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2014 (7) TMI 50 - HC - Income TaxRevision u/s 263 - Validity of show cause notice u/s 263 - an order erroneous and prejudicial to revenue – Allowability of deduction on expenses far in excess of the income received - the contention of the assessee that assessment order was passed after consultation with the CIT - Held that:- there is nothing on record to show that order has been passed after consultation with the Commissioner, who has passed the impugned orders nor is it pleaded that there is any such office procedure available - Decided against the assessee. Next contention of the assessee is that, revision under Section 263 could be made only if there is a legal infirmity in the order. - Held that:- The issues specifically dealt with in the impugned notices are not seen discussed by the Assessing Officer, except the expenditure for foreign travel. This is a case where the entire materials on record were not considered by the Assessing Officer. The Commissioner had taken into account the information available to the Department, as revealed from the records called for under Section 263, and found many transactions to have been omitted to be considered by the Assessing Officer. - contentions of the assessee rejected - Decided against the assessee. It would have definitely be an erroneous procedure adopted by the AO, wherein the entire materials available to the Department had not been taken into account, resulting in prejudice to the interests of the revenue – Commissioner has not attempted a substitution of his opinion to that of the AO, but has taken cognizance of the 'lack of enquiry' with respect to certain transactions as distinguished from 'insufficient enquiry'- this reveals clear non-application of mind by the AO – Relying upon [M/s. Appollo Tyres Ltd. Versus The Deputy Commissioner of Income Tax 2013 (10) TMI 1233 - KERALA HIGH COURT] - no interference can be made at the stage of show cause notice - assessee would have their remedies before the CIT, who shall definitely consider the objections placed before him and pass reasoned orders as is mandated u/s 263 - With respect to the power of the Commissioner u/s 263 to issue a show cause notice in the nature of the orders in the writ petitions, it was perfectly proper and legal and within the powers of the Commissioner u/s 263 of the Act – thus, invocation of extra-ordinary powers u/s 226 is declined – Decided against Assessee.
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