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2015 (8) TMI 866 - AT - Income TaxRevision u/s 263 - fall in the gross profit rate set off of the brought forward losses and depreciation - Held that:- The assessee has been able to demonstrate before us that the Assessing Officer made detailed enquiry at the assessment stage with regard to the fall in the gross profit rate set off of the brought forward losses and depreciation. The Assessing Officer issued several statutory notices to the assessee and called for complete details with regard to the manufacturing process, month-wise production, consumption, quantitative sales and justification of major expenses. The assessee furnished complete details and replies before the Assessing Officer at the assessment stage and also produced the books of account which have been test checked by the Assessing Officer and no infirmity in the replies of the assessee and books of account have been found at the assessment stage. The Assessing Officer, almost took up each and every issue with regard to manufacturing activity of the assessee and was satisfied with the explanation of the assessee. The assessee has shown surrender of income as was made during the course of survey in the computation of income and after claiming set off of business loss and unabsorbed depreciation, shown taxable income at ₹ 63.42 lakhs. The nature of business of the assessee is manufacturing of sweet items on which the assessee explained that it was not possible to maintain the details of manufactured items or of the closing stock. The nature of business of the assessee clearly revealed that it may not be possible to give the exact detail of the manufacturing of the sweet items. The Assessing Officer has examined this aspect considering the history of the assessee and the learned Commissioner of Income-tax did not adversely committed upon the same in the impugned order that when the assessee is continuing with the same nature of business from the earlier year and similar data of manufactured items have not been prepared and have not been doubted by the Revenue-Department why such an item is considered in the proceedings under section 263 of the Act. The record further revealed that whatever objections have been raised by the learned Commissioner of Income-tax, have been met by the assessee by explaining the same before the Assessing Officer at assessment stage. The assessee explained the issue of set off of unabsorbed loss of ₹ 14,84,641 by referring to the reply filed before the Assessing Officer dated May 21, 2012 paper book 103 along with the details.The assessee also replied to the query raised by the Assessing Officer with regard to surrendered income, copies of the replies are filed on record. The assessee also explained that the Assessing Officer, after consideration of all the replies, has allowed the depreciation and the depreciation chart is filed at page 44 of the paper book. It is, therefore, clear that the assessee submitted complete details before the Assessing Officer at the assessment stage regarding all the issues which have been raised by the learned Commissioner of Income-tax in the impugned order under section 263 of the Act. It is, therefore, clear that the Assessing Officer was satisfied with all the items which have been raised in notice under section 263 of the Act and allowed the claim of the assessee after conducting proper enquiry into the matter. AO after making complete enquiries has made part addition, which will prove that the issues raised in the proceedings under section 263 of the Act have been correctly examined by the Assessing Officer at assessment stage. Therefore, when the Assessing Officer adopted one of the courses permissible in law and the view taken by the Assessing Officer was not found to be unsustainable in law, CIT(A) should not substitute the opinion of the Assessing Officer in the proceedings under section 263 of the Act. It, therefore, appears that the learned Commissioner of Income-tax changed the opinion by reappraising the evidences and explanation filed on record, thus it would not give revisional jurisdiction to him under section 263 of the Act to set aside the assessment order. - Decided in favour of assessee.
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