TaxTMI 
TaxTMI 
TaxTMI 
2021 (1) TMI 1313
X X X X Extracts X X X X
X X X X Extracts X X X X
....which is in contravention of the mandate laid down by the Act rendering the issue of the impugned order under Section 263 of the Act invalid. ii. On the facts and circumstances of the case and in law, the learned Pr. CIT has legally erred in passing the order under Section 263 of the Act, without providing the Appellant with sufficient and adequate opportunity of being heard and in breach of the principles of natural justice as held by the Apex court. iii. On the facts and circumstances of the case and in law, the learned Pr. CIT has legally and factually erred placing reliance on the decision Hon'ble Supreme Court of India in the case of Amitabh Bachchan (69 Taxmann.com 170) without considering that the facts in the case therein and case of the Appellant is factually different. In the aforementioned case, the learned AO had granted the Assessee an opportunity of being heard as required by the provisions of the Act, whereas in the instant case, the Appellant was not granted with any opportunity of being heard or argue before the Pr. CIT during the course of revision proceedings. iv. On the facts and circumstances of the case and in law, the learned Pr. CIT has legally err....
X X X X Extracts X X X X
X X X X Extracts X X X X
....o inquiries were made in respect to said issue during the revision proceedings, and the order under Section 263 of the Act was passed without providing the Appellant with sufficient and adequate opportunity of being heard, thereby breaching the principles of natural justice as held by the Apex court. Accordingly, directions given by learned Pr. CIT to examine the said issue vide order under Section 263 of the Act is invalid and bad in law. ii. On the facts and circumstances of the case and in law, the learned Pr. CIT has legally erred in directing the learned AO to examine whether any payments were made toward Online Promotional Expenses and applicability of provisions of Chapter XVII B of the Act, without himself examining the matter and recording reasons thereof to conclude that order passed by the learned AO is erroneous and prejudicial to the interest of revenue. iii. On the facts and circumstances of the case and in law, the learned Pr. CIT has legally erred in directing the learned AO to examine whether any payments were made toward Online Promotional Expenses and the applicability of provisions of Chapter XVII B of the Act without appreciating the fact that there were in....
X X X X Extracts X X X X
X X X X Extracts X X X X
....cause notice detailing specific grounds on which revision of assessment order is tentatively being proposed affecting initiation of exercise in absence thereof or to require Commissioner to confine himself to terms of notice and foreclosing consideration of any other issue or question of fact; Commissioner is free to exercise his jurisdiction on consideration of all relevant facts, provided an opportunity of hearing is afforded to assessee to contest facts on basis of which he had exercised revisional jurisdiction." Thereafter, he concluded as under :- "8.1 It is therefore, to be examined whether the assessment made by the Assessing Officer is erroneous in so far as it is prejudicial to the interests of the revenue. Explanation 2 below sub-section (1) of the Section 263 states that : For the purposes of this section, it is hereby declared that an order passed by the Assessing Officer shall be deemed to be erroneous in so far as it is prejudicial to the interests of the revenue, if, in the opinion of the Principal Commissioner or Commissioner, - (a) the order is passed without making inquiries or verification which should have been made; (b) the order is passed allowing any....
X X X X Extracts X X X X
X X X X Extracts X X X X
....on in an altogether different issue. He submitted that the case law from the Hon'ble Supreme Court in the case of Amitabh Bachhan (supra), which the learned Commissioner has referred had held that other matters can be examined by Commissioner other than those for which Section 263 notice was issued, provided opportunity is given to the assessee. The learned senior counsel submitted that there has been a serious violation of mandatory requirement, hence the order of Commissioner deserves to be quashed. 6. Furthermore, learned senior counsel submitted that the issue has been a subject matter of Assessing Officer's examination. He referred to various pages of the paper book submitted for the proposition that the issue was explained in detail before the Assessing Officer. Learned senior counsel further referred to the concluding portion of the order of Commissioner and observed that the order is completely erroneous and non-sustainable. He submitted that the learned Commissioner has not pointed any error on the part of Assessing Officer or the revenue loss to the Department. The learned senior counsel further relied upon several case laws in support of his propositions. 7. Per co....
X X X X Extracts X X X X
X X X X Extracts X X X X
....l. Income Tax Officer v. Ponkunnam Traders (102 ITR 366) (Ker.); iv) Colonisers v. ACIT (41 ITD 57) (Hyd. SB); and, v) Union of India v. Tulsiram Patel and Ors. (AIR 1985 SC 1416) Thereafter, learned counsel of the assessee has distinguished the following decisions :- i) Rajmandir Estates (P.) Ltd. (386 ITR 162) (Cal.); ii) Kapurchand Shrimal v. CIT (131 ITR 451) (SC); and, iii) State of U.P. v. Sudhir Kumar Singh (Civil Appeal No. 3498 of 2020) The learned senior counsel further referred to following case laws :- i) Ambuja Cement Limited v. CIT (ITA No. 3563/Mum/2016); ii) Damodar Valley Corporation v. DCIT (160 ITD 78) (Kol Trib.); iii) Smt. Shardaben B. Patel v. PCIT (180 ITD 328) (Ahm. Trib.); and, iv) H.M. Mehta v. ACIT (387 ITR 561) (Bom.) 9. On the merits of the issue of payments towards winning from lottery or crossword puzzles, it has been submitted that learned Commissioner has proceeded on a factually incorrect premise that the Assessing Officer has failed to make necessary inquiries. It has been submitted that the assessee submitted the copy of form 3CD of the Tax Audit report with the Assessing Officer where details pertaining to tax deduction at s....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ve been referred :- i) CIT v. Gabriel India (1993) 203 ITR 108 (Bom); ii) CIT v. Nirav Modi (2016) 390 ITR 292 (Bom); iii) CIT v. Vikas Polymers (2012) 341 ITR 537 (Del); iv) CIT v. Gabriel India (1993) 203 ITR 108 (Bom); v) DIT v. Jyoti Foundation (2013) 357 ITR 388 (Del); and, vi) Globus Infocom Ltd. v. CIT (2014) 369 ITR 14 (Del) Furthermore, following case laws have been referred :- i) Malabar Industries Co. Ltd. v. CIT (2000) 243 ITR 83 (SC); ii) CIT v. Max India (2007) 295 ITR 282 (SC); iii) CIT v. Reliance Communication Ltd., 396 ITR 217 (Bom); and, iv) Spectra Shares & Scrips (P.) Ltd. v. CIT, 354 ITR 35 (AP) Lastly, it has been submitted that insertion of Explanation 2 by the Finance Act 2015 has not diluted the basic requirement of the section which still needs to be satisfied before invoking the revision jurisdiction. In this regard, following case laws have been relied :- i) Anil L. Todarwal v. PCIT (ITA No. 3498/Mum/2017) (2018) (Mum); ii) Narayan Tatu Rane v. Income Tax Officer (70 taxman 227) (2016) (Mum); and, iii) Torrent Pharmaceuticals Ltd. (173 ITD 130) (Ahm. Trib.) 12. We have carefully considered the detailed submissions and peruse....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ase it had to meet and by giving due opportunity for explaining the same and the Tribunal, therefore, vacated the order of the Commissioner and remanded the case to him with the observation to dispose it of afresh after giving due opportunity to the assessee. On a reference being made, the High Court held that the Tribunal did not act properly in directing the Commissioner to dispose of the case afresh. On appeal, the Supreme Court held that the order of the Tribunal was proper. It is thus clear that in a case, when the order of the Commissioner under Section 263(1) of the Act is set aside by the Tribunal on the ground that there was no adequate opportunity to the assessee, the Tribunal has jurisdiction to remand the case to the Commissioner for deciding the case afresh in accordance with law. 4. Learned counsel for the assessee contended that in the instant case, in view of the fact that there was a flagrant violation of the principles of natural justice, the Tribunal did not deem it proper to remand the case to the Commissioner for fresh disposal. This contention is not founded on facts. The decision of the Tribunal flows from the finding of the Tribunal that the order of the C....
X X X X Extracts X X X X
X X X X Extracts X X X X
....vision. It is a different matter if the course adopted by the Assessing officer is permissible, as then there is no error. 12. In view of the aforesaid, we answer the question of law framed above in negative i.e. in favour of the Revenue and against the assessee. The CIT will pass a fresh order under Section 263 of the Act after hearing the assessee. The contentions and issues raised by the assessee will be dealt with by the CIT. He shall also examine whether the issue in question was raised before the Assessing Officer and considered and verified or the course adopted is permissible. If this is correct, then his jurisdiction will be ascribed and limited to the extent of deciding whether the finding is erroneous i.e. contrary to law etc. In the facts of the case, there will be no order as to costs. Appeal is disposed of." 15. In the background of aforesaid discussion and precedents, including that from the Hon'ble Supreme Court, we find that the plea of the learned counsel of the assessee that the revision order deserves to be quashed for lack of opportunity to the assessee is not sustainable. Furthermore, it is also arising out of the ratio of the aforesaid precedents that ....