TaxTMI 
TaxTMI 
2011 (5) TMI 581
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....87,270/-. The ld. CIT noticed that the assessment was completed without making meaningful enquiries in a casual manner. The ld. CIT observed the following deficiencies in the assessment order: (i) The assessee had claimed deduction of Rs. 59,68,46,701/- on account of bad debts written off u/s 46(1)(vii) even when the credit balance in the provision for bad and doubtful debts account was Rs. 117.90 crores. The Assessing Officer has allowed expenditure of Rs. 39,10,46,701/- which according to the ld. CIT is against the express provisions of the Income tax Act, 1961. (ii) The Assessing Officer has treated the entire investment in securities held by the bank as capital in nature even when the Hon'ble Madras High Court in....
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.... of NPAs, the Assessing Officer has allowed deduction u/s 36(1)(viia)(a) to the fullest extent while assuming that NPAs are bad and doubtful debts under the Income-tax Act, 1961 and both are interchangeable terms. 3. On the above mentioned reasons, the ld. CIT issued a notice u/s 263 of the Act to the assessee asking him as to why the assessment framed by the Assessing Officer should not be set aside. The assessee submitted written submission dated 23.3.2010. After considering the submissions of the assessee, the ld. CIT has set aside the assessment order with a direction to pass fresh assessment order in the light of the provisions of the Act, case laws and circulars and instruction of the Board. Now the assessee is in appeal befor....
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....' co-exist. 6. The subject of 'revision under section 263' has been vastly examined and analysed by various Courts including the Hon'ble Apex Court. The revisional power conferred on the CIT vide section 263 is of vide amplitude. It enables the CIT to call for and examine the records of any proceeding under the Act. It empowers the CIT to make or cause to be made such an enquiry as he deems necessary in order to find out if any order passed by Assessing Officer is erroneous in so far as it is prejudicial to the interest of the Revenue. The only limitation on his powers is that he must have some material(s) which would enable him to form a prima facie opinion that the order passed by the Officer is erroneous in so far as it is prejud....
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.... section 263 may be summarized below: (i) The CIT must record satisfaction that the order of the Assessing Officer is erroneous and prejudicial to the interests of the revenue. Both the conditions must be fulfilled. (ii) Section 263 cannot be invoked to correct each and every type of mistake or error committed by the Assessing Officer and it is only when an order is erroneous, that the section will be attracted. (iii) An incorrect assumption of facts or an incorrect application of law will suffice for the requirement or order being erroneous. (iv) If the order is passed without application of mind, such order will fall under the category of erroneous order. (v) Every loss of revenue cannot be treated ....
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.... erroneous simply because in his order he does not make an elaborate discussion in that regard. 7. Now, reverting to the facts of this case, it was found that the issue raised vide Ground No.1 (i) regarding deduction u/s 36(1)(vii) of the Act stands covered by the order of the Tribunal, in favour of the assessee passed in I.T.A.No. 1161/Mds/1995 for assessment year 1990-91, order dated 22.5.2003. The Department could not controvert this fact and we have also found it to be correct. Therefore, Ground No.1(i) does not stand to be made a basis for revision. 8. Ground No.1(ii) relating to the value of Government Securities also stands covered in favour of the assessee by the order of the Tribunal (supra). This will also not surv....