 263 OF THE INCOME-TAX ACT, 1961. 9. WE HAVE HEARD BOTH THE PARTIES, PERUSED THE MATE RIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF AUTHORITIES B ELOW. THE PCIT REVISED ASSESSMENT ORDER PASSED U/S 143(3) R.W.S. 263 BASIC ALLY ON SIX ISSUES. THE PCIT HAS NARRATED THE ISSUES DISCUSSED IN HIS ORDER IN T HE SHOW CAUSE NOTICE DATED 23-03-2018, AS PER WHICH THE INTERNAL AUDIT PARTY H AS RAISED CERTAIN OBJECTIONS INSOFAR AS DEDUCTIBILITY OF LIABILITY OF CONTINGENT NATURE, CAPITAL EXPENDITURE DEBITED TO P&L ACCOUNT, NON DISALLOWANCE OF CERTAIN EXPENDITURE U/S 40(A)(IA), EXCESS CLAIM OF DEDUCTYION U/S 43(6) BEING WRITE OF F OF ASSET AS PER I.T. ACT AND WRONG WORKING OF BOOK PROFIT U/S 115JB OF THE I.T. ACT, 1961. WE FIND THAT ALL THESE ISSUES WERE SUBJECT MATTER OF 263 PROCEEDINGS BY THE THEN CIT-1, 11 PENNZOIL QUAKER STATE INDIA LTD MUMBAI. THE THEN CIT-1, MUMBAI, VIDE HIS ORDER DAT ED 11-03-2015 PASSED U/S 263 OF THE ACT, HAS ISSUED CERTAIN DIRECTIONS TO TH E AO IN RESPECT OF SIX ISSUES. THE AO, VIDE HIS ORDER DATED 29-02-2016 HAS DISCUSS ED ALL SIX ISSUES QUESTIONED BY THE CIT-1, MUMBAI AND AFTER EXAMINATION OF FACTS IN THE LIGHT OF SUBMISSIONS MADE BY THE ASSESSEE, HE CAME TO THE CONCLUSION THA T ADDITION IS REQUIRED TO BE MADE IN RESPECT OF EXCISE DUTY NOT PAID FOR RS.2 4,67,462 AND CLAIM OF REVERSAL PROVISION FOR RS.2,78,96,822. HOWEVER, IN SOFAR AS REMAINING FOUR ISSUES, I.E. LIABILITY OF CONTINGENT NATURE, CAPITA L EXPENDITURE DEBITED TO P&L ACCOUNT, NO DISALLOWANCE U/S 40(A)(IA) AND WRONG WO RKING OF BOOK PROFIT U/S 115JB, THE AO CATEGORICALLY OBSERVED THAT ON EXAMIN ATION OF FACTS, IT HAS COME TO LIGHT THAT NO ADDITION IS WARRANTED AND AS SUCH NO ADVERSE INFERENCE IS CONSIDERED NECESSARY ON THOSE ISSUES. 10. THE PROVISIONS OF SECTION 263 ENVISAGE REVISION OF ASSESSMENT ORDER IF THE TWIN CONDITIONS PRESCRIBED UNDER THE SAID PROVI SIONS ARE SATISFIED. IN ORDER TO INVOKE THE JURISDICTION U/S 263, THE CIT HAS TO SATISFY THAT THE ORDER OF THE AO SOUGHT TO BE REVISED IS ERRONEOUS AND IT IS PREJ UDICIAL TO THE INTEREST OF THE REVENUE. THE ORDER SOUGHT TO BE REVISED MUST BE ER RONEOUS INSOFAR AS IT IS PREJUDICIAL TO THE INTEREST OF THE REVENUE. THUS, U/S 263, AN ORDER MUST BE BOTH ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF T HE REVENUE. IF ORDER IS ERRONEOUS, BUT THERE IS NO LOSS OF REVENUE OR IF OR DER IS NOT ERRONEOUS, BUT 12 PENNZOIL QUAKER STATE INDIA LTD THERE IS LOSS TO REVENUE, THEN SECTION 263 CANNOT B E INVOKED. WE FURTHER NOTICE THAT WHEN A PARTICULAR ISSUE HAS BEEN SUBJEC T MATTER OF ASSESSMENT PROCEEDINGS OR APPELLATE OR REVISION PROCEEDINGS AN D ALSO THE AUTHORITIES HAVE TAKEN A PARTICULAR VIEW ON EXAMINATION OF FACTS AND SUBMISSIONS OF THE ASSESSEE, THEN THE PCIT CANNOT INVOKE JURISDICTION U/S 263 ON SAME ISSUES ON THE GROUND THAT THERE WAS LACK OF ENQUIRY OR INADEQ UATE ENQUIRY IN RESPECT OF THOSE ISSUES, BECAUSE ONCE A PARTICULAR ISSUE IS SU BJECT MATTER OF VERIFICATION BY THE AO AND HE HAS TAKEN A PARTICULAR VIEW ON BEING SATISFIED WITH THE EXPLANATION FURNISHED BY THE ASSESSEE, THEN THERE I S NO SCOPE OF WHATSOEVER FOR THE CIT TO REVISE SUCH ASSESSMENT ORDER PASSED BY THE AO ON THE SAME ISSUES U/S 263 OF THE I.T. ACT, 1961. 11. IN THIS CASE, ON PERUSAL OF FACTS AVAILABLE ON RECORD, IT IS ABUNDANTLY CLEAR THAT ALL SIX ISSUES QUESTIONED BY THE PCIT WERE SUB JECT MATTER OF VERIFICATION BY THE THEN CIT-1, MUMBAI IN FIRST 263 PROCEEDINGS. T HE THEN CIT-1, MUMBAI GAVE CERTAIN DIRECTIONS IN RESPECT OF SIX ISSUES. THE A O, ON THE BASIS OF DIRECTION ISSUED BY THE CIT, HAS TAKEN UP THE PROCEEDINGS AND ON BEING SATISFIED WITH THE EXPLANATION FURNISHED BY THE ASSESSEE, HAS ACCEPTED FOUR ISSUES BY STATING THAT NO OBSERVATIONS OR FINDING HAS COME TO LIGHT THAT W ARRANTED AN ADDITION OR DISALLOWANCE AS SUCH, NO ADVERSE INFERENCE WAS CONS IDERED NECESSARY ON THE ISSUES. INSOFAR AS TWO ISSUES, I.E. EXCISE DUTY NO T PAID AND CLAIM OF REVERSAL OF 13 PENNZOIL QUAKER STATE INDIA LTD PROVISION, THE AO HAS MADE ADDITION IN THE ORDER PA SSED U/S 143(3) R.W.S. 263 DATED 29-09-2016. FURTHER, WE ARE OF THE CONSIDERE D VIEW THAT THE PCIT WAS ERRED IN INVOKING THE JURISDICTION CONFERRED U/S 26 3 OF THE I.T. ACT, 1961 UNDER THE GUISE OF LACK OF ENQUIRY OR INADEQUATE ENQUIRY. THEREFORE, WE ARE OF THE CONSIDERED VIEW THAT THE ISSUES QUESTIONED BY THE P CIT ARE NOT COMING WITHIN THE AMBIT OF LACK OF ENQUIRY OR INADEQUATE ENQUIRY. 12. INSOFAR AS REMAINING ISSUES ARE CONCERNED, THE LD. AR FOR THE ASSESSEE HAS MADE OUT A CASE THAT THE ASSESSEE HAS ALREADY S UO MOTO DISALLOWED LIABILITY OF CONTINGENT NATURE IN STATEMENT OF TOTAL INCOME F OR AY 2008-09 AND ALSO CAPITAL EXPENDITURE DEBITED TO P&L ACCOUNT HAS BEEN DISALLOWED IN THE STATEMENT OF TOTAL INCOME. AS REGARDS NON DISALLOW ANCE OF CERTAIN EXPENDITURE U/S 40(A)(IA), THE LD.AR HAS BROUGHT OUT ALL MATERI ALS TO PROVE THAT THERE IS NO LOSS OF REVENUE AS PROVISIONS OF SECTION 40(A)(IA) HAS BEEN AMENDED W.E.F. 01- 04-2010 BY THE FINANCE ACT, 2010, RELAXING THE TIME LIMIT TO DEPOSIT TAX UP TO THE DATE OF FILING OF RETURN OF INCOME. VARIOUS CO URTS HAVE HELD THAT SUCH AMENDMENT TO PROVISION IS RETROSPECTIVE IN NATURE. THE ASSESSEE ALSO FILED NECESSARY DETAILS TO PROVE THAT IT HAS PAID THE TDS ON OR BEFORE DUE DATE OF FILING RETURN OF INCOME. SIMILARLY, THE ASSESSEE H AS EXPLAINED THE ISSUE OF EXCESS DEDUCTION U/S 43(6) SO AS TO MAKE IT CLEAR T HAT THERE IS NO LOSS OF REVENUE AS IT HAS GIVEN PROPER TREATMENT IN ITS BOO KS OF ACCOUNT AND STATEMENT 14 PENNZOIL QUAKER STATE INDIA LTD OF TOTAL INCOME. THE LD.AR FURTHER MADE IT CLEAR T HAT THIS ISSUE HAD NOT BEEN QUESTIONED BY THE THEN CIT-1, MUMBAI IN THE FIRST F OUND OF PROCEEDINGS U/S 263 AND HENCE, UNDER SIMILAR SET OF FACTS, THE ISSUE CA NNOT BE QUESTIONED ONCE AGAIN BY THE PCIT. 13. COMING TO THE CASE LAWS RELIED UPON BY THE ASSE SSEE. THE ASSESSEE HAS RELIED UPON THE DECISION OF HONBLE SUPREME COURT I N THE CASE OF MALABAR INDUSTRIAL CO LTD VS CIT (SUPRA) WHEREIN THE HONBL E SUPREME COURT IN THE LIGHT OF PROVISIONS OF SECTION 263 HAS OBSERVED AS UNDER :- THE PHRASE PREJUDICIAL TO THE INTERESTS OF THE REVE NUE IS NOT AN EXPRESSION OF ART AND IS NOT DEFINED IN THE ACT. UNDERSTOOD IN ITS ORDINAR Y MEANING IT IS OF WIDE IMPORT AND IS NOT CONFINED TO LOSS OF TAX MR. ABARAHAM RELIED O N THE JUDGMENT OF THE DIVISION BENCH OF THE HIGH COURT OF MADRAS IN VENKATAKRISHNA RICE COMPANY VS. COMMISSIONER OF INCOME-TAX [163 ITR 129] INTERPRETING PREJUDICIAL TO THE INTERESTS OF THE RE VENUE. THE HIGH COURT HELD, IN THIS CONTEXT, IT MUST BE REGARD ED AS INVOLVING A CONCEPTION OF ACTS OR ORDERS WHICH ARE SUBVERSIVE OF THE ADMIN ISTRATION OF REVENUE. THERE MUST BE SOME GRIEVOUS ERROR IN THE ORDER PASSED BY THE I NCOME-TAX OFFICER, WHICH MIGHT SET A BAD TREND OR PATTERN FOR SIMILAR ASSESSMENTS, WHICH ON A BROAD RECKONING, THE COMMISSIONER MIGHT THINK TO BE PREJUDICIAL TO THE I NTERESTS OF REVENUE ADMINISTRATION. IN OUR VIEW THIS INTERPRETATION I S TOO NARROW TO MERIT ACCEPTANCE. THE SCHEME OF THE ACT IS TO LEVY AND COLLECT TAX IN ACCORDANCE WITH THE PROVISIONS OF THE ACT AND THIS TASK IS ENTRUSTED TO THE REVENUE. IF DUE TO AN ERRONEOUS ORDER OF THE INCOME-TAX OFFICER, THE REVENUE IS LOSING TAX LAWFULL Y PAYABLE BY A PERSON, IT WILL CERTAINLY BE PREJUDICIAL TO THE INTERESTS OF THE REV ENUE. THE PHRASE PREJUDICIAL TO THE INTERESTS OF THE REVEN UE HAS TO BE READ IN CONJUNCTION WITH AN ERRONEOUS ORDER PASSED BY THE ASSESSING OFFIC ER. EVERY LOSS OF REVENUE AS A CONSEQUENCE OF AN ORDER OF ASSESSING OFFICER CAN NOT BE TREATED AS PREJUDICIAL TO THE INTERESTS OF THE REVENUE, FOR EXAMPLE, WHEN AN INCOME-TAX OFFICER ADOPTED ONE OF THE COURSES PERMISSIBLE IN LAW AND IT HAS RES ULTED 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 A S AN ERRONEOUS ORDER PREJUDICIAL TO THE INTERESTS OF THE REVENUE UNLESS THE VIEW TAKE N BY THE INCOME-TAX OFFICER IS UNSUSTAINABLE IN LAW. IT HAS BEEN HELD BY THIS COUR T THAT WHERE A SUM NOT EARNED BY A PERSON IS ASSESSED AS INCOME IN HIS HANDS ON HIS SO OFFERING, THE ORDER PASSED BY THE ASSESSING OFFICER ACCEPTING THE SAME AS SUCH WI LL BE ERRONEOUS AND PREJUDICIAL TO THE INTERESTS OF THE REVENUE. RAMPYARI DEVI SARAOGI VS. COMMISSIONER OF INCOME-TA X [67 ITR 84] AND IN SMT. TARA DEVI AGGARWAL VS. COMMISSIONER OF I NCOME-TAX, WEST BENGAL [88 ITR 323] . IN THE INSTANT CASE, THE COMMISSIONER NOTED THAT THE INCOME-TAX OFFICER PASSED THE ORDER OF NIL ASSESSMENT WITHOUT A PPLICATION OF MIND. INDEED, THE HIGH COURT RECORDED THE FINDING THAT THE INCOME-TAX OFFICER FAILED TO APPLY HIS MIND TO THE CASE IN ALL PERSPECTIVE AND THE ORDER PASSED BY HIM WAS ERRONEOUS. IT APPEARS THAT THE RESOLUTION PASSED BY THE BOARD OF THE APPEL LANT- COMPANY WAS NOT PLACED 15 PENNZOIL QUAKER STATE INDIA LTD BEFORE THE ASSESSING OFFICER. THUS, THERE WAS NO MATER IAL TO SUPPORT THE CLAIM OF THE APPELLANT THAT THE SAID AMOUNT REPRESENTED COMPENSA TION FOR LOSS OF AGRICULTURAL INCOME. HE ACCEPTED THE ENTRY IN THE STATEMENT OF THE ACCOUNT FILED BY THE APPELLANT IN THE ABSENCE OF ANY SUPPORTING MATERIAL AND WITHOUT MAKING ANY INQUIRY. ON THESE FACTS THE CONCLUSION THAT THE OR DER OF THE INCOME-TAX OFFICER WAS ERRONEOUS IS IRRESISTIBLE. WE ARE, THEREFORE, OF THE OPINION THAT THE HIGH COURT HAS RIGHTLY HELD THAT THE EXERCISE OF THE JURISDICTION B Y THE COMMISSIONER UNDER SECTION 263(1) WAS JUSTIFIED. THE SECOND CONTENTION HAS TO B E REJECTED IN VIEW OF THE FINDING OF FACT RECORDED BY THE HIGH COURT. IT WAS NOT SHOW N AT ANY STAGE OF THE PROCEEDINGS, THE AMOUNT IN QUESTION WAS FIXED OR QUA NTIFIED AS LOSS OF AGRICULTURAL INCOME AND ADMITTEDLY IT IS NOT SO FOUND BY THE TRI BUNAL. THE FURTHER QUESTION WHETHER IT WILL BE AGRICULTURAL INCOME WITHIN THE M EANING OF SECTION 2(1A) OF THE ACT AS ELUCIDATED BY THIS COURT IN COMMISSIONER OF INCOM E-TAX , WEST BENGAL, CALCUTTA VS. RAJA BENOY KUMAR SAHAS ROY [32 ITR 466] DOES NOT ARISE FOR CONSIDERATION. IT IS EVIDENT FROM THE ORDER OF THE HIGH COURT THAT FINDINGS RECORD ED BY THE TRIBUNAL THAT THE APPELLANT STOPPED AGRICULTURAL OPERATION IN NOVEMBE R 1982 AND THE RECEIPT UNDER CONSIDERATION DID NOT RELATE TO ANY AGRICULTURAL OP ERATION CARRIED ON BY THE APPELLANT, WERE NOT QUESTIONED BEFORE IT. THOUGH, WE DO NOT AGR EE WITH THE HIGH COURT THAT THE SAID AMOUNT WAS PAID FOR BREACH OF CONTRACT AS INDEED IT WAS PAID IN MODIFICATION/RELAXATION OF THE TERMS OF THE CONTRACT, WE HOLD THAT THE HIGH COURT IS JUSTIFIED IN CONCLUDING THAT THE SAID AMOUNT WAS A T AXABLE RECEIPT UNDER THE HEAD INCOME FROM OTHER SOURCES. 14. THE ASSESSEE HAS ALSO RELIED UPON THE DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS GABRIEL INDIA LTD (SUPR A). THE HONBLE JURISDICTIONAL HIGH COURTT, WHILE CONSIDERING THE ISSUE OF LACK OF ENQUIRY AND INADEQUATE ENQUIRY, HAS HELD THAT MERELY FOR THE REASON THAT T HERE IS LACK OF ENQUIRY, THE CIT CANNOT ASSUME JURISDICTION U/S 263 WHEN THE AO HAS TAKEN ONE POSSIBLE VIEW ON BEING SATISFIED WITH THE EXPLANATION FURNIS HED BY THE ASSESSEE. THE RELEVANT OBSERVATIONS ARE AS UNDER:- 12. FROM THE AFORESAID DEFINITIONS IT IS CLEAR THA T AN ORDER CANNOT BE TERMED AS ERRONEOUS UNLESS IT IS NOT IN ACCORDANCE WITH LA W. IF AN INCOME-TAX OFFICER ACTING IN ACCORDANCE WITH LAW MAKES A CERTAIN ASSES SMENT, THE SAME CANNOT BE BRANDED AS ERRONEOUS BY THE COMMISSIONER SIMPLY BECAUSE, ACCORDING TO HIM, THE ORDER SHOULD HAVE BEEN WRITTEN MORE ELABOR ATELY THIS SECTION DOES NOT VISUALISE A CASE OF SUBSTITUTION OF THE JUDGMEN T OF THE COMMISSIONER FOR THAT OF THE INCOME-TAX OFFICER, WHO PASSED THE ORDE R UNLESS THE DECISION IS HELD TO BE ERRONEOUS. CASES MAY BE VISUALISED WHERE THE INCOME-TAX OFFICER WHILE MAKING AN ASSESSMENT EXAMINES THE ACCOUNTS, M AKES ENQUIRIES, APPLIES HIS MIND TO THE FACTS AND CIRCUMSTANCES OF THE CASE AND DETERMINES THE 16 PENNZOIL QUAKER STATE INDIA LTD INCOME EITHER BY ACCEPTING THE ACCOUNTS OR BY MAKIN G SOME ESTIMATE HIMSELF. THE COMMISSIONER, ON PERUSAL OF THE RECORDS, MAY BE OF THE OPINION THAT THE ESTIMATE MADE BY THE OFFICER CONCERNED WAS ON THE L OWER SIDE AND LEFT TO THE COMMISSIONER HE WOULD HAVE ESTIMATED THE INCOME AT A FIGURE HIGHER THAN THE ONE DETERMINED BY THE INCOME-TAX OFFICER. THAT WOULD NOT VEST THE COMMISSIONER WITH POWER TO RE-EXAMINE THE ACCOUNTS AND DETERMINE THE INCOME HIMSELF AT A HIGHER FIGURE. IT IS BECAUSE TH E INCOME-TAX OFFICER HAS EXERCISED THE QUASI-JUDICIAL POWER VESTED IN HIM IN ACCORDANCE WITH LAW AND ARRIVED AT CONCLUSION AND SUCH A CONCLUSION CANNOT BE TERMED TO BE ERRONEOUS SIMPLY BECAUSE THE COMMISSIONER DOES NOT FEEL SATISFIED WITH THE CONCLUSION. IT MAY BE SAID IN SUCH A CASE THAT IN T HE OPINION OF THE COMMISSIONER THE ORDER IN QUESTION IS PREJUDICIAL T O THE INTERESTS OF THE REVENUE. BUT THAT BY ITSELF WILL NOT BE ENOUGH TO V EST THE COMMISSIONER WITH THE POWER OF SUO MOTU REVISION BECAUSE THE FIRST RE QUIREMENT, VIZ., THAT THE ORDER IS ERRONEOUS, IS ABSENT. SIMILARLY, IF AN ORD ER IS ERRONEOUS BUT NOT PREJUDICIAL TO THE INTERESTS OF THE REVENUE, THEN A LSO THE POWER OF SUO MOTU REVISION CANNOT BE EXERCISED. ANY AND EVERY ERRONEO US ORDER CANNOT BE THE SUBJECT-MATTER OF REVISION BECAUSE THE SECOND REQUI REMENT ALSO MUST BE FULFILLED. THERE MUST BE SOME PRIMA FACIE MATERIAL ON RECORD TO SHOW THAT TAX WHICH WAS LAWFULLY EXIGIBLE HAS NOT BEEN IMPOSED OR THAT BY THE APPLICATION OF THE RELEVANT STATUTE ON AN INCORRECT OR INCOMPLE TE INTERPRETATION A LESSER TAX THAN WHAT WAS JUST HAS BEEN IMPOSED. 15. IN THIS VIEW OF THE MATTER AND RESPECTFULLY FOL LOWING THE CASE LAWS DISCUSSED HEREINABOVE, WE ARE OF THE CONSIDERED VIE W THAT THE ORDER PASSED BY THE AO U/S 143(3) R.W.S. 263 IS NEITHER ERROR PASSE D U/S 263 BY THE LD.PCIT AND RESTORE THE ASSESSMENT ORDER PASSED BY THE AO U/S 1 43(3) R.W.S. 263 DATED 29- 02-2016. 16. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 21-12-2018 . SD/- SD/- (RAVISH SOOD) (G MANJUNATHA) JUDICIAL MEMBER ACCOUNTANT MEMBER 17 PENNZOIL QUAKER STATE INDIA LTD MUMBAI, DT : 21 ST DECEMBER, 2018 PK/- COPY TO : 1. APPELLANT 2. RESPONDENT 3. CIT(A) 4. CIT 5. DR /TRUE COPY/ BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI