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2015 (11) TMI 1432 - AT - Income TaxRevision u/sec. 263 - contention of the assessee is that the CIT has not applied his mind and the show cause notice was prepared only by the ITO and the basic details as required are not available in the show cause notice - Held that:- Sec 263 allows CIT to call for and examine the records of any proceedings under the Income-tax Act, 1961, if he considers that the order passed by the Assessing Officer is erroneous and prejudicial to the interest of the Revenue, he may, after giving an opportunity to the assessee and after making such enquiry as he deems necessary, pass an order enhancing or modifying the assessment or cancelling the assessment. Therefore, what is required u/s 263 is an opportunity of being heard. Sec. 263 does not require the CIT to issue any show cause notice. Therefore, this Tribunal is of the considered opinion that even if there was any defect in the show cause notice that will not affect the consequential order passed by the CIT. This view of ours is fortified by the judgment of the Apex Court in CIT vs Electro House [1971 (9) TMI 10 - SUPREME Court ].- Decided against assessee Claim of depreciation in respect of machinery purchased from Germany - CIT(A) directed AO to allow 50% claim - Held that:- As from the material available on record, it appears that the machinery was installed and put to use on 25.9.2010. The Customs Authorities inspected the usage and running of the machinery on 4.10.2010. When the Customs authorities inspected the machinery on 4.10.2010, it is obvious that the machinery should have been installed and ready for use before 4.10.2010. Therefore, this Tribunal is of the considered opinion that the machinery was in fact installed on 25.9.2010 and it is ready for use. Therefore, machinery was put to use for more than 180 days and the assessee is entitled for full depreciation. Hence, the CIT is not justified in directing the Assessing Officer to allow only 50% depreciation. Accordingly, the order of the CIT is set aside and the Assessing Officer is directed to allow full depreciation in respect of the machinery purchased from Germany.- Decided in favour of assessee CIT to initiate penalty proceedings u/s 271(1)(c) - Held that:- The authorities under the Income-tax Act are empowered to perform judicial function. In other words, the authority concerned has to take an independent decision in respect of the case whether to initiate penalty u/s 271(1)(c) of the Act or not? Though the Assessing Officer is established under the provisions of the Income-tax Act, he is discharging a judicial function while initiating proceedings for levy of penalty. Therefore, no authority can direct the Assessing Officer to initiate penalty proceedings u/s 271(1)(c) of the Act. The Assessing Officer is expected to take an independent decision. In the course of any proceedings before the CIT, he may initiate penalty proceedings and decide the same on his own. However, the CIT has no authority to direct the Assessing Officer to initiate penalty proceedings. The direction of the Administrative Commissioner to initiate penalty proceedings would amount to interference with judicial function of the Assessing Officer. Therefore, this Tribunal is of the considered opinion that the CIT has exceeded his jurisdiction in directing the Assessing Officer to initiate penalty proceedings u/s 271(1)(c) of the Act. Accordingly, the order of the CIT is set aside and direction issued by the CIT to initiate penalty proceedings is quashed.- Decided in favour of assessee
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