TaxTMI 
TaxTMI 
2023 (10) TMI 87
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....ing jurisdiction in passing the order u/s 263, more so when the assessment order passed u/s 143(3) is neither erroneous nor prejudicial to the interest of revenue. 3. That having regard to the facts and circumstances of the case, the Ld. Pr. C1T has erred in setting aside the assessment order passed u/s 143(3) of the Act by the ACIT, Circle 5(1) Kolkata on the ground that 'no detailed investigations' have been carried out by the ACIT. 4. That the Ld. Pr. CIT has tailed to consider that the assessment as framed by the ACIT, Circle 5(1) Kolkata was after due application of mind and after considering the detailed replied on various dates as filed before him during the course of assessment proceedings. 5. That the Ld. Pr. CIT has failed to appreciate that details of -expenses were filed as required by the ACIT, Circle 5(1), Kolkata and the assessment order has been passed after due application of mind. 6. That the assessment order passed after detailed enquiries does not become erroneous merely because Ld. Pr. CIT feels that further enquiries should have been made. Hence the notice issued u/s 263 and the order passed u/s 263 is illegal, bad in law and without jurisdiction. 7.....
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....nd that Section 40(a)(ia) of the Act cannot be attracted in respect of payment of brokerage to non-resident brokers. However, ld. Pr. CIT was not satisfied and he was of the view that the assessment dated 25.09.2019 is erroneous and prejudicial to the interests of the revenue and accordingly directed the AO to frame assessment afresh. 5. Aggrieved, the assessee is now in appeal before this Tribunal. Ld. Counsel for the assessee referring to the paperbook containing 154 pages submitted that in the past also assessment u/s 143(3) of the Act for AY 2010-11 & AY 2012-13 have been completed u/s 143(3) of the Act and no such disallowance of brokerage paid to non-resident brokers have been made. He also stated that declaration by parties of not having any permanent establishment in India along with their tax residency certificate were filed before ld. Pr. CIT who ought to have considered the same. It was also submitted that reply was given to the notice u/s 142(1) of the Act on 10.12.2019. It was also submitted that such brokerage expenses have been consistently paid by the assessee in the past and Revenue authorities have accepted that these parties are non-resident brokers having no pe....
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....ve included all records relating to any proceeding under this Act available at the time of examination by the Commissioner; (c) where any order referred to in this sub-section and passed by the Assessing Officer had been the subject matter of any appeal filed on or before or after the 1st day of June, 1988, the powers of the Commissioner under this sub-section shall extend and shall be deemed always to have extended to such matters as had not been considered and decided in such appeal. (2) No order shall be made under sub-section (1) after the expiry of two years from the end of the financial year in which the order sought to be revised was passed. (3) Notwithstanding anything contained in sub-section (2), an order in revision under this section may be passed at any time in the case of an order which has been passed in consequence of, or to give effect to, any finding or direction contained in an order of the Appellate Tribunal, National Tax Tribunal, the High Court or the Supreme Court. Explanation- In computing the period of limitation for the purposes of sub-section (2), the time taken in giving an opportunity to the assessee to be reheard under the proviso to section 12....
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....f facts or an incorrect application of law will satisfy the requirement of the order being erroneous. In the same category fall orders passed without applying the principles of natural justice or without application of mind. The phrase 'prejudicial to the interests of the revenue' has to be read in conjunction with an 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 revenue, for example, when an ITO adopted one of the courses permissible in law and it has resulted in loss of revenue; or where two views are possible and the ITO has taken one view with which the Commissioner does not agree, it cannot be treated as an erroneous order prejudicial to the interests of the revenue unless the view taken by the ITO is unsustainable in law. It has been held by this Court that where a sum not earned by a person is assessed as income in his hands on his so offering, the order passed by the Assessing Officer accepting the same as such will be erroneous and prejudicial to the interests of the revenue - Rampyari Devi Saraogi v. CIT [1968] 67 ITR 84 (SC) and in S....
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....e assessee is higher than the gross total income. As per the audited financial statement against the gross receipts of Rs. 430.16 Crore the net profit before tax is Rs. 1.31 Crore whereas the brokerage paid to agents outside India is Rs. 5.62 Crore. So, based on both the issues as referred by the AO in the assessment order it was bare minimum expected from the AO to have called for the details of all the non-resident brokers to whom the brokerage has been paid and the basis of its calculation and why tax has not been deducted. The AO has not called for any such details and therefore, the assessee did not file these details. The copy of the notice u/s 142(1) of the Act has also not been filed by the assessee. We thus, find that no such question was raised by the AO during the course of assessment proceedings about the alleged issue of deductibility of tax at source u/s 195 of the Act on the payment of brokerage of Rs. 5,62,07,050/-. By not calling these details the assessment proceedings are erroneous and since the Revenue is involved which has not been examined by the AO, the assessment proceedings are prejudicial to the interests of the revenue also. 11. So far as the contention ....