2013 (6) TMI 476

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....d in brief. The assessment in the hands of the assessee for the year under consideration was completed by the Assessing Officer u/s. 143(3) of the Act on 25/09/2008. On examination of the assessment records, the Ld. CIT noticed that the Assessing Officer did not apply his mind on the following three issues:- i) Commuted value of pension paid directly to the retired Employees to the tune of Rs. 3,68,38,022/- was paid to the employees by direct debit to the P&L A/c and was allowed as an expenditure though it should have been disallowed on account of the fact that it was not allowable as an expenses u/s. 37 (General Clause) since it was specifically allowable as per conditions u/s. 36(1)(iv) being a specific allowance section, but not done ....

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....wers the Commissioner to call for and examine the record of any proceedings under the Act and, if he considers that any order passed therein, by the Assessing Officer is erroneous in so far as it is prejudicial to the interests of the Revenue, to pass an order upon hearing the assessee and after an enquiry as is necessary, enhancing or modifying the assessment or canceling the assessment and directing a fresh assessment. The key words that are used by section 263 are that the order must be considered by the Commissioner to be "erroneous in so far as it is prejudicial to the interests of the Revenue". This provision has been interpreted by the Supreme Court in several judgments to which it is now necessary to turn. In Malabar Industrial Co. ....

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....inable in law." The principle which has been laid down in Malabar Industrial Co. Ltd. [2000] 243 ITR 83 (SC) has been followed and explained in a subsequent judgment of the Supreme Court in CIT v. Max India Ltd. [2007] 295 ITR 282." There may not be any dispute that the revision proceeding shall not lie on the issues on which the Assessing Officer has taken a plausible view after examining and applying his mind on it. If the AO did not make any enquiry on any of the pertinent issue, it will result in lack of application of mind. 4. In the instant case, it was not shown to us that the assessing officer did examine the issues pointed out by Ld CIT and has taken a plausible view on them. At this juncture, it would be pertinent to refe....