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2014 (2) TMI 685 - AT - Income TaxJurisdiction u/s 263 of the Act Held that:- Only if the Assessing Officer has taken a view patently unsustainable in law, that power u/s 263 can be exercised, where the taking of such an erroneous view results in loss of revenue, thereby satisfying the twin requisite conditions of erroneous assessment order and prejudicial to the interests of the revenue, for invocation of Section 263 of the Act. On the other hand, if the view taken by the Assessing Officer is a view possible in law, power u/s 263 of the Act cannot be exercised Relying upon Malabar Industrial Company vs. CIT [2000 (2) TMI 10 - SUPREME Court] - unless the assessment order is erroneous, substitution of the judgement of the Commissioner for that of the Assessing Officer does not stand visualized under the provisions of Section 263 of the Act. Nature of Income Income from letting out of godown Whether the income to be assessable as income from house property or not Held that:- The assessee's contention that the godown building stands constructed on agricultural land belonging to the partners of the assessee firm does not help him, since the full requirement of Proviso (i) to Section 2 (1A) (c) is not only of the building being in the immediate vicinity of the land, but also that the building is required by the receiver of the rent or the revenue, or the cultivator, or the receiver of the rent-in-kind, by reason of his connection with the land, as a dwelling house, or as a store-house, or other out-building - Proviso (i) is subservient to the main provision of Section 2 (1A) (c) and since the assessee does not fulfill the conditions of the main provision of Section 2(1A) (c), the factum of the building being in the immediate vicinity of the land, by virtue of being constructed thereon, does not bring the income earned by the assessee within the ken of 'agricultural income' as defined in Section 2 (1A) (c) - the explanation offered by the assessee before the Assessing Officer was accepted by the Assessing Officer without dealing with as to how such explanation was acceptable thus, the grievance of the assessee is rejected and the action of the. CIT in holding the assessment order to be an erroneous order prejudicial to the interests of the revenue is confirmed Decided against Assessee.
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