Jeetendra Patidar{ L/h. of Late shri Satyanarayan Patidar}, Indore V. The Pr. CIT-2, Indore

ITA 486/Ind/2019

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 4521 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 6 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-10-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 16-06-2020
• Assessment Year: 2015-2016
• Appeal Filed On: 18-04-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASHIMA GUPTA
• Keywords: Revision of order; Opportunity of being heard; Principle of natural justice; Question of law; Assessment record; Benefit of exemption; Revenue expenditure; Capital expenditure; Set aside
• Section: 54; 263; 63; 143(3); 54B; 54F; 142(1); 260A; 251; 143(2); 64; 113; 13; 119; 22; 20

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER ITA NO.486/IND/2019 ASSESSMENT YEAR:2015-16 SHRI JITENDRA PATIDAR (L/H OF LATE SHRI SATYANARAYAN PATIDAR) 184, KHAJRANA MAIN RD. KHAJARANA, INDORE / VS. PR. CIT - 2 INDORE ( APPELLANT ) ( REVENUE ) P.A. NO. BXEPP0823N APPELLANT BY SHRI S. N . AGRAWAL, C A REVENUE BY SMT. ASHIMA GUPTA , CIT - DR DATE OF HEARING: 01.10.2020 DATE OF PRONOUNCEMENT: 21.10.2020 / O R D E R PER KUL BHARAT, J.M: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF LD. PR. COMMISSIONER OF INCOME TAX(IN SHORT LD. PR. CI T,-2 INDORE DATED 29.03.2019 PERTAINING TO ASSESSMENT YEAR 2015 -16. THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEA L: SHRI JITENDRA PATIDAR /ITANO.486/IND/2019 2 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE AND IN LAW, THE LD. PR. CIT ERRED IN SETTING ASIDE THE ORDER AS PASSED BY THE ASSESSING OFFICER UNDER SECTION 143(3) OF TH E ACT BY INVOKING THE PROVISIONS OF SECTION 263 OF THE ACT E VEN WHEN THE ORDER AS PASSED BY THE ASSESSING OFFICER WAS NEITHE R ERRONEOUS NOR PREJUDICIAL TO THE INTERESTS OF THE REVENUE. 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE AND IN LAW, THE LD. PR. CIT ERRED IN SETTING ASIDE THE ROD ER AS PASSED BY THE ASSESSING OFFICER BY INVOKING THE PROVISIONS OF SECTION 263 OF THE ACT EVEN WHEN THE ORDER WAS PASSED BY TH E ASSESSING OFFICER UNDER SECTION 143(3) OF THE ACT A FTER CONDUCTING NECESSARY ENQUIRIES AND AFTER DUE APPLIC ATION OF MIND. 3.THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE AND IN LAW, THE LD. PR. CIT ERRED IN SETTING ASIDE THE ORD ER AS PASSED Y THE ASSESSING OFFICER BY INVOKING THE PROVISIONS OF SECTION 263 OF THE ACT WITHOUT PROPERLY APPRECIATING THE FACTS OF THE CASE AND SUBMISSIONS MADE BEFORE HIM EVEN WHEN AMOUNT OF INV ESTMENT IN AGRICULTURAL LAND OF RS.1,40,18,850/- CLAIMED AS DEDUCTION UNDER SECTION 54B OF THE ACT WAS LEGAL AND PROPER. 4. THE ASSESSEE CRAVES LEAVE TO ADD, ALTER MODIFY T HE GROUNDS OF APPEAL AS TAKEN BY HIM. 2. THE FACTS GIVING RISE TO THE PRESENT APPEAL ARE THAT THE IN THIS CASE ASSESSMENT WAS COMPLETED BY THE ASSESSING OFFICER U/S 143(3) OF THE INCOME TAX ACT 1961 (HERE INAFTER REFERRED AS THE ACT) ON 27.03.2017, ASSESSING THE IN COME AT RS. 2,98,060/-. SUBSEQUENTLY, THE LD. PR. CIT ON GOI NG THROUGH ASSESSMENT RECORDS FOUND THAT CERTAIN POINTS SHRI JITENDRA PATIDAR /ITANO.486/IND/2019 3 WHICH WERE MENTIONED IN THE SELECTION OF THE CASE FO R SCRUTINY UNDER CASS WERE NOT TAKEN INTO CONSIDERATION BY THE ASSESSING OFFICER WHILE COMPLETING ASSESSMENT U/S 143(3) OF THE ACT. THE LD. PR. CIT WAS OF THE VIEW T HAT THE ASSESSING OFFICER PASSED AN ORDER WITHOUT MAKING REQUIR ED INVESTIGATION FOR EXAMINATION WHICH HAS RESULTED THE ASSESSMENT BEING ERRONEOUS IN SO FOR AS IT IS ALSO PREJUDICIAL TO THE INTEREST OF THE REVENUE. HENCE, L D. PR. CIT ISSUED NOTICE U/S 263 OF THE ACT CALLING UPON THE ASS ESSEE AS TO WHY ASSESSMENT ORDER SHOULD NOT BE REVISED. BASI S OF ISSUING NOTICE U/S 263 IS RECORDED IN PARA 3 OF THE S HOW CAUSE NOTICE WHICH IS REPRODUCED AS UNDER: AS PER THE INFORMATION AVAILABLE ON RECORDS, IT IS NOTED THAT YOU HAVE SOLD IMMOVABLE PROPERTY (LAND) FOR A TOTAL SALE CONSIDERATION OF RS.1,60,65,000/- AND SHOWN LONG TE RM CAPITAL GAIN OF RS.1,36,25,525/-. FURTEHR YOU HAVE CLAIMED DEDUCTION U/S 54B OF THE IT ACT AMOUNTING TO RS.1,40,18,850/- ON PURCHASE OF AGRICULTURE LAND AND SHOWN CAPITAL LOSS OF RS.(- )3,93,265/-. ON PERUSAL OF THE DETAILS OF DEDUCTION CLAIMED U/S 54B REGARDING AGRICULTURE LAND PURCHASED, IT APPEAR S THAT NO AGRICULTURE LAND HAS BEEN PURCHASED ON YOUR NAME. T HE SAID LANDS HAVE BEEN PURCHASED ON THE NAME OF YOUR SONS AND DAUGHTER IN LAW. HENCE THE CLAIMED DEDUCTION SHOULD HAVE BEEN SHRI JITENDRA PATIDAR /ITANO.486/IND/2019 4 DISALLOWED AS PER PROVISIONS OF SECTION. 54B OF THE I.T. ACT. THE AO HAS NOT EXAMINED THIS FACTOR AND NO ENQUIRY/INVE STIGATION HAS BEEN MADE. THEREFORE, THE ASSESSMENT ORDER PASS ED BY THE AO APPEARS TO BE ERRONEOUS IN SO FAR AS IT IS PREJU DICIAL TO THE INTEREST OF THE REVENUE. YOU ARE THEREFORE, REQUIRE D TO SHOW CAUSE WHY PROVISIONS OF SECTION 263 BE NOT INVOKED IN YOUR CASE FOR THE REASONS MENTIONED ABOVE. 3. IN RESPONSE THERETO, THE ASSESSEE FILED WRITTEN SUBMISSIONS THROUGH ITS AUTHORIZED REPRESENTATIVE (A R), CA, SATYANARAYAN AGRAWAL. HOWEVER, EXPLANATION OFFERED BY THE ASSESSEE WAS NOT FOUND ACCEPTABLE BY THE LD. PR . CIT, HE THEREFORE, HELD THAT THE ASSESSMENT ORDER DATE D 27.03.2017 IS ERRONEOUS IN SO FAR AS ALSO PREJUDICIAL T O THE INTEREST OF THE REVENUE ON ACCOUNT OF PASSING OF THE ORDER WITHOUT MAKING REQUISITE ENQUIRY/INVESTIGATION IN RES PECT OF DEDUCTION U/S 54B OF THE ACT . HE, THEREFORE, SE T ASIDE THE ASSESSMENT ORDER AND DIRECTED THE ASSESSING OFFICE R TO REEXAMINE THE ISSUE AFRESH AFTER CAUSING NECESSARY ENQUIRY/INVESTIGATION. SHRI JITENDRA PATIDAR /ITANO.486/IND/2019 5 3. AGGRIEVED AGAINST THIS THE ASSESSEE PREFERRED AN APPE AL BEFORE THIS TRIBUNAL. LD. COUNSEL FOR THE ASSESSEE VEHEMENTLY ARGUED THAT THE LD. PR. CIT HAS NOT APPLIED HIS MIND ON THE FACTS OF THE CASE AND PRECEDED AGAINST THE ASSESSEE MECHANICALLY. HE FURTHER REITERATED THE SUBMISSIONS AS MADE IN THE WRITTEN SUBMISSION FOR T HE SAKE OF CLARITY SUBMISSION OF THE ASSESSEE ARE REPRODUC ED AS UNDER: A.1] THE PRESENT APPEAL IS FILED BY THE APPELLANT A GAINST THE ORDER AS PASSED BY THE LD PR. COMMISSIONER OF INCOME TAX - 2 ON 29-03-2019 UN DER SECTION 263 OF THE INCOME TAX ACT. A.2] THE ASSESSEE FILED HIS RETURN OF INCOME FOR AS SESSMENTYEAR 2015-16 DECLARING TOTAL INCOME OF RS. 2,98,060/- ON 28-08-2015. A.3.1] THE ASSESSING OFFICER ISSUED NOTICEDATED 12- 01-2017 UNDER SECTION 142(1) OF THE INCOME TAX ACT TO THE ASSESSEE CALLING FOR THE INFO RMATION AND EXPLANATION IN RESPECT OF SALE OF AGRICULTURAL LAND SITUATED AT HALKA NO. 19 [NEW NO. 38], KHASRA NO.284,GRAM BALYAKHEDA, INDORE FOR THE CONSIDERATION OF RS. 1,6 0,65,000/- AND THE PURCHASE OF NEW AGRICULTURAL LAND AT RS. 1,40,18,850/- CLAIMING EXE MPTION UNDER SECTION 54B OF THE INCOME TAX ACT. A.3.2] THE ASSESSEE IN RESPONSE TO THE SAID NOTICE UNDER SECTION 142(1) OF THE INCOME TAX ACT FILED HIS REPLY DATED 30-01-2017 AND 09-03- 2017 ALONG WITH THE NECESSARY DOCUMENTS AND INFORMATION AS REQUIRED IN THE COURSE OF ASSESSMENT PROCEEDINGS SO AS TO JUSTIFY THE CLAIM OF DEDUCTION UNDER SECTION 54B OF THE INCOME TAX ACT. A.3.3] THE ASSESSING OFFICER, THEREAFTER PASSED AN ASSESSMENT ORDER U/S 143(3) OF THE INCOME TAX ACT ON 27-03-2017AND ACCEPTED THE RETURN ED INCOME AS DECLARED BY THE APPELLANT AT RS. 2,98,060/- . A.4] THE ASSESSEE DIED ON 06-05-2017 AND HIS SON SH RI JITENDRAPATIDAR WAS APPOINTED AS THE LEGAL HEIR OF THE ASSESSEE. SHRI JITENDRA PATIDAR /ITANO.486/IND/2019 6 A.5.1] THAT SUBSEQUENTLY, PROCEEDINGS U/S 263 WERE INITIATED BY WAY OF ISSUE OF SHOW CAUSE NOTICE DT 17-07-2018 IN THE NAME OF LATE SHRI SATYANARAYANPATIDAR FOR THE FOLLOWING REASONS: 1 DISALLOWANCE OF DEDUCTION CLAIMED U/S 54B REGARDING AGRICULTURE LAND PURCHASED, SINCE LANDS HAVE BEEN PURCHASED IN THE NAME OF SON AND DA UGHTER-IN- LAW OF THE ASSESSEE AND NOT INHIS IN HIS OWN NAME. A.5.2] HOWEVER, THE LEGAL HEIR OF THE ASSESSEE VIDE LETTER DATED 05-09-2018 HAS OBJECTED THE ISSUANCE OF NOTICE U/S 263 OF THE ACT IN THE NA ME OF DECEASED PERSON. THEREBY, FRESH NOTICE U/S 263 WAS ISSUED IN THE NAME OF LEGAL HEIR OF THE DECEASED SHRI JITENDRA PATIDAR DATED 31-10-2018. B]THE APPELLANT IN THE PRESENT APPEAL HAS TAKEN THE FOLLOWING GROUNDS OF APPEALS BEFORE THE HONBLE BENCH:- 1.1] THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD PR. CIT ERRED IN SETTING-ASIDE THE ORDER AS PASSED BY THE ASSESSING OFFICER UNDER SECTION 143[3] OF THE ACT BY INVOKING THE PROVISION S OF SECTION 263 OF THE ACT EVEN WHEN THE ORDER AS PASSED BY THE ASSESSING OFFICER W AS NEITHER ERRONEOUS NOR PREJUDICIAL TO THE INTERESTS OF THE REVENUE. 1.2] THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD PR. CIT ERRED IN SETTING-ASIDE THE ORDER AS PASSED BY T HE ASSESSING OFFICER BY INVOKING THE PROVISIONS OF SECTION 263 OF THE ACT E VEN WHEN THE ORDER WAS PASSED BY THE ASSESSING OFFICER UNDER SECTION 143[3 ] OF THE ACT AFTER CONDUCTING NECESSARY ENQUIRIES AND AFTER DUE APPLICATION OF MI ND 2] THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE AND IN LAW, THE LD PR. CIT ERRED IN SETTING-ASIDE THE ORDER AS PASSED BY T HE ASSESSING OFFICER BY INVOKING THE PROVISIONS OF SECTION 263 OF THE ACT W ITHOUT PROPERLY APPRECIATING THE FACTS OF THE CASE AND SUBMISSIONS MADE BEFORE H IM EVEN WHEN AMOUNT OF INVESTMENT IN AGRICULTURAL LAND OF RS. 1,40,18,850/ - CLAIMED AS DEDUCTION UNDER SECTION 54B OF THE ACT WAS LEGAL AND PROPER GROUND NO 2- ON MERIT CHALLENGING THE DENIAL OF D EDUCITON AS CLAIMED UNDER SECTION 54B OF THE INCOME TAX ACT IN RESPECT OF PURCHASE OF AGRICULTURAL LAND 1.1] THE ASSESSEE HAD SOLD HIS INHERITED AGRICULTURAL LA ND SITUATED AT HALKA NO. 19 [NEW NO. 38], KHASRA NO.284,GRAM BALYAKHEDA, INDORE ADMEASURING 1.215 HECTARES FOR THE CONSIDERATION OF RS. 1,60,65 ,000/- ON 30-06-2014. 1.2] COPY OF SALE DEED AS EXECUTED BY THE ASSESSEE IS ENCLOSED. IN PARA 2 OF THE SAID DEED IT WAS STATED THAT THE SAID AGRICULTURAL LAND AS SOLD BY THE ASSESSEE WAS NOT ACTUALLY PURCHASED FROM HIS OWN FUNDS BUT W AS INHERITED TO HIM. HENCE THE SAID LAND WAS SOLD WITH THE CONSENT OF HIS SONS AND BROTHER OF THE ASSESSEE. THE NAME OF THE CONSENTOR AS MENTIONED IN THE SALE DEED AS UNDER: S.NO. NAME OF THE CONSENTOR RELATION WITH THE ASSESSEE SHRI JITENDRA PATIDAR /ITANO.486/IND/2019 7 1.1 SHRI PREM NARAYAN S/O SHRI MANGILALPATIDAR BROT HER OF THE ASSESSEE 1.2 SHRI GANESH S/O SHRI PREM NARAYAN PATIDAR SON O F BROTHER OF THE ASSESSEE 1.3 SHRI JITENDRA S/O SHRI SATYANARAYANPATIDAR SON OF THE ASSESSEE 1.4 SHRI NITESH S/O SHRI SATYANARAYANPATIDAR SON OF THE ASSESSEE 1.3] THAT THE LAND AS SOLD BY THE ASSESSEE WAS WITH THE CONSENT OF HIS SONS AND THEREFORE NEW LANDS IN DISPUTE WERE PURCHASED BY TH E ASSESSEE IN THE NAME OF HIS SONS AND ALSO IN THE NAME OF HIS SONS WIFE. T HAT AS PER PROVISION OF SECTION 64 OF THE INCOME TAX ACT, THE AMOUNT AS INVESTED BY THE ASSESSEE IN THE NAME OF HIS HIS SONS WIFE IS TO BE CLUBBED WITH THE ASSESS EE. HENCE, INVESTMENT AS MADE BY THE ASSESSEE IN THE NAME OF HIS SONS WIFE IS EL IGIBLE FOR DEDUCTION U/S 54B OF THE ACT. 1.4.1] THAT IT IS ALSO SETTLED POSITION OF LAW, IN CASE OF ANY INHERITED PROPERTY, RIGHT OF ALL THE FAMILY MEMBERS WERE AUTOMATICALLY CREATED IN IT AND IN COMMON PARLANCE THE SAME IS CALLED AS PROPERTY OF HUF OR J OINT PROPERTY. SINCE, THE SAME WAS NOT PURCHASED BY THE ASSESSEE HIMSELF FROM HIS INCOME IN HIS LIFE TIME. 1.4.2] THAT THE LAND AS SOLD BY THE ASSESSEE WITH T HE CONSENT OF HIS SONS. SINCE, THE SAID LAND WAS INHERITED BY THE ASSESSEE AND THE REFORE HIS SONS ALSO HAVING INTEREST IN THIS LAND. THUS, THE INVESTMENT AS MADE IN THE NAME OF HIS SONS WAS ALSO ELIGIBLE UNDER SECTION 54B OF THE INCOME TAX A CT. 1.5] THAT THE ASSESSEE WAS AN OLD MAN AT THE TIME O F SALE/ PURCHASE OF LAND. HE DIED ON 06-05-2017. THAT IT WAS NOT IN DISPUTE THAT THE AMOUNT AS INVESTED IN THE NAME OF HIS SONS WAS ALSO FROM THE SALE PROCEED OF THE LAND AS RECEIVED BY THE ASSESSEE. THE AMOUNT AS INVESTED IN THE NAME OF HIS SON IS ALSO ELIGIBLE FOR DEDUCTION UNDER SECTION 54B OF THE ACT. 1.6] THAT IT IS NOW STAND SETTLED IN FAVOUR OF THE APPELLANT, THAT IF ANY AGRICULTURAL LAND IS PURCHASED IN THE NAME OF THE SPOUSE OF THE APPELLANT, IN THE NAME OF HIS SONS AND ALSO IN THE NAME OF HIS SONS WIFE IS ELI GIBLE FOR DEDUCITON UNDER SECTION 54B OF THE INCOME TAX ACT. 1.7.1] DETAIL OF LAND AS PURCHASED BY THE ASSESSEE IN THE NAME OF HIS FAMILY MEMBERS ARE AS UNDER: S.NO NAME OF THE PERSON RELATION COST EXPENSES TOTAL COST [RS] 1 JITENDRA PATIDAR SON 10,19,000 71,855 10,90,855 2 JITENDRA PATIDAR SON 16,45,000 1,16,150 17,61,15 0 3 NITESH PATIDAR SON 31,54,000 2,22,555 33,76,555 4 NITESH PATIDAR SON 21,11,000 1,49,060 22,60,060 5 DIVYA NITESH PATIDAR SONS WIFE 51,66,000 3,64,2 30 55,30,230 1,40,18,850 1.7.2] THE AMOUNT OF DEDUCTION UNDER SECTION 54B OF THE INCOME TAX ACT IS RESTRICTED TO THE EXTENT OF CAPITAL GAIN OF RS 1,36 ,25,585/-. SHRI JITENDRA PATIDAR /ITANO.486/IND/2019 8 1.8] THAT IN THE FOLLOWING DECISIONS IT WAS HELD EV EN IF THE INVESTMENT WAS MADE IN THE NAME OF HIS WIFE AND ALSO IN THE NAME OF HIS SO N AND SONS WIFE ARE ELIGIBLE FOR DEDUCTION UNDER SECTION 54B OF THE INCOME TAX ACT. S.NO CITATION REFERENCE 1.8.1 CIT VS KAMAL WAHAL APPEAL NO. ITA 4/2013 1.8.2 CIT VS NATARAJAN 154 TAXMANN 399 1.8.3 CIT VS BALMUKUNDMEENA APPEAL NO. ITA 118/2016 1.8.4 SHRI RAJA RAM PATIDAR APPEAL NO. 371/IND/2015 1.8.5 DIT VS MRS JENNIFER BHIDE 252 CTR 444 [KARNATA KA] 1.8.6 CIT VS GURNAM SINGH 327 ITR 278 1.8.7 CIT VS RAVINDRA KUMAR ARORA (2012) 342 ITR 38 (DEL) 1.8.8 CIT VS V NATARAJAN 154 TAXMANN 399 RELEVANT EXTRACTS FROM THE JUDICIAL RULINGS THAT HI GHLIGHT THE ABOVE DISCUSSED PRINCIPLE ARE REPRODUCED AS UNDER FOR YOUR KIND REF ERENCE: 1.9.1] THAT HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS KAMAL WAHAL [APPEAL NO ITA 4/2013] DT 11-01-2013 [ REFER PARAS 9 & 10] HAS HELD THAT: 9. IT THUS APPEARS TO US THAT THE PREDOMINANT JUDI CIAL VIEW, INCLUDING THAT OF THIS COURT, IS THAT FOR THE PURPOSES OF SECTION 54F , THE NEW RESIDENTIAL HOUSE NEED NOT BE PURCHASED BY THE ASSESSEE IN HIS OWN NAME NOR IS IT NECESSARY THAT IT SHOULD BE PURCHASED EXCLUSIVELY IN HIS NAME. IT IS MOREOVE R TO BE NOTED THAT THE ASSESSEE IN THE PRESENT CASE HAS NOT PURCHASED THE NEW HOUSE IN THE NAME OF A STRANGER OR SOMEBODY WHO IS UNCONNECTED WITH HIM. H E HAS PURCHASED IT ONLY IN THE NAME OF HIS WIFE. THERE IS ALSO NO DISPUTE THAT THE ENTIRE INVESTMENT HAS COME OUT OF THE SALE PROCEEDS AND THAT THERE WAS NO CONTRIBUTION FROM THE ASSESSEE'S WIFE. 10. HAVING REGARD TO THE RULE OF PURPOSIVE CONSTRUC TION AND THE OBJECT WHICH SECTION 54F SEEKS TO ACHIEVE AND RESPECTFULLY AGREEING WITH TH E JUDGMENT OF THIS COURT, WE ANSWER THE SUBSTANTIAL QUESTION O F LAW FRAMED BY US IN THE AFFIRMATIVE, IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE. 1.9.2] THAT HONBLE MADRAS HIGH COURT IN THE CASE O F CIT VS V NATARAJAN AS REPORTED IN 154 TAXMANN399 HAS HELD THAT [ REFER PA RAS 3.5 AND 3.6 OF THE ORDER]: 5 IN THE INSTANT CASE, THE ASSESSEE PURCHASED A HO USE AT ANNA NAGAR IN THE NAME OF HIS WIFE SMT. MEERA AFTER SELLING THE PROPE RTY AT BANGALORE. BUT THE SAME WAS ASSESSED IN THE HANDS OF THE ASSESSEE. HEN CE, AS CORRECTLY HELD BY THE CIT(A) AS WELL AS BY THE TRIBUNAL THAT THE ASSE SSEE IS ENTITLED FOR EXEMPTION UNDER SECTION 54 OF THE ACT. 3.6 THE ASSASSEE SOLD A PROPERTY AT BANGALORE AND P URCHASED A PROPERTY AT ANNA NAGAR IN THE NAME OF HIS WIFE IS ONLY A QUESTI ON OF FACT. IT IS A SETTLED LAW THAT THE FACTUAL FINDINGS OF THE TRIBUNAL CANNOT BE DISTURBED IN EXERCISE OF THE POWERS UNDER SECTION 260A OF THE ACT VIDE M. JANARD HANA RAO V. JT. CIT [2005] 273 ITR 50 1 (SC). HENCE, WE DO NOT SEE ANY QUESTION OF LAW MU CH SHRI JITENDRA PATIDAR /ITANO.486/IND/2019 9 LESS, SUBSTANTIAL QUESTION OF LAW ARISES FOR CONSID ERATION. ACCORDINGLY, THE FIRST QUESTION FAILS AND THE SAME IS REJECTED. 1.9.3] THAT HONBLE JURISDICTION HIGH COURT IN THE CASE OF PR CIT VS BALMUKUNDMEENA [ APPEAL NO ITA 118/ 2016 DT 16-02-2 017 ] HAS HELD THAT REFER PARAS 3 & 4: ________ WE HAVE HEARD THE COUNSEL FOR THE REVENU E AND GONE THROUGH THE AFORESAID IMPUGNED ORDER. IN OUR OPINION, FROM THE IMPUGNED ORDER, NO SUBSTANTIAL QUESTION OF LAW IS ARISING FOR CONSIDER ATION OF THIS COURT AS THE ITAT WHILE RECORDING A PURE FINDING OF FACT HAS DISMISSE D THE APPEAL OF THE REVENUE. UNDISPUTEDLY, IN THIS CASE THE ASSESSEE HAD SOLD TH E AGRICULTURAL LAND WHICH WAS BEING USED BY HIM FOR AGRICULTURAL PURPOSES. OU T OF SALE PROCEEDS OF THE SAID SALE, THE ASSESSEE HAS PURCHASED OTHER PIECE O F LAND (LAND IN QUESTION) IN HIS NAME AND IN THE NAME OF HIS ONLY SON, WHO WAS B ACHELOR AND DEPENDENT UPON HIM, FOR BEING USED FOR AGRICULTURAL PURPOSES WITHIN THE STIPULATED TIME. FURTHER, IT IS NOT THE CASE OF THE REVENUE THAT FRO M THE SALE PROCEEDS OF THE AGRICULTURAL LAND EARLIER OWNED BY THE ASSESSEE, TH E LAND IN QUESTION WAS PURCHASED FOR ANY OTHER PURPOSE THAN THE AGRICULTUR AL PURPOSE. UNDISPUTEDLY, THE PURCHASED LAND IS BEING USED BY THE ASSESSEE ON LY FOR AGRICULTURAL PURPOSE AND MERELY BECAUSE IN THE SALE DEED HIS ONLY SON WA S ALSO SHOWN AS CO-OWNER, THE ITAT HAS RIGHTLY COME TO THE CONCLUSION THAT IT DOES NOT MAKE ANY DIFFERENCE BECAUSE THE PURCHASED LAND IS BEING USED BY THE ASS ESSEE FOR AGRICULTURAL PURPOSES. IT IS NOT THE CASE OF THE REVENUE THAT TH E SAID LAND IS BEING USED EXCLUSIVELY BY HIS SON. IN OUR VIEW, A PURE FINDING OF FACT HAS BEEN RECORDED BY THE ITAT WHICH DOES NOT REQUIRE ANY INTERFERENCE IN THIS APPEAL. 4. NO SUBSTANTIAL QUESTION OF LAW IS INVOLVED IN TH IS APPEAL.A SIMILAR VIEW HAS BEEN TAKEN BY THE HIGH COURT OF DELHI IN THE CASE O F COMMISSIONER OF INCOME-TAX- XII VS. KAMAL WAHAL , REPORTED IN 2013 (30) TAXMANN.COM 34 (DELHI). PAR AGRAPH NOS. 8, 9 AND 10 OF THE AFORESAID JUDGMENT READ AS UNDER:- 8. THIS COURT IN THE DECISION CITED ALONE ALSO NOTICED THE JUDGMENT OF THE MADRAS HIGH COURT (SUPRA) AND AGREED WITH THE SAME, OBSERVING THAT TH OUGH THE MADRAS CASE WAS DECIDED IN RELATION TO SECTION 54 OF THE ACT, THAT SECTION WAS IN PARIMATERIA WITH SECTION 54F . THE JUDGMENT OF THE PUNJAB AND HARYANA HIGH COURT IN THE CASE OF CIT VS. GURNAM SINGH : (2010) 327 ITR 278/[ 2008] 170 TAXMAN 160 IN WHICH THE SAME VIEW WAS TAKEN WITH REFERENCE TO SECTION 54F WAS ALSO NOTICED BY THIS COURT. 1.9.4] THAT HONBLE INDORE BENCH OF ITAT IN THE CAS E OF SHRI RAJA RAM PATIDAR [ APPEAL NO ITA NO 371/ IND/ 2015 DT 28-09-2018 FOR T HE ASST YEAR 2010-11] HAS HELD THAT: 28. THE ABOVE PROVISION CONTEMPLATES THAT THE BENEF IT/EXEMPTION IS AVAILABLE IF AN AGRICULTURE LAND IS PURCHASED OUT OF THE SALE CO NSIDERATION OF SALE OF AGRICULTURE LAND. IN THE INSTANT APPEAL ALSO THE AS SESSEE RECEIVED THE SALE CONSIDERATION FROM SALE OF AGRICULTURE LAND AND APP LIED THE SAME TO PURCHASE ANOTHER PIECE OF AGRICULTURE LAND IN THE NAME OF SE LF AND OTHERS IN THE NAME OF WIFE AND CHILDREN. THE REVENUE AUTHORITIES HAVE ALS O ACCEPTED THE CLAIM AND ALLOWED BY LD.CIT(A) MADE BY THE ASSESSEE FOR PURCH ASE OF AGRICULTURE LAND IN THE NAME OF THE ASSESSEE AS WELL AS HIS WIFE. THE O THER TWO REMAINING PERSONS ARE ASSESSEES SON AND DAUGHTER. WE DO NOT FIND ANY REASON THAT WHY THE SHRI JITENDRA PATIDAR /ITANO.486/IND/2019 10 BENEFIT SHOULD NOT BE GIVEN RAJA RAM PATIDAR ITA NO .371/IND/2015 A.Y. 2010- 11 71 FOR PURCHASE OF AGRICULTURE LAND IN THE NAME OF HIS SON AND DAUGHTER WHO ARE NOT SOMEONE NOT CONNECTED OR STRANGERS TO THE A SSESSEE AND AS HELD BY THE HON'BLE HIGH COURT THAT THE ASSESSEE INCLUDES HIS L EGAL HEIRS ALSO SO AS TO GIVE THE VIDE AND LEGAL INTERPRETATION. WE THEREFORE ARE OF THE VIEW THAT THE LD.CIT(A) ERRED IN DENYING THE EXEMPTIONS U/S 54B OF THE ACT TO THE ASSESSEE FOR INVESTMENT OF SALE CONSIDERATION FOR PURCHASING AGR ICULTURE LAND IN NAME OF HIS SON AND DAUGHTER AT RS.49,86,085/- AND RS. 12,50,17 5/- RESPECTIVELY. WE ACCORDINGLY SET ASIDE THE FINDINGS OF BOTH THE LOWE R AUTHORITIES AND DIRECT THE LD. ASSESSING OFFICER TO GIVE THE BENEFIT OF EXEMPTION U/S 54B OF THE ACT TO THE ASSESSEE AT RS.62,36,260/- WHICH IS OVER AND ABOVE THE BENEFIT OF RS.91,18,190/- ALREADY ALLOWED BY LD.CIT(A) U/S 54B OF THE ACT. IN THE RESULT THE ISSUE NO.3 RAISED BY THE ASSESSEE UNDER GROUND NO.2 OF THE APPEAL IS ALLOWED. 1.10]THAT IN VIEW OF THE ABOVE, IT IS SUBMITTED THA T DEDUCTION AS CLAIMED UNDER SECTION 54B OF THE INCOME TAX ACT WAS LEGAL AND PRO PER AND THE SAME WAS RIGHTLY ALLOWED BY THE THEN ASSESSING OFFFICER AT T HE TIME OF PASSING OF THE ORIGINAL ASSESSMENT ORDER. 2] GROUND NO 1 TREATING THE ASSESSMENT ORDER AS P ASSED AS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENU E 2.1] THE APPELLANT HAD FILED HIS RETURN OF TOTAL IN COME FOR THIS ASSESSMENT YEAR ON 28-08-2015 DECLARING TOTAL INCOME AT RS 2,98,060/-. 2.2] THE CASE OF THE ABOVE ASSESSEE WAS SELECTED IN SCRUTINY AND NOTICE WAS ISSUED UNDER SECTION 143(2) OF THE ACT. IN COMPLIAN CE TO THE NOTICES AS ISSUED FROM TIME TO TIME, DETAILED SUBMISSION WAS FILED BY THE APPELLANT. THE SAME WAS DULY EXAMINED BY THE ASSESSING OFFICER AND CLAIMED OF DE DUCTION UNDER SECTION 54B OF THE ACT WAS ACCEPTED. 2.3] THE PR CIT-2, INDORE BY ISSUING NOTICE UNDER S ECTION 263 OF THE ACT SETTING ASIDE THE ORDER AS PASSED BY THE ASSESSING OFFICER BY HOLDING THAT THE SAME WAS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENU E. 2.4] THE APPELLANT HAD FILED COMPLETE DETAILS BEFOR E THE ASSESSING OFFICER. THE ASSESSING OFFICER AFTER TAKING INTO ACCOUNT, DETAIL S AS FILED BY THE APPELLANT PASSED AN ORDER UNDER SECTION 143(3) OF THE ACT DUL Y ACCEPTING THE CLAIM OF THE APPELLANT AS LEGAL AND PROPER. HENCE, THE ASSESSMEN T ORDER AS PASSED BY THE ASSESSING OFFICER WAS NEITHER ERRONEOUS NOR PREJUDI CIAL TO THE INTERESTS OF THE REVENUE. THE SAID ORDER WAS PASSED AFTER CONDUCTING NECESSARY ENQUIRIES AND AFTER DUE APPLICATION OF MIND. 2.2] IT IS PERTINENT TO MENTION THE RELEVANT PROVIS IONS OF SECTION 263 OF THE INCOME TAX ACT WHICH PROVIDES THAT THEPRINCIPAL COMMISSION ER OR COMMISSIONER MAY CALL FOR AND EXAMINE THE RECORD OF ANY PROCEEDING UNDER THIS ACT, AND IF HE CONSIDERS THAT ANY ORDER PASSED THEREIN BY THE ASSESSING OFFI CER IS ERRONEOUS IN SO FAR AS IT SHRI JITENDRA PATIDAR /ITANO.486/IND/2019 11 IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE. REL EVANT EXTRACT OF SECTION 263 OF THE ACT IS REPRODUCED AS UNDER FOR YOUR KIND REFERENCE: (1) THE PRINCIPAL COMMISSIONER OR COMMISSIONER MAY CALL FOR AND EXAMINE THE RECORD OF ANY PROCEEDING UNDER THIS ACT, AND IF HE CONSIDERS T HAT ANY ORDER PASSED THEREIN BY THE ASSESSING OFFICER IS ERRONEOUS IN SO FAR AS IT IS PR EJUDICIAL TO THE INTERESTS OF THE REVENUE, HE MAY, AFTER GIVING THE ASSESSEE AN OPPORTUNITY OF BEING HEARD AND AFTER MAKING OR CAUSING TO BE MADE SUCH INQUIRY AS HE DEEMS NECESSA RY, 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. EXPLANATION 2 - FOR THE PURPOSES OF THIS SECTION, I T IS HEREBY DECLARED THAT AN ORDER PASSED BY THE ASSESSING OFFICER SHALL BE DEEMED TO B E ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE, IF, IN THE OPINION OF THE PRINCIPAL COMMISSIONER OR COMMISSIONER, (A) THE ORDER IS PASSED WITHOUT MAKING INQUIRIES O R VERIFICATION WHICH SHOULD HAVE BEEN MADE; (B) THE ORDER IS PASSED ALLOWING ANY RELIEF WITHOU T INQUIRING INTO THE CLAIM; (C) THE ORDER HAS NOT BEEN MADE IN ACCORDANCE WITH ANY ORDER, DIRECTION OR INSTRUCTION ISSUED BY THE BOARD UNDER SECTION 119 ; OR (D) THE ORDER HAS NOT BEEN PASSED IN ACCORDANCE WI TH ANY DECISION WHICH IS PREJUDICIAL TO THE ASSESSEE, RENDERED BY THE JURISDICTIONAL HIG H COURT OR SUPREME COURT IN THE CASE OF THE ASSESSEE OR ANY OTHER PERSON. 2.3.1] THAT ON ANALYSIS OF PROVISIONS OF SECTION 26 3 OF THE ACT, IT IS CLEARLY EVIDENT THAT LD CIT CAN ASSUME JURISDICTION UNDER SECTION 2 63 OF THE ACT WHEN THE ORDER PASSED BY THE ASSESSING OFFICER IS ERRONEOUS INSOFA R AS IT IS PREJUDICIAL TO THE INTEREST OF THE REVENUE. THE ORDER OF THE ASSESSING OFFICER SHALL BE DEEMED TO BE ERRONEOUS IN SO FAR ALSO PREJUDICIAL TO THE INTERES T OF THE REVENUE ONLY ON THE FULFILLMENT OF CERTAIN CONDITIONS AS PRESCRIBED. 2.3.2] IN PURSUANT TO ABOVE, ONE OF THE CRITERIA TO ASSUME JURISDICTION U/S 263 IS THAT IF THE LD COMMISSIONER OR PR. COMMISSIONER IS OF THE OPINION THAT THE ORDER PASSED BY THE ASSESSING OFFICER WAS WITHOUT MAKING INQUIRIES OR VERIFICATION WHICH SHOULD HAVE BEEN MADE, SAID ORDER IS DEEMED T O BE ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE AND CONSEQUE NTIAL PROCEEDINGS UNDER SECTION 263 COULD BE INITIATED. 2.4.1] HOWEVER, IN THE FACTS OF THE PRESENT CASE, T HE APPELLANT DURING THE COURSE OF ASSESSMENT PROCEEDING FILED AMPLE DOCUMENTS SO AS T O JUSTIFY CLAIM OF THE ASSESSEE UNDER SECTION 54B OF THE INCOME TAX ACT. C OPY OF THE SALE DEED OF THE AGRICULTURAL LAND AS SOLD BY THE ASSESSEE ALONG WIT H THE COPIES OF REGISTRY AS EXECUTED BY THE ASSESSEE IN RESPECT OF AGRICULTURAL LAND PURCHASED HAD BEEN PROVIDED DURING THE COURSE OF ASSESSMENT PROCEEDING S BEFORE THE ASSESSING OFFICER. THE CLAIM OF DEDUCTION OF THE APPELLANT WA S ALSO DULY SUPPORTED WITH THE DECISIONS OF JURISDICITONAL BENCH AND ALSO OF JURIS DICTIONAL HIGH COURT. 2.4.2] THE APPELLANT FILED FOLLOWING DOCUMENTS IN S UPPORT OF LAND AS PURCHASED BY THE ASSESSEE IN THE NAME OF HIS SON AND DAUGHTER IN LAW SO AS TO JUSTIFY THE EXEMPTION CLAIMED UNDER SECTION 54B OF THE ACT: S.NO. DESCRIPTION OF PAPERS SHRI JITENDRA PATIDAR /ITANO.486/IND/2019 12 1 COPY OF REGISTRY DATED 30-06-2014 FOR SALE OF LAND SITUATED GRAM BALYAKHEDA, INDORE FOR CONSIDERATION OF RS.1,60,65,000/- 2 COPY OF REGISTRY DATED 25-08-2014 IN RESPECT OF AGRICULTURE LAND PURCHASED AT GRAM NIGNOTI, INDORE FOR RS.10,90,855/- IN THE NAME OF J EETENDRAPATIDAR 3 COPY OF REGISTRY DATED 15-05-2014 IN RESPECT OF AGRICULTURAL LAND PURCHASED SITUATED AT GRAM NIGNOTI, INDORE FOR RS.17,61,150/- IN THE N AME OF JEETENDRAPATIDAR 4 COPY OF REGISTRY DATED 22-05-2014 IN RESPECT OF AGRICULTURAL LAND PURCHASED SITUATED AT GRAM NIGNOTI, INDORE FOR RS.33,76,555/- IN THE N AME OF NITESHPATIDAR 5 COPY OF REGISTRY DATED 21-07-2014 IN RESPECT OF AGRICULTURAL LAND PURCHASED SITUATED AT GRAM NIGNOTI, INDORE FOR RS.22,60,060/- IN THE N AME OF NITESHPATIDAR 6 COPY OF REGISTRY DATED 28-08-2014 IN RESPECT OF AGRICULTURAL LAND PURCHASED SITUATED AT GRAM NIGNOTI, INDORE FOR RS.55,30,230/- IN THE N AME OF DIVYAPATIDAR 2.5.1] THAT IN THE VIEW OF ABOVE, ASSESSING OFFICER HAS EXAMINED ALL THE SUBMISSIONS PLACED BEFORE HIM AND PASSED THE ASSESS MENT ORDER ONLY AFTER CONDUCTING NECESSARY ENQUIRY/INVESTIGATION AND AFTE R DUE APPLICATION OF MIND IN THE FACTS OF THE PRESENT CASE. HENCE THE ORDER P ASSED BY THE ASSESSING OFFICER WAS NEITHER ERRONEOUS NOR PREJUDICIAL TO THE INTERE ST OF THE REVENUE. 2.5.2] THEREFORE, IN THE VIEW OF ABOVE,THE LD PR. C IT WAS NOT JUSTIFIED IN SETTING ASIDE THE ASSESSMENT ORDER AS PASSED BY THE ASSESSI NG OFFICER BY INVOKING THE PROVISIONS OF SECTION 263 OF THE ACT, WHEN THE ORDE R WAS PASSED BY THE ASSESSING OFFICER UNDER SECTION 143[3] OF THE ACT A FTER CONDUCTING NECESSARY ENQUIRIES AND AFTER DUE APPLICATION OF MIND. 2.6.1] THAT HONBLE SUPREME COURT IN THE CASE OFMAL ABAR INDUSTRIAL CO. LTD. CIT [2000] 243 ITR 83 (SC) AFTER CONSIDERING THE DECISI ONS OF RAMPYARI DEVI SARAOGI (SUPRA) AND SMT. TARA DEVI AGGARWAL (SUPRA):- [PAGE NO. 52 OF THE COMPILATION] THERE CAN BE NO DOUBT THAT THE PROVISION CANNOT BE INVOKED TO CORRECT EACH AND EVERY TYPE OF MISTAKE OR ERROR COMMITTED BY THE ASSESSING OFFICER;IT IS ONLY WHEN AN ORDER IS ERRONEOUS THAT THE SECTION WILL BE ATTRACTED. AN IN CORRECT ASSUMPTION OF FACTS OR AN INCORRECT APPLICATION OF LAW WILLSATISFY THE REQUIR EMENT OF THE ORDER BEING ERRONEOUS. IN THE SAME CATEGORY FALL ORDERS PASSED WITHOUT APP LYING THE PRINCIPLES OF NATURAL JUSTICE OR WITHOUT APPLICATION OF MIND. THE PHRASE 'PREJUDICIAL TO THE INTERESTS OF THE REV ENUE 'HAS TO BE READ IN CONJUNCTION WITH AN ERRONEOUS ORDER PASSED BY THE ASSESSING OFFI CER. EVERY LOSS OF REVENUE AS A CONSEQUENCE OF AN ORDER OF THE ASSESSING OFFICER CANNOT BE TREATED AS PREJUDICIAL TO THE INTERESTS OF THE REVE NUE, FOR EXAMPLE, WHEN AN ITO ADOPTED ONE OF THE COURSES PERMISSIBLE IN LAW AND I T HAS RESULTED IN LOSS OF REVENUE; OR WHERE TWO VIEWS ARE POSSIBLE AND THE ITO HAS TAK EN 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 TAK EN BY THE ITO IS UNSUSTAINABLE IN LAW. IT HAS BEEN HELD BY THIS COURT THAT WHERE A SU M 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 WILL BE ERRONEOUS AND PREJUDICIAL TO THE SHRI JITENDRA PATIDAR /ITANO.486/IND/2019 13 INTERESTS OF THE REVENUE - RAMPYARI DEVI SARAOGI V. CIT [1968167ITR 84 (SC) AND IN SMT. TARA DEVI AGGARWAL V. CIT [1973] 88 ITR 323 (SC ). [ EMPHASIS SUPPLIED ] 2.6.2] HON'BLE DELHI HIGH COURT IN THE CASE OF CIT VS. SUN BEAM AUTO REPORTED IN 227 CTR 113 HAS POINTED OUT A DISTINCTION BETWEEN L ACK OF INQUIRY AND INADEQUATE INQUIRY . IF THERE IS A LACK OF ENQUIRY, THEN THE ASSESSMEN T ORDER CAN BE BRANDED AS ERRONEOUS. THE FOLLOWING OBSERVATIONS OF THE HON'BLE DELHI HIGH COURT ARE WORTH TO NOTE:- 12. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS OF TH E COUNSEL ON THE OTHER SIDE AND HAVE GONE THROUGH THE RECORDS. THE FIRST ISSUE THAT ARISES FOR OUR CONSIDERATION IS ABOUT THE EXERCISE OF POWER BY THE COMMISSIONER OF INCOME -TAX UNDER SECTION 263 OF THE INCOME-TAX ACT. AS NOTED ABOVE, THE SUBMISSION OF LEA RNED COUNSEL FOR THE REVENUE WAS THAT WHILE PASSING THE ASSESSMENT ORDER, THE ASSESSI NG OFFICER DID NOT CONSIDER THIS ASPECT SPECIFICALLY WHETHER THE EXPENDITURE IN QUES TION WAS REVENUE OR CAPITAL EXPENDITURE. THIS ARGUMENT PREDICATES ON THE ASSESS MENT ORDER WHICH APPARENTLY DOES NOT GIVE ANY REASONS WHILE ALLOWING THE ENTIRE EXPE NDITURE AS REVENUE EXPENDITURE. HOWEVER, THAT BY ITSELF WOULD NOT BE INDICATIVE OF THE FACT THAT THE ASSESSING OFFICER HAD NOT APPLIED HIS MIND ON THE ISSUE. THERE ARE JU DGMENTS GALORE LAYING DOWN THE PRINCIPLE THAT THE ASSESSING OFFICER IN THE ASSESSME NT ORDER IS NOT REQUIRED TO GIVE DETAILED REASON IN RESPECT OF EACH AND EVERY ITEM O F DEDUCTION, ETC. THEREFORE, ONE HAS TO SEE FROM THE RECORD AS TO WHETHER THERE WAS APPL ICATION OF MIND BEFORE ALLOWING THE EXPENDITURE IN QUESTION AS REVENUE EXPENDITURE. LEA RNED COUNSEL FOR THE ASSESSEE IS RIGHT IN HIS SUBMISSION THAT ONE HAS TO KEEP IN MIN D THE DISTINCTION BETWEEN LACK OF INQUIRY AND INADEQUATE INQUIRY. IF THERE WAS ANY INQUIRY, EVEN INADEQUATE, THAT WOULD NOT BY ITSELF, GIVE OCCASION TO THE COMMISSIO NER TO PASS ORDERS UNDER SECTION 263 OF THE ACT, MERELY BECAUSE HE HAS DIFFERENT OPIN ION IN THE MATTER. IT IS ONLY IN CASES OF LACK OF INQUIRY, THAT SUCH A COURSE OF ACTION WOULD BE OPEN. [ EMPHASIS SUPPLI ED ] 2.6.3] HON'BLE AHMEDABAD BENCH OF ITAT IN THE CASE OF M/S JAY AGRICULTURE TEST VS PR CIT [ APPEAL NO ITA NO 605/ AHD /2015 DT 01-0 1-2015 HAS HELD THAT :- 20. ON DUE CONSIDERATION OF THESE FACTS, WE ARE OF THE VIEW THAT THE AO HAS EXAMINED THE ISSUE, THOUGH NOT DISCUSSED ELABORATELY IN THE ASSESSMENT ORDER. BUT ON RECORD, HE HAS CALLED FOR INFORMATION FROM THE ASSESSEE AND TH EREAFTER ACCEPTED. IT IS THE PREROGATIVE OF THE AO WHAT TO DISCUSS IN THE ASSESSM ENT ORDER AND THE ASSESSEE CANNOT FORCE THE AO TO DRAFT THE ASSESSMENT ORDER I N A PARTICULAR MANNER. THE ASSESSMENT ORDER CANNOT BE TERMED ERRONEOUS AS WELL AS PREJUDICIAL TO THE INTEREST OF THE REVENUE ON THE GROUND THAT INQUIRY WAS NOT CONDUCTED BY THE AO. [ EMPHASIS SUPPLIED ] 2.6.4] HON'BLE MUMBAI BENCH OF ITAT IN THE CASE OF RELIANCE MONEY INFRASTRUCTURE LTD VS PR CIT AS REPORTED IN 51 CCH 0166 HAS HELD THAT :- 26. IN VIEW OF THE FOREGOING DISCUSSIONS, WE NOTE T HAT THE AO HAS PASSED THE ASSESSMENT ORDER AFTER OBTAINING AND CALLING FOR DE TAILS/CLARIFICATIONS OF ALL THE SEVEN ISSUES RAISED BY THE PR CIT IN THE REVISIONARY PROC EEDINGS AND THEREAFTER FRAMED THE ASSESSMENT WHEREAS THE LDPR.CIT HAS NOT SPECIFIED I N HIS ORDER AS TO HOW THE ORDER OF THE AO IS ERRONEOUS SO AS TO PREJUDICIAL TO THE INT EREST OF THE REVENUE. THE PR. CIT HAS EVEN MADE ROVING DIRECTION THAT THE AO MAY EXAMINE ANY OTHER ISSUE WHICH MAY COME TO HIS NOTICE IN THE SET ASIDE PROCEEDINGS. TH US EVIDENTLY IT IS NOT A CASE OF NO INQUIRY OR WRONG APPLICATION OF LAW OR WRONG ASSUMPTION OF FACTS AND THEREFORE THE SHRI JITENDRA PATIDAR /ITANO.486/IND/2019 14 REVISIONARY JURISDICTION EXERCISED BY THE PCIT IS N OT PROPER AND AS PER THE PROVISIONS OF THE SECTION ITSELF. WE ARE OF THE CONSIDERED OPI NION THAT IN THE PRESENT CASETHE AO HAS SPECIFICALLY CALLED FOR EXPLANATION FROM THE AS SESSEE ON ALL POINTS DURING THE COURSE OF ASSESSMENT PROCEEDING AND THEREAFTER HAS TAKEN A POSSIBLE VIEW. MOREOVER, IT IS NOT NECESSARY FOR THE AO TO GIVE DETAILED FINDINGS OR E LABORATE IN THE ASSESSMENT ORDER ON EACH AND EVERY ISSUE WHICH HAS BEEN EXAMINED DURING THE COURSE OF SCRUTINY PROCEEDINGS. BESIDES, THE CASE O F THE ASSESSEE IS SQUARELY COVERED BY THE RATIO LAID DOWN IN THE VARIOUS CASE LAWS REF ERRED TO BY THE LD AR DISCUSSED BRIEFLY HEREINABOVE WHILE A SERIES OF CASES RELIED UPON BY THE REVENUE HAVE BEEN CAREFULLY PERUSED AND ARE FOUND TO BE DISTINGUISHAB LE ON FACTS AND ARE NOT APPLICABLE. THE AMENDMENT TO SECTION 263 IS ALSO PROSPECTIVE. T HUS, THE REVERSIONARY PROCEEDINGS U/S 263 OF THE ACT ARE NOT VALIDLY INITIATED IN VIEW OF THE FACTS THAT THE ISSUES RAKED UP BY THE PR.CIT STAND EXAMINED BY THE AO IN THE ASS ESSMENT PROCEEDINGS AND THE LDPRCIT HAS FAILED TO STATE AS TO HOW THE ORDER OF AO IS ERRONEOUS AND NOT IN ACCORDANCE WITH LAW OR SETTLED LEGAL POSITION. EVEN ON MERIT, THE ASSESSEE IS ENTITLED TO ALL THE DEDUCTIONS/CLAIMS AS PER THE PROVISIONS OF THE ACT. CONSIDERING ALL THESE FACTS IN TOTALITY AND RESPECTFULLY FOLLOWING THE RA TIO LAID DOWN IN THE VARIOUS DECISIONS OF THE JURISDICTIONAL AND OTHER HIGH COURTS, WE ARE OF THE CONSIDERED VIEW THAT THE JURISDICTION BY THE PR.CIT U/S 263 OF THE ACT WAS IN VALIDLY ASSUMED. ACCORDINGLY WE SET ASIDE THE PROCEEDINGS U/S 263 OF THE ACT AS BEIN G INVALID AND ALSO CONSEQUENT ORDER OF PCIT U/S 263 OF THE ACT. [ EMPHASIS SUPPLIED ] 2.6.5] THESE PRINCIPLES HAVE BEEN RE-ITERATED BY TH E APEX COURT IN ITS JUDGMENT IN COMMISSIONER OF INCOME TAX VS AMITABHBACCAHAN[2016( 3) KLT SN.4 (C.NO.3) SC], WHERE THE COURT INTER ALIA HELD THUS:- 'THERE CAN BE NO DOUBT THAT SO LONG AS THE VIEW TAK EN BY THE ASSESSING OFFICER IS A POSSIBLE VIEW THE SAME OUGHT NOT TO BE INTERFERED W ITH BY THE COMMISSIONER UNDER S.263 OF THE ACT MERELY ON THE GROUND THAT THERE IS ANOTHER POSSIBLE VIEW OF THE MATTER.PERMITTING EXERCISE OF REVISIONAL POWER IN A SITUATION WHERE TWO VIEWS ARE POSSIBLE WOULD REALLY AMOUNT TO CONFERRING SOME KIN D OF AN APPELLATE POWER IN THE REVISIONAL AUTHORITY. THIS IS A COURSE OF ACTION TH AT MUST BE DESISTED FROM.' [EMPHASIS SUPPLIED ] 2.6.6] THAT HON'BLE HIGH COURT OF ANDHRA PRADESH IN THE CASE OF SPECTRA SHARES AND SCRIPS (P) LTD. VS COMMISSIONER OF INCOME TAX III, HYDERABAD AS REPORTED IN 2013 36 TAXMANN.COM 348 HAS HELD THAT:- IT MAY BE THAT IN THE ASSESSMENT ORDER, THE ASSESSIN G OFFICER HAS NOT MADE AN ELABORATE DISCUSSION ON THE ISSUE AS TO THE NAT URE OF ACTIVITY OF THE ASSESSEE I.E. WHETHER IT IS AN INVESTMENT OR WHETHER IT IS BUSINE SS INCOME AND DID NOT REFER TO HIS QUERY ON THE ISSUE TO THE ASSE SSEE BEFORE PASSING THE ORDER OR REPLY GIVEN BY THE ASSESSEE TO HIS QUERY, HOWEVER, WHEN IT IS NOT INCU MBENT ON THE ASSESSING OFFICER TO PASS A DETAILED OR DER, MERELY BECAUSE THE ORDER DOES NOT CONTAIN REASONS AS TO WHY HE ACC EPTED THAT THE ASSESSEE IS (SIC-NOT) A TRADING COMPANY, HIS ORDER DOES NOT BEC OME SUSCEPTIBLE FOR REVISION. THE ASSESSING OFFICER WH ILE MAKING AN ASSESSMENT HAD EXAMINED THE ACCOUNTS, MADE INQUIRIES, APPLIED HIS MIND TO THE F ACTS AND CIRCUMSTANCES OF THE CASE AND DETERMINED THE INCOME OF THE ASSESSEE. THEREFORE, IT IS NOT OPEN TO THE COMMISSIONER, ON THE GROUND THAT A DIFFERENT VIEW IS POSSIBLE, TO REOPEN THE ASSESSMENT ON THE GROUND THAT THE ASSESSING OFFI CER DID NOT MAKE AN SHRI JITENDRA PATIDAR /ITANO.486/IND/2019 15 ELABORATE DISCUSSION IN THAT REGARD. [PARA 34] 2.6.7] THAT HON'BLE HIGH COURT OF MADHYA PRADESH IN THE CA SE OF COMMISSIONER OF INCOME TAX VS RATLAM COAL ASH CO. A S REPORTED IN 1987 34 TAXMANN.COM 443 HAS HELD THAT :- IT IS WELL SETTLED THAT WHERE THE ITO MADE THE ASSE SSMENT IN UNDUE HURRY, ACCEPTING WHAT THE ASSESSEE STATES IN THE RETURN WI THOUT MAKING ANY ENQUIRIES IN THE CIRCUMSTANCES OF THE CASE, THE COM MISSIONER WOULD BE JUSTIFIED IN HOLDING THE ORDER OF THE ITO TO THE ER RONEOUS. HOWEVER, IN THE INSTANT CASE, THE TRIBUNAL HAD FOUND THAT THE ASSES SEE HAD FURNISHED ALL THE REQUISITE INFORMATION AND THAT THE ITO CONSIDERING ALL THE FACTS HAD COMPLETED THE ASSESSMENT. IT WAS FURTHER HELD THAT IN THE CIR CUMSTANCES OF THE CASE IT COULD NOT BE HELD THAT THE ITO HAD MADE ASSESSMENT WITHOUT MAKING PROPER ENQUIRIES. ACCORDINGLY, THE TRIBUNAL WAS JUSTIFIED I N REVERSING THE ORDER PASSED BY THE COMMISSIONER. 2.6.8] THAT HON'BLE HIGH COURT OF MADHYA PRADESH IN THE CA SE OF BAKIR SINGH VS COMMISSIONER OF INCOME TAX AS REPORTED IN 2013 40 TAXMANN.COM 128 HAS HELD THAT :- 10.1 IN THE PRESENT CASE THE AO DURING THE COURSE OF ORIGINAL ASSESSMENT PROCEEDINGS MADE THE ENQUIRIES RELATING TO CASH DEPOSIT AND EVE N THE CASE WAS SELECTED FOR SCRUTINY ON THE BASIS OF DEPOSITS IN THE BANK ACCOU NT. THE ASSESSEE FURNISHED THE BANK STATEMENT AND SOURCE OF AGRICULTURAL INCOME FR OM 184 BIGHAS AGRICULTURAL LAND. THE AO EXAMINED THOSE DOCUMENTS AND ON BEING SATISFI ED, FRAMED THE ASSESSMENT UNDER S. 143(3) OF THE ACT VIDE ORDER DT. 16TH SEPT. , 2011. THEREFORE, A POSSIBLE VIEW WAS TAKEN BY THE AO. SO IT CANNOT BE SAID THAT THE AO HAD NOT EXAMINED THE ISSUE ON THE BASIS OF WHICH THE LEARNED CIT HAS HELD THAT THE ASSESSMENT ORDER DT. 16TH SEPT., 2011 PASSED BY THE AO WAS ERRONEOUS OR PREJUD ICIAL TO THE INTEREST OF THE REVENUE. IN THE PRESENT CASE, IT IS NOTICED FROM THE COPY OF THE ORDER SHEET OF THE AO DURING THE ASSESSMENT PROCEEDINGS (PLACED AT PAGE N O. 14 OF THE ASSESSEE'S COMPILATION) THAT ON 7TH SEPT., 2011 THE ASSESSEE F URNISHED COPY OF BANK ACCOUNT, EVIDENCE FOR LAND HOLDING, AGRICULTURAL INCOME AND INTEREST INCOME. THEREAFTER, ON 12TH SEPT., 2011, THE AO ASKED THE ASSESSEE TO EXPL AIN THE SOURCE OF DEPOSIT AMOUNTING TO RS. 15,59,000 ON 8TH APRIL, 2008 IN SBB J SAVINGS ACCOUNT. THE AO AGAIN NOTED IN THE ORDER SHEET ENTRY DT. 15TH SEPT. , 2011 THAT THE ASSESSEE FILED THE SOURCE OF DEPOSIT IN THE BANK ACCOUNT. HE AGAIN ASK ED THE ASSESSEE TO FURNISH THE COPY OF BANK ACCOUNT NO. 85940 FOR FURTHER VERIFICA TION AND ULTIMATELY THE AO NOTED IN THE ORDER SHEET ENTRY DT. 16TH SEPT., 2011 THAT THE ASSESSEE PRODUCED THE INFORMATION AND THE CASE WAS DISCUSSED WITH HIM. FR OM THE ABOVESAID ORDER SHEET ENTRIES, COPY OF WHICH IS PLACED AT PAGE NOS. 14 AN D 15 OF THE ASSESSEE' COMPILATION, IT IS CLEAR THAT THE AO MADE THE PROPER ENQUIRY REL ATING TO THE DEPOSIT OF THE RS. 15,59,000 AND ONLY AFTER BEING SATISFIED, THE ASSES SMENT WAS FRAMED UNDER S. 143(3) OF THE ACT. 10.2 ON A SIMILAR ISSUE, THE HON'BLE SUPREME COURT IN THE CASE OF MAX INDIA LTD. (SUPRA) HAS HELD AS UNDER : 'THE PHRASE 'PREJUDICIAL TO THE INTERESTS OF THE REV ENUE' IN S. 263 OF THE IT ACT, 1961, HAS TO BE READ IN CONJUNCTION WITH THE EXPRESSION ' ERRONEOUS' ORDER PASSED BY THE AO. EVERY LOSS OF REVENUE AS A CONSEQUENCE OF AN ORDER OF THE AO CANNOT BE TREATED AS PREJUDICIAL TO THE INTERESTS OF THE REVENUE. FOR EXA MPLE, WHEN THE AO ADOPTS ONE OF TWO COURSES PERMISSIBLE IN LAW AND IT HAS RESULTED IN LOSS OF REVENUE, OR WHERE TWO VIEWS ARE POSSIBLE AND THE AO HAS TAKEN ONE VIEW WIT H WHICH THE CIT DOES NOT SHRI JITENDRA PATIDAR /ITANO.486/IND/2019 16 AGREE, IT CANNOT BE TREATED AS AN ERRONEOUS ORDER P REJUDICIAL TO THE REVENUE, UNLESS THE VIEW TAKEN BY THE AO IS UNSUSTAINABLE IN LAW.' 11.IN THE PRESENT CASE ALSO, THE AO HAD MADE NECESS ARY ENQUIRY ABOUT THE BANK TRANSACTIONS AND AFTER BEING SATISFIED FROM THE ASS ESSEE'S EXPLANATION THAT SUCH TRANSACTIONS WERE GENUINE, HE PASSED THE ORDER UNDE R S. 143(3) OF THE ACT. THEREFORE, A MERE DISAGREEMENT OR DISSATISFACTION OF THE LEARN ED CIT OVER THE MANNER OF ASSESSMENT CANNOT BE A BASIS FOR REVISION OF THE OR DER UNDER S. 263 OF THE ACT. IN THAT VIEW OF THE MATTER, WE SET ASIDE THE IMPUGNED ORDER PASSED BY THE LEARNED CIT AND THE ASSESSMENT ORDER FRAMED BY THE AO UNDER S. 143(3 ) OF THE ACT VIDE ORDER DT. 16TH SEPT., 2011 IS RESTORED. 12. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED. 2.7.1] THE ORDER AS PASSED BY THE ASSESSING OFFICER WAS NOT ERRONEOUS, SINCE, THE VIEW AS TAKEN BY THE ASSESSING OFFICER WAS ONE OF T HE POSSIBLE VIEW ON THE BASIS OF DOCUMENTS AS FURNISHED BY THE ASSESSEE. HENCE, THE ORDER AS PASSED BY THE ASSESSING OFFICER WAS NOT ERRONEOUS AND PREJUDICIAL ORDER. 2.7.2] THAT HONBLE APEX COURT IN THE CASE OF CIT V S MAX INDIA LIMITED AS REPORTED IN 295 ITR 0282 HAS HELD THAT: -[PAGE NO. 62 OF THE COMPILATION] 2. AT THIS STAGE WE MAY CLARIFY THAT UNDER PARA 1 0 OF THE JUDGMENT IN THE CASE OF MALABAR INDUSTRIAL CO. LTD. (SUPRA) THIS COURT HAS TAKEN THE VIEW THAT THE PHRASE 'PREJUDICIAL TO THE INTEREST OF THE REVENUE' UNDER S . 263 HAS TO BE READ IN CONJUNCTION WITH THE EXPRESSION 'ERRONEOUS' ORDER PASSED BY THE AO. EVERY LOSS OF REVENUE AS A CONSEQUENCE OF AN ORDER OF THE AO CANNOT BE TREATED AS PREJUDICIAL TO THE INTEREST OF THE REVENUE. FOR EXAMPLE, WHEN THE ITO ADOPTED ONE O F THE COURSES PERMISSIBLE IN LAW AND IT HAS RESULTED IN LOSS OF REVENUE; OR WHER E TWO VIEWS ARE POSSIBLE AND THE ITO HAS TAKEN ONE VIEW WITH WHICH THE CIT DOES NOT AGREE, IT CANNOT BE TREATED AS AN ERRONEOUS ORDER PREJUDICIAL TO THE INTEREST OF T HE REVENUE, UNLESS THE VIEW TAKEN BY THE ITO IS UNSUSTAINABLE IN LAW. [ EMPHASIS SUPPLIED ] 2.7.3] THAT HON'BLE JURISDICTIONAL HIGH COURT IN TH E CASE OF CIT VS ASSOCIATED FOOD PRODUCTS (P) LTD AS REPORTED IN 280 ITR 0377 H AS HELD THAT: - [PAGE NO. 59- 60 OF THE COMPILATION] 10 . IN VIEW OF THE AFORESAID PRONOUNCEMENT OF LAW AND TAKING INTO CONSIDERATION THE LANGUAGE EMPLOYED UNDER S. 263 OF THE ACT, IT IS CL EAR AS CRYSTAL THAT BEFORE EXERCISE OF POWERS TWO REQUISITES ARE IMPERATIVE TO BE PRESENT. IN THE ABSENCE OF SUCH FOUNDATION EXERCISE OF A SUO MOTU POWER IS IMPERMISSIBLE. IT SHOULD NOT BE P RESUMED THAT INITIATION OF POWER UNDER SUO MOTU REVISION IS MERELY AN ADMINISTRATIVE ACT. IT IS AN ACT OF A QUASI-JUDICIAL AUTHORITY AND BASED ON FORMATION OF AN OPINION WITH REGARD TO EXISTENCE OF ADEQUATE MATERIAL TO SATISFY THAT T HE DECISION TAKEN BY THE AO IS ERRONEOUS AS WELL AS PREJUDICIAL TO THE INTERESTS O F THE REVENUE. THE CONCEPT OF 'PREJUDICIAL TO THE INTERESTS OF THE REVENUE' HAS TO BE CORRECTLY AND SOUNDLY UNDERSTOOD. IT PRECISELY MEANS AN ORDER WHICH HAS N OT BEEN PASSED IN CONSONANCE WITH THE PRINCIPLES OF LAW WHICH HAS IN ULTIMATE EV ENTUATE AFFECTED REALIZATION OF LAWFUL REVENUE EITHER BY THE STATE HAS NOT BEEN REA LIZED OR IT HAS GONE BEYOND REALIZATION. THESE TWO BASIC INGREDIENTS HAVE TO BE SATISFIED AS SINE QUA NON FOR EXERCISE OF SUCH POWER. ON A PERUSAL OF THE MATERIAL BROUGHT ON RECORD AND THE ORDER PASSED BY THE CIT IT IS PERCEPTIBLE THAT THE SAID A UTHORITY HAS NOT KEPT IN VIEW THE SHRI JITENDRA PATIDAR /ITANO.486/IND/2019 17 REQUIREMENT OF S. 263 OF THE ACT INASMUCH AS THE ORD ER DOES NOT REFLECT ANY KIND OF SATISFACTION. AS IS MANIFEST THE SAID AUTHORITY HAS BEEN GOVERNED BY A SINGULAR FACTOR THAT THE ORDER OF THE AO IS WRONG. THAT MAY BE SO B UT THAT IS NOT ENOUGH. WHAT WAS THE SEQUITUR OR CONSEQUENCE OF SUCH ORDER QUA PREJU DICIAL TO THE INTEREST OF THE REVENUE SHOULD HAVE BEEN FOCUSED UPON. THAT HAVING N OT BEEN DONE, IN OUR CONSIDERED OPINION, EXERCISE OF JURISDICTION UNDER S. 263 OF THE ACT IS TOTALLY ERRONEOUS AND CANNOT WITHSTAND SCRUTINY. HENCE, THE TRIBUNAL HAS CORRECTLY UNSETTLED AND DISLODGED THE ORDER OF THE CIT. [ EMPHASIS SUPPLIED ] 3] THAT IN VIEW OF THE ABOVE , THE LD. PR CIT WAS N OT JUSTIFIED IN PASSING AN ORDER UNDER SECTION 263 OF THE ACT AND SETTING ASIDE THE ORDER AS PASSED BY THE ASSESSING OFFICER IN VIEW OF PROVISION OF SECTION 5 4B OF THE INCOME TAX ACT. THE ORDER AS PASSED BY THE LD PR CIT UNDER SECTION 263 OF THE ACT THEREFORE REQUIRES TO BE QUASHED. 4. LD. COUNSEL FOR THE ASSESSEE HAS ALSO PLACED RELIANC E ON THE DECISION OF THIS TRIBUNAL RENDERED IN THE CASE OF SHRI SUKHRAM MUKATI VS. ITO IN ITANO.409 & 410/IND/2014 VIDE ORDER DATED 09.08.2017. LD. COUNSEL FOR THE ASSE SSEE SUBMITTED THAT THE FACTS ARE IDENTICAL. HOWEVER, THE HO N'BLE HIGH COURT OF RAJASTHAN IN THE CASE OF KALYA VS. CIT 251 CTR 174 (RAJASTHAN) HAS HELD THAT WORD ASSESSEE USED IN INCOME TAX ACT NEEDS TO BE GIVEN A LEGAL INTERPRETATIO N AND NOT A LIBERAL INTERPRETATION. IF THE WORD ASSESSEE IS GIVEN A LIBERAL INTERPRETATION, IT WOULD BE TANTAMOUNT TO GIVIN G A FREE HAND TO THE ASSESSEE AND HIS LEGAL HEIRS AND IT SHAL L SHRI JITENDRA PATIDAR /ITANO.486/IND/2019 18 CURTAIL THE REVENUE OF THE GOVERNMENT, WHICH THE LAW DOES NOT PERMIT. LD. COUNSEL FOR THE ASSESSEE SUBMITTED T HAT THE FACTS IN THE PRESENT CASE ARE DISTINGUISHABLE AS IN THE PRESENT CASE HE SOLD HIS ANCESTRAL PROPERTY. NO OBJEC TION WAS OBTAINED FROM THE ASSESSEE IN RESPECT OF HIS RIGHT S TO BE TRANSFERRED BY FATHER OF THE ASSESSEE. LD. COUNSEL FOR THE ASSESSEE FURTHER SUBMITTED THAT THE JURISDICTIONAL HIG H COURT IN THE CASE OF THE PRINCIPAL COMMISSIONER OF INCOME TAX VS. BALMUKUND MEENA (ITANO.118/2016 DATED 16.02.2017 WHEREIN THE HON'BLE HIGH COURT HAS HELD AS UNDER: 9. IT THUS APPEARS TO US THAT THE PREDOMINANT JUDI CIAL VIEW, INCLUDING THAT OF THIS COURT, IS THAT FOR THE PURPO SES OF SECTION 54F, THE NEW RESIDENTIAL HOUSE NEED NOT BE PURCHASED BY THE ASSESSEE IN HIS OWN NAME NOR IS IT NECESSARY THAT IT SHOULD BE PURCHASED EXCLUSIVELY I N HIS NAME. IT IS MOREOVER TO BE NOTED THAT THE ASSESSEE IN THE PRESENT CASE HAS NOT PURCHASED THE NEW HOUSE IN THE NAME OF A STRANGER OR SOMEBODY WHO IS UNCONNECTED WITH H IM. HE HAS PURCHASED IT ONLY IN THE NAME OF HIS WIFE. THER E IS ALSO NO DISPUTE THAT THE ENTIRE INVESTMENT HAS COME OUT OF THE SALE PROCEEDS AND THAT THERE WAS NO CONTRIBUTION FR OM THE ASSESSEES WIFE. SHRI JITENDRA PATIDAR /ITANO.486/IND/2019 19 10. HAVING REGARD TO THE RULE OF PURPOSIVE CONSTRUC TION AND THE OBJECT WHICH SECTION 54F SEEKS TO ACHIEVE AND RESPECTFULLY AGREEING WITH THE JUDGMENT OF THIS COU RT, WE ANSWER THE SUBSTANTIAL QUESTION OF LAW FRAMED BY US IN THE AFFIRMATIVE, IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE. THE APPEAL IS ACCORDINGLY DISMISSED WITH N O ORDER AS TO COSTS. THE TRIBUNAL WHILE DISMISSING THE APPE AL OF THE REVENUE HAS HELD THAT THE ASSESSEE HAS PURCHASED TH E AGRICULTURAL LAND AND, THEREFORE, THE ORDER PASSED BY THE INCOME TAX APPELLATE TRIBUNAL IS JUST AND PROPER. 5. THERE IS CONFLICTING VIEW OF THE HON'BLE RAJASTHAN HIGH COURT AND THE HON'BLE JURISDICTIONAL HIGH COURT ON TH E ISSUE OF DEDUCTION U/S 54F OF THE ACT. THE HON'BLE JURISDICTIONAL HIGH COURT AFTER CONSIDERING THE JUDGM ENT OF HON'BLE PUNJAB AND HARYANA HIGH COURT AND HON'BLE DELHI HIGH COURT RULED IN FAVOUR OF THE ASSESSEE. IN THE PR ESENT CASE THE LD. PR. CIT HAD INVOKED THE PROVISIONS OF S ECTION 263 OF THE ACT, ON THE GROUND THAT THE ASSESSING OFFI CER HAD NOT MADE INQUIRY REGARDING THE CLAIM OF DEDUCTION U/S 54F OF THE ACT. THE RELEVANT FINDINGS OF THE LD. PR. CIT ARE REPRODUCED AS UNDER: SHRI JITENDRA PATIDAR /ITANO.486/IND/2019 20 THEREFORE, IN VIEW OF THE ABOVE DISCUSSION, I AM OF THE CONSIDERED OPINION THAT THE ORDER DATED 27.03.2017 FOR A.Y.2015-16 IS ERRONEOUS IN SO FAR AS IT IS ALSO PR EJUDICIAL TO THE INTEREST OF REVENUE ON ACCOUNT OF PASSING OF THE OR DER WITHOUT MAKING REQUIRED ENQUIRIES/INVESTIGATIONS IN RESPECT OF CLAIM OF DEDUCTION U/S 54B. ACCORDINGLY, I AM SATISFIED THAT PROVISIONS OF SECTION 263 OF I.T. ACT 1961 ARE REQUIRED TO BE INVOKED. THEREFORE, THE ASSESSMENT FOR A.Y.2015-16 FRAMED ON 27.03.2017 IS HEREBY SET ASIDE TO THE FILE OF AO TO REEXAMINE THE ISSUE OF CLAIM OF DEDUCTION U/S 54F, INDICATED IN T HE PRECEDING DISCUSSION U/S 263 AND PASSING AN ORDER AS PER THE LAW AFTER MAKING NECESSARY VERIFICATION, INQUIRIES AND INVEST IGATION. IT WOULD BE NOT OUT OF PLACE TO MENTION THAT THE AO SH ALL RE- EXAMINE ONLY THE ISSUES WHICH HAVE BEEN INDICATED F OR FURTHER INVESTIGATION IN THE PRECEDING DISCUSSION. 6. IT IS SETTLED POSITION OF LAW THAT THE PROVISIONS OF SECTION 263 OF THE ACT CAN BE INVOKED WHEN TWIN CONDITIONS I .E. THE ASSESSMENT ORDER IS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE ARE SATISFIED. IN THE PRESENT CASE UNDER THE IDENTICAL FACTS THE HON'BLE JURISDICTIONAL HIGH C OURT HAS RULED IN FAVOUR OF THE ASSESSEE REGARDING AVAILABILITY O F DEDUCTION U/S 54B OF THE ACT WHERE THE INVESTMENT I N NEW ASSET IS MADE IN THE NAME OF SON OF THE ASSESSEE. THE REVENUE HAS NOT BROUGHT TO OUR NOTICE ANY CONTRARY JUDGMENT BY THE HON'BLE JURISDICTIONAL HIGH COURT OR SHRI JITENDRA PATIDAR /ITANO.486/IND/2019 21 HON'BLE SUPREME COURT AS A BINDING PRECEDENCE. THEREF ORE, UNDER THESE FACTS, IT CANNOT BE CONSTRUED THAT THE OR DER PASSED BY THE ASSESSING OFFICER IS PREJUDICIAL TO THE INTEREST OF THE REVENUE. AS THE ASSESSMENT ORDER IS IN ACCORDAN CE WITH THE RATIO LAID DOWN BY THE HON'BLE JURISDICTIONAL HIGH COURT, THUS, WE ARE OF THE CONSIDERED VIEW THAT IN TH E LIGHT OF THE JUDGMENT OF THE HON'BLE JURISDICTIONAL HIGH C OURT, LD. PR. CIT WAS NOT JUSTIFIED IN INVOKING THE PROVIS ION OF SECTION 263 OF THE ACT. THE IMPUGNED ORDER IS, THER EFORE, SET ASIDE. THE GROUNDS RAISED IN THE PRESENT APPEAL ARE ALLOWED. 7. IN RESULT, APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 21.10.202 0. SD/- (MANISH BORAD) SD/- (KUL BHARAT) A CCOUNTANT MEMBER JUDICIAL MEMBER SHRI JITENDRA PATIDAR /ITANO.486/IND/2019 22 INDORE; DATED : 21/10/2020 PATEL/PS COPY TO: ASSESSEE/AO/PR. CIT/ CIT (A)/ITAT (DR)/GUAR D FILE. BY ORDER ASSISTANT REGISTRAR, INDORE