TaxTMI 
TaxTMI 
2020 (12) TMI 1201
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....ment year 2009-10. The appeal is admitted today on the following substantial question of law: Whether the Commissioner committed an error of law in invoking powers under Section 263 of the Income Tax Act, 1961 in the fact situation of the case. 2. Facts leading to filing of this appeal briefly stated are that assessee is an individual and is running two proprietorship concerns viz., Bhagirath Enterprises and Puneeth Associates. The assessee is also a document writer and is engaged in the business of typing and Xerox. The assessee filed the return of income for the Assessment Year 2009-10 declaring a total income of Rs. 35,59,600/-. The assessee declared business income from the proprietary concern Bhagirath Enterprises to the extent of R....
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....eduction under Section 80C of the Act for an amount of Rs. 1,00,000/-. The assessee filed a detailed reply in which it was pointed out that there is no error in the order passed by the Assessing Officer nor the same is prejudicial to the interest of the revenue. The Commissioner of Income Tax by an order dated 02.01.2014 set aside the order of assessment and directed the Assessing Officer to pass fresh orders after duly verifying the details furnished by the assessee with that of books of accounts / documents filed, after providing reasonable opportunity of hearing to the assessee. The Assessing Officer was directed to look into the claim of the assessee with regard to disallowance under Section 80C of the Act and to adopt the guideline val....
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....d that the Assessing Officer has mentioned the details of all the properties with dates of purchase and sale and it is evident that the properties were brought and sold within a maximum period of 20 months, which is indicative of the fact that the assessee was engaged in real estate business. It is also argued that the assessee's treatment of income cannot dictate the decision of the Assessing Officer and once the material on record is considered, the power under Section 263 of the Act cannot be invoked merely because a different view can be taken. It is also argued that assessee had conducted the enquiries as required by Explanation 2(a) of Section 263 of the Act. In support of aforesaid submissions, reliance has been placed on decisio....
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....ed counsel for the parties and have perused the record. Before proceeding further, it is apposite to take note of the relevant extract of Section 263 of the Act, which reads as under: 263. Revision of orders prejudicial to revenue (1) The Commissioner may call for and examine the record of any proceeding under this Act, and if he considers that any order passed therein by the Assessing Officer is erroneous in so far as it is prejudicial to the interests of the revenue, he, may, after giving the assessee an opportunity of being heard and after making or causing to be made such inquiry as he deems necessary, pass such order thereon as the circumstances of the case justify, including an order enhancing or modifying the assessment, or cancell....
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....Commissioner of income Tax, it is evident that he has invoked powers under Section 263 of the Act, on the ground that the Assessing Officer has not satisfied itself that the assessee was engaged in the business of purchase and sale of plots and Assessing Officer has not brought any material on record to show that investment in the property was made for the purposes of trading. However, it is pertinent to mention here that the Commissioner of Income Tax as well as the tribunal has failed to appreciate that the Assessing Officer had put 36 questions to the assessee to ascertain the nature of business of the assessee and from perusal of questions Nos.16 and 18, it is evident that the aforesaid questions specifically pertain to issue of classif....