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2014 (10) TMI 617 - AT - Income TaxInvocation of provisions of section 263 by CIT – Held that:- The power of suo motu revision u/s 263(1) is in the nature of supervisory jurisdiction and the same can be exercised only if the circumstances specified therein exist – relying upon Malabar Industrial Co Ltd Vs CIT [2000 (2) TMI 10 - SUPREME Court] - during the course of assessment proceedings AO had raised query with respect to the exchange fluctuation loss and in response to which the Assessee has submitted its reply - the reply of Assessee was found to be acceptable by the AO because no addition on account of exchange rate fluctuation was made by the AO in the assessment order - for A.Y. 2006-07 and A.Y. 2008-09, AO had had made full inquiries by raising the queries and the same were also replied by the assessee and on receipt of the replies accepted the claim of the assessee – in CIT vs. Max India Ltd. [2007 (11) TMI 12 - Supreme Court of India] - where two views are possible and the ITO has taken one view with which the CIT does not agree, it cannot be treated as an erroneous order prejudicial to the interest of Revenue, unless the view taken by the ITO is unsustainable in law - during the course of assessment proceedings, the AO examines numerous issues and generally, the issues which are accepted do not find mention in the assessment order and only such points are taken note of on which the assessee's explanations are rejected and additions/disallowances are made - provisions of s. 263 cannot be resorted to – relying upon Commissioner Of Income-Tax Versus Gabriel India Limited [1993 (4) TMI 55 - BOMBAY High Court] - when a regular assessment is made u/s 143(3) a presumption can be raised that the order has been passed upon on application of mind - Revenue has not brought any material on record to demonstrate that the view taken by the AO was an impermissible view and was contrary to law or was upon erroneous application of legal principles necessitating the exercising of Revisionary powers u/s 263 – thus, the order of the CIT(A) is to be set aside – Decided in favour of assessee.
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