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2015 (3) TMI 924 - AT - Income TaxRevision u/s 263 - order passed by Assessing Officer is erroneous as he had not verified the credit of prior period expenditure which should have been considered under the provisions of Section 41(1) and also under the provisions of Section 115JB - Held that:- Coming to the issue of addition of prior period expenditure as income, Ld.CIT directed the Assessing Officer to examine and consider the amounts u/s.41(1). It was the contention of assessee that this amount has never been claimed as a deduction. As seen from the consequential order passed by Assessing Officer on the directions of the CIT, Assessing Officer without examining the amounts, added the entire amount as income u/s.41(1) on the pretext of assessee's failure to prove as the amount was not claimed as a deduction u/s.43B. We are surprised about the action of the Assessing Officer. Assessee is in a position to furnish the details and reconcile the amounts of how much was claimed as expenditure, how much was disallowed and amounts waived by the bank. Since these details are not considered by Assessing Officer and not examined in its correct perspective, we are of the opinion that these require reconciliation year-wise. Prima facie, we are of the opinion that assessee has not claimed any amount as deduction, therefore, addition u/s.41(1) may not arise. Since this issue was not examined by Assessing Officer in correct perspective, we are of the opinion that the Assessing Officer has to examine the same before considering any amount of disallowance. Therefore, reiterating the direction of the CIT we direct the Assessing Officer to examine and consider the same for addition, if any u/s.41(1). Decided in favour of assessee for statistical purposes. Direction of the CIT on the inclusion of prior period income under the provisions of Sec.115JB - Held that:- The computation has to start from the final figure of P&L A/c and necessary adjustments as provided in Explanation to Section 115JB has to be considered, while computing the book profit for the purpose of 115JB. The CIT also made a mistake in directing to take a different amount. There seems to be no inquiry under the provisions of Section 115JB while completing assessment u/s 143(3) therefore to that extent, order of the Assessing Officer is not only erroneous on the facts but also on the principles of law. We therefore uphold invoking the jurisdiction by CIT on the order of Assessing Officer. Since amounts adopted by CIT is not correct, while upholding the jurisdiction of the order of the CIT on 263, we set aside consequential order passed by Assessing Officer and restore the issue to the file of Assessing Officer to re-do the exercise of reconciliation of amounts of prior period income and computing the income u/s.115JB as per the provisions of the Act, after giving due opportunity to assessee to make submissions which should be examined and properly considered.- Decided partly in favour of assessee for statistical purposes. Direction of CIT on claiming of normal depreciation and additional depreciation - Held that:- This issue has been examined by Assessing Officer in the original assessment proceedings, therefore, the CIT direction to re-examine the issue does not arise, as it is contrary to the provisions of the Act. CIT cannot substitute his opinion and direct the Assessing Officer to re-examine the issue which was already examined and accepted by Assessing Officer. As seen from the consequential order passed by Assessing Officer also, he did not make any disallowance on this issue which indicate that there is no error in the original order passed - Decided in favour of assessee.
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