TaxTMI 
TaxTMI 
2015 (2) TMI 578
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....t, 1961 and in reopening of the case. 2. On the facts and circumstances of the case, the order passed u/s 263 of the Income Tax Act, 1961 by the Ld. CIT-X is bad both in the eye of law and on facts. Hence the order passed is liable to be squashed. 3. That the Ld. CIT erred in law as well as facts in not providing the proper opportunity of being heard. 4. That the Ld. CIT erred in law as well as facts in passing the order without taking into consideration the reply submitted by the appellant. 3. Briefly stated the facts giving rise to this appeal are that the AO completed assessment u/s 143(3) of the Act and framed the assessment at returned income as declared by the assessee. Subsequently, CIT, Delhi-X issued a notice u/s 263 of the Act....
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....e assessee drawn our attention towards impugned order and submitted that the CIT has merely noted that there was a mismatch in the figure of deduction as claimed in form No. 10CCB (which was claimed in the return of income) and form No. 3CD and held that the AO had not applied his mind about this discrepancy and nor it is the case of the assessee that the alleged revised report was submitted before the AO during the assessment proceedings and CIT wrongly hold that there was a complete failure on the part of AO to make appropriate inquiry to the facts of the case to ascertain and verify the correctness of the assessee's claim of deduction u/s 80IC of the Act. The Ld. Counsel drawn our attention towards appeal folder page No. 1 to 10 and subm....
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....esh adjudication after throughout examination to the correctness of the assessee's claim of deduction u/s 80IC of the Act. 7. On careful consideration of the above submission and careful perusal of the relevant material placed on record especially file folder and papers filed under index spread over 45 pages we observe that the assessee vide its reply dated 12.11.2013 (page 1 to 10 of appeal folder) to the notice u/s 263 of the Act has submitted that the amount of deduction under chapter VIA for asstt. Year 2009-10 as mentioned in the text audit report at Rs. 14,17,940/- just a clerical mistake as the same amount was claimed in asstt. year 2008-09 and this figure remained unchanged in the text audit report of asstt. year 2009-10. The asses....
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....e said finding must be recorded. CIT cannot remand the matter to the Assessign Officer to decide whether the findings recorded are erroneous. In cases where there is inadequate enquiry but not lack of enquiry, again the CIT must give and record a finding that the order / inquiry made is erroneous. This can happen if an enquiry and verification is conducted by the CIT and he is able to establish and show the error or mistake made by the Assessing Officer, making the order unsustainable in Law. In some cases possibly though rarely, the CIT can also show and establish that the facts on record or inferences drawn from facts on record per se justified and mandated further enquiry or investigation but the Assessing Officer had erroneously not und....
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....records reasons why it is erroneous. An order will not become erroneous because on remit, the Assessing Officer may decide that the order is erroneous. Therefore CIT must after recording reasons hold that the order is erroneous. The jurisdictional precondition stipulated is that the CIT must come to the conclusion that the order is erroneous and is unsustainable in law. We may notice that the material which the CIT can rely includes not only the record as it stands at the time when the order in question was passed by the 'Assessing Officer but also the record as it stands as the time of examination by the CIT [see CIT vs. Shree Manjunathesware Packing Products, 231 ITR 53 (SC)]. Nothing bars/prohibits the CIT from collecting and relying upo....
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....of the jurisdiction u/s 263 of the Act is not sustainable. We further observed that the order of the AO may be or may not be wrong but CIT cannot direct consideration of this ground of the lack of inquiry but only when the order is erroneous and prejudicial to the interest of revenue the CIT can quash the asstt. order and direct the AO to reframe the assessment u/s 263 of the Act. We are inclined to hold that the order cannot be passed by the CIT u/s 263 of the Act to ask the AO to decide whether the assessment order was erroneous or not . The CIT must after recording reasons hold that the order is erroneous then only assessment order can be quashed and the AO may be directed to pass the asstt. order in pursuant to order of CIT u/s 263 of t....