2015 (3) TMI 1066

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....009-10 on 30.09.2009 declaring total income of Rs. 1,53,31,02,225/-. The same was processed u/s 143(1) of the Act. Subsequently the case was selected for scrutiny under CASS and notice u/s 143(2) was issued and served. The assessment was completed u/s 143(3) on 30.12.2011 determining the total income at Rs. 1,67,70,53,680. 3. Aggrieved by the order of the AO, assessee preferred an appeal before the CIT (A) and raised grounds against the issue of disallowance of Rs. 14,23,29,696 u/s 14A of the Act. The CIT (A) by its order dated 31.08.2012 dismissed the appeal of the assessee. 4. The CIT-III Hyderabad assuming jurisdiction u/s 263 of the Act held as follows: "1.2 On an examination of facts available on record, it was seen that the compan....

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....unt the amount of Rs. 7,03,88,613 incurred towards processing fee. 4. The ld CIT ought to have appreciated that the issue of disallowance u/s 14A was duly considered by the AO and merely because the ld CIT entertains a different view the assessment cannot be termed as erroneous. 5. The ld CIT ought to have appreciated that the issue of disallowance u/s 14A having merged into the order of the ld CIT (A), it is no more within the jurisdiction of CIT u/s 263 of the Act to consider the sufficiency of disallowance". 6. At Ground No.5 the assessee objected to the jurisdiction assumed by the CIT u/s 263 of the Act and on the ground that the order of AO merged with order of the CIT (A) and CIT has no jurisdiction to revise u/s 263. The ld C....

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....fully. In our opinion, this Court's decision in Tejaji Farasram Kharawala's case (supra) still holds the field and is binding on us. Chief Justice Chagla in that case has categorically held that the principle underlying section 33B of the Indian Income-tax Act, 1922 ('the 1922 Act'), corresponding to section 263 of the 1961 Act, is that it is only the order of the ITO which can be revised by the Commissioner. Once the order of assessment is confirmed by the AAC or any order with regard to the assessment has been made by him, that becomes a final order of assessment and the only right the department has is the right of appeal to the Tribunal. The right of the Commissioner continues so long as the order of the ITO is not merge....