MIHIR J. DOSHI, MUMBAI V. ACIT CIR 26(2), MUMBAI

ITA 4403/MUM/2010

• Counselvise Citation: 440319914 RSA 2010
• Duration Of Justice: 3 year(s) 3 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-08-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Next Hearing Date: 26-08-2013
• Assessment Year: 2003-2004
• Appeal Filed On: 28-05-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K C P PATNAIK
• Assessee Lawyers: ALIASAGER RAMPURAWALA
• Keywords: Salary income; Assessment record
• Section: 143(3); 263; 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH H, MUMBAI BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER AND DR. S.T.M. PAVALAN, JUDICIAL MEMBER ITA NO.4403/MUM/2010 ASSESSMENT YEAR : 2003-04 SHRI MIHIR J. DOSHI 41-A, MEHER APARTMENTS ANSTEY ROAD MUMBAI-400 026. PAN NO.AADPD 5791 Q VS. ACIT - 26(2) MUMBAI. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI KANCHUN KAUSHAL AND SHRI ALIASAGER RAMPURAWALA REVENUE BY : SHRI K.C.P. PATNAIK DA TE OF HEARING : 26/08/2013 DATE OF PRONOUNCEMENT : 30 / 0 8 /2013 O R D E R PER B. RAMAKOTAIAH, AM: THIS IS AN APPEAL BY ASSESSEE AGAINST ORDER OF THE CIT -26 DATED 30-03-2010 U/S. 263. 2. THE FACTS LEADING TO THE PRESENT APPEAL ARE IN A PECULIAR WAY. THE ASSESSEE WAS AN EMPLOYEE OF M/S. MORGAN STANLEY INT ERNATIONAL INC. OF THE USA AND WAS ON DEPUTATION TO INDIA. ASSESSEE F ILED RETURN OF INCOME FOR ASSESSMENT YEAR 2003-04 ON 19.10.2004 CLAIMING THE STATUS OF RESIDENT BUT NOT ORDINARILY RESIDENT THEREBY OFFE RING THE SALARY EARNED IN INDIA TO AN EXTENT OF RS.3,23,23,506/-. IN THE C OURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE OFFERED FURTHER INCOME UN DER SHORT TERM CAPITAL GAIN OF RS.2,23,872/- AND BANK INTEREST OF RS.98,290/- SUO MOTO ITA NO.4403/M/10 A.Y.03-04 2 WHICH AO BROUGHT TO TAX U/S. 143(3) VIDE ORDER DATE D 24.01.2006. THE ASSESSEE MADE AN APPLICATION TO AO TO SUBMIT THAT T HE INCOME WHICH SHOULD HAVE BEEN TAKEN AS SALARY FROM INDIA WAS AT RS.3,24,45,350/- AS AGAINST RS.3,23,23,506/- ORIGINALLY OFFERED. THEREA FTER AO PASSED THE ORDER U/S. 154 MODIFYING THE TOTAL INCOME TO AN AMO UNT OF RS.3,27,55,512/-. THEREAFTER AFTER NOTICING THAT AO DID NOT EXAMINE THE STATUS OF THE ASSESSEE IN THE COURSE OF ASSESSMENT PROCEEDINGS, THE LD. CIT INITIATED PROCEEDINGS U/S. 263 AND ON THE BASIS OF INTERPRETATION OF SECTION 6(6) OF THE IT ACT, AVAILABLE AT THAT POINT OF TIME, HELD ASSESSEE AS RESIDENT AND ACCORDINGLY DIRECTED AO TO CONSIDER TH E GLOBAL INCOME ALSO. THEREAFTER, AO COMPLETED THE ORDER U/S. 143(3) READ WITH SECTION 263 ON 29.12.2008 TAKING GLOBAL SALARY AT RS.7,18,15,365/- , THEREBY DETERMINING TOTAL INCOME AT RS.10,51,06,290/-. THE ASSESSEE AGAIN U/S. 154 BROUGHT IT TO THE NOTICE OF AO THAT THE GLOBAL INCOME OF RS.7,18,15,365/- TAKEN AS INCOME FROM USA IN FACT I NCLUDES THE INDIAN SALARY ALREADY BROUGHT TO TAX AT RS.3,24,45,350/-. THEREFORE, THE ASSESSEE ASKED FOR RECTIFICATION OF THE ORDER TO EX CLUDE DOUBLE ADDITION. SURPRISINGLY, AO VIDE ORDER DATED 24.02.2009 DELETE D THE ENTIRE AMOUNT OF RS. 7,18,15,365/- AS AGAINST RS. 3,24,45,350/- W HICH WAS THE AMOUNT TO BE EXCLUDED. 3. BASED ON THE PROPOSAL RECEIVED FROM AO AND AFTER EXAMINING THE ASSESSMENT RECORDS, NOTICE U/S. 263 DATED 26.10.200 9 WAS ISSUED TO ASSESSEE. IN THE PROCEEDINGS THE LD. CIT CONSIDERED THAT ASSESSING OFFICER WRONGLY EXCLUDED THE GLOBAL INCOME OF SALARY AND SI NCE STATUS BEING RESIDENT THE ENTIRE GLOBAL INCOME SHOULD HAVE BEEN BROUGHT TO TAX. HE CONSIDERED THE ORDER TO BE ERRONEOUS AND PREJUDICIA L TO INTERESTS OF THE REVENUE. NEXT ISSUE CONSIDERED WAS WITH REFERENCE T O TAXING OF PERQUISITES. AN AMOUNT OF RS.1,01,54,606/- WAS CO NSIDERED AS PERQUISITES OF ASSESSEE (TAX PAID BY ASSESSEES EMP LOYER) WHEREAS ACCORDING TO THE CIT TOTAL TAX PAID WAS TO THE TUNE OF RS.1,54,73,859/- . ITA NO.4403/M/10 A.Y.03-04 3 THEREFORE, THE ORDER OF AO SUFFERED TO THAT EXTENT. THE THIRD ISSUE WAS WITH REFERENCE TO CAPITAL GAIN WAS RAISED, BUT WAS ACCEPTED BY CIT IN THE COURSE OF PROCEEDINGS U/S. 263. 4. BEFORE THE LD. CIT ON THE TWO ISSUES, THE ASSESS EE SUBMITTED AS UNDER :- ( AS EXTRACTED FROM THE ORDER) 5.: (I) WITH REGARD TO THE TAXATION OF INDIAN SALARY AL ONG WITH USA SALARY, THE ASSESSEES AR, SUBMITTED THAT FOR THE Y EAR UNDER CONSIDERATION, HE WAS NOT RESIDENT, BUT NOT ORDI NARILY RESIDENT AND ACCORDINGLY THE SAME WAS STATED BY HIM IN HIS R ETURN OF INCOME. IN SUPPORT OF THIS CLAIM, THE ASSESSEE FILED STATEM ENT SHOWING HIS INCOME IN THE PREVIOUS YEAR ON THE BASIS THAT HE WA S NOT ORDINARILY RESIDENT AND ALSO SUBMITTED THAT WITHOUT PREJUDICE TO THE ABOVE FACT ON WHICH TOTAL INCOME OF THE ASSESSEE SHOULD B E COMPUTED EVEN IF INCOME WAS ASSESSED IN INDIA, NO FURTHER TAX IS DUE CONSIDERING THE TAX PAID BY HIM IN USA AND IN INDIA, AND AS SUC H, THERE IS NO PREJUDICE CAUSED TO THE INTEREST OF REVENUE. (II) THE ASSSESSEE FURTHER SUBMITTED A STATEMENT OF COMPUTATION OF INCOME SHOWING THAT INCOME AS SHOWN BY HIM IN HIS R ETURN OF INCOME AS FILED IN INDIA HAS BEEN TAKEN INTO ACCOUN T IN THE RETURN FILED BY HIM UNDER US LAW. SINCE IN USA, THE COMPUT ATION OF INCOME IS DONE ON CALENDAR YEAR BASIS AND WHEREAS IN INDIA , THE COMPUTATION IS DONE ON THE BASIS OF FINANCIAL YEAR AND AS SUCH, THERE IS OVERLAPPING PERIOD FOR FEW MONTHS, AND THE REFORE, THE INCOME FOR OVERLAPPING PERIOD HAS BEEN TAKEN ON PRO-RATA BASIS. THE ASSESSEE HAS ALSO FILED CERTIFICATE FROM HIS EMPLOY ER M/S. MORGAN STANLEY, SHOWING THEREIN THE TOTAL PAYMENTS MADE TO THE ASSESSEE FROM APRIL, 2002 TO 31ST MARCH, 2003. ACCORDINGLY, THE ASSESSEE SUBMITS THAT THE INCOME TAX RETURN AS FILED BY HIM UNDER US LAW INCLUDES SALARY INCOME RECEIVED IN INDIA BECAUSE UN DER US LAW, THE GLOBAL INCOME OF THE ASSESSEE IS TAXABLE AND AS SUC H, THE ASSESSEE SUBMITTED THAT RECTIFICATION DONE BY THE ASSESSING OFFICER BY EXCLUDING THE US SALARY FROM THE TOTAL INCOME OF TH E ASSESSEE IS CORRECT AND THERE IS NO MISTAKE IN THE ORDER WHICH WOULD CAUSE ANY PREJUDICE TO THE INTEREST OF REVENUE. (III) THE SECOND ISSUE IS RELATING TO THE TAXABILIT Y OF THE INCOME OF RS.53,19,253/- ON ACCOUNT OF DIFFERENCE BETWEEN TAX ON PERQUISITES AS PAID BY HIS EMPLOYER COMPANY AND THE AMOUNT OF T AX ON ACCOUNT OF PERQUISITES AS SHOWN BY THE ASSESSEE IN HIS RETU RN OF INCOME. THE ASSESSEE HAS SUBMITTED THAT HIS EMPLOYER MORGAN STA NLEY HAS FILED ITA NO.4403/M/10 A.Y.03-04 4 A LETTER STATING THAT THE AMOUNT OF RS.53,19,253/- IS DUE TO THE COMPANY. THEREFORE, THE ASSESSEE STATES THAT IT IS INCORRECT TO TAX THE DIFFERENCE OF PERQUISITES BEING INCOME AS THE SAME WOULD NEVER HAVE BEEN HIS INCOME AS THE AMOUNT PERTAINS TO EMPLOYER COMPANY WHICH HE REQUIRES TO BE RETURNED TO THE EMPLOYER WHENEVER HE RECEIVES IT FROM THE DEPARTMENT. THEREFORE, ON THIS ISSUE, THE ORDER PASSED BY THE ASSESSING OFFICER IS NOT ERRONEOUS AND PREJUDIC E TO THE INTEREST OF REVENUE. 5. THEREAFTER, THE LD. CIT AFTER CONSIDERING THE SU BMISSIONS DISCUSSED THE ISSUE ELABORATELY IN PARA- 6 AND DIRECTED AO TO BRING TO TAX THE ENTIRE AMOUNT OF RS.7,18,15,365/- AS INCOME FROM SALARY, I N ADDITION THE CAPITAL GAIN , INTEREST AND DIVIDEND INCOME TOTALIN G TO RS.7,26,21,832/- AS GLOBAL INCOME AND FURTHER AMOUNT OF RS.53,99,253 /- WHICH WAS THE TAX PAID BY THE EMPLOYER AS INCOME OF ASSESSEE. THE ASSESSEE IS AGGRIEVED. 6. THE LD. COUNSEL SUBMITTED THAT THERE IS NO PREJU DICE CAUSED TO THE REVENUE AS PROVISIONS OF SECTION 6(6)(A) AS INTERPR ETED BY THE HON'BLE SUPREME COURT IN THE CASE OF PRADIP J. MEHTA VS. CIT (300 ITR 231) PRONOUNCED ON 11.04.2008, MAKES IT CLEAR THAT THE A SSESSEE IS NOT ORDINARILY RESIDENT IN THE ASSESSMENT YEAR, THEREFO RE, THERE IS NO PREJUDICE CAUSED TO THE REVENUE, SO PROCEEDINGS U/S . 263 ARE NOT WARRANTED. WITH REFERENCE TO THE DIRECTIONS OF THE CIT TO BRING TO TAX AN AMOUNT OF RS.53,19,253/- LD. COUNSEL REFERRED TO TH E LETTER FILED BEFORE AO INCLUDED IN PAPER BOOK AT PAGE NO.22 DATED 27.09 .2004 TO SUBMIT THAT THE TAX AGGREGATING TO RS.53,93,253/- HAS BEEN BORNE BY THE EMPLOYER AND THE ASSESSEE HAS NO OBJECTION IF ANY R EFUND IS GRANTED TO THE EMPLOYER. IT IS FURTHER SUBMITTED THAT ASSESSEE S EMPLOYER COMPANY M/S. MORGAN STANLEY INTERNATIONAL INC. OF THE USA A LSO FILED LETTER DATED 04.01.2010 STATING THAT THE AMOUNT BELONGS TO THEM PLACED IN PAPER BOOK AT PAGE-32. IT WAS ITS SUBMISSION THAT THE ASS ESSEE HAS ALREADY PAID AN AMOUNT OF RS.40,41,172/- TO THE EMPLOYER B Y WAY OF REFUND WHICH WAS GIVEN CREDIT IN THE SUBSEQUENT PAYMENTS. THEREFORE, TO THAT EXTENT ASSESSEES CONTENTIONS WERE SUPPORTED BY EVI DENCE THAT THIS ITA NO.4403/M/10 A.Y.03-04 5 AMOUNT BELONGS TO THE EMPLOYER COMPANY AND NOT TO T HE ASSESSEE EMPLOYEE. 7. THE LD. DR HOWEVER REITERATED THE OBSERVATIONS O F THE CIT FOR INVOKING THE PROCEEDINGS U/S. 263 AND FINDINGS OF C IT. 8. ON A QUERY FROM THE BENCH AS TO WHICH OF THE ORD ER OF ASSESSING OFFICER, LD. CIT INVOKED PROCEEDINGS U/S. 263, IT W AS SUBMITTED THAT PROCEEDINGS MAINLY PERTAINED TO ORDER U/S. 154. THE LD. CIT CONSIDERED TWO ISSUES. HE SUPPORTED THE ORDER OF LD. CIT. 9. WE HAVE CONSIDERED THE ISSUE AND EXAMINED THE DE TAILS ON RECORD. WE WERE SURPRISED TO NOTICE THAT THE LD. CIT-26, IN THE GUISE OF INVOKING PROCEEDINGS U/S.263, CONSIDERED THE ORDER U/S. 143( 3) R.W. SEC.263 DT. 29/12/09 AND ALSO U/S. 154 DATED 24/02/2009. INCIDE NTALLY BOTH THE ORDERS ARE WITHIN TIME LIMITS PERMITTED U/S.263 FOR INVOKING JURISDICTION. AS ALREADY STATED, THERE WAS ALREADY PROCEEDINGS U/ S. 263 EARLIER AND THIS ORDER OF ASSESSMENT DATED 29.12.2008 WAS PURSU ANT TO THE ORDER U/S. 263 DATED 31.05.2007. THE ISSUE IN THAT EARLIE R ORDER U/S. 263 WAS ABOUT STATUS OF THE ASSESSEE WHETHER RESIDENT OR RESIDENT BUT NOT ORDINARILY RESIDENT. THE CIT HELD AS RESIDENT. THE ASSESSEE HOWEVER DID NOT CHALLENGE THE ORDER U/S. 263 AND AO BROUGHT TO TAX THE ENTIRE GLOBAL SALARY OF RS.7,18,15,365/- WHICH INCLUDES THE INDIA N COMPONENT OF RS.3,24,45,350/- ORIGINALLY ASSESSED, THEREBY MAKIN G DOUBLE ADDITION TO THAT EXTENT. IF THE PROCEEDINGS U/S. 263 ARE ON AS SESSMENT ORDER DATED 29.12.2008, OBVIOUSLY THERE CAN NOT BE ANY PREJUDIC E CAUSED TO THE REVENUE, AS AO NOT ONLY BROUGHT TO TAX THE INDIAN C OMPONENT BUT ALSO THE ENTIRE GLOBAL COMPONENT OF THE SALARY. THEREFOR E, THE PROCEEDINGS U/S. 263 CAN ONLY BE CONSIDERED TO BE AGAINST THE O RDER DATED 24.02.2009 U/S. 154 IN WHICH AO BY MISTAKE EXCLUDED RS.7,18,15,365/- INSTEAD OF RS.3,24,45,350/- INCLUDED IN THE ABOVE A MOUNT. ITA NO.4403/M/10 A.Y.03-04 6 10. SINCE THE PROCEEDINGS ARE INITIATED AGAINST THE ORDER U/S 154 DATED 24.02.2009, QUESTION OF CONSIDERING AMOUNT OF RS.53 ,19,253/- DOES NOT ARISE AT ALL, AS ISSUE OF PERQUISITE WAS ORIGINALLY CONCLUDED BY THE ORDER DATED 24.01.2006 AND SUBSEQUENT PROCEEDINGS U/S. 26 3 DID NOT MAKE IT AS AN ISSUE. THEREFORE, THE LD. CIT RAISING AN ISSU E OF TAXABILITY OF PERQUISITE OUT OF THE ENTIRE TAX DEDUCTED AT SOURCE DOES NOT ARISE AT ALL, AS THIS IS NOT AN ISSUE CONSIDERED IN THE ORDER U/S . 154. THEREFORE TO THAT EXTENT THE DIRECTION OF CIT TO BRING THE AMOUNT TO TAX IS BEYOND JURISDICTION. 11. EVEN ON MERITS, THE ASSESSEE, FROM THE BEGINNIN G HAS SUBMITTED BEFORE AO THAT THE TAX RE-FUND IF ANY DOES NOT BELO NG TO HIM AND BELONGS TO EMPLOYER. BASED ON THE ABOVE SUBMISSIONS, THE IS SUE OF PERQUISITE WOULD NOT HAVE BEEN RAISED BY AO. BE THAT AS IT MAY , ASSESSEE PLACED EVIDENCE ON RECORD THAT ALREADY REFUND TO THE EXTEN T OF RS.40,41,172/- WAS RETURNED TO THE EMPLOYER AND BALANCE REFUND, IF ANY ARISING TO THE ASSESSEE, WOULD ALSO BE RETURNED TO THE EMPLOYER. T HEREFORE, IN OUR OPINION, THERE IS NO ERROR IN THE ORDER AND CERTAIN LY NO PREJUDICE TO THE REVENUE. 12. THAT LEAVES US, WITH THE MAIN ISSUE WHETHER THE RE IS ANY PREJUDICE CAUSED TO THE REVENUE IN THE ORDER U/S. 154 DATED 2 4.02.2009. WHILE ADMITTING THAT THERE IS A MISTAKE IN REDUCING THE AMOUNT BY AO IN THAT ORDER, WHICH COULD HAVE BEEN RECTIFIED BY ANOTHER 1 54 ORDER BY THE AUTHORITIES, THE CIT INVOKED JURISDICTION U/S. 263. IN THAT, THE ASSESSEE IS FREE TO SUPPORT THE ORDER THAT THERE IS NO ERROR OR PREJUDICE CAUSED TO THE REVENUE SO AS TO INVOKE JURISDICTION U/S. 263. AS REPRTED BY THE LD. CIT IN THE ORDER U/S 263 DATED 31.05.2007, THE STA TUS OF THE ASSESSEE IN RESPECT OF VARIOUS ASSESSMENT YEARS IS AS PER THE F OLLOWING CHART:- ITA NO.4403/M/10 A.Y.03-04 7 ASSESSMENT YEAR RESIDENT IAL STATUS AS PER SEC. 6(1) R.W.6(6)(A) OF THE ACT. 1993 - 94 NR 1994 - 95 NR 1995 - 96 NR 1996 - 97 NOT ORDINARILY RESIDENT (NOR) 1997 - 98 NOR 1998 - 99 NOR 1999 - 2000 NOR 2000 - 01 NOR 2001 - 02 NOR 2002 - 03 NOR 12.1 IT WAS THE CONTENTION OF THE ASSESSEE THAT HE CONTINUED TO BE NOR AS PER PROVISIONS OF SECTION 6(6)(A) AS HE WAS NOT RESIDENT IN INDIA IN NINE OUT OF THE TEN PREVIOUS YEARS PRECEDING THE RE LEVANT PREVIOUS YEAR. THE ASSESSEE SUPPORTED THE CONTENTION BY FOLLOWING TWO JUDGMENTS THEN EXISTING: (1) CIT VS. ZAM ZAM TANNERS (ALL) AND (II) CIT VS. POOSHYA EXPORTS P. LTD. (MAD) . THIS OPINION OF THE ASSESSEE IS SUPPORTED BY THE J UDGMENT OF HON'BLE SUPREME COURT IN THE CASE OF PRADIP J. MEHTA VS. CIT (300 ITR 231) (SUPRA), DURING THE COURSE OF HIS EMPLOYMENT THE ASSESSEE , WHO WAS A MARINE ENGINEER FOR A COMPANY IN HONG KONG, WAS POS TED TO WORK ON THE HIGH SEAS AND WAS PAID ABROAD FOR MANY YEARS . FOR THE ASSESSMENT YEAR 1982-83, AS HE WAS NOT RESIDENT IN INDIA FOR 9 OUT OF 10 YEARS, THE ASSESSEE CLAIMED THE STATUS OF NO T ORDINARILY RESIDENT AS DEFINED IN SECTION 6(6)(A) OF THE INCOM E-TAX ACT, 1961, WHICH PROVIDES THAT IN THE CASE OF A PERSON NOT ORDINARILY RESIDENT INCOME WHICH, ACCRUES OR RISE TO HIM OUTS IDE INDIA SHALL NOT BE INCLUDED IN HIS TOTAL INCOME. THE ASSESSING OFFICER REFUSED TO GRANT THE ASSES- SEE THAT STATUS ON THE GROUND THAT THE ASSESSEE WAS A NON-RESIDENT IN INDIA FOR ONLY 3 YEARS DURING THE LAST 10 YEARS AND DURING THE PAST 7 YEARS HE HAD STAYED IN INDIA FOR MORE THAN 730 DAYS. THE ASSESSEES APPEAL WAS DISMISSED BY THE COMMISSIONER (APPEALS) AND THE APPELLATE TRIBUNAL. ON THE ASSESSEES APPLICATION THE TRIBUNAL REFERRED TO THE HIGH COURT, IN EFFECT, THE QUESTION OF LAZY WHETHER THE TRIBUNAL W AS JUSTIFIED IN ITA NO.4403/M/10 A.Y.03-04 8 HOLDING THAT THE STATUS OF THE ASSES- SEE FOR THE A SSESSMENT YEAR WAS NOT RESIDENT BUT. NOT ORDINARILY RESIDENT; AN D THE HIGH COURT ANSWERED THE QUESTION AGAINST THE ASSESSED. ON APPE AL TO THE SUPREME COURT: HELD, REVERSING THE DECISION OF THE HIGH COURT, THA T THE ASSESSEE WAS NOT ORDINARILY RESIDENT IN INDIA WITHIN THE M EANING 0F SECTION 6(6)(A ) AS HE WAS NOT RESIDENT FOR 9 OUT OF 10 YEARS . A PERSON WOULD BECOME AN ORDINARY RESIDENT ONLY (A) F HE HAD BEEN RESIDING IN INDIA IN 9 OUT OF 10 PRECEDING YEARS, AND (B) HE HAD BEEN IN INDIA FOR AT LEAST 730 DAYS IN THE PREVIOUS SEVEN YEARS. 13. THE AMENDMENT TO SECTION 6(6)(A) HAS COME W.E.F . FROM 01.04.2004, THEREFORE, THE SAME IS NOT APPLICABLE TO THE ASSESS MENT YEAR UNDER CONSIDERATION. IN VIEW OF THE ABOVE INTERPRETATION GIVEN BY THE HON'BLE SUPREME COURT TO THE THEN EXISTING LAW, IN A WAY AO EXCLUDED THE INCOME EARNED OUTSIDE INDIA AND ULTIMATELY ASSESSEE WAS TAXED IN THE INCOME EARNED IN INDIA. THEREFORE, TO THAT EXTENT T HERE IS NO PREJUDICE CAUSED TO THE REVENUE ON THE BASIS OF INTERPRETATIO N OF LAW RELEVANT FOR THE ASSESSMENT YEAR 2003-04. THEREFORE, IN OUR OPIN ION THE ORDER U/S. 263 BY CIT IS BAD IN LAW AND ORDER OF ASSESSING OFF ICER IS NOT ERRONEOUS OR PREJUDICIAL TO THE INTERESTS OF THE REVENUE, EVE NTHOUGH THERE WAS A MISTAKE COMMITTED IN THE ORDER U/S.154 AS STATED EA RLIER. LD CIT CAN NOT EXERCISE JURISDICTION U/S 263 UNLESS THE ORDER IS E RRONEOUS IN SO FAR IT IS PREJUDICIAL TO THE INTERESTS OF REVENUE. CONSEQUENT LY, WE SET ASIDE THE ORDER U/S. 263 DT.30 TH MARCH 2010. ASSESSEES GROUNDS ARE ALLOWED. 14. IN THE RESULT, APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 30 TH AUGUST, 2013. SD/- SD/- (S.T.M. PAVALAN ) JUDICIAL MEMBER (B. RAMAKOTAIAH ) ACCOUNTANT MEMBER MUMBAI, DATED: 30/08/2013. JV. ITA NO.4403/M/10 A.Y.03-04 9 COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT(A) CONCERNED, MUMBAI THE DR BENCH TRUE COPY BY ORDER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.