Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2015 (6) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2015 (6) TMI 36 - AT - Income TaxRevision u/s 263 - assessee has claimed Overburden removal expenses (OBR) expenses as revenue nature u/s 37 (1) - Held that:- In the impugned revision proceedings, learned Commissioner started by pointing out that the AO did not realize that the matter was decided on the basis of accepting CoD verdict but the CoD itself has outlived its utility as was held by Hon’ble Supreme Court in the case of Electronics Corporation (2011 (2) TMI 3 - Supreme Court), but what he concluded was that the said assessment order was passed “in haste, without making necessary inquiries warranted and also not appreciating the correct set of facts”. In our humble understanding, lack of proper inquiries, which an Assessing Officer ought to have conducted on the facts of the said case, is altogether a different reason from a claim having been allowed on the basis of CoD decision which is no longer legally valid. In view of the above discussions, as also bearing in mind entirety of the case, we are of the considered view that the impugned revision order is contrary to the scheme of law, and should be quashed for this reason also. The Assessing Officer has noted that “ it was also brought to notice of the department that departmental request for approval of the same [i.e. pursuing appeal against Overburden Removal Expenses being held to be deductible under section 37(1)] was rejected by the CoD”. It was in this backdrop and apparently with due deference to the views expressed by the CoD that the Assessing Officer decided not to make this disallowance in this assessment year. Once such a high powered committee as the Committee on Disputes, set up in the Cabinet Secretariat under directions of Hon’ble Supreme Court, decides that admissibility of deduction in respect of overburden removal expenses need not be carried to the judicial forums and the income tax department should not agitate its grievance against its admissibility, it is certainly a possible, and desirable, view of the mater that the income tax authorities should stop making an issue of this deduction. It is well settled in law, as held in the case of the Malabar Industrial Co Ltd Vs CIT [2000 (2) TMI 10 - SUPREME Court], that, “when an ITO adopted one of the courses permissible in law and it has resulted in loss of revenue; or 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 interests of the Revenue unless the view taken by the ITO is unsustainable in law.” The stand of the Assessing Officer, on the facts of this case and notwithstanding the subsequent legal developments in the case of the Electronics Corporation (supra), was one of the possible views of the matter and it was not “unsustainable in law”. For this reason also, it was not a fit case for invoking revision powers by the learned Commissioner. Thus the impugned revision order is indeed unsustainable, in law and on facts, for more reasons than one - Decided in favour of assesse.
|