2022 (12) TMI 840

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....ent order and not prejudicial to the interest of the revenue, order u/s. 263 by the Principal Commissioner is unwarranted and unjustified. 2. Unabsorbed Depreciation is not unabsorbed Business Loss. The limitation for carrying forward of business loss do not apply to carrying forward the unabsorbed Depreciation. Hence it is prayed that the Principal Commissioner ought not to have passed the order that the order of the Assessing officer is erroneous and prejudicial to the interest of the revenue. 3. The brief facts of the case are that the assessee is a partnership firm which is engaged in the business of manufacturing and sale of rice filed its return of income for the AY 2015-16 on 30.11.2016 declaring 'Nil' total inco....

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.... hand shown as on 31.03.2015. The AO has called for various details including cash book, sales tax return, ledger, bank statements, etc., and the assessee has furnished all details. The AO after considering relevant evidences observed that reason for selection for limited scrutiny has been examined with reference to supporting evidences and concluded the assessment. Therefore, it cannot be said that the assessment order passed by the AO is erroneous and prejudicial to the interest of the Revenue. The PCIT after considering relevant submissions of the assessee and also by relying upon various judicial precedents observed that the assessment order passed by the AO dated 30.10.2017 is erroneous in so far as it is prejudicial to the interest of....

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.... in cash in hand after demonetization. Similarly, the AO has failed to carry out necessary verification on the issue of unabsorbed depreciation and thus, the PCIT rightly held that the assessment order passed by the AO is erroneous and prejudicial to the interest of the Revenue 7. We have heard both the parties, perused the materials available on record and gone through orders of the authorities below. The provisions of Sec.263 of the Act, confers suo moto powers to the PCIT to revise the assessment order passed by the AO, if the PCIT satisfies, assessment order passed by the AO is erroneous in so far as it is prejudicial to the interest of the Revenue. In order to assume jurisdiction u/s.263 of the Act, the PCIT must satisfy that the as....

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....filed by the assessee without making any additions to returned income. In our considered view, once the AO has considered the issue and has accepted the explanation of the assessee, then there is no scope for the PCIT to take up said issue for revision proceedings on the guise of inadequate enquiry. We further noted that the PCIT may assume jurisdiction to revise assessment order, in a case, where there is no enquiry at all. However, he does not have power to revise the assessment order, in a case, where enquiry has been made and according to the PCIT, enquiry is inadequate and this principle is supported by the decision of the Hon'ble Bombay High Court in the case of CIT v. Gabriel India Ltd., reported in [1993] 203 ITR 108 (Bom). 8. As....