Shri Satya Prasad Gorti, Hyderabad V. The Asst. CIT, Circle-3(1), Hyderabad

ITA 707/HYD/2013

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 2496 (ITAT-HYDERABAD)
• Duration Of Justice: 4 year(s) 5 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-10-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 27-06-2017
• Assessment Year: 2008-2009
• Appeal Filed On: 10-05-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: P CHANDRA SEKHAR
• Assessee Lawyers: D V ANJANEYULU
• Keywords: Charitable institution; Principle of natural justice; Difference of opinion; Assessment record; Change of opinion
• Section: 143(3); 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B, HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER ITA NO. 707/HYD/2013 ASSESSMENT YEAR: 2008-09 SATYA PRASAD GORTHI, HYDERABAD. PAN ADBPG 9020G VS. ASST. COMMISSIONER OF INCOME-TAX, CIRCLE 3(1), HYDERABAD. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI D.V. ANJANEYULU REVENUE BY : SHRI P. CHANDRASEKHAR DATE OF HEARING : 06-10-2017 DATE OF PRONOUNCEMENT : 25-10-2017 O R D E R PER S. RIFAUR RAHMAN, A.M.: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME-TAX - III, HY DERABAD, DATED 23-12-2016 FOR AY 2013-14, PASSED U/S 263 OF THE AC T. 2. BRIEFLY THE FACTS OF THE CASE ARE THAT THE ASSES SEE FILED HIS RETURN OF INCOME ADMITTING TOTAL INCOME OF RS. 1,15 ,304 AND AGRICULTURAL INCOME OF RS. 51,200/-. THE AO AFTER S CRUTINIZING THE CASE, HAD COMPLETED THE ASSESSMENT U/S 143(3) ON 22 /11/2010 BY ACCEPTING THE INCOME RETURNED. 3. THEREAFTER, THE CIT, BY VIRTUE OF POWERS VESTED IN HIM U/S 263 OF THE ACT, CALLED FOR THE ASSESSMENT RECORD OF THE AS SESSEE FOR AY 2008-09 AND EXAMINED. AFTER EXAMINING THE RECORD, H E NOTICED THE FOLLOWING ISSUES: 2 ITA NO. 707/H/13 SATYA PRAKASH GORTHI (I) IT WAS NOTICED THAT THE ASSESSEE HAD MADE CASH DEPOSITS EXCEEDING RS.10 LAKHS IN A SAVINGS BANK A/C MAINTAI NED WITH, BANK OF INDIA AND CANARA BANK. AIR DATA PERTAINING TO THE ASSESSEE MENTIONED CASH DEPOSITS TO THE TUNE OF RS. 15,89,748. DURING THE COURSE OF ASSESSMENT, THE ASSESSING OFFI CER HAD NEITHER CALLED FOR COPIES OF THE BANK ACCOUNTS NOR CARRIED OUT ANY ENQUIRY REGARDING THE SOURCE OF SUCH CASH DEPOS ITS. (II) IN THE BALANCE SHEET AS ON 31.3.2008, A BUILDI NG AT VIJAYAWADA WAS SHOWN AT RS.6,00,000 BUT THE ASSESSE E HAS NOT OFFERED ANY RENTAL INCOME. THE ASSESSING OFFICER HA S ALSO DETERMINED ALV IN RESPECT OF THE HOUSE PROPERTY SIT UATED AT VIJAYAWADA. (III) VERIFICATION OF THE BALANCE SHEET AS ON 31/03 /2007 & 31/03/2008 REVEALED THE FRESH INVESTMENT IN SHARES BY THE ASSESSEE AT RS. 18,05,000. THE ASSESSING OFFICER HA S FAILED TO EXAMINE THE SOURCES FOR INVESTMENT IN SHARES AND GA INS FROM SALE OF SHARES, IF ANY. (IV) IT WAS NOTICED THAT AS PER THE STATEMENT OF AF FAIRS FILED BY THE ASSESSEE AS ON 31.3.2007, THERE WAS AN ADVANCE GIVEN AMOUNTING TO RS.13,00,000. THE STATEMENT OF AFFAIRS AS ON 31.3.2008 DOES NOT REFLECT THIS ADVANCE, WHICH THE ASSESSING OFFICER HAS FAILED TO ENQUIRE INTO. 3.1 IN VIEW OF THE ABOVE, THE CIT OBSERVED THAT THE AO FAILED TO CALL FOR THE DETAILS REGARDING THE ABOVE ISSUES AND HE, THEREFORE, CONSIDERED THE ASSESSMENT PASSED FOR AY 2008-09 IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTERESTS OF REVENU E. ACCORDINGLY, A NOTICE U/S 263 DATED 18/01/2013 WAS ISSUED TO THE A SSESSEE CALLING UPON HIM TO SHOW CAUSE AS TO WHY THE SAID ASSESSMEN T ORDER SHOULD NOT BE REVISED U/S 263 OF THE IT ACT IN VIEW OF THE ABOVE ISSUES. IN RESPONSE, THE ASSESSEE FILED WRITTEN SUBMISSIONS. 3.2 THE CIT AFTER CONSIDERING THE WRITTEN SUBMISSIO NS OF THE ASSESSEE, OBSERVED, INTER-ALIA, THAT THE ASSESSEE H AD DEPOSITED OVER RS. 19 LAKHS IN HIS BANK ACCOUNTS AND HAD ALSO CLAI MED TO HAVE RECEIVED A LOAN OF RS. 9.50 LAKHS FROM ONE SMT. M.V . RAJYALAKSHMI. THE SOURCE OF CASH, AS CLAIMED BY THE ASSESSEE HAD BEEN DISCUSSED AND IT WAS ALSO NOTICED THAT NO ENQUIRIES HAD BEEN CARRIED OUT BY THE 3 ITA NO. 707/H/13 SATYA PRAKASH GORTHI AO IN THIS REGARD. HE, THEREFORE, CONSIDERING THE A SSESSMENT ORDER PASSED BY THE AO AS ERRONEOUS AND PREJUDICIAL TO TH E INTERESTS OF REVENUE, SET ASIDE THE ASSESSMENT ORDER TO AO WITH A DIRECTION TO REFRAME THE ASSESSMENT ORDER AFTER CARRYING OUT NEC ESSARY ENQUIRIES ON THE LINES MENTIONED IN RESPECT OF VARIOUS AMOUNT S WHICH THE ASSESSEE HAD CLAIMED TO HAVE RECEIVED EITHER IN CAS H OR IN CHEQUE AS LOAN. 4. AGGRIEVED BY THE ORDER OF CIT, THE ASSESSEE IS I N APPEAL BEFORE US RAISING THE FOLLOWING GROUNDS OF APPEAL: 01. THE ORDER PASSED U/S 263 IS ERRONEOUS IN LAW CO NTRARY TO THE FACTS, PROBABILITIES OF THE CASE AND AGAINST TH E PRINCIPLES OF EQUITY AND NATURAL JUSTICE. 02. THE COMMISSIONER INVOKING THE PROVISIONS OF SEC 263 THAT THE ORDER PASSED BY THE AO U/S 143(3) IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE O N THE SIMPLE REASON ALLEGING THAT THE AO FAILED TO CALL FOR DETA ILS WITH REGARD TO THE ISSUES RAISED U/S 263 AND NOT EXAMINING THE SAME WHICH IS IN CORRECT AS HE COMPLETED THE ASSESSMENT AFTER ISSUING NOTICE U/S 143(2), AFTER VERIFICATION OF DOCUMENTS FURNISHED IN SUPPORT OF STATEMENT OF AFFAIRS ACCOMPANIED TO RETU RN OF INCOME WHICH CLEARLY DEPICTS THE ISSUES RAISED BY T HE COMMISSIONER. THEREFORE INVOCATION OF PROVISIONS OF SECTION 263 IS TOTALLY UNJUSTIFIED AND UNWARRANTED BOTH IN LAW AND FACTS. 03. THE CIT RELIED ON IRRELEVANT CASE LAW I.E., DAG A ENTRADE 327 ITR 467 (GAU) WHERE THE APPRAISAL REPORT WHICH IS O N RECORD WAS NOT DULY CONSIDERED BY AO AND APPLYING THE ABOV E CASE LAW INVOKING THE SECTION 263 IS LEGALLY INCORRECT A S THE AO AFTER FULL SATISFACTION TOWARDS THE TRANSACTIONS DISCLOSE D IN STATEMENT OF AFFAIRS ON WHICH THE CIT INVOKED THE PROVISIONS OF SEC 263, COMPLETED THE ASSESSMENT. THEREFORE IT IS NOTHING B UT CHANGE OF OPINION. 04. THE CIT IGNORED THE VERY SETTLED PROPOSITION WH ERE IN THE ORDER PASSED BRIEFLY AFTER THE CONSIDERING THE DOCU MENTARY EVIDENCE IS NOT SUFFICIENT REASON TO BRAND THE ASSE SSMENT ORDER AS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REV ENUE AS HELD IN THE CASES OF I) CIT V. GOYAL PRIVATE FAMILY SPECIFIC TRUST, (199 8) 171 ITR 698, 701-02 (ALL) 4 ITA NO. 707/H/13 SATYA PRAKASH GORTHI II) CIT V. TRUSTEES OF ANUPAM CHARITABLE TRUST, (19 87) 167 ITR 129 (RAJ) III) MALABAR INDUSTRIAL CO. LTD V. CIT, (2000) 243 ITR 83, 87(SC) IV) CIT V. SESHASAYEE PAPER & BOARDS LTD., (2000) 2 42 ITR 490,500 (MAD) 05. THE APPELLANT CRAVE TO SUBMIT THAT ALL THE FACT S, CONTENTIONS AND CASE LAWS MENTIONED IN THE STATEMENT OF FACTS ACCOMPANIED THESE GROUNDS SHALL BE TREATED AS 'PART AND PARCEL OF THESE GROUNDS AND SHALL BE DEALT WITH. 06. F OR THESE AND OTHER GROUNDS THAT MAY BE URGED AT THE TIME OF HEARING, THE APPELLANT PRAYS THE HONORABLE INCOM E TAX APPELLATE TRIBUNAL TO KINDLY SET ASIDE THE ORDER PA SSED U/S 263 OF THE ACT. 5. BEFORE US, THE LD. AR OF THE ASSESSEE SUBMITTED THAT THE ASSESSMENT WAS COMPLETED U/S 143(3). AFTER CAREFUL EXAMINATION TOWARDS THE DEPOSITS IN THE BANK WHICH WERE OUT OF RECEIPT OF THE PREVIOUS ADVANCES GIVEN WHICH IN TURN REFLECTS DULY IN THE STATEMENT OF AFFAIRS AND WHEREIN THE OPENING BALANCE AND CLOS ING BALANCE OF BANK AND CASH DULY TALLIED WITH MATERIAL EVIDENCE. HE SUBMITTED THAT THE AO HAS CONSIDERED THE PREVIOUS ASSESSMENT YEAR AND THIS ASSESSMENT YEAR WHERE THE HOUSE PROPERTY WAS SHOWN AS SELF OCCUPIED. HE SUBMITTED THAT THE INVESTMENT IN SHARE S OF RS. 18,05,000/- WERE MADE BY CHEQUE OF RS. 9,00,000/- A ND BY CASH OF RS. 9,05,000/- AND THESE DETAILS WERE FURNISHED AND IS ON RECORD BEFORE AO. RS. 13,00,000/- WAS RECEIVED DURING THE A.Y. 2008-09 WHICH CLEARLY REFLECTS IN THE STATEMENT OF AFFAIRS AS ON 31-03-2007. 5.1 LD. AR SUBMITTED THAT THE AO HAS COMPLETED THE ASSESSMENT AFTER DUE CONSIDERATION OF MATERIAL SUBMITTED BEFOR E HIM AND HE HAS COMPLETED THE ASSESSMENT AFTER APPLYING HIS MIND AN D DUE CONSIDERATION WITHIN HIS POWERS. THE ASSESSMENT WAS COMPLETED ONLY AFTER GIVING SUFFICIENT OPPORTUNITY AND SUFFICIENT HEARING, CONSIDERING THE MATERIALS AND ON PERSONAL HEARINGS ON 10-11-201 0 AND 12-11- 2010. 5 ITA NO. 707/H/13 SATYA PRAKASH GORTHI 5.2 THE LD. AR SUBMITTED THAT THE COMMISSIONER'S IS OF THE VIEW THAT THE AO FAILED TO CALL FOR THE DETAILS REGARDING THE ABOVE ISSUES AND TAX IMPLICATIONS THEREIN IGNORING THE FACT THAT THE AO COMPLETED THE ASSESSMENT U/S 143(3) AFTER BEING FULLY SATISFIED W ITH THE DETAILS FURNISHED AND DATA AVAILABLE ON RECORD. THE COMMISS IONER INVOKED SEC 263 ON THE SIMPLE REASON THAT THE ABOVE ISSUES ARE NOT DISCUSSED IN THE ASSESSMENT ORDER. HE SUBMITTED THAT UNDER TH E PROVISIONS OF THE ACT, THE AO IF SATISFIED IN HIS CONSIDERED OPIN ION, NO NEED TO BRING THE ISSUES IN THE ORDER PASSED BECAUSE THE SATISFAC TION AND APPLICATION OF MIND IS SUFFICIENT. 5.3 LD. AR CONTENDED THAT THE COMMISSIONER RELIED O N IRRELEVANT CASE LAW WHEREIN THE AO COMPLETELY FAILED TOWARDS V ERIFICATION OF CONTENTS OF APPRAISAL REPORT AVAILABLE ON RECORD, N OT APPLYING HIS MIND, WHEREAS IN ASSESSEES CASE THERE IS NO SUCH A PPRAISAL REPORT OR DOCUMENTS WHICH REVEAL ANY ISSUES FOR THE PURPOSE O F ASSESSMENT PROCEEDINGS SINCE THE ENTIRE EVIDENCE SUPPORTING TH E STATEMENT OF AFFAIRS WHICH RELIED BY THE COMMISSIONER IS AVAILAB LE ON RECORD AT THE TIME OF ASSESSMENT PROCEEDINGS. THIS TANTAMOUNT TO CHANGE OF OPINION AND THEREFORE UNDER THE PROVISIONS OF LAW T HE ORDER PASSED U/S 143(3) IS NOT ERRONEOUS IN LAW IN SO FAR AS PRE JUDICIAL TO INTEREST OF REVENUE. 5.4 LD. AR SUBMITTED THAT A BARE READING OF SECTION 263(1) MAKES IT CLEAR THAT THE PRE-REQUISITE TO EXERCISE OF JURISDI CTION BY THE COMMISSIONER SUO MOTU UNDER IT, IS THAT THE ORDER O F THE AO IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INT ERESTS OF THE REVENUE. HE, THEREFORE, SUBMITTED THAT THE COMMISSIONER HAS TO BE SATISFIED WITH TWIN CONDITIONS, NAMELY, I) THE ORDER OF THE A O SOUGHT TO BE REVISED IS ERRONEOUS; AND (II) IT IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE. IF ONE OF THEM IS ABSENT IF THE ORDER OF THE AO IS ERRONEOUS BUT IS NOT PREJUDICIAL TO THE REVENUE OR IF IT IS NOT ERRONEOUS BUT IS 6 ITA NO. 707/H/13 SATYA PRAKASH GORTHI PREJUDICIAL TO THE REVENUE - RECOURSE CANNOT BE HAD TO SECTION 263 (1) [MALABAR INDUSTRIAL CO. LTD V. CIT, (2000) 243 ITR 83, 87(SC).] THUS, HE SUBMITTED THAT THERE CAN BE NO QUARREL OVER THE PROPOSITION OF LAW THAT THE TWIN CONDITIONS PRESCRIBED IN SECTION 263, VIZ., THE ORDER MUST BE ERRONEOUS AND PREJUDICIAL TO THE INTERESTS OF TH E REVENUE, SHOULD BE SATISFIED. FOR THIS PROPOSITION, HE RELIED ON TH E DECISION IN THE CASE OF CIT V. SESHASAYEE PAPER & BOARDS LTD., (2000) 24 2 ITR 490, 500 (MAD). 5.5 THE LD. AR SUBMITTED THAT THE ORDERS OF THE ASS ESSING OFFICER MAY BE BRIEF AND CRYPTIC, BUT THAT BY ITSELF IS NOT SUFFICIENT REASON TO BRAND THE ASSESSMENT ORDERS AS ERRONEOUS AND PREJUD ICIAL TO THE INTERESTS OF THE REVENUE. WRITING AN ORDER IN DETAI L MAY BE A LEGAL REQUIREMENT, BUT THE ORDER NOT FULFILLING THIS REQU IREMENT, CANNOT BE SAID TO BE ERRONEOUS AND PREJUDICIAL TO THE INTERES T OF THE REVENUE. THE COMMISSIONER HAVING FAILED TO POINT OUT ANY ERR OR, NO ERROR CAN BE INFERRED FROM THE ORDERS OF THE ASSESSING OFFICER F OR THE SIMPLE REASON THAT THEY ARE BEREFT OF DETAILS. IF THE ORDER IS NO T ERRONEOUS, THEN IT CANNOT BE PREJUDICIAL TO THE INTERESTS OF THE REVEN UE. FOR THIS PROPOSITION, HE RELIED ON THE DECISION IN THE CASE OF CIT V. GOYAL PRIVATE FAMILY SPECIFIC TRUST, (1998) 171 ITR 698, 701-02 (ALL) 5.6 HE SUBMITTED THAT THE ERROR ENVISAGED BY SECTIO N 263 IS NOT ONE WHICH DEPENDS ON POSSIBILITY OR GUESSWORK, BUT IT S HOULD BE ACTUALLY AN ERROR EITHER OF FACT OR OF LAW. FOR THIS PROPOSI TION, HE RELIED ON THE DECISION IN THE CASE OF CIT V. TRUSTEES OF ANUPARN CHARITABLE TRUST, (1987) 167 ITR 129 (RAJ). 5.7 REFERRING TO THE ABOVE PROPOSITIONS, LD. AR SUB MITTED THAT THE VERY ISSUE OF NOTICE U/S 263 IS LEGALLY INVALID. 6. LD. DR, ON THE OTHER HAND, RELIED ON THE ORDER O F CIT. HE SUBMITTED THAT ASSESSMENT RECORDS ARE CALLED FOR AN D ON VERIFICATION, 7 ITA NO. 707/H/13 SATYA PRAKASH GORTHI THERE IS NO EVIDENCE THAT THE ASSESSEE HAS ACTUALLY FILED ANY RELEVANT MATERIAL EXCEPT STATEMENT OF AFFAIRS, WHICH WILL IN DICATE THAT AO HAS VERIFIED THE RELEVANT ISSUES AND APPLIED HIS MIND B EFORE COMPLETING THE ASSESSMENT. HE FURTHER SUBMITTED THAT THIS CASE WAS SELECTED FOR SCRUTINY BECAUSE OF AIR REPORT, AS PER WHICH, ASSES SEE HAS DEPOSITED CASH MORE THAN RS. 10 LAKHS. THE CLEAR DIRECTION TO AO AS PER INTERNAL DIRECTIONS ARE TO EXAMINE THE SOURCES OF EXPENDITUR E AND INVESTMENTS. HE SUBMITTED THAT THE AOS RECORD DOES NOT SHOW ANY EVIDENCE OF SUCH EXAMINATION. HE SUBMITTED THAT AO HAS NOT APPLIED HIS MIND WITHOUT ANY PROPER EVIDENCE PLACED BEFORE HIM. IN THE GIVEN CASE, CIT IS JUSTIFIED IN INVOKING REVISIONARY POWE RS DUE TO THE FACT THERE IS NO ENQUIRY MADE BY THE AO, IT AMOUNTS TO O RDER AS ERRONEOUS AND PREJUDICIAL TO THE INTERESTS OF REVENUE. ACCORD INGLY, HE PLACED RELIANCE ON THE FOLLOWING DECISIONS: 1. CIT VS. AMITABH BACHCHAN, [2016] 384 ITR 200 (S C) 2. JEEVAN INVESTMENT & FINANCE (P) LTD. VS. CIT, 2 91 CTR 241 3. CIT VS. ALLOY STEELS, [2013] 359 ITR 355 (KAR.) 7. CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL FACTS ON RECORD. THE GROUND NO. 1 IS THE ONLY EFFECTIVE G ROUND OF THE ASSESSEE AND OTHER GROUNDS ARE ARGUMENTATIVE IN NAT URE. HENCE, EXCEPT GROUND NO. 1, ALL OTHER GROUNDS ARE NOT REQU IRED TO BE ADJUDICATED AS THEY ARE ARGUMENTATIVE, WHICH WAS DU LY ACCEPTED BY LD. AR. 7.1 THE BENCH HAS DIRECTED LD. DR TO VERIFY THE REC ORDS OF ASSESSMENT AND WHETHER THE ASSESSEE HAS SUBMITTED T HE REQUIRED INFORMATION RELATING TO THE BANK DEPOSITS AND INVES TMENTS BEFORE COMPLETION OF THE ASSESSMENT. LD. DR BROUGHT TO OUR NOTICE THE ORDER SHEET OF ASSESSMENT AND THERE IS NO TRACE OF ANY IN FORMATION IN THE ASSESSMENT RECORD. ASSESSEE HAS SUBMITTED ONLY THE STATEMENT OF AFFAIRS FOR THE CURRENT AY. IT IS CLEARLY ESTABLISH ED THAT AO HAS NOT CALLED FOR ANY DETAILS RELATING TO THE CASH DEPOSIT S AND INVESTMENTS 8 ITA NO. 707/H/13 SATYA PRAKASH GORTHI MADE BY THE ASSESSEE. IT DOES CLEARLY INDICATE THAT THE AO HAS NOT MADE ANY ENQUIRY NOR APPLIED HIS MIND AND THERE WAS NO PROPER EVIDENCE ON RECORD. IN THIS CONNECTION, WE REFER TO THE RATIO LAID DOWN BY THE HONBLE KARNATAKA HIGH COURT IN THE CASE OF CIT VS. ALLOY STEELS (SUPRA), WHICH IS AS UNDER: AO HAD OBTAINED ALL INFORMATION OF LABOUR CHARGES, FELTING CHARGES AND MOULDING CHARGES AND FOUND THAT TDS PRO VISION WAS NOT APPLICABLE TO THESE EXPENSES. THEREFORE, REASON ING GIVEN BY CIT WAS JUST AND PROPER. ASSESSEE HAD STATED THAT T HERE WERE SMALL LABOURERS OR MACHINE REPAIRERS WHO WERE HIRED UNDER EMERGENT CONDITIONS AND PAYMENTS MADE TO THEM AND C ONTENDED THAT THESE ARE EXPENSES WHICH ARE REALLY INCURRED. HOWEVER, HE HAD NOT PRODUCED ANY VOUCHERS, RECEIPTS OR BILLS TO SHOW AMOUNT INCURRED. THIS SHOWS THAT THERE WAS NO APPLICATION OF MIND ON PART OF AO. SAID FACT WAS RIGHTLY TAKEN NOTE OF BY CIT A ND AO HAD NOT CONSIDERED SAME. THEREFORE, ITATS ORDER IS SET ASI DE AND MATTER IS REMANDED TO AO TO CONSIDER AFRESH. APPEAL ALLOWE D. 7.2 IN THE CASE OF AMITABH BACHCHAN (SUPRA), THE HO NBLE SUPREME COURT HAS HELD AS UNDER: IN THE COURSE OF THE REVISIONAL EXERCISE RELEVANT FACTS, DOCUMENTS, AND BOOKS OF ACCOUNT WHICH WERE OVERLOOKED IN THE ASSES SMENT PROCEEDINGS WERE CONSIDERED. ON SUCH RE-SCRUTINY IT WAS REVEALE D THAT THE ORIGINAL ASSESSMENT ORDER ON SEVERAL HEADS WAS ERRONEOUS AND HAD THE POTENTIAL OF CAUSING LOSS OF REVENUE TO THE STATE. IT IS ON THE AFORESAID BASIS THAT THE NECESSARY SATISFACTION THAT THE ASSESSMENT ORDER DA TED 30TH MARCH, 2004 WAS ERRONEOUS AND PREJUDICIAL TO THE INTERESTS OF T HE REVENUE WAS RECORDED BY THE LEARNED C.I.T. AT EACH STAGE OF THE REVISION AL PROCEEDING THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE HAD APPEA RED AND HAD FULL OPPORTUNITY TO CONTEST THE BASIS ON WHICH THE REVIS IONAL AUTHORITY WAS PROCEEDING/HAD PROCEEDED IN THE MATTER. IF THE REVI SIONAL AUTHORITY HAD COME TO ITS CONCLUSIONS IN THE MATTER ON THE BASIS OF THE RECORD OF THE ASSESSMENT PROCEEDINGS WHICH WAS OPEN FOR SCRUTINY BY THE ASSESSEE AND AVAILABLE TO HIS AUTHORIZED REPRESENTATIVE AT ALL T IMES IT IS DIFFICULT TO SEE AS TO HOW THE REQUIREMENT OF GIVING OF A REASONABLE OP PORTUNITY OF BEING HEARD AS CONTEMPLATED BY SECTION 263 OF THE ACT HAD BEEN BREACHED IN THE PRESENT CASE. THE ORDER OF THE LEARNED TRIBUNAL INSOFAR AS THE FIRST ISSUE I.E. THE REVISIONAL ORDER GOING BEYOND THE SHOW CAUSE NOTICE IS CONCERNED, THEREFORE, CANNOT HAVE OUR ACCEPTANCE. THE HIGH COU RT HAVING FAILED TO FULLY DEAL WITH THE MATTER IN ITS CRYPTIC ORDER DATED 7TH AUGUST, 2008 WE ARE OF THE VIEW THAT THE SAID ORDERS ARE NOT TENABLE AND A RE LIABLE TO BE INTERFERED WITH. PERMITTING EXERCISE OF REVISIONAL POWER IN A SITUAT ION 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 AC TION THAT MUST BE DESISTED FROM. HOWEVER, THE ABOVE IS NOT THE SITUATION IN TH E PRESENT CASE IN VIEW OF THE REASONS STATED BY THE LEARNED C.I.T. ON THE BAS IS OF WHICH THE SAID AUTHORITY FELT THAT THE MATTER NEEDED FURTHER INVES TIGATION, A VIEW WITH 9 ITA NO. 707/H/13 SATYA PRAKASH GORTHI WHICH SUPREME COURT WHOLLY AGREE. MAKING A CLAIM WH ICH WOULD PRIMA FACIE DISCLOSE THAT THE EXPENSES IN RESPECT OF WHICH DEDU CTION HAS BEEN CLAIMED HAS BEEN INCURRED AND THEREAFTER ABANDONING/WITHDRA WING THE SAME GIVES RISE TO THE NECESSITY OF FURTHER ENQUIRY IN THE INT EREST OF THE REVENUE. THE NOTICE ISSUED UNDER SECTION 69-C OF THE ACT COULD N OT HAVE BEEN SIMPLY DROPPED ON THE GROUND THAT THE CLAIM HAS BEEN WITHD RAWN. SUPREME COURT, THEREFORE, ARE OF THE OPINION THAT THE LEARN ED C.I.T. WAS PERFECTLY JUSTIFIED IN COMING TO HIS CONCLUSIONS INSOFAR AS T HE ISSUE NO.(III) IS CONCERNED AND IN PASSING THE IMPUGNED ORDER ON THAT BASIS. THE LEARNED TRIBUNAL AS WELL AS THE HIGH COURT, THEREFORE, OUGH T NOT TO HAVE INTERFERED WITH THE SAID CONCLUSION. IN THE LIGHT OF THE DISCUSSIONS THAT HAD PRECEDED A ND FOR THE REASONS ALLUDED SUPREME COURT WERE OF THE OPINION THAT THE PRESENT WAS A FIT CASE FOR EXERCISE OF THE SUO MOTU REVISIONAL POWERS OF THE L EARNED C.I.T. UNDER SECTION 263 OF THE ACT. THE ORDER OF THE LEARNED C. I.T., THEREFORE, WAS RESTORED AND THOSE OF THE LEARNED TRIBUNAL DATED 28 TH AUGUST, 2007 AND THE HIGH COURT DATED 7TH AUGUST, 2008 WERE SET ASIDE. T HE APPEAL OF THE REVENUE WAS ALLOWED. RESPECTFULLY FOLLOWING THE RATIOS LAID DOWN IN THE ABOVE CASES, WE UPHOLD THE ORDER OF THE CIT IN TREATING THE ASSESSM ENT ORDER AS ERRONEOUS AND PREJUDICIAL TO THE INTERESTS OF REVEN UE AND SET ASIDE THE CASE TO THE AO WITH A DIRECTION TO REFRAME THE ASSESSMENT ORDER AS DIRECTED IN CIT ORDER. THUS, THE GROUND RAISED B Y THE ASSESSEE IS DISMISSED. 8. IN THE RESULT, APPEAL OF THE ASSESSEE DISMISSED. PRONOUNCED IN THE OPEN COURT ON 25 TH OCTOBER, 2017. SD/- SD/- (P. MADHAVI DEVI) (S. RIFAUR RA HMAN) JUDICIAL MEMBER A CCOUNTANT MEMBER HYDERABAD, DATED: 25 TH OCTOBER, 2017. KV 10 ITA NO. 707/H/13 SATYA PRAKASH GORTHI COPY TO:- 1) SATYA PRAKASH GORTHI, C/O M/S ANJANEYULU & CO., CA, 30, BHAGYALAKSHMI NAGAR, GANDHI NAGAR, HYDERABAD 500 080. 2) CIT III, HYDERABAD 3) DCIT, CIRCLE 3(1), , HYDERABAD 4) THE DEPARTMENTAL REPRESENTATIVE, I.T.A.T., HYDE RABAD. 5) GUARD FILE