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2017 (10) TMI 1495 - ITAT PUNERevision u/s 263 - AO had selected the case for scrutiny under CASS in order to verify the claim of deduction u/s 80IB(10) - HELD THAT:- In view of the settled position by the Hon’ble High Court of Karnataka in CIT Vs. Shravanee Constructions [2012 (7) TMI 88 - KARNATAKA HIGH COURT] and the ratio laid down by different Benches of Tribunal, where the facts of the present case before us are identical to the facts before the Tribunal and the Hon’ble High Court, we hold that the assessee having introduced his land for development and also having obtained the approvals for carrying out the said development including getting sanctions from various State Authorities, it cannot be said that no expenditure has been incurred by the assessee for development of the said property. Hence, the assessee is entitled to claim the deduction under section 80IB(10) as the Co-venturer of the project along with Rajkotia. We have already mentioned in the paras hereinabove that other Co-venturer Rajkotia, who has already been allowed the deduction u/s 80IB(10) of the Act by the Tribunal. Necessary enquiries were conducted by the AO in scrutiny proceedings, which were picked up under CASS for the specific purpose of verifying the claim of deduction under Chapter VI-A, the Assessing Officer after conducting the enquiries have come to a conclusion which is as per the law and hence, the same cannot be disturbed by the Commissioner under the garb of exercise of revisionary powers under section 263 of the Act. In any case, the Commissioner has failed to give a finding and has remitted the matter back to the file of Assessing Officer to verify the claim of assessee, which is also not permissible under section 263 of the Act. Without prejudice to our findings in the paras hereinabove, the order of Commissioner under section 263 of the Act is contrary to the extent that where he has held that the assessee merely transferred the land, then in such circumstances, the resultant profit is assessable as capital gains on the date of transfer i.e. 05.10.2004, which falls in assessment year 2005-06 and hence, there is no merit in exercising the jurisdiction under section 263 of the Act in assessment years 2009-10 and 2010-11. Assessee with an authorized share capital of ₹ 1.36 crores raised nearly sum of ₹ 32 crores on account of premium and chose not to go in for increase of authorized share capital, merely to avoid payment of statutory fees, as per the Commissioner was an important pointer necessitating investigation. In such a case, the Commissioner held the assessment order is erroneous and prejudicial to the interest of revenue. However, the facts of the said case are at variance to the facts raised before us and we have already referred to the facts and investigation made by the Assessing Officer during the course of assessment proceedings and hence, there is no merit in the aforesaid reliance. Now, coming to the aspect of book profits which was considered by the Commissioner and the order of the Assessing Officer was held to be erroneous and prejudicial to the interest of revenue. In this regard, it may be pointed out that the case of assessee was picked up for scrutiny under CASS for the limited purpose of verifying the Chapter VI-A deduction. Once the case is picked up for specific purpose under CASS, then it is outside the purview of the Assessing Officer to look into any other aspect other than the aspect for which it is picked up. Assessing Officer has not formed any opinion in respect of computation of book profits in the hands of assessee. Once, no such opinion has been formed by the Assessing Officer, the Commissioner has erred in holding the order of the Assessing Officer to be erroneous and prejudicial to the interest of revenue in this regard. Accordingly, we reverse the findings of the Commissioner. Accordingly, we hold that the order passed by the Commissioner under section 263 of the Act is invalid and the same is quashed for both the assessment years.
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