TaxTMI 
TaxTMI 
2021 (6) TMI 1032
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....Ld. Pr. CIT erred in passing order under Section 263 of the Income Tax Act, 1961 ('the Act' for short) holding the order passed by the Dy. Commissioner of Income Tax, Circle - 3, Gurugram to be erroneous and prejudicial to the interest of revenue and directing a redo of the assessment is arbitrary, erroneous and unlawful which must be quashed." 3. The assessee furnished its return for A.Y. 2014-15 through online on 06.10.2014, declaring total deemed income of Rs. 20,300/-. The return was processed u/s 143(1) of the Income Tax Act, 1961 through the system, and refund claimed in the return at Rs. 2,11,300/- was allowed to the assessee company. Later on, the case was selected for scrutiny through CASS due to the reasons that "(i) Large share....
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.... assessing Officer in framing the assessment order leads to completion of order as erroneous and prejudicial to revenue." After considering the reply/submissions of the assessee, the Pr. CIT set aside the Assessment order and directed the Assessing Officer to pass fresh assessment order after making thorough and detailed inquiries on this particular issue only. 4. Being aggrieved by the order under Section 263 of the Act passed by the Pr. CIT, the assessee filed present appeal before us. 5. The Ld. AR submitted that the Assessing Officer at the time of assessment proceedings has raised the query vide notice dated 12.08.2016 under Section 142(1) of the Act relating to party-wise detail, confirmation, ITR, balance sheet, bank statement of....
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....er is erroneous and prejudicial to the interest of revenue. The Ld. AR relied upon the decision of the Hon'ble Supreme Court in case of CIT vs. Max India Ltd 295 ITR 282, Malabar Industrial Co. Ltd. vs. CIT 243 ITR 83. The Ld. AR also relied upon the decision of the Jurisdictional High Court in case of CIT vs. Sunbeam Auto Ltd. 332 ITR 167 and ITO vs. DG Housing Projects Ltd. (2012) 74 DTR 153. 6. The Ld. DR submitted that valuation report referred by the assessee / Ld. AR was not before the Assessing Officer. Further the Ld. DR submitted that no verification relating to proper fair market value of share premium was done by the Assessing Officer as the Director who has taken the share was not called for and also no notice under Section 133....
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....rtinent to note that the Assessing Officer at the time of assessment order / proceedings has specifically raised queries relating to the fair market value of the unquoted per equity share and the related document were present before the AO while passing the final assessment order. After perusal of the document which were presented before the AO, we have noticed that the reasoning given by the Pr. CIT that the total share of 39,510 at Rs. 220/- per share against the face value of Rs. 10/- each and the received share premium to the tune of Rs. 82,97,100/-, has totally ignored the explanation given by the Assessee before the Assessing Officer as well as before the Pr. CIT. The assessee has properly demonstrated through bank statement, the valu....
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....rovisions u/s 263 of the Act. In the present case the Assessing Officer has made all the inquiries and after verifying the documents/ material on record passed a reasoned Assessment Order. Therefore, the Commissioner does not have any locus standi to make further inquiry. The decision of the Hon'ble Supreme Court in case of CIT vs. Max India Ltd 295 ITR 282, Malabar Industrial Co. Ltd. vs. CIT 243 ITR 83 are aptly applicable in the present case as the Hon'ble Apex Court wherein it is held that Section 263 has to be read in conjunction with the expression "erroneous" order passed by the Assessing Officer. Every loss of revenue as a consequence of an order of the assessing officer cannot be treated as prejudicial to the interests of the reven....