2019 (12) TMI 208
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....y recording incorrect facts and findings and without observing the principles of natural justice. 3. That having regard to facts & circumstances of the case, Ld. CIT has erred in law and on facts in holding the assessment order passed u/s 143(3)/254 dated 29-12- 2016 is erroneous and prejudicial to the interest of revenue and further erred in holding that AO has not made enquiry or investigation with regard to the issue involved. 4. That having regard to facts & circumstances of the case, Ld. CIT has erred in law and on facts in passing the impugned order u/s 263 which is bad in law and against the facts and circumstances of the case and is in violation of principles of natural justice. 5. That the appellant craves the leave to add, amend, modify, delete any of the grounds of appeal before or at the time of hearing and all the above grounds are without prejudice to each other." 3. The only issue raised in the present appeal is against the exercise of jurisdiction u/s 263 of the Act by the Commissioner against order passed u/s 143(3)/254 of the Act. 4. Briefly in the facts of the present case the original assessment was completed u/s 143(3) of the Act vide order dated 28.03.....
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....operty in respect of which acquisition proceedings were carried out by the Office of the Inspecting Asstt. Commissioner of Income tax (Acq.), Range-3, New Delhi and compared with the report of the DVO and estimated the fair market value of the said property at Rs. 95,28,000/- as on 01.04.1981. The assessment order was passed u/s 143(3) of the Act after remand from the Tribunal determining the fair market value of the property as on 01.04.1981 was passed on 29.12.1960. 5. Consequent thereto, the Commissioner exercising his jurisdiction u/s 263 of the Act, issued show cause notice to the assessee and referred to the valuation done by an authorized valuer valuing the property at Rs. 95,28,000/- as on 01.04.1981. After going through the assessment records, the Commissioner observed that the assessment order dated 29.12.2016 was erroneous and prejudicial to the interest of the Revenue. He observed that the valuation report of the second valuer did not match with the directions of the Tribunal to adopt comparable valuation. He was of the view that the Assessing Officer should have made the inquiries to find the value of any comparable incident in 1981. Further, the Assessing Officer ha....
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....e for estimating the fair market value by the DVO u/s 55A(a) of the Act, where the fair market value was less than the value declared by assessee. In this regard, reliance was placed on the decision of Hon'ble Bombay High Court in CIT vs Puja Prints [2014] 360 ITR 697 (Bom.) and also decision of Pune Bench of the Tribunal in the case of Sh. Maruti G.Thopte vs ITO in ITA No.863/Pun/2017 dated 05.01.2018. He further pointed out that in case, no reference could be made to the DVO then the Assessing Officer had to accept the valuation of the Registered Valuer and other material and in such cases the assessment order cannot be said to be erroneous and prejudicial to the interest of the Revenue. 8. The Ld. DR for the Revenue has furnished written submissions before us and he has pointed out that where the Assessing Officer had made no inquiries or any investigation then the order of the Assessing Officer is both erroneous and prejudicial to the interest of the Revenue. In such circumstances, the Commissioner had the power to exercise his jurisdiction u/s 263 of the Act. In the absence of making any inquiry, the Ld. DR for the Revenue stressed that the order suffers from infirmities and ....
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....hat the phase prejudicial to the interest of revenue has to be read in conjunction with erroneous order passed by the Assessing Officer. Every loss of revenue as consequent of an order of the Assessing Officer cannot be treated as prejudicial to the interest of revenue; for example, when Income Tax Officer adopted one of the courses permissible in law and it has resulted any loss of revenue or where two views are possible and the Income Tax Officer has taken one view with which the Commissioner does not agree, it cannot be treated as erroneous order which is prejudicial to the interest of revenue unless the view taken by the ITO is unsustainable in law. 11. In the facts of the present case, the proceedings before the Assessing Officer were in second round where the matter was remitted back to the file of the Assessing Officer to make a denovo assessment as per the directions of the Tribunal in assessee's own case. The dispute was with regard to computation of long term capital gains vis-a-vis the cost of acquisition as on 01.04.1981. The assessee in the initial assessment proceedings had filed a valuer report of Registered Valuer in support of the fair market value as on 01.04.198....