DEVAUNSHI ANOOP MEHTA, MUMBAI V. PR CIT CEN 2, MUMBAI

ITA 3672/MUM/2016

• Counselvise Citation: 367219914 RSA 2016
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-12-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2006-2007
• Appeal Filed On: 26-05-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K KRISHNA MURTHY
• Keywords: Peak credit; Tax effect; Revised return
• Section: 143(3); 153A; 234B; 147; 148; 263; 63

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH D, MUMBAI BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER AND SHRI ASHWANI TANEJA, ACCOUNTANT MEMBER ITA NO.3672/M/2016 ASSESSMENT YEAR: 2006-07 SMT. DEVAUNSHI ANOOP MEHTA, 91, EL-CID, 13A RIDGE ROAD, MUMBAI 400006 PAN: AAHPM4586E VS. PRINCIPAL COMMISSIONER OF INCOME TAX, CENTRAL-2, AIR INDIA BLDG., NARIMAN POINT, MUMBAI - 400021 (APPELLANT) (RESPONDENT) PRESENT FOR: ASSESSEE BY : SHRI VIJAY MEHTA, A.R. REVENUE BY : SHRI K. KRISHNA MURTHY, D.R. DATE OF HEARING : 20.10.2016 DATE OF PRONOUNCEMENT : 14.12.2016 O R D E R PER SANJAY GARG, JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE ASSES SEE AGAINST THE REVISION ORDER DATED 22.03.2016 PASSED UNDER SECTIO N 263 OF THE ACT BY THE PRINCIPAL COMMISSIONER OF INCOME TAX (HEREINAFTER R EFERRED TO AS THE PCIT) RELEVANT TO ASSESSMENT YEAR 2006-07. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE SCRUTIN Y ASSESSMENT IN THE CASE OF THE ASSESSEE HAS BEEN COMPLETED BY THE ASSESSING OF FICER (HEREINAFTER REFERRED TO AS THE AO) UNDER SECTION 143(3) READ WITH SECTIO N 153A OF THE INCOME TAX ACT. HOWEVER, THE LD. PCIT FROM THE RECORDS NOTICE D THAT THE ASSESSEE HAD SOME CONNECTION WITH A BANK ACCOUNT IN HSBC BANK, G ENEVA. ONE MR. ANOOP MEHTA HAD DECLARED THE AMOUNT LYING IN THE SA ID BANK ACCOUNT AS UNDISCLOSED INCOME IN THE HANDS OF THE ESTATE OF LA TE SHRI V.C. MEHTA AND HAD PAID THE TAXES THEREUPON. THE ASSESSMENT, THUS, WA S MADE ON SUBSTANTIVE BASIS IN THE HANDS OF ESTATE OF LATE SHRI V.C. MEHTA FOR ASSESSMENT YEARS 2006-07 ITA NO.3672/M/2016 SMT. DEVAUNSHI ANOOP MEHTA 2 AND 2007-08 UNDER SECTION 148 OF THE I.T. ACT, 1961 AND THEREBY UNDISCLOSED INCOME OF RS.8 CRORE AND RS.1.58 CRORE RESPECTIVEL Y WAS ADDED AS INCOME IN RESPECT OF THE AMOUNT LYING IN THE SAID FOREIGN BAN K ACCOUNT. HOWEVER, A PROTECTIVE ASSESSMENT WAS MADE IN THE ASSESSEES CA SE FOR ASSESSMENT YEAR 2007-08 AT THE PEAK VALUE OF US$ 21,51,725 (INR 9,5 7,07,316). THE LD. PCIT, HOWEVER, NOTED THAT THE PEAK VALUE O F THE AMOUNT LYING IN THE SAID UNDISCLOSED BANK ACCOUNT WAS US$ 17,95,426 (IN R 8,07,94,197) FOR ASSESSMENT YEAR 2006-07 AND THAT THE SAID AMOUNT SH OULD HAVE BEEN ADDED TO THE ASSESSEES INCOME FOR ASSESSMENT YEAR 2006-07 O N PROTECTIVE BASIS, WHICH WAS NOT DONE BY THE AO AND INSTEAD ENTIRE PEAK OF U S$ 21,51,725 (INR 9,57,07,316) WAS ADDED ON PROTECTIVE BASIS IN ASSES SMENT YEAR 2007-08. HE, THEREFORE, HELD THAT SINCE THE AMOUNT PERTAINING TO ASSESSMENT YEAR 2006-07 WAS NOT ADDED IN THE RESPECTIVE YEAR, HENCE THE ASS ESSMENT ORDER WAS ERRONEOUS AS WELL AS PREJUDICIAL TO THE INTEREST OF REVENUE. HE, THEREFORE, EXERCISING HIS POWERS UNDER SECTION 263 OF THE ACT SET ASIDE THE ASSESSMENT ORDER OF THE AO AND DIRECTED THE AO TO MAKE FRESH A SSESSMENT CONSIDERING THE PEAK VALUE OF US$ 17,95,426 AS UNDISCLOSED INCOME F OR ASSESSMENT YEAR 2006- 07 ON PROTECTIVE BASIS AS PER LAW. 3. THE LD. A.R. OF THE ASSESSEE BEFORE US HAS STATE D THAT THE SAID FOREIGN BANK ACCOUNT BELONGED TO THE FATHER IN LAW OF THE A SSESSEE NAMELY SHRI BRIJLAL MEHTA. SHRI VRAJLAL C. MEHTA, SINCE DECEASED. SEV ERAL FAMILY MEMBERS INCLUDING ASSESSEE WERE BENEFICIARIES OF THAT ACCOU NT. A SEARCH ACTION UNDER SECTION 132(1) OF THE ACT WAS CARRIED OUT IN THE CA SE OF M/S. MOHIT DIAMONDS PVT. LTD. ALONG WITH OTHER GROUP CONCERNS. FURTHER INFORMATION HAD BEEN RECEIVED FROM ADDITIONAL DIT (INV) THAT THE SAID AC COUNT IN HSBC BANK, SWITZERLAND BELONGED TO LATE SHRI V.C. MEHTA, FATHE R IN LAW OF THE ASSESSEE. THE ASSESSMENT, THUS, IN THE CASE OF LATE SHRI V.C. MEHTA WAS REOPENED UNDER SECTION 147 OF THE ACT. DURING THE ASSESSMENT PROC EEDINGS OF LATE SHRI V.C. MEHTA IT WAS INTIMATED THAT ALL THE PROPERTY WAS LY ING WITH THE EXECUTORS OF THE ITA NO.3672/M/2016 SMT. DEVAUNSHI ANOOP MEHTA 3 ESTATE OF LATE SHRI V.C. MEHTA. AFTER CONSIDERING THE EVIDENCES AND SUBMISSIONS, THE AO CONCLUDED THAT THE EXECUTORS OF THE ESTATE OF LATE SHRI V.C. MEHTA HAD FILED A REVISED RETURN OF INCOME FOR ASSESSMENT YEAR 2007-08 ON 26.03.15 DECLARING THE INCOME OF RS.1,57,86,368/ -. THE AO, HOWEVER, CONCLUDED THAT THE SAID RETURN WAS INVALID. THE AO , THUS, ADDED AN AMOUNT OF RS.1,57,86,368/- BEING THE PEAK BALANCE FOR THE ASS ESSMENT YEAR 2007-08 IN THE HANDS OF ESTATE OF LATE SHRI V.C. MEHTA ON SUBSTANT IVE BASIS. HOWEVER, PROTECTIVE ADDITIONS WERE MADE IN THE HANDS OF THE BENEFICIARIES OF THE ESTATE OF LATE SHRI V.C. MEHTA INCLUDING THE ASSESSEE BEFORE US, NAMELY, SMT. DEVAUNSHI ANOOP MEHTA. THE LD. A.R. HAS STATED THAT THE ADDITION ON SUBSTA NTIVE BASIS HAS BEEN ADMITTED BY THE LEGAL HEIRS/EXECUTORS OF THE ESTATE OF LATE SHRI V.C. MEHTA, WHEREAS THE ADDITION IN QUESTION HAS BEEN MADE IN T HE CASE OF THE ASSESSEE ONLY ON PROTECTIVE BASIS. IT HAS BEEN CONTENDED THAT WH EN THE ADDITION ON SUBSTANTIVE BASIS HAS BEEN MADE AND ADMITTED IN THE CASE OF ESTATE OF LATE SHRI V.C. MEHTA, THERE WAS NO JUSTIFICATION ON THE PART OF THE PCIT TO SET ASIDE THE ASSESSMENT ORDER IN RELATION TO THE ADDITION MADE O N PROTECTIVE BASIS IN THE HANDS OF THE ASSESSEE. IT HAS BEEN FURTHER CONTEND ED THAT THE ORDER OF THE AO IS NEITHER ERRONEOUS NOR PREJUDICIAL TO THE INTEREST O F THE REVENUE. IT HAS BEEN FURTHER CONTENDED THAT EVEN IF THE ORDER IS REVISED , NO PECUNIARY BENEFIT OR TAXES ARE LIKELY TO BE ENHANCED OR RECEIVED FROM THE ASSE SSEE AS THE ADDITIONS IN THE CASE OF ASSESSEE WERE MADE ONLY ON PROTECTIVE BASIS . IT HAS BEEN FURTHER SUBMITTED THAT SINCE THE AMOUNT LYING IN THE BANK A CCOUNT WAS ADMITTED AND ACCEPTED AND TAXES PAID BY THE ESTATE OF LATE SHRI V.C. MEHTA EVEN THERE WAS NO JUSTIFICATION FOR MAKING ADDITION ON PROTECTIVE BAS IS IN THE HANDS OF THE ASSESSEE. FINALLY THE LD. A.R. HAS CONTENDED THAT EVEN IF IT IS ASSUMED THAT THE ORDER OF THE AO IS ERRONEOUS ON THE GROUND THAT A P ART OF THE AMOUNT LYING IN THE BANK ACCOUNT SHOULD HAVE BEEN ASSESSED/ADDED IN THE ASSESSMENT YEAR 2006-07 INSTEAD OF THE ENTIRE ADDITION MADE IN ASSE SSMENT YEAR 2007-08 ON ITA NO.3672/M/2016 SMT. DEVAUNSHI ANOOP MEHTA 4 PROTECTIVE BASIS, STILL THE SAID ORDER CANNOT IN AN Y MANNER BE SAID TO BE PREJUDICIAL TO THE INTEREST OF REVENUE. 4. THE LD. D.R., ON THE OTHER HAND, HAS SUPPORTED T HE ORDER OF THE LD. PCIT. 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND HAVE ALS O GONE THROUGH THE RECORDS. A SPECIFIC QUESTION WAS ASKED TO THE LD. A .R. THAT WHETHER ANY APPEAL HAS BEEN FILED BY THE LEGAL HEIRS/EXECUTORS OF THE ESTATE OF LATE SHRI V.C. MEHTA CHALLENGING THE ABOVE ADDITIONS MADE BY THE AO IN T HE HANDS OF LATE SHRI V.C. MEHTA. AT THIS, THE LD. A.R. HAS SUBMITTED THAT TH OUGH AN APPEAL HAS BEEN FILED BUT THAT HAS BEEN FILED RELATING TO CERTAIN O THER GROUNDS. HOWEVER, THE ESTATE OF LATE SHRI V.C. MEHTA HAVE OWNED UP OF THE BALANCES LYING IN THE HSBC BANK ACCOUNT AND HAVE PAID THE TAXES THEREON I N VARIOUS ASSESSMENT YEARS. AT THIS, THE LD. A.R. WAS ASKED TO FILE THE COPY OF THE GROUNDS OF APPEAL FILED BY THE ESTATE OF LATE SHRI V.C. MEHTA AGAINST THE ASSESSMENT ORDER IN THE CASE OF LATE SHRI V.C. MEHTA, THE LD. A.R. ACCORDIN GLY SUBMITTED THE COPY OF GROUNDS OF APPEAL IN THE CASE OF LATE SHRI V.C. MEH TA WHICH FOR THE SAKE OF CONVENIENCE IS REPRODUCED AS UNDER: GROUND NO.1: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LEARNED AO ERRED IN PASSING THE ASSESSMENT ORDER ARBITRARILY. THE AP PELLANT SUBMITS THAT THE ORDER OF ASSESSMENT IS BAD IN LAW AND NEEDS TO BE S TRUCK DOWN. GROUND NO. 2 : ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LEARNED AO ERRED IN OBSERVING THAT THE LEGAL HEIR CLAIMED THE BENEFI CIAL OWNER-SHIP OF THE HSBC BANK ACCOUNT. THE APPELLANT SUBMITS THAT THE SAID O BSERVATIONS OF LD. A.O. IS ARBITRARY AND WITHOUT APPRECIATING THE CORRECT FACT S AND CIRCUMSTANCES OF THE CASE. GROUND NO. 3 : ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LEARNED AO ERRED IN OBSERVING THAT THE APPELLANT DID NOT CO-OPERATE BY NOT PROVIDING THE COPY OF HSBC BANK STATEMENT. THE APPELLANT SUBMITS THAT THE SAID OBSERVATIONS OF ID. A.O. IS ARBITRARY AND WITHOUT APPRECIATING THE CORRECT FACT S AND CIRCUMSTANCES OF THE CASE. GROUND NO. 4: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LEARNED AO ITA NO.3672/M/2016 SMT. DEVAUNSHI ANOOP MEHTA 5 ERRED IN NOT GRANTING THE CREDIT OF RS.2,68,90,154 PAID BY THE APPELLANT ON 30.03.2012 ON ACCOUNT OF SELF ASSESSMENT TAX. THE A PPELLANT PRAYS THAT THE ACTION OF LD.AO MAY KINDLY BE TREATED AS BAD IN LAW AND THE CREDIT OF SUCH PAID SELF ASSESSMENT TAX MAY KINDLY BE DIRECTED TO BE AL LOWED. ALTHOUGH SUCH PAYMENT WAS MADE FOR AY 2012-13, SINCE PART OF INCO ME HAS BEEN ASSESSED TO TAX FOR ASSESSMENT YEAR UNDER APPEAL, IT IS IMPE RATIVE THAT THE CORRESPONDING PART OF CREDIT FOR TAX IS ALSO ALLOWE D THIS YEAR. GROUND NO. 5. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LEARNED AO ERRED IN WRONGLY CALCULATING THE AMOUNT OF INTEREST PAYABLE ON ACCOUNT OF SECTION 234B OF THE INCOME TAX ACT, 1961. THE APPEL LANT PRAYS THAT THE CALCULATION OF LD. AO MAY KINDLY BE DIRECTED TO BE REVISED. THE APPELLANT CRAVES, LEAVE TO ADD, AMEND, ALTER, O MIT ANY OF THE GROUNDS OF APPEAL BEFORE THE HEARING OF THE APPEAL, IF SO ADVI SED. 6. A PERUSAL OF THE ABOVE GROUNDS OF APPEAL REVEALS THAT THOUGH THERE IS NO SPECIFIC CHALLENGE TO THE ADDITIONS RELATING TO THE AMOUNT FOUND LYING IN THE ACCOUNT OF LATE SHRI V.C. MEHTA, HOWEVER, VIDE GROU ND NO.1, WHICH IS A GENERAL GROUND, THE ASSESSEE HAS CHALLENGED ASSESSM ENT ORDER ITSELF STATING THAT THE SAME IS BAD IN LAW. THE LD. A.R. WAS ASKED TO EXPLAIN IN THIS RESPECT. AT THIS, THE LD. A.R. OF THE ASSESSEE SUBMITTED THAT E VEN VIDE GROUND NO.1 THE ESTATE OF LATE SHRI V.C. MEHTA HAS NOT CHALLENGED O R DISOWNED THE AMOUNT LYING IN THE BANK ACCOUNT OF LATE SHRI V.C. MEHTA. TO FU RTHER SUBSTANTIATE HIS CONTENTIONS THE LD. A.R. HAS PRODUCED ON FILE A LET TER DATED 20.10.2016 ACCOMPANIED WITH A COPY OF UNDERTAKING SUBMITTED BY THE EXECUTORS OF ESTATE OF LATE SHRI V.C. MEHTA TO THE COMMISSIONER OF INCO ME TAX (APPEALS) WHEREIN THEY HAVE UNDERTAKEN AND CLARIFIED THAT THE INCOME IN THE FORM OF PEAK BALANCE IN THE BANK ACCOUNT OF LATE SHRI V.C. MEHTA WITH HS BC BANK, GENEVA HAS BEEN OFFERED FOR TAXATION FOR DIFFERENT ASSESSMENT YEARS. IT HAS BEEN STATED THAT THEY STAND WITH THE ABOVE SAID DISCLOSURE OF INCOME AND THAT THEY WILL NOT BE SEEKING ANY REDUCTION IN THE INCOME OFFERED AT ANY STAGE. THAT THEY HAVE OWNED UP THE BALANCES LYING IN THE ABOVE REFERRED B ANK ACCOUNT AND HAVE PAID THE TAXES THEREON IN VARIOUS ASSESSMENT YEARS AND T HAT THEY WILL NOT BE CLAIMING ANY REFUND OF THE AMOUNT OF TAXES ALREADY PAID EXCE PT FOR INTER-SE ADJUSTMENT OF THE TAXES PAID AMONGST VARIOUS ASSESSMENT YEARS. THE SAID COPY OF THE LETTER - . . ITA NO.3672/M/2016 SMT. DEVAUNSHI ANOOP MEHTA 6 DATED 17.10.2016 SUBMITTED BY THE EXECUTORS OF ESTA TE OF LATE SHRI V.C. MEHTA TO THE COMMISSIONER OF INCOME TAX (APPEALS) FOR THE SAKE OF CONVENIENCE IS REPRODUCED AS UNDER: ESTATE OF THE LATE MR. VRAIIAL C. MEHTA OCTOBER 17TH, 2016 TO, COMMISSIONER OF INCOME TAX (APPEALS) - 51, ROOM NO. 619, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI - 400004. RESPECTED SIR, RE: ESTATE OF LATE MR VRAJLAL C. MEHTA AY: 2006-2007 PAN: AADPM5837E SUB: LETTER OF UNDERTAKING THIS IS IN REFERENCE TO THE APPEAL FILED BY US FOR A.Y. 2006-07 ON 11.12.2015 BEFORE YOUR HONOUR. IN THE ABOVE REFERRED APPEAL, WE HAVE TAKEN VARIOUS GROUNDS INCLUDING THE GENERAL GROUND CHALLENGING VALIDITY OF THE ASSESSMENT ORDER PASSED BY THE ASSESSING OFFICER. WE WOULD LIKE TO CLARIFY THAT WE HAVE FILED OUR RET URNS OF INCOME FOR THE ABOVE ASSESSMENT YEAR, I.E. FOR A.Y. 2006-07 AS WELL AS FOR A.Y. 200 7-08 AND 2012-13 IN WHICH INCOME IN THE FORM OF PEAK BALANCE IN THE BANK ACCOUNT WITH HSBC BANK, GENEVA BEING ACCOUNT NO. 5091334050 HAS BEEN OFFERED FOR THE PURPOSE OF TAXA TION. THE YEAR-WISE POSITION OF INCOME DECLARED IS AS UNDER: SR.N O. A.Y. DATE OF FILLING OF REVISED RETURN OF INCOME AMOUNT 1. 2006 - 07 26.03.2015 8,00,94,000 2. 2007 - 08 26.03.2015 1,57,86,300 3. 2012-13 26.03.2015 2,43,20,246 WE WOULD LIKE TO CLARIFY THAT WE WILL STAND BY OUR AFORESAID DISCLOSURE OF INCOME & WE WILL NOT BE SEEKING ANY REDUCTION IN THE INCOME OFFERED AT ANY STAGE. WE FURTHER CLARIFY THAT WE HAVE OWNED UP THE BALANCES LYING IN THE ABOVE REFER RED BANK ACCOUNT AND PAID THE TAXES ITA NO.3672/M/2016 SMT. DEVAUNSHI ANOOP MEHTA 7 THEREON IN VARIOUS ASSESSMENT YEARS. WE WOULD NOT B E CLAIMING ANY REFUND OF THE AMOUNT OF TAXES ALREADY PAID EXCEPT FOR INTER SEY ADJUSTME NT OF THE TAXES PAID AMONGST VARIOUS ASSESSMENT YEARS. OUR ABOVE SUBMISSIONS MAY KINDLY BE TAKEN ON RECORD . THANKING YOU, YOURS FAITHFULLY, KERUL S. SHAH HITENDRA K. BHANSALI EXECUTORS OF 'ESTATE OF LATE VRAJLAL C. MEHTA' (APPOINTED AS SUCH UNDER THE LAST WILL AND TESTAMEN T OF MR. V. C. MEHTA DATED 14TH DECEMBER 2002 AND THE PROBATE DATED 28TH NOVEMBER 2 007 ISSUED BY THE HIGH COURT AT BOMBAY) 7. SINCE THE EXECUTORS OF ESTATE OF LATE SHRI V.C. MEHTA HAVE OWNED UP THE AMOUNT LYING IN THE HSBC BANK AND HAVE PAID THE TA XES THEREUPON AND THEY HAVE ALSO GIVEN AN UNDERTAKING TO THE COMMISSIONER OF INCOME TAX (APPEALS) THAT THEY OWNED UP THE BANK BALANCES LYING IN THE B ANK ACCOUNT OF LATE SHRI V.C. MEHTA, HENCE, UNDER SUCH CIRCUMSTANCES, THE AD DITION, IF ANY, MADE ON PROTECTIVE BASIS IN THE HANDS OF ASSESSEE WILL NOT HAVE ANY TAX EFFECT. THE LD. A.R. HAS STATED THAT BY SETTING ASIDE THE ASSESSMEN T PROCEEDINGS RELATING TO THE DECISIONS MADE ON PROTECTIVE BASIS IN THE HANDS OF ASSESSEE, THE ASSESSEE HAS BEEN SUBJECTED TO FACE MULTIPLE PROCEEDINGS AND WIL L HAVE TO SUFFER HARASSMENT OF ATTENDING THE PROCEEDINGS BEFORE THE AO WHICH UL TIMATELY WILL NOT HAVE ANY BEARING IN RELATION TO THE TAX EFFECT AS THE AMOUNT LYING IN THE HSBC BANK ACCOUNT HAS ALREADY BEEN OWNED UP BY THE ESTATE OF LATE SHRI V.C. MEHTA. SUBSTANTIVE ADDITIONS HAVE BEEN MADE IN THE CASE OF LATE SHRI V.C. MEHTA AND UNDER THE CIRCUMSTANCES THE ASSESSMENT ORDER PASSED IN THE CASE OF THE ASSESSEE ON PROTECTIVE BASIS CANNOT BE SAID TO BE PREJUDICIA L TO THE INTEREST OF THE REVENUE AT ALL. CONSIDERING THE ABOVE SUBMISSIONS, WE ARE OF THE VIEW THAT WHEN THE ESTATE OF LATE SHRI V.C. MEHTA, IN WHOSE C ASE THE ADDITIONS HAVE BEEN ITA NO.3672/M/2016 SMT. DEVAUNSHI ANOOP MEHTA 8 MADE ON PROTECTIVE BASIS, HAVE OWNED UP THE AMOUNT LYING IN THE BANK ACCOUNT AND HAVE ALSO GIVEN AN UNDERTAKING TO THE COMMISSIO NER OF INCOME TAX (APPEALS) THAT THEY STAND BY THE DISCLOSURE MADE BY THEM IN RELATION TO THE ABOVE SAID BANK ACCOUNT AND WILL NOT BE CLAIMING AN Y REFUND OF THE TAXES ALREADY PAID EXCEPT THE INTER-SE ADJUSTMENT OF TAXE S PAID AMONGST VARIOUS ASSESSMENT YEARS, NO USEFUL PURPOSE WILL BE SERVED IN MAKING A FRESH ASSESSMENT ON PROTECTIVE BASIS IN THE HANDS OF THE ASSESSEE MERELY BECAUSE THAT SOME OF THE INCOME WAS TO BE ADDED IN ASSESSMENT YE AR 2006-07 INSTEAD OF THE ENTIRE ADDITION MADE IN ASSESSMENT YEAR 2007-08 ON PROTECTIVE BASIS. IT IS A SETTLED POSITION IN LAW THAT POWERS UNDER SECTION 2 63 OF THE ACT CAN BE EXERCISED BY THE CIT ON SATISFACTION OF TWIN CONDIT IONS VIZ. THE ASSESSMENT ORDER SHOULD BE ERRONEOUS AND PREJUDICIAL TO THE RE VENUE. THUS, THIS POWER CANNOT BE EXERCISED UNLESS THE CIT IS ABLE TO ESTAB LISH THAT THE ORDER OF THE ASSESSING OFFICER IS ERRONEOUS AND PREJUDICIAL TO T HE REVENUE. THE ORDER OF THE AO UNDER THE CIRCUMSTANCES CANNOT BE HELD TO BE PRE JUDICIAL TO THE INTEREST OF THE REVENUE. WE, THEREFORE, DO NOT FIND ANY JUSTIF ICATION IN INVOKING THE PROVISIONS OF SECTION 263 OF THE ACT FOR PASSING TH E ABOVE SAID REVISION ORDER BY LD. PCIT AND THE SAME IS THEREFORE SET ASIDE. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS HER EBY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 14.12.2016. SD/- SD/- (ASHWANI TANEJA) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 14.12.2016. * KISHORE, SR. P.S. COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT (A) CONCERNED, MUMBAI ITA NO.3672/M/2016 SMT. DEVAUNSHI ANOOP MEHTA 9 THE DR CONCERNED BENCH //TRUE COPY// [ BY ORD ER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.