TaxTMI 
TaxTMI 
2019 (5) TMI 735
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....n with the assessment order passed by the AO under s. 143(3) of the Act dated 20.02.2015 concerning AY. 2012-13. 2. As per the grounds of appeal, the essential grievance of the assessee is that in the facts and the circumstances of the case the Pr.CIT was not justified in exercising revisionary powers under s.263 of the Act and thereby setting aside the assessment order passed under s.143(3) of the Act with a direction to the AO to frame assessment afresh after proper examination, inquiry and verification with reference to deduction under s.54B of the Act claimed by the assessee. 3. To adjudicate the grievance of the assessee, the relevant facts are taken note of as follows: 3.1 The assessee filed its return of income for AY 2012-1....
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....he assets prior to the sale of land and hence the exemption claimed by you is not allowable. Failure to disallow your claim of Rs. 41,09,160/- is incorrect. From the above discussions, it appears that the said assessment order dated 20/02/2015 is erroneous and prejudicial to the interest of revenue to the extent mentioned above. You are, therefore, requested to show cause as to why the total income assessed u/s. 143(3) of the Act should not be enhanced or modified u/s. 263 of the Act..." 3.3 The assessee filed a reply thereto contesting the show cause notice and also challenged the foundation of jurisdiction under s.263 of the Act sought to be assumed by the Pr.CIT. From the case record, it appears that the AO made an addition t....
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....has failed to disallow deduction under s.54B of the Act in respect of purchase of land (as per Item Nos. 1 & 3 tabulated above) where the purchase of land has occurred prior to transfer of capital asset for the purposes of Section 54B(1) of the Act. The Pr.CIT observed that Section 54B(1) of the Act enjoins upon the assessee to purchase of land for agricultural purposes after the date of transfer of the original capital asset in order to avail the exemption contemplated under s.54B of the Act. But in the instant case, the assessee has purchased the asset prior to the date of transfer of the original capital asset to the tune of Rs. 41,09,160/-. The Pr.CIT alleged that the AO has not looked into this crucial aspect and finalized the assessme....
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....ully considered the rival submissions and perused the revisional order passed by the Pr.CIT under s.263 of the Act as well as other materials referred to and relied upon by the respective parties and case laws cited. 5.1 Supervisory jurisdiction vested under Section 263 of the Act enables the concerned Pr.CIT/CIT to review the records of any proceedings and order passed therein by the AO. It empowers the Revisional Commissioner concerned to call for and examine the records of another proceeding under the Act and if he considers that any order passed therein by the AO is erroneous in so far as it is prejudicial to the interest of the Revenue, then he may (after giving the assessee an opportunity of being heard and after making or causing ....
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....accepted the claim of deduction by oversight and without any application of mind in this regard. No evidence has been adduced before us to show that the issue was present to the mind of the AO. A wrong acceptance of claim of deduction would not given inference towards application of mind. Secondly, the eligibility of deduction under s.54B of the Act in respect of land acquired prior to transfer of capital asset is clearly opposed to the plain provision of the Act and thus apparently not sustainable having regard to express the provision of the statute. The legislature in its own wisdom has used the expression before the transfer of long term asset as well as after the transfer of capital asset at appropriate places viz. Section 54 of the Ac....