TaxTMI 
TaxTMI 
2017 (2) TMI 229
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....venue has come up in appeal. The following substantial question of law has been raised : "Whether on the facts and in the circumstances of the case the Tribunal was justified in law in setting aside the order of the Commissioner of Income-tax passed under section 263 of the Act completely ignoring the facts that the Assessing Officer, in original assessment order dated May 11, 2009 passed under section 143(3) of the Act, erroneously allowed the loss of Rs. 3,17,02,725 from purchase and sale of cotton knitted fabric without making any enquiry whatsoever, though the assessee was not in the said business of purchase and sale of cotton knitted fabric in earlier year, which is prejudicial to the interests of the Revenue and its purported findi....
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.... yarn ; (b) There was no opening or closing stock of cotton yarn ; (c) Purchase and sale were all amongst the connected concerns which had the same address. This fact surfaced before the learned Tribunal. (d) No details of purchases/sales are on the record ; and (e) Such details were not also called for. 4. These facts have neither been disputed before us by the learned counsel appearing for the assessee nor were these facts contested before the learned Tribunal. There is a finding recorded by the Commissioner of Income-tax that "the assessment was also made hurriedly as is apparent from the records". This finding of the Commissioner of Income-tax has not been commented upon or reversed by the learned Tribunal. The learned Tribunal....
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....t, as the case may be. The learned Tribunal failed to notice the facts, which were not in dispute and have not also been disputed before us, which we have quoted above. It was only reasonable to infer that an attempt might have been made to reduce the income by booking fictitious loss. The Commissioner of Income-tax could not have recorded any definite finding in respect of a matter which he intended to refer to the Assessing Officer for further investigation. After recording a final opinion that the loss was in fact fictitious there would be no point in remanding the matter to the Assessing Officer. There can be no doubt that merely on the basis of presumption or surmise or suspicion, an order under section 263 cannot be passed. The learne....
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....on that the learned Tribunal has not applied its mind to all the relevant materials and has not considered the same and therefore the conclusion drawn is perverse. Reference may in this regard be made to the judgment in the case of Collector of Customs v. Biswanath Mukherjee reported in [1974] CLJ 251, wherein the following views were taken : "It is, however, equally well-settled that even in a writ petition under article 226, the court is entitled to interfere with the finding of the Tribunal on any question of fact which the Tribunal is competent to decide, if the court is satisfied that the finding of the Tribunal is perverse and the finding of the Tribunal is considered to be perverse, if- (a) The Tribunal has come to the finding on....