M/S Vardhman Industires Ltd, V. DCIT,

ITA 511/CHANDI/2014

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 8338 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 10 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-03-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 20-10-2015
• Assessment Year: 2004-2005
• Appeal Filed On: 15-05-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Revision of order; Opportunity of being heard
• Section: 43B; 143(3); 153A; 54; 263; 132; 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND MS. RANO JAIN, ACCOUNTANT MEMBER ITA NO.511/CHD/2014 ( ASSESSMENT YEAR : 2004-05) M/S VARDHMAN INDUSTRIES LTD., VS. THE D.C.I.T., 2ND FLOOR, JEEVANDEEP BUILDING, CENTRAL CIRCLE-1, PARLIAMENT STREET, LUDHIANA. NEW DELHI. PAN: AAACV3229R (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI ASHWANI KUMAR RESPONDENT BY : SHRI MANOJ MISHRA, CIT DR DATE OF HEARING : 19.01.2016 DATE OF PRONOUNCEMENT : 15.03.2016 O R D E R PER RANO JAIN, A.M . : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF LEARNED COMMISSIONER OF INCO ME TAX (CENTRAL), LUDHIANA DATED 14.03.2014, PASSED UNDE R SECTION 263 OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT). 2. BRIEFLY, THE FACTS OF THE CASE ARE THAT A SEARC H UNDER SECTION 132 OF THE ACT WAS CONDUCTED ON 10.06.2009. THE ASSESSEE FILED ITS RETURN IN PURSU ANCE TO NOTICE UNDER SECTION 153A OF THE ACT DECLARING INCO ME OF 2 RS.4,81,513/ ON 26.06.2010. THE ASSESSMENT UNDER SECTION 153A OF THE ACT WAS COMPLETED VIDE ORDER DA TED 29.12.2011 AT AN INCOME OF RS.9, 63, 880/. 3. THE COMMISSIONER OF INCOME TAX ISSUED A SHOW CAUSE NOTICE DATED 2.1.2014 UNDER SECTION 263 OF TH E ACT TO THE ASSESSEE, THE RELEVANT EXTRACT OF WHICH READ S AS UNDER. 5. WHILE REVIEWING THE CASE, IT WAS NOTICED THAT IN THE P&L ACCOUNT, THE ASSESSEE HAD CLAIMED AN EXPENSE OF RS.1,12,50,000/- ON ACCOUNT OF SALES TAX INCLUDED IN THE SELLING AND DISTRIBUTION EXPENSES (ANNEXURE-U TO P&L ACCOUNT) (COMPOUND LEVY SCHEME IRQ BANASPATI UNIT) AND THE SAME WAS ALLOWED BY THE ASSESSING OFFICER. AS PER NOTES ON ACCOUNTS, SALES DID NOT INCLUDE SALES-TAX. IN FACT, THIS EXPENSE IS NOT ALLOWABLE AND SHOULD HAVE BEEN DISALLOWED. AS SUCH, ORDER OF THE A.O. WAS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE TO THE EXTENT OF INCOME OF RS.1,12,50,000/-. PENALTY PROCEEDINGS U/S 271(L)(C) WERE ALSO LEVIABLE WHICH WERE NOT INITIATED BY THE A.O. WHILE PASSING ASSESSMENT ORDER. 6. IN VIEW OF THE ABOVE FACTS, IT IS APPARENT THAT ACTI ON IN THIS CASE IS REQUIRED TO BE TAKEN U/S 263 IN VIEW OF THE DECISION OF THE TRIBUNAL IN THE CASE OF JAI COMMERCIA L CO. LTD VS. JOINT CIT (2000) 66 TTJ (DEL-TRIBUNAL) 73 1, IT WAS HELD THAT IT IS OPEN FOR THE COMMISSIONER TO CALL FOR AND EXAMINE THE RECORD OF ANY PROCEEDINGS UNDER THE ACT, IN EXERCISE OF HIS ADMINISTRATIVE POWERS. IF AN ORDER IS FOUND TO BE ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE, THE COMMISSIONER CAN ASSUME JURISDICTION UNDER SECTION 263. THE SCOPE OF 3 INTERFERENCE UNDER SECTION 263 IS NOT TO SET ASIDE MERELY UNFAVORABLE ORDERS AND BRING TO TAX SOME MORE MONEY IN THE TREASURY. THE PREJUDICE THAT IS CONTEMPLATED UNDER SECTION 263 IS PREJUDICE TO THE INCOME TAX ADMINISTRATION AS A WHOLE. SECTION 263 IS TO BE INVOKED FOR THE PURPOSE OF SETTING RIGHT DISTORTIONS AND PREJUDICE TO THE INTEREST OF THE REVENUE. INDISPUTABLE UNDER SECTION 263 THE COMMISSIONER DOES HAVE THE POWER TO SET ASIDE THE ASSESSMENT ORDER AND RESTORE THE MATTER FOR A FRESH ASSESSMENT IF HE IS SATISFIED THAT FURTHER ENQUIRY IS NECESSARY AND THAT THE ORDER OF THE ASSESSING OFFICER IS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE. 7. IN THE LIGHT OF THE AFORESAID FACTS, IT IS CONSIDERE D THAT THE ORDER PASSED U/S 153A R.W.S. 143(3) OF THE ACTUATED 29.12.2011 BY THE DCIT, CENTRAL CIRCLE-L, LUDHIANA IS PRIMA FACIE ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTEREST OF REVENUE. YOU ARE, THEREFORE, REQUESTED TO SHOW CAUSE AS TO WHY THE AFORESAID ORDER DATED 29.12.2011 PASSED U/S 153A R.W.S.143(3) OF THE ACT FOR THE A.Y.2004-05 SHOULD NOT BE REVISED/MODIFIED/ENHANCED OR SET ASIDE WITH THE DIRECTIONS TO MAKE THE ASSESSMENT DENOVO. 8. FOR THIS PURPOSE, YOU ARE HEREBY GIVEN AN OPPORT UNITY OF BEING HEARD EITHER IN PERSON OR THROUGH AN AUTHORIZED REPRESENTATIVE IN MY OFFICE SITUATED AT DANDI SWAMI CHOWK, LUDHIANA ON 21.01.2014 AT 11.30 A.M. ON THAT DATE, YOU MAY SUBMIT YOUR OBJECTIONS WITH EVIDENCE, IF ANY, TO THE PROPOSED ACT ION IN WRITING. IN CASE OF YOUR FAILURE TO ATTEND ON THE AFORESAID DATE OR TO SUBMIT WRITTEN REPLY BY THAT DA TE, IT WILL BE PRESUMED THAT YOU HAVE NO OBJECTION TO THE PROPOSED ACTION AND MATTER SHALL BE DECIDED ON MERITS. 4 4. THE ASSESSEE REPLIED TO THE COMMISSIONER OF INCOME TAX. THE FIRST CONTENTION OF THE ASSESSEE W AS THAT SINCE THE ORDER OF THE ASSESSING OFFICER WAS NOT PA SSED ON INCORRECT ASSUMPTION OF FACTS OR LAW OR WITHOUT APPLICATION OF MIND THE SAME CANNOT BE A MATTER FOR REVISION UNDER SECTION 263 OF THE ACT. FURTHER IT WAS ALSO SUBMITTED THAT SALES TAX PAYABLE OF RS.1,12,50,000/ WAS MADE ON ACCOUNT OF COMPOUND LEVY SCHEME AND IS ALLOWABLE UNDER SECTION 43B OF THE ACT. IT WAS ALSO STATED THAT SALES TAX IS NOT CHARGED SEPARATELY. THE ASSES SEE ALSO SUBMITTED BEFORE THE COMMISSIONER OF INCOME TAX THA T THIS ISSUE HAS BEEN EXAMINED IN THE COURSE OF ORIGI NAL ASSESSMENT PROCEEDINGS, PROCEEDINGS UNDER SECTION 1 54 OF THE ACT AND ALSO IN PROCEEDINGS INITIATED UNDER SEC TION 153A OF THE ACT AFTER THE SEARCH CONDUCTED UNDER SE CTION 132 ON 10.06.2009. THE SUBMISSION OF THE ASSESSEE W AS THAT THE ASSESSING OFFICER AFTER APPLYING HIS MIND DID NOT MAKE ANY ADDITION ON THIS ACCOUNT. 5. ON THE MERITS OF THE CASE, IT WAS SUBMITTED THA T THE PAYMENTS WERE MADE ON ACCOUNT OF SALES TAX UNDE R COMPOUND LEVY SCHEME IN RESPECT OF ITS VANASPATI U NIT AT SAHARANPUR AND WHATEVER SALES TAX WAS PAID, ACCORDI NG TO THE ASSESSEE IS ALLOWABLE EXPENDITURE. THE COMMISSI ONER OF INCOME TAX REJECTED THE CONTENTIONS OF THE ASSES SEE. HE STATED THAT THE ASSESSEE HAS CLAIMED IN ITS PROF IT AND LOSS ACCOUNT AN EXPENSE ON ACCOUNT OF SALE TAX OF RS.1,12,50,000/ WHICH WAS ALLOWED BY THE ASSESSING 5 OFFICER. AS PER THE NOTES ON ACCOUNTS SALES DO NOT INCLUDE SALES TAX AND THEREFORE SUM OF RS.1,12,15,000/ IS NOT AN ALLOWABLE EXPENSE. THE COMMISSIONER OF INCOME TAX A LSO HELD THAT IT IS EVIDENT THAT THE ASSESSING OFFICER HAS NOT PROPERLY EXAMINED THE ISSUE OF ALLOWABILITY OF SALE TAX OF RS. 1,12,50,000/. THE ENTIRE ISSUE OF PAYMENT OF S ALE TAX AND ITS ALLOWABILITY IS INTRICATELY CONNECTED WITH THE ISSUE OF COLLECTION OF SALE TAX AND ITS ACCOUNTING KEEPIN G IN VIEW THE RELEVANT PROVISIONS OF LAW. AS PER THE COMMISS IONER OF INCOME TAX, IT WAS NOT CLEAR WHETHER ASSESSEE HA S FULFILLED THE CONDITIONS CONCERNING COMPOUND LEVY S CHEME IN RESPECT OF ONE OF THE UNITS. IN VIEW OF THIS, T HE COMMISSIONER OF INCOME TAX HELD THAT THE ASSESSING OFFICER HAS NOT PROPERLY EXAMINED THE ASPECT OF ALL OW ABILITY OF SALE TAX AND AFTER RELYING ON A NUMBER O F JUDGEMENTS, THE COMMISSIONER OF INCOME TAX HELD THE ORDER OF THE ASSESSING OFFICER PASSED UNDER SECTION 153A OF THE ACT, DATED 29.12.2011 TO BE ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE AND SET IT A SIDE WITH THE DIRECTIONS TO MAKE FRESH ASSESSMENT DENOVO AFTE R PROPERLY EXAMINING THE FACTS OF THE CASE AND RELEVA NT LEGAL PROVISIONS AND CONDUCTING PROPER ENQUIRY AND AFTER AFFORDING AN OPPORTUNITY OF BEING HEARD TO THE ASS ESSEE. 6. AGGRIEVED BY THIS ORDER THE ASSESSEE HAS COME I N APPEAL BEFORE US, RAISING THE FOLLOWING GROUNDS OF APPEAL: 1. THAT ORDER PASSED U/S 263 OF THE INCOME TAX ACT , 1961 BY THE LD. COMMISSIONER OF INCOME TAX (CENTRAL) , LUDHIANA IS AGAINST LAW AND FACTS ON THE FILE IN AS MUCH 6 AS HE WAS NOT JUSTIFIED TO ARBITRARILY HOLD THAT ASSESSMENT ORDER DATED 29.12.2011 PASSED BY THE LD. ASSESSING OFFICER IS ERRONEOUS AND PREJUDICIAL TO T HE INTEREST OF REVENUE. 2. THAT THE LD. CIT WAS NOT JUSTIFIED TO HOLD THAT TH E ASSESSMENT ORDER HAD BEEN PASSED WITHOUT MAKING PROPER ENQUIRIES AND THE ASPECT OF ALLOWABILITY OF SALES TAX PAID HAS NOT BEEN PROPERLY EXAMINED. 7. BEFORE US, THE LD. COUNSEL OF THE ASSESSEE STARTED HIS ARGUMENTS BY DRAWING OUR ATTENTION TO V ARIOUS PAGES OF THE PAPER BOOK FILED BY THE ASSESSEE. OUR ATTENTION WAS INVITED TO PAPER BOOK PAGE NO. 9, WHE REBY A LETTER DATED 7.10.2008 WAS PLACED ON RECORD WHEREBY AT POINT NO. 20 ASSESSEE HAS SUBMITTED A COPY OF THE S ALE TAX POLICY OF UTTAR PRADESH GOVERNMENT REGARDING LEVY O F SALE TAX UNDER COMPOUND LEVY SCHEME IN RESPECT OF ONE OF ITS UNITS. A COPY OF THE SALE TAX POLICY WAS ANNEXED WI TH THE SAID LETTER. IT WAS CLARIFIED THAT THIS LETTER WAS GIVEN TO THE ASSESSING OFFICER DURING THE ORIGINAL ASSESSMEN T PROCEEDINGS UNDER SECTION 143 (3) OF THE ACT. AT PA PER BOOK PAGE 11 A NOTICE FROM THE ASSESSING OFFICER DA TED 28.07.2008 WAS ANNEXED WHERE SOME CLARIFICATION REGARDING INCOME ESCAPEMENT WAS ALSO ENCLOSED WITH THE SAID LETTER. THIS LETTER WAS ISSUED TO THE ASSESSE E AFTER THE PASSING OF ORIGINAL ASSESSMENT UNDER SECTION 14 3 (3). IN THIS LETTER ALSO, THE ASSESSEE WAS ASKED TO CLAR IFY REGARDING THE ALLOWABILITY OF SALE TAX PAID. AT PAG E 13 THE REPLY TO THE SAID LETTER FILED BY THE ASSESSEE TO T HE ASSESSING OFFICER WAS ENCLOSED IN WHICH IT WAS CLAR IFIED 7 THAT THE SALE TAX AMOUNTING TO RS.1,12,50,000/- UND ER THE COMPOUND LEVY SCHEME IN RESPECT OF UNIT IN UTTAR PR ADESH WAS RAISED DURING THE ASSESSMENT PROCEEDINGS WHICH WAS DULY REPLIED THEREON HOWEVER WAS AGAIN ANNEXED WITH THE SAID REPLY. AT PAGE 15 ANOTHER REPLY FILED BY THE ASSESSEE IN RESPONSE TO NOTICE UNDER SECTION 154 WAS FILED, WHEREBY AGAIN THE ISSUE OF SALE TAX WAS CLARIFIED BY THE AS SESSEE TO THE ASSESSING OFFICER. AT PAGE 16 WHICH WAS A LETTE R FILED BEFORE THE ASSESSING OFFICER DURING THE ASSESSMENT PROCEEDINGS UNDER SECTION 153A OF THE ACT. IN THIS LETTER ALSO CLARIFICATION WITH REGARD TO THE SALE TAX WAS GIVEN AND A COPY OF THE EARLIER LETTER WITH THE COPY OF SCHEM E WAS ALSO ENCLOSED THEREWITH. ALL THIS WAS SHOWN TO US IN ORDER TO EMPHASISE THE FACT THAT THE ISSUE OF SALE TAX WA S BEING CONSIDERED BY THE ASSESSING OFFICER BOTH AT THE TIM E OF ORIGINAL ASSESSMENT UNDER SECTION 143(3) AS WELL AS UNDER PROCEEDINGS IN PURSUANCE TO NOTICE UNDER SECTION 15 3A OF THE ACT. ANOTHER OCCASION ON WHICH THE SAID ISSUE W AS DEALT WITH BY THE ASSESSING OFFICER WAS AFTER ISSUI NG NOTICE UNDER SECTION 154. THE CONTENTION OF THE COU NSEL OF THE ASSESSEE WAS THAT SINCE SPECIFIC QUERY REGARDIN G THE SALE TAX WERE RAISED DURING THE ASSESSMENT PROCEEDI NGS AND WHICH WERE DULY REPLIED BY THE ASSESSEE IT CANN OT BE SAID THAT THE ASSESSING OFFICER HAS NOT APPLIED HIS MIND TO THE SAID ISSUE. THIS IS NOT A CASE OF NO INQUIRY OR INADEQUATE INQUIRY, THEREFORE, THE COMMISSIONER OF INCOME TAX DOES NOT HAVE JURISDICTION TO REVIEW THE ORDER OF THE 8 ASSESSING OFFICER IN THE GARB OF INVOKING PROVISION S OF SECTION 263 OF THE ACT. 8. ANOTHER ARGUMENT RAISED BY THE LD. COUNSEL OF THE ASSESSEE DURING THE COURSE OF HEARING WAS THAT THE COMMISSIONER OF INCOME TAX HAS HELD THE ORDER OF T HE ASSESSING OFFICER BEING ERRONEOUS AS WELL AS PREJUD ICIAL TO THE INTEREST OF REVENUE. HOWEVER HE HAS GIVEN DIREC TION TO THE ASSESSING OFFICER TO MAKE AFRESH ASSESSMENT DEN OVO AFTER PROPERLY EXAMINING THE FACTS OF THE CASE AND LEGAL PROVISIONS. THE ASSESSING OFFICER IS ALSO DIRECTED BY THE COMMISSIONER OF INCOME TAX TO CONDUCT PROPER ENQUIR Y AFTER AFFORDING AN OPPORTUNITY OF BEING HEARD TO TH E ASSESSEE. THE ARGUMENT OF THE COUNSEL OF THE ASSESS EE WAS THAT ONCE THE COMMISSIONER OF INCOME TAX INVOKES TH E PROVISIONS OF SECTION 263 OF THE ACT AND HOLDS THE ORDER TO BE ERRONEOUS HE HAS TO GIVE A CATEGORICAL FINDING WITH REGARD TO THE ERROR IN THE ORDER OF THE ASSESSING O FFICER. IN THE GARB OF PROVISIONS UNDER SECTION 263 OF THE ACT HE CANNOT ASK THE ASSESSING OFFICER TO AGAIN MAKE ASSE SSMENT DENOVO. IN THIS VIEW IT WAS PRAYED THAT THE ORDER P ASSED BY THE COMMISSIONER OF INCOME TAX UNDER SECTION 263 BE HELD NOT AS PER LAW. RELIANCE WAS PLACED ON THE OR DER OF THE I.T.A.T., CHANDIGARH BENCH IN THE CASE OF DAMIN I RESORTS & BUILDERS (P) LTD. VS. CIT, ITA NO.404/CHD/2012, DATED 31.10.2014 AND SEL MFG. CO. LTD. VS. ADDL. CIT, ITA NO.409 & 410/CHD/2014, DATE D 18.11.2015. 9 9. THE LD. DR RELIED ON THE ORDER OF THE COMMISSIONER OF INCOME TAX AND FURTHER SUBMITTED TH AT IT IS A FACT ON RECORD THAT THE SALE TAX IS NOT ALLOWA BLE TO THE ASSESSEE, THEREFORE THERE IS AN ERROR IN THE ORDER OF THE ASSESSING OFFICER WHICH IS ALSO PREJUDICIAL TO THE INTEREST OF REVENUE THEREFORE THE COMMISSIONER OF INCOME TAX HAS RIGHTLY INVOKED THE PROVISIONS OF SECTION 263 OF TH E ACT. 10. WE HAVE HEARD THE LEARNED REPRESENTATIVES OF BOTH THE PARTIES, PERUSED THE FINDINGS OF THE AUTHO RITIES BELOW AND CONSIDERED THE MATERIAL AVAILABLE ON RECO RD. IN ORDER TO INVOKE PROVISIONS OF SECTION 263 OF THE AC T, THE TWO CONDITIONS OF THE ORDER BEING ERRONEOUS AS WELL AS PREJUDICIAL TO THE INTEREST OF THE REVENUE ARE TO B E SATISFIED SIMULTANEOUSLY. AN ORDER CAN BE SAID TO BE ERRONEOUS IF THE ASSESSING OFFICER HAS NOT MADE ENQ UIRY ON A RELEVANT ISSUE. AN ENQUIRY MADE BY THE ASSESS ING OFFICER, CONSIDERED INADEQUATE BY THE COMMISSIONER OF INCOME TAX, CANNOT MAKE THE ORDER OF THE ASSESSING OFFICER ERRONEOUS. YES, THE ORDER CAN BE ERRONEOUS IF THE ASSESSING OFFICER FAILS TO APPLY THE LAW RIGHTLY ON THE FACTS OF THE CASE. IN THE PRESENT CASE, AS CAN BE SEEN F ROM THE PAPER BOOK, IT CANNOT BE SAID THAT THERE IS NO ENQU IRY. CERTAINLY, ENQUIRIES HAVE BEEN CONDUCTED BY THE ASS ESSING OFFICER WITH REGARD TO THE ISSUES OF SALE TAX. AS FAR AS ADEQUACY OF ENQUIRY IS CONSIDERED, THERE IS NO LAW WHICH PROVIDES THE EXTENT OF ENQUIRIES TO BE MADE BY THE ASSESSING OFFICER. IT IS ASSESSING OFFICERS PRERO GATIVE TO 10 MAKE ENQUIRY TO THE EXTENT HE FEELS PROPER. THE LE ARNED COMMISSIONER OF INCOME TAX BY INVOKING REVISIONERY POWERS UNDER SECTION 263 OF THE ACT CANNOT IMPOSE H IS OWN UNDERSTANDING OF THE EXTENT OF ENQUIRY. THERE ARE A NUMBER OF JUDGMENTS BY VARIOUS HIGH COURTS IN THIS REGARD. WE ARE NOT REFERRING TO THE SAME FOR THE SAKE OF BREVITY. IN THIS VIEW, WE DO NOT FIND ANY ERROR IN THE ORDER OF THE ASSESSING OFFICER. 11. THERE IS ANOTHER ANGLE TO THE PRESENT CASE. H ERE THE LEARNED COMMISSIONER OF INCOME TAX HOLDS THE OR DER OF THE ASSESSING OFFICER TO BE ERRONEOUS AND AT THE CONCLUSION OF HIS ORDER DIRECTS THE ASSESSING OFFIC ER TO MAKE ASSESSMENT DE-NOVO. WE DO NOT FIND THIS APPRO ACH OF THE LEARNED COMMISSIONER OF INCOME TAX TO BE COR RECT IN LAW. THE REVISIONERY POWERS UNDER SECTION 263 O F THE ACT ARE GIVEN TO THE LEARNED COMMISSIONER OF INCOME TAX WHEN HE FINDS THE ORDER OF THE ASSESSING OFFICER TO BE ERRONEOUS AS WELL AS PREJUDICIAL TO THE INTEREST OF THE REVENUE. IN CASE THE LEARNED COMMISSIONER OF INCOM E TAX FINDS THE ERROR IN THE ORDER OF THE ASSESSING OFFIC ER, STILL PREFERS TO DIRECT HIM TO MAKE ASSESSMENT DE-NOVO, T HESE TWO THINGS CONTRADICT EACH OTHER. IF THE LEARNED COMMISSIONER OF INCOME TAX DIRECTS THE ASSESSING OF FICER TO MAKE ASSESSMENT AFTER FURTHER ENQUIRY, THIS ACT OF THE LEARNED COMMISSIONER OF INCOME TAX SHOWS THAT HE IS NOT SURE WHETHER THE ORIGINAL ORDER WAS ERRONEOUS OR NO T, AS ON CONCLUSION OF FURTHER ENQUIRY, THE ASSESSING OFF ICER 11 MAY NOT MAKE THE PROPOSED ADDITION OR DISALLOWANCE. THERE WILL EMERGE A VERY WEIRD SITUATION IN SUCH A CASE. THEREFORE, IF THE LEARNED COMMISSIONER OF INCOME TA X HOLDS THAT THERE IS ANY ERROR IN THE ORDER OF THE A SSESSING OFFICER, HE SHOULD GIVE A CATEGORICAL FINDING IN TH IS REGARD AND FOR THIS PURPOSE, HE HIMSELF HAS TO MAKE ENQUIR IES AND INVESTIGATIONS, WHATEVER HE DEEMS FIT IN THE CIRCUMSTANCES. OUR VIEW GETS STRENGTHENED BY THE JUDGMENT OF THE HON'BLE DELHI HIGH COURT IN THE CAS E OF ITO VS. D.G. HOUSING PROJECTS LTD. (2012) 343 ITR 3 29 (DEL), WHEREBY THE HON'BLE HIGH COURT HELD AS UNDER : 16. THUS, IN CASES OF WRONG OPINION OR FINDING ON M ERITS, THE CIT HAS TO COME TO THE CONCLUSION AND HIMSELF DECIDE THAT THE ORDER IS ERRONEOUS, BY CONDUCTING NECESSARY ENQUIRY , IF REQUIRED AND NECESSARY, BEFORE THE ORDER UNDER SECTI ON 263 IS PASSED. IN SUCH CASES, THE ORDER OF THE ASSESSING OFF ICER WILL BE ERRONEOUS BECAUSE THE ORDER PASSED IS NOT SUSTAIN ABLE IN LAW AND THE SAID FINDING MUST BE RECORDED. CIT CANNO T REMAND THE MATTER TO THE ASSESSING OFFICER TO DECID E WHETHER THE FINDINGS RECORDED ARE ERRONEOUS. IN CASES WHERE THERE IS INADEQUATE ENQUIRY BUT NOT LACK OF ENQUIRY, AGAIN TH E CIT MUST GIVE AND RECORD A FINDING THAT THE ORDER/INQUI RY MADE IS ERRONEOUS. THIS CAN HAPPEN IF AN ENQUIRY AND VERIFIC ATION IS CONDUCTED BY THE CIT AND HE IS ABLE TO ESTABLISH AND SHOW THE ERROR OR MISTAKE MADE BY THE ASSESSING OFFICER, MAKI NG THE ORDER UNSUSTAINABLE IN LAW. IN SOME CASES POSSIBLY T HOUGH RARELY, THE CIT CAN ALSO SHOW AND ESTABLISH THAT THE F ACTS ON RECORD OR INFERENCES DRAWN FROM FACTS ON RECORD PER SE JUSTIFIED AND MANDATED FURTHER ENQUIRY OR INVESTIGA TION BUT THE ASSESSING OFFICER HAD ERRONEOUSLY NOT UNDERTAKE N THE SAME. HOWEVER, THE SAID FINDING MUST BE CLEAR, UNAMBIGU OUS AND NOT DEBATABLE. THE MATTER CANNOT BE REMITTED FOR A FRESH DECISION TO THE ASSESSING OFFICER TO CONDUCT FURTHE R ENQUIRIES 12 WITHOUT A FINDING THAT THE ORDER IS ERRONEOUS. FINDI NG THAT THE ORDER IS ERRONEOUS IS A CONDITION OR REQUIREMENT WHI CH MUST BE SATISFIED FOR EXERCISE OF JURISDICTION UNDER SECTIO N 263 OF THE ACT. IN SUCH MATTERS, TO REMAND THE MATTER/ISSUE TO T HE ASSESSING OFFICER WOULD IMPLY AND MEAN THE CIT HAS NO T EXAMINED AND DECIDED WHETHER OR NOT THE ORDER IS ER RONEOUS BUT HAS DIRECTED THE ASSESSING OFFICER TO DECIDE TH E ASPECT/QUESTION. 12. WE SEE, IN THE PRESENT CASE, THE LEARNED COMMISSIONER OF INCOME TAX HIMSELF HAS NOT GIVEN A NY CONCRETE FINDING AS TO THE MERITS OF THE CASE AND H AS DIRECTED THE ASSESSING OFFICER TO MAKE FURTHER ENQU IRY. IN VIEW OF THIS, WE HOLD THAT THE ASSUMPTION OF JURISD ICTION UNDER SECTION 263 OF THE ACT BY THE LEARNED COMMISS IONER OF INCOME TAX IS NOT AS PER LAW. 13. IN THE RESULT APPEAL OF THE ASSESSEE IS ALLOWE D. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 15 TH DAY OF MARCH, 2016. SD/- SD/- (BHAVENESH SIANI) (RANO JAIN) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 15 TH MARCH, 2016 *RATI* COPY TO: THE APPELLANT/THE RESPONDENT/THE CIT(A)/THE CIT/THE D R. ASSISTANT REGISTRAR, ITAT, CHANDIGARH 13