2017 (2) TMI 1180

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.... of the Act is bad in law. 3. In this case, assessment was made vide order dated 30.10.2013 u/s. 143(3) of the Act. Returned income of Rs. 1,78,690/- was assessed at Rs. 1,78,690/- as under:- Income for STCG Rs. 24,051/- Income from LTCG Rs. Nil/- Income from other sources Rs. 2,39,642/- Commodity income Rs. 30,000/- Deduction u/c. VIA Rs. 1,15,000/- Total Income 1,78,693/- Rounded off Rs. 1,78,690/-   4. The ld. Principal CIT called for and examined the assessment order. According to the ld. Principal CIT, the assessment order was not only erroneous but also prejudicial to the interest of the revenue as per the facts stated below:- 1. Incorrect claim of deduction u/s. 54 of the Act amounting to Rs. 63,03,311/-....

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....drawals on 04-08-2011 (i) Rs. 20 lac for investing in CDR (ii) Rs. 10 lac for FDR, (iii) Rs. 10 lac for CDR and (iv) Rs. 10 lac being amount transferred. As per the capital account scheme Notification No.G.S.R.724(E) dated 22-06-1988, Refer 172 ITR (st.) 54/No.S.No.S.O.2553(E) dated 25-10-2012 Refer 349 ITR (St.) 18 has defined the depositor, deposit office i.e. notified bank by the Central government to receive deposit and maintain account for the depositor. Hence, the assessee's this account cannot be regarded as capital gain. Therefore, this account of the assessee cannot be treated as capital gain account. Further, the assessee's claim for deduction u/s 54 of the Act includes expenditure of Rs. 41,60,486/- claimed to have been s....

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....power u/s. 263 of the Act. The Hon'ble Supreme Court in Malabar Industrial Co. Ltd. 243 ITR 83 has laid down the following ratio:- "A bare reading of section. 263 of the Income-tax Act, 1961, makes it clear that the prerequisite for the exercise of jurisdiction by the Commissioner suo motu under ii, is that the order of the Income-tax Officer is erroneous in so far as it is prejudicial to the interests of the Revenue. The Commissioner has to be satisfied of twin conditions, namely, (i) the order of the Assessing Officer sought to be revised is erroneous; and (ii) it is prejudicial to the interests of the Revenue. If one of them is absent-if the order of the Income-tax Officer is erroneous but is not prejudicial to the Revenue or if it is n....

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....tate Bank of India constituted under the State Bank of India Act, 1955 (23 of 1955), or of a subsidiary bank as defined in the State Bank of India (Subsidiary Banks) Act, 1959 (38 of 1959), or of a corresponding new bank constituted under section 3 of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 (5 of 1970) or under section 3 of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980 (40 of 1980), authorized by the Central Government, by notification in the official Gazette, to receive deposit and maintain account of the depositor, under this Scheme; (f) "depositor"- means an assessee who is eligible to make a deposit under section 54, 54B, 54D, 54F or 54G of this Act: (g) all other words....