TaxTMI 
TaxTMI 
2016 (3) TMI 536
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....he issue under dispute are discussed in brief. The assessee is a partnership firm and is engaged in the business of manufacturing and trading in Gold ornaments. The assessment of the year under consideration was completed by the assessing officer u/s 143(3) of the Act. The Ld CIT, on examination of record, noticed that the assessee has claimed deduction of bad debts of Rs. 30,79,230/- and the same was allowed by the AO without examining the same. The Ld CIT noticed that the said claimed by the assessee related to the insurance claim lodged with an Insurance company against the theft of stock. The Insurance company rejected the said claim on the reasoning that the assessee could not conclusively prove the claim of loss by way of theft. The a....
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....able either in AY 2000-01 or in AY 2002-03 or in AY 2007-08. Accordingly he disallowed the claim made by the assessee in AY 2006-07. Consequent thereto, the assessee filed a revised computation of income before the AO in AY 2007-08 by claiming the deduction of Rs. 30,79,230/-. During the course of assessment proceedings, the assessee filed a letter dated 10.10.2009 before the assessing officer explaining the details of additional claim by duly attaching all the relevant documents. The AO has accordingly allowed the claim of the assessee. Accordingly, the Ld A.R submitted that the assessing officer has allowed the claim after due application of mind and he has taken a possible view of the matter. Accordingly, he submitted that the Ld CIT(A) ....
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....icer 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 cancelling 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. Ltd. v. CIT [2000] 243 ITR 83, the Supreme Court held that the provision "cannot be invoked to correct each and every type of mistake or error committed by the A....
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....ained in a subsequent judgment of the Supreme Court in CIT v. Max India Ltd. [2007] 295 ITR 282." 6. According to Ld A.R, the assessing officer has examined the issue during the course of assessment proceedings relating to AY 2006-07 as well as in AY 2007-08 by examining the relevant documents. We find merit in the said submissions. A perusal of the assessment order relating to AY 2006-07 would show that the assessing officer has examined the claim of the assessee in that year and has taken the view that the same is not allowable in that year. He has expressed the view specifically that the said claim is allowable either in AY 2000-01 or 2001-02 or in AY 2007-08, meaning thereby, the assessing officer was satisfied with the claim made by....