Bengal Steel Industries Ltd., , Kolkata V. ITO, Ward - 11(3), Kolkata , Kolkata

ITA 699/KOL/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 8213 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 9 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-01-2020
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 03-12-2019
• Assessment Year: 2012-2013
• Appeal Filed On: 13-04-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: A K NAYAK
• Assessee Lawyers: GOUTAM BANERJEE
• Keywords: Rectification of order; Difference of opinion; Assessment record; Change of opinion; Set aside; Capital Gains
• Section: 143(3); 115JB; 143(1); 6; 263; 154

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH A KOLKATA BEFORE SHRI J.SUDHAKAR REDDY, ACCOUNTANT MEMBER AND SHRI S.S.GODARA, JUDICIAL MEMBER ITA NO.699/KOL/2018 ASSESSMENT YEAR: 2012-13 BENGAL STEEL INDUSTRIES LTD., 84/1A, TOPSIA ROAD, (S), KOLKTA-700 046 [ PAN NO.AAABCB 0969 P ] / V/S . INCOME TAX OFFICER WARD-11(3), AAYAKAR BHAWAN, P-7, CHOWRINGHEE SQUARE, KOLKATA-700 096 /APPELLANT .. /RESPONDENT /BY APPELLANT SHRI GOUTAM BANERJEE, FCA /BY RESPONDENT SHRI A.K. NAYAK, CIT-DR /DATE OF HEARING 03-12-2019 /DATE OF PRONOUNCEMENT 22-01-2020 /O R D E R PER S.S.GODARA, JUDICIAL MEMBER:- THIS ASSESSEES APPEAL FOR ASSESSMENT YEAR 2012-13 ARISES AGAINST THE PRINCIPAL COMMISSIONER OF INCOME TAX-4, KOLKATAS ORDER DATED 28.02.2018, INVOLVING PROCEEDINGS U/S 263 OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT. 2. WE HAVE HEARD BOTH THE PARTIES. CASE FILE PERUSE D. WE ADVERT TO THE BASIC RELEVANT FACTS. THIS ASSESSEE-COMPANY IS A MANUFACT URER OF STEEL PRODUCTS. IT ALSO DERIVES INCOME FROM HOUSE PROPERTY / RENTAL INCOME AND CARRIES OUT INVESTMENT BUSINESS. THE ASSESSEE HAD FILED ITS ORIGINAL RETUR N ON 26.09.2012 DECLARING TOTAL INCOME AT 501,410/-. THE SAME STOOD SUMMARILY PROCESSED ON 08 .05.2013 BY CPC. ITA NO.699/KOL/2018 ASSESSMENT YEAR 2 012-13 BENGAL STEEL INDUSTRIES. LTD. VS ITO WD-11(3 ), KOL. PAGE 2 THE ASSESSING AUTHORITY THEREAFTER FORMED REASONS T O BELIEVE THAT THE ASSESSEES TAXABLE INCOME LIABLE TO BE ASSESSED HAD ESCAPED ASSESSMENT . HE ISSUED SEC.148 NOTICE DATED 12.09.2014 AND FRAMED THE RE-ASSESSMENT IN QUESTION DATED 16.03.2016 ASSESSING THE ASSESSEES TOTAL TAXABLE INCOME AT 121,49,582/- AS REDUCED BY LONG TERM CAPITAL GAINS ADJUSTMENTS CARRIED FORWARD FROM THE PRECEDING ASSE SSMENT YEAR TO THE TUNE OF 40,31,675/-; COMING TO NET ASSESSED INCOME OF 81,17,907/-. 3. BOTH THE LEARNED REPRESENTATIVES SUBMITTED AT TH IS STAGE THAT IT IS THE SAID RE- ASSESSMENT WHICH FORMS SUBJECT-MATTER OF THE PCITS EXERCISE OF SEC. 263 REVISION JURISDICTION AS UNDER:- 2. SUBSEQUENTLY, THE ASSESSMENT RECORDS OF THE ASS ESSEE WERE CALLED FOR & ON THE BASIS OF THE VERIFICATION OF THE MATERIAL AVAILABLE ON RECORDS, IT WAS FOUND THAT THE ORDER ASSESSMENT WAS ERRONEOUS SO FAR AS IT IS PREJUDICIAL TO THE INTERE ST OF REVENUE ON THE FOLLOWING GROUNDS:- IT IS NOTICED THAT LONG TERM CAPITAL LOSS OF RS. 40 ,31,675/- RELATING TO PREVIOUS YEAR WAS SET OFF WITH THE TOTAL TAXABLE INCOME. FROM THE DETAILS AVAILABLE ON RECORD IT IS SEEN THAT THE LOSSES WERE PERTAINING TO A.Y2005-06 FOR RS.20,46,281/-, A.Y 2010-11 FOR RS.5,38,147/- AND A.Y 2011-12 FOR RS.14, 47, 24 7/-. FURTHER, ON PERUSAL OF ASSESSMENT RECORD IT REVEALED THAT LONG TERM CAPITA L LOSS FOR RS.14,47,2481- IN A.Y 2011-12 WAS EXEMPTED LOSS. SINCE, EXEMPTED LONG TER M CAPITAL LOSS CANNOT BE CARRIED FORWARD, THEIR SETTING WITHOUT CURRENT YEAR S LONG TERM CAPITAL GAIN WAS NOT ALLOWABLE AND THEREFORE THE SAME WAS REQUIRED TO B E DISALLOWED BY THE AO WHILE PASSING THE ORDER U/S 147/143(3) OF THE ACT, BUT TH E SAME WAS NOT DONE BY THE AO . FURTHER, THE NATURE OF OTHER LOSS CLAIMED FOR A. Y 2005-06 AND A. Y 201011 ALSO NEEDS TO BE VERIFIED AS TO WHETHER THOSE WERE ON AC COUNT OF SECTION 10(38) OR OTHERWISE. 3. A SHOW CAUSE NOTICE WAS ISSUED TO THE ASSESSEE O N 04-12-2017 REQUIRING IT TO SUBMIT CLARIFICATION OR EXPLANATION TO THE AFOREMENTIONED ISSUES & ALSO TO SHOW CAUSE WHY REMEDIAL ACTION U/S 263 OF THE ACT WOULD NOT BE TAKEN AGAINS T THE ASSESSMENT MADE U/S 147/143(3) OF THE ACT DATED 16-03-2016 BUT NO COMPLIANCE WAS MADE ON THE SAID DATE. THE ASSESSEE WAS GIVEN ANOTHER OPPORTUNITY VIDE LETTER DATED 13-02-2 018 FIXING DATE OF HEARING ON 21-02-2018. IN RESPONSE TO THIS NOTICE SHRI GAUTAM BANERJEE, TH E AIR OF THE ASSESSEE APPEARED AND SOUGHT ADJOURNMENT AND CASE WAS ADJOURNED TO 26-02-2018. S HRI GAUTAM BANERJEE, THE AIR OF THE ASSESSE APPEARED AND FILED WRITTEN SUBMISSION. THE RELEVANT PORTION OF THE WRITTEN SUBMISSION OF THE ASSESSEE IS EXTRACTED BELOW:- '.. ... THIS HAS REFERENCE TO YOUR NOTICE DATED 04. 12.2017 IN COURSE OF PROCEEDINGS U/S. 263 FOR A.Y. 2012-13 AGAINST THE ABOVE ASSESSEE. THE ASSESSEE SUBMITTED RETURN OF INCOME SHOWING INC OME OF RS. 501,410 AS PER NORMAL CALCULATION. THE ASSESSEE'S TAX U/S 115JB WAS HIGHE R AT RS. 14,32,311 AND THIS TAX WAS PAID. THE ASSESSMENT WAS REOPENED AND INCOME REASSESSED A T RS. 81,17,907 AFTER SET- OFF OF LONG TERM CAPITAL LOSS OF RS.40,31,675. THIS SET-OFF OF LTCL ARISES FROM TRANSFER OF SHARE/M.F., THE INCOME OF WHICH QUALIFY FOR EXEMPTION U/S. 10(38). YOUR OBJECTION IS THAT THE LTCG U/S. 10(38) BEING EXEMPT, THE CORRESPONDING L TCL CANNOT BE ALLOWED TO BE CARRIED FORWARD OR ITA NO.699/KOL/2018 ASSESSMENT YEAR 2 012-13 BENGAL STEEL INDUSTRIES. LTD. VS ITO WD-11(3 ), KOL. PAGE 3 SET-OFF AGAINST INCOME OF SUCCEEDING YEARS. THE FIG URES ARE UNDISPUTED AND THE ONLY LEGAL ISSUE TO DECIDE IS WHETHER LTCL ARISING FROM TRANSF ER OF SHARES/M.F., THE INCOME OF WHICH QUALIFY U/S.10(38), IS ALLOWABLE FOR SET-OFF/CARRY FORWARD U/S.70/74. AS PER S.74(1)(C) THE LTCL IS ALLOWED TO BE CARRIED FORWARD & SET-OFF AGA INST LTCG OF SUBSEQUENT EIGHT A. YRS. THE LTCL FOR THE PURPOSE OF S. 74, SO COMPUTED, DOE S NOT DISTINGUISH BETWEEN LOSSES FROM SHARES/M.F. INCOME OF WHICH QUALIFY U/S. 10(38) OR OTHER LOSSES. THUS, THE PROFIT ON TRANSFER OF SHARES/M.F. QUALIFYING U/S. 10(38) MAY BE EXEMPT BU T IT DOES NOT MAKE, CORRESPONDING LTCL TO BE INELIGIBLE TO BE CONSIDERED AS A LOSS. THUS, THE LTCL ARISING FROM TRANSFER OF EQUITY SHARES/M.F. QUALIFYING U/S. 10(38), CAN BE ADJUSTED FROM LTCG OF SAME YEAR OR CAN BE CARRIED FORWARD & SET-OFF AGAINST L TCG OF FUTURE YEARS. THE IMPUGNED ASSESSMENT ORDER IS PASSED U/S. 147114 3(3) ON 16.03.2017. IN REASONS RECORDED FOR REOPENING THE ISSUE OF CLAIM OF EXCESS SET-OFF OF CARRY FORWARD LTCL WAS RAISED. THE ASSESSEE'S CLAIM OF SET-OFF OF CARRY FORWARD LTCL W AS EXAMINED AND THEN THE SAME WAS ALLOWED AT RS.40,31,675. THE REASSESSMENT WAS COMPL ETED ON 16.03.2016 AFTER GRANTING HEARING AND EXAMINING AND VERIFYING ALL NECESSARY D ETAILS AND INFORMATION RELATING TO REASSESSMENT. THUS, IT CAN BE PRESUMED THAT THE SET -OFF OF LTCL HAS BEEN DONE WITH FULL KNOWLEDGE AND CONSCIOUS DECISION THAT THE SAME IS A LLOWABLE. NOW, TO HOLD DIFFERENTLY WOULD BE A CHANGE OF OPINION ON THE PART OF DEPT. IN 263 PROCEEDINGS, ERROR PREJUDICIAL TO REVENUE ARE TO BE REVISED BUT OPINION OF HIGHER AUTHORITY C ANNOT BE REPLACED FOR OPINION OF AO. THIS, OBVIOUSLY, CANNOT BE ADMITTED NOR HELD TO BE CORREC T. THE PROCEEDINGS DRAWN U/S. 263 APPEARS TO BE A RESULT OF AUDIT OBSERVATION AND IS NOT BASE D ON ANY LAW BUT ON GENERAL PRINCIPLE, NOT ACCEPTED OR ADMITTED AS LAW. SUCH OBSERVATION, THER EFORE, CANNOT BE EMPIRICAL TRUTH OR SACROSANCT BY ITSELF. SO FAR AS PROCEEDINGS U/S. 147/143(3) IS CONCERNED, THE ISSUE OF SET-OFF OF CARRY FORWARD LOSS UNDER LONG TERM CAPITAL LOSS, WAS EXAMINED, VERIFIE D AND THEN ONLY ALLOWED, WHICH IS ONE OF THE TWO OPINIONS AVAILABLE IN THIS FIELD. THIS IS N OT A DECISION WHICH IS IMPOSSIBLE TO BE TAKEN BY ANY PERSON OF REASONABLE WISDOM. IT CANNOT BE SA ID THAT THE SET- OFF OF LONG TERM CAPITAL LOSS IS ERRONEOUS. IN THAT CASE, ONE OF THE MANDATO RY REQUIREMENTS OF APPLICATION OF S. 263 FAILS AND THE PROCEEDINGS BECOME UNJUST. MOREOVER, AS PER YOUR NOTICE REFERRED TO ABOVE, IT APPEARS THAT THE NATURE OF LOSS FOR A.Y. 2005-06 AND A.Y. 2010-11 CLAIMED AS SET-OFF IN THIS A.Y. ARE NOT KNOWN TO YOU SINCE YOU FELT THAT THIS NEEDS TO BE VERIFIED. UNLESS AFTER CAUSIN G ENQUIRY AND AFTER CONSIDERATION OF THE IMPUGNED ORDER, THERE IS NO CERTAIN FINDING ABOUT T HE SET-OFF OF LOSS OF A.Y. 2005-06 AND A.Y. 2010-11, THE SAME CANNOT BE COVERED U/S. 263 AT PRE SENT. IT IS ALSO MENTIONED THAT THE ASSESSMENT ORDER PASSED U/S. 147/143(3) DATED 16.03 .2014 IS NOT AN ORDER WHICH CAN BE HELD TO BE ERRONEOUS AS PER EXPLANATION 2 OF S. 263. THE PROCESSING OF THE RETURN OF INCOME FOR A.Y. 2012-13 HAVING BEEN COMPLETED ON 26.09.2012, I T IS SUBMITTED THAT THE 263 PROCEEDINGS IS NOT VALID DUE TO EFFLUXION OF TIME AND COULD BE MADE ONLY BEFORE 31.03.2015. IT IS SUBMITTED THAT THE ASSESSMENT ORDER PASSED U/ S. 147/143(3) DATED 16.03.2016 FOR A.Y. 2012-13 IS ASSAILED IN APPEAL BEFORE CIT(A)-4 ON TH E GROUND JURISDICTION U/S. 147/148 AS WELL AS OF DETERMINATION OF ASSESSED LONG TERM CAPITAL G AINS. THIS MATTER OF SET-OFF OF CAPITAL LOSS AGAINST LTCG IS ASSOCIATED WITH THE ASSESSED INCOME AND THE ISSUE BEING CONTESTED IN APPEAL, CANNOT NOW BE THE SUBJECT MATTER IN PROCEEDINGS U/S . 263. THE CIT(A) HAS ALL POWERS OF THE AO TO EXERT SO THAT HE CAN ALSO HOLD THE LTCL TO BE NOT ADJUSTABLE. FROM THIS POINT OF VIEW ALSO, THE JURISDICTION OF U/S. 263 DOES NOT EXIST. ON AN EARLIER OCCASION, THE AO ISSUED NOTICE U/S, 1 54/155 TO RECTIFY MISTAKE APPARENT FROM RECORD FOR DISALLOWING THE SET-OFF OF EARLIER YEAR' S LOSSES OF RS.40,31,675. IT WAS POINTED OUT THAT THIS DIFFERENCE OF OPINION IS NOT A MISTAKE AP PARENT FROM RECORD AND THE PROCEEDINGS WERE DROPPED. NOW, THE SAME DIFFERENCE OF OPINION IS BEI NG SOUGHT TO BE IMPOSED ON ASSESSEE IN THE NAME OF ERRONEOUS AND PREJUDICIAL PROCEEDINGS, WHICH IT IS NOT. ITA NO.699/KOL/2018 ASSESSMENT YEAR 2 012-13 BENGAL STEEL INDUSTRIES. LTD. VS ITO WD-11(3 ), KOL. PAGE 4 RELIANCE IS PLACED ON FOLLOWING: 1. G.K. RAMMURTHY V JCIT (ITAT-MUM) LONG TERM CAPITAL LOSS (LTCL) AS PER COMPUTATION AF TER CHARGING STT IS AN ADDITIONAL REASON FOR ALLOWING CARRY FORWARD & SET- OFF OF THIS LOSS AGAINST OTHER INCOME. 2. RAPTAKOS-BRETT CASE - ITAT ONLINE - ITAT MUMBA I. HOPE, YOU WILL FIND THE AFORESAID IN ORDER.' 4. THE SUBMISSION OF THE ID. AIR OF THE ASSESSEE CO NSIDERED. THE SUBMISSION OF THE ID. AIR OF THE ASSESSEE THAT THE LTCL ARISING FROM TRANSFER OF EQUITY SHARES/M.F. QUALIFYING U/S.10(38) CAN BE ADJUSTED FROM L TCG OF SAME YEAR OR CAN BE C ARRIED FORWARD & SET-OFF AGAINST LTCG OF FUTURE YEARS IS NOT TENABLE. IN THIS REGARD SUBM ISSION OF ASSESSEE RELYING UPON THE VARIOUS JURIDICAL PRONOUNCEMENT IS NOT APPLICABLE IN THIS P ARTICULAR ISSUE AS THE SAME ARE PRIMA FACIE DISTINGUISHABLE ON FACTS. THE EXEMPTED L TCL CANNOT BE CARRIED FORWARD AND THEIR SETTING OFF WITH CURRENT YEAR'S LTCG DOES NOT APPEAR TO BE PRIM A FACIE ALLOWABLE. HOWEVER, THE AO FAILED TO THE EXAMINE THIS ISSUE WHILE PASSING THE ORDER U/S 147/143(3) OF THE ACT. THE FINAL APPLICATION OF JUDICIAL PRONOUNCEMENTS WILL COME IN TO PLAY ONLY AFTER ASCERTAINING THE FULL FACTS REGARDING NATURE AN GENUINENESS OF TRANSACTIO N WHICH THE A. AS FAILED TO DO DURING THE ASSESSMENT PROCEEDINGS. THE PLEA OF THE ID. AIR COU LD ALSO BE JUDICIALLY EXAMINED ONLY AFTER EXAMINATION/VERIFICATION OF RELEVANT MATERIAL FACTS . THUS, THE ORDER PASSED U/S 147/143(3) OF THE INCOME TAX ACT, 1961 ON 16-03-2016 SUFFERS FROM LACK OF ENQUIRY/INADEQUATE VERIFICATION MAKING THE ORDER PASSED U/S 147/143(3) OF THE INCOM E TAX ACT, 1961 ERRONEOUS SO FAR AS PREJUDICIAL TO THE INTEREST OF REVENUE. PRIMA-FACIE ON THE WHOLE THE ASSESSMENT ORDER SUFFERS FROM LACK OF ENQUIRY ON THE ABOVE MENTIONED GROUND. 5. THE POWER OF REVISION BY THE CIT U/S 263 OF THE ACT IS VERY WIDE AND IT IS IN THE NATURE OF SUPERVISORY JURISDICTION. THE POWER U/S 263 CAN BE EXERCISED EVEN IN CASES WHERE THE ISSUE IS DEBATABLE AND SUCH POWER IS NOT COMPARABLE WITH THE POWER OF RECTIFICATION OF MISTAKE U/S 154 OF THE INCOME TAX ACT. IT IS WELL SETTLED THAT INCO RRECT ASSUMPTION OF FACTS OR APPLICATION OF LAW SATISFIES THE REQUIREMENT OF LAW I.E. ORDER BEI NG ERRONEOUS & PREJUDICIAL TO THE INTEREST OF REVENUE. THE ORDER PASSED BY THE A.O. WITHOUT APPLI CATION OF MIND OR ORDER SHOWING APPARENT ERROR OF REASONING OR THE ORDER WHERE THE A.O SIMPL Y ACCEPTS WHERE THE ASSESSEE STATED IN HIS RETURN OF INCOME AND FAILS TO MAKE THE ENQUIRIES WH ICH ARE CALLED FOR IN THE FACTS AND CIRCUMSTANCES OF THE CASE WILL ALSO CALL FOR INTERV ENTION U/S 263 OF THE ACT BY THE CIT/PR.CIT. IT IS A TRITE LAW THAT THE DISCLOSURE OF FACTS BY T HE ASSESSEE IN THE RETURN OF INCOME AND / OR IN THE COURSE OF ASSESSMENT PROCEEDINGS CANNOT GIVE IM MUNITY FROM REVISIONAL JURISDICTION OF THE CIT/PR.CIT U/S 263. IN THIS CONTEXT, IT MAY BE MENT IONED HERE THAT IN THE CASE OF COMMISSIONER OF INCOME TAX, CENTRAL-L KOLKATA VS MA ITHAN INTERNATIONAL, IT WAS HELD BY CALCUTTA HIGH COURT [2015] 56 TAXMANN.COM 283(CALCU TTA) THAT 'IT IS NOT THE LAW THAT THE ASSESSING OFFICER OCCUP YING THE POSITION OF AN INVESTIGATOR AND ADJUDICATOR CAN DISCHARGE HIS FUNCTION BY PERFU NCTORY OR INADEQUATE INVESTIGATION. SUCH A COURSE IS BOUND TO RESULT IN ERRONEOUS AND P REJUDICIAL ORDER. WHERE THE RELEVANT ENQUIRY WAS NOT UNDERTAKEN, AS IN THE CASE , THE ORDER IS ERRONEOUS AND PREJUDICIAL TOO AND THEREFORE REVISABLE. INVESTIGAT ION SHOULD ALWAYS BE FAITHFUL AND FRUITFUL. UNLESS ALL FRUITFUL AREAS OR ENQUIRY ARE PURSUED THE ENQUIRY CANNOT BE SAID TO HAVE BEEN FAITHFULLY CONDUCTED. ' THE HON'BLE SUPREME COURT, FURTHER, IN THE CASE OF RAMPYARI DEVI SARAOGI-VS- CIT(1968) 67 ITR 87(SC) AND SMT. TARA DEVI AGGARWAL-VS-CIT(1973) 85 ITR 323 (SC) HAS HELD THAT IN ABSENCE OF PROPER ENQUIRIES, THE ASSESSMENT ORDER W OULD BECOME ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE. ITA NO.699/KOL/2018 ASSESSMENT YEAR 2 012-13 BENGAL STEEL INDUSTRIES. LTD. VS ITO WD-11(3 ), KOL. PAGE 5 THE HON'BLE DELHI HIGH COURT IN THE CASE OF GEE VEE ENTERPRISE-VS-ADDL. CIT(1975) 99 ITR 375 HAS ALSO HELD AS UNDER:- 'THE REASON IS OBVIOUS. THE POSITION AND FUNCTION O F THE INCOME TAX OFFICER IS VERY DIFFERENT FROM THAT OF A CIVIL COURT. THE STATEMENT S MADE IN A PLEADING PROVED BY THE MINIMUM AMOUNT OF EVIDENCE MAY BE ACCEPTED BY A CIV IL COURT IN THE ABSENCE OF REBUTTAL. THE CIVIL COURT IS NEUTRAL. IT SIMPLY GIV ES DECISION ON THE BASIS OF PLEADING AND EVIDENCE WHICH COMES BEFORE IT. THE INCOME TAX OFFICER IS NOT ONLY AN ADJUDICATOR BUT ALSO AN INVESTIGATOR. HE CANNOT REMAIN PASSIVE IN THE FACE OF RETURN WHICH IS APPARENTLY IN ORDER BUT CALLS FOR FURTHER ENQUIRY. IT IS HIS DUTY TO ASCERTAIN THE TRUTH OF FACTS STATED IN THE RETURN WHEN THE CIRCUMSTANCES O F CASE ARE SUCH AS TO PROVOKE AN ENQUIRY. THE MEANING TO BE GIVEN TO THE WORD ' ERRONEOUS ' IN SECTION 263 EMERGES OUT OF THIS CONTEXT. IT IS BECAUSE IT IS INCUMBENT ON THE INCOME TAX OFFICER TO FURTHER SUCH AN ENQUIRY PRUDENT THAT THE WORD ' ERRONEOUS ' IN SECTION 263 INCLUDES THE FAILURE TO MAKE SUCH AN ENQUIRY. THE ORDER BECOMES ERRONEOU S BECAUSE SUCH AN ENQUIRY HAS NOT BEEN AND NOT BECAUSE THERE IS ANYTHING WRONG WI TH THE ORDER IF ALL THE FACTS STATED THEREIN ARE ASSUMED TO BE CORRECT. ' IN VIEW OF THE FACTS AND THE LEGAL POSITION STATED ABOVE, I AM OF THE VIEW THAT THE ORDER PASSED ON AN INCORRECT ASSUMPTION OF FACTS OR INCORRECT AP PLICATION OF LAW AND WITHOUT MAKING REQUISITE INQUIRIES WILL SATISFY THE REQUIREMENT OF THE ORDER BEING ERRONEOUS AND PRE-JUDICIAL TO THE INTEREST OF THE REVENUE WITHIN THE MEANING AND SCOPE OF SECTION 263 OF THE INCOME TAX ACT, 1961. THE AFORESTATED DECISIONS POSTULATE THAT WHEN THE O FFICER IS EXPECTED TO MAKE AN INQUIRY OF A PARTICULAR ITEM OF INCOME AND IF HE DOES NOT MAKE A N INQUIRY AS EXPECTED, THAT WOULD BE A GROUND FOR THE COMMISSIONER TO INTERFERE WITH THE O RDER PASSED BY THE OFFICER SINCE SUCH AN ORDER PASSED BY THE OFFICER IS ERRONEOUS AND PREJUD ICIAL TO THE INTERESTS OF THE REVENUE ( K.A. RAMASWAMY CHETTIAR V. CIT , (1996) 220 ITR 657). 6. I HAVE CAREFULLY CONSIDERED THE MATERIAL AVAILAB LE ON RECORD AND FOUND THAT THE ISSUES POINTED OUT IN THE SHOW CAUSE NEEDS VERIFICATION AS MERELY ACCEPTING SUBMISSION WITHOUT CALLING FOR RELEVANT MATERIAL / EVIDENCES DURING TH E COURSE OF ASSESSMENT PROCEEDINGS THE A.O. FAILED TO EXAMINE THE ABOVE REFERRED ISSUE. AFTER H AVING CONSIDERED THE POSITION OF LAW AND FACTS AND CIRCUMSTANCES OF THE INSTANT' CASE, I AM OF THE CONSIDERED OPINION THAT THE ASSESSMENT ORDER PASSED BY THE A.O. IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTEREST OF REVENUE IN ACCORDANCE WITH THE EXPLANATION 2(C) BEL OW SECTION 263(1) OF THE ACT. ACCORDINGLY, THE ISSUE IS SET ASIDE TO THE TABLE OF A.O ON SPECIFIC POINT MENTIONED IN PARA 2 ABOVE. THE A.O. IS DIRECTED TO PROVIDE REASONABLE O PPORTUNITY TO THE ASSESSEE COMPANY TO PRODUCE DOCUMENTS & EVIDENCES WHICH IT MAY CHOOSE T O RELY UPON FOR SUBSTANTIATING ITS OWN CLAIM. THEREAFTER A FRESH ASSESSMENT ORDER MAY BE P ASSED IN ACCORDANCE WITH THE RELEVANT PROVISIONS OF TAW. 4. LEARNED AUTHORIZED REPRESENTATIVE VEHEMENTLY CON TENDED DURING THE COURSE OF HEARING THAT THE PCIT HAS ERRED IN LAW AND ON FACTS IN ASSUMING HIS REVISION JURISDICTION FOR THE PURPOSE OF HOLDING THE ABOVE R EGULAR ASSESSMENT / RE-ASSESSMENT AS ERRONEOUS CAUSING PREJUDICE TO THE INTEREST OF THE REVENUE ON THE SOLE ISSUE OF THE SET OFF LONG TERM CAPITAL LOSS (LTCL) PERTAINING TO ASS ESSMENT YEARS 2005-06, 2010-11 & 2011-12; RESPECTIVELY. HIS FURTHER CASE IS THAT SUC H LTCL IS ARISING OUT OF TRANSFER OF ITA NO.699/KOL/2018 ASSESSMENT YEAR 2 012-13 BENGAL STEEL INDUSTRIES. LTD. VS ITO WD-11(3 ), KOL. PAGE 6 SHARES AND SECURITIES; AFTER PAYMENT OF SECURITIES TRANSACTION TAX (STT), IS VERY WELL ALLOWABLE TO BE CARRIED FORWARD AS PER THIS TRIBUNA LS CO-ORDINATE BENCHS DECISION IN M/S UNITED INVESTMENTS VS. ACIT, CIRCLE-40, KOLKATA ITA NO.511/KOL/2017 DECIDED ON 01.07.2019. HIS PLEA CASE THEREFORE IS THAT THE IMPUGNED REGULAR ASSESSMENT FRAMED BY ALLOWING THE ASSESSEES BENEFIT OF SET OFF LONG TERM CAPITAL LOSS(ES) DESERVES TO BE RESTORED. 5. LEARNED CIT-DR HAS STRONGLY SUPPORTED THE PCITS REVISION DIRECTION UNDER CHALLENGE THAT THE ASSESSING OFFICER HAD ERRED IN A LLOWING THE IMPUGNED SET OFF OF LTCL PERTAINING TO FOREGOING THREE ASSESSMENT YEAR( S) (SUPRA) WHICH IS NOT ALLOWABLE UNDER THE PROVISION OF THE ACT. 6. WE HAVE HEARD THE FOREGOING RIVAL CONTENTIONS. C ASE FILE PERUSED. AFTER GIVING OUR THOUGHTFUL CONSIDERATION TO ASSESSEE AND REVENU ES AGAINST AND IN FAVOUR OF CORRECTNESS OF PCITS IMPUGNED REVISION JURISDICTIO N, WE FIND NO MERIT IN ASSESSEES GRIEVANCE. THERE CAN HARDLY BE ANY DISPUTE ABOUT TH E LEGAL PROPOSITION FLOWING FROM VARIOUS JUDICIAL PRECEDENTS DISCUSSED IN THE PCITS REVISION ORDER UNDER CHALLENGE (SUPRA) THAT AN ASSESSMENT HAS TO BE BOTH ERRONEOUS AS WELL AS CAUSING PREJUDICE TO THE INTEREST OF THE REVENUE BEFORE SEC.263 REVISION JUR ISDICTION IS INVOKED. COMING TO THE RELEVANT FACTS INVOLVED IN THE INSTANT LIS, WE NOTE THAT ALTHOUGH THE ASSESSEES RETURNS OF INCOME ASSESSMENT YEAR(S) 2005-06, 2010-11 AND 2 011-12 HAD STATED LTCL OF 20,46,281, 5,38147/- AND 14,47,241/-, THE CORRESPONDING SEC. 143(3) ASSESSME NT DATED 28.12.2007 HAD TAKEN THE LOSS FIGURE AS NIL I N THE ASSESSMENT YEAR AND THE LATTER TWO ASSESSMENT YEAR(S) RETURNS HAD BEEN SUMMARILY P ROCESSED ON 27.07.2011 AND 21.02.2012 U/S 143(1) OF THE ACT, WE OBSERVE IN THI S BACKDROP OF FACTS THAT THE IMPUGNED LTCL STOOD REDUCED TO THE EXTENT OF 19,85,394/- ONLY WHEREAS THE RELIEF GRANTED TO THE ASSESSEE DURING THE COURSE OF RE-ASS ESSMENT READ AN AMOUNT OF 40,31,675/-. WE THUS ARE OF THE VIEW THAT THE PCIT HAS RIGHTLY EXERCISED HIS SEC. 263 REVISION JURISDICTION FOLLOWED BY HIS DIRECTIONS UN DER CHALLENGE TO THE ASSESSING OFFICER FOR FINALIZING THE IMPUGNED COMPUTATION AFR ESH AS PER LAW. THE SAME STANDS AFFIRMED THEREFORE. SUFFICE TO SAY, THE ASSESSING O FFICERS CONSEQUENTIAL ASSESSMENT ITA NO.699/KOL/2018 ASSESSMENT YEAR 2 012-13 BENGAL STEEL INDUSTRIES. LTD. VS ITO WD-11(3 ), KOL. PAGE 7 SHALL BE FRAMED AFTER AFFIRMING ADEQUATE OPPORTUNIT Y OF HEARING TO THIS TAXPAYER WHO SHALL BE AT LIBERTY TO RAISE ALL FACTUAL & LEGAL PL EAS IN SUPPORT OF THE IMPUGNED LTCL SET OFF CLAIM. 7. THIS ASSESSEES APPEAL IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 22/01/2020 SD/- SD/- ( ') () ') (J.SUDHAKAR REDDY) (S.S.GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER *DKP-SR.PS * - 22/01/2020 / KOLKATA / COPY OF ORDER FORWARDED TO:- 1. /APPELLANT-BENGAL STEEL INDUSTRIES LTD., 84/1A, TOP SIA ROAD,(S) KOL-46 2. /RESPONDENT-ITO WD-11(3), P-7, AAYKAR BHAWAN, KOLKA TA-700 069 3. - . / CONCERNED CIT 4. . - / CIT (A) 5. / ))- , - /DR, ITAT, KOLKATA 6. 3 / GUARD FILE. BY ORD ER/ , /TRUE COPY/ -,