TaxTMI 
TaxTMI 
2011 (6) TMI 188
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....ter referred to as the Learned CIT) erred in initiating proceedings under section 263 of Income-tax Act, 1961 (Act) by wrongly assuming jurisdiction under section 263 of the Act and hence, the order passed by the CIT under section 263 of Act is bad in law and void ab initio. On the facts and circumstances of the case and in law, the CIT erred in holding that the regulatory charges amounting to Rs. 358,130,408 are capital in nature and need to be amortized under section 35ABB of the Act and has, therefore, erred in directing the DCIT, Circle 12(1), New Delhi (hereinafter referred to as the ld. Assessing Officer) to compute allowance under section 35ABB of the Act. On the facts and circumstances of the case and in law, the CIT erred in ....
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.... in terms of migration of National Telecom Policy 1999, effective from 1-8-1999, the license fee accrued and paid uptill the date of migration was treated as one time entry fee which has been capitalized by the assessee company and amortized under section 35ABB. (ii) The assessee has further submitted that in terms of the migration to the revenue sharing regime, with effect from 1-8-1999, the assessee company was paying licence fee at specified percentage of the gross revenue derived by the assessee from its cellular business. The assessee has submitted that under the new revenue sharing regime effective from 1-8-1999, the licence fees was a direct function of the revenue which was based on unit call rate and call time. The a....
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....ssing Officer for its own. (c) Various case laws have been relied upon including Malabar Industrial Co. Ltd. v. CIT [2000] 243 ITR 83/109 Taxman 66 (SC)); CIT v. G.M. Mittal Stainless Steel (P.) Ltd. [2003] 263 ITR 255/130 Taxman 67 (SC); CIT v. Gabriel India Ltd. [1993] 203 ITR 108/71 Taxman 585 (Bom.); Rawani Dal & Floor Mills v. CST [1992] 86 STC 409 (Orissa); Graden Silk Mills Ltd. v. CIT [1996] 221 ITR 861 (Guj); Ram Kishan Dass v. ITO [2005] 149 Taxman 55 (Delhi) (Mag.). 3.2 The ld. Commissioner of Income-tax (Appeals) did not accept the above contention. He opined that the payments were towards acquisition of and in consideration of licence for 20 year to operate specified services by the assessee. The main object ....
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....sel of the assessee contended that Assessing Officer has duly issued questionnaire and sought information with regard to all the three issues. He took us the paper book page Nos. 75 and 76 wherein the questionnaire given by the Assessing Officer was attached. 5.1 Ld. counsel of the assessee further referred to reply given to the Assessing Officer which was placed in the paper book page Nos. 84 to 115. 5.2 In light of the above submissions, ld. counsel of the assessee contended that in this case in all the three issues Assessing Officer has made the necessary enquiries. He argued that if the enquiries are inadequate the recourse cannot be made under section 263 by the CIT. In this connection, he placed reliance upon the order of the Ju....
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....ourt decision in the case of Sunbeam Auto Ltd. (supra) is relevant wherein it has been held as under (Heads Notes Only) :- "There is a distinction between 'lack of enquiry' and 'inadequate enquiry' - If there is an enquiry, even inadequate, that would not by itself give occasion to the CIT to pass order under section 263, merely because he has a different opinion in the matter - Such a course of action is open only in cases of 'lack of enquiry' - Contention of the revenue that the Assessing Officer did not consider as to whether the expenditure in question was capital or revenue expenditure cannot be accepted - Although apparently the assessment does not give any reasons for allowing the entire expenditure as revenue expenditure, that by....