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TaxTMI 
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TaxTMI 
2007 (11) TMI 610
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....ig installed on it. This purchase was made by the assessee on 18-3-1993. 3. In the assessment year 1994-95, an issue came up for consideration whether the vessel was a ship or not. In the assessment order passed for that year, the assessing officer took the view, after discussing the matter with a representative of the assessee, that the vessel in question was a ship and, therefore, he allowed 20 per cent depreciation claimed by the assessee. It was noted by the assessing officer that the vessel was actually a barge with a drilling rig installed on it. It was mobile and could be used for offshore drilling. It was, therefore, held that the assessee was entitled to claim a deduction under section 33AC of the Income Tax Act, 1961 (hereinafter....
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....t year 1996-97, as also for other assessment years (subject to some changes in dates, amounts etc.), returns were filed by the assessee and they were accepted under section 143(1)(a) or under section 143(3) of the Act by the assessing officer on 5-1-1998. 8. Thereafter, on 9-1-2002, the assessing officer issued a notice to the assessee under section 148 of the Act in which it was opined that the assessee had wrongly claimed a deduction under section 80-IA(3) of the Act. No such notice, was issued to the assessee in respect of the claim adjudicated in respect of section 33AC of the Act. 9. The assessee gave a reply to the notice on 7-2-2002 in which it was explained that the 'Deep Sea Matdrill' was never used in the territorial wat....
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....assessee. 11. In appeal, the Tribunal set aside the order passed under section 263 of the Act and these appeals arise out of orders passed by the Tribunal. 12. It is the contention of learned counsel for the revenue that there was no application of mind by the assessing officer to the fact that the ship was or was not used in the Indian territorial waters prior to its acquisition by the assessee. 13. Insofar as the first issue, whether the 'Deep Sea Matdrill' is a ship for the purposes of section 33AC of the Act is concerned, we find that this issue was decided in favour of the assessee in respect of the assessment year 1994-95. We find merit in the contention urged by learned counsel for the assessee that this issue cannot be ag....
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....present case is concerned, we are of the opinion that only one view is possible, namely, that the 'Deep Sea Matdrill' is a ship. Even if learned counsel for the revenue is right in contending that the 'Deep Sea Matdrill' is not a ship, we do not think that exercise of power under section 263 of the Act by the Commissioner would be justified only because the assessing officer has taken a view in favour of the assessee. The law requires the view to be erroneous also�and that has not been substantiated by learned counsel for the revenue . 17. Insofar as the second issue relating to section 80-IA(3) of the Act is concerned, which is to the effect whether the 'Deep Sea Matdrill' was used in the India....
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....ppear that the assessing officer did not conduct any further inquiry apparently because he was satisfied with the explanation given. We cannot understand Gee Vee Enterprises (supra) to mean that that even when the assessing officer is satisfied with the explanation given by the assessee, he must make a further investigation so as to unearth something against the assessee. 21. That apart, the Tribunal has noted that there was no material at all before the Commissioner to take a different view of the matter particularly since the assessing officer had dropped the objection. It is true that if there was material before the Commissioner to have the issue reconsidered, he could have done so but it was noted by the Tribunal that there was no mat....