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2016 (1) TMI 890 - AT - Income TaxRental income - treated under the head ‘House property’ or 'business income’ - revision u/s 263 - Held that:- We do not find any lack of enquiry on the part of the Officer for taxing the income under the head business income and not under the head income from house property. The AO has taken a view which may be different from the view of the Ld. Commissioner and assuming that the view taken by the AO is a loss to the Revenue but the Hon’ble Supreme Court in the case of Malabar Industrial Co. Ltd (2000 (2) TMI 10 - SUPREME Court ) has held that “every loss of Revenue as a consequence of an order of the Assessing Officer cannot be treated as prejudicial to the interest of the Revenue”, for e.g. when an Income Tax Officer adopted one of the courses permissible in law and it has resulted in loss of revenue or where two views are possible and the Income Tax Officer has taken one view with which the Ld. Commissioner does not agree, it cannot be treated as an order which is erroneous or prejudicial to the interest of Revenue unless the view taken by the Income Tax Officer is unsustainable in law. Moreover, the view taken by the AO is now well supported by the decision of the Hon’ble Supreme Court taken in the case of Chennai Properties & Investment Ltd [2015 (5) TMI 46 - SUPREME COURT]. Thus, even if the revised return have been completely ignored by the AO that would only make the assessment order erroneous but by any stretch of imagination, it cannot be said to be prejudicial to the interest of the Revenue in the light of the ratio laid down by the Hon’ble Supreme Court in the case of Chennai Properties & Investment Ltd (supra). Thus we do not find any merit in the assumption of jurisdiction by the Commissioner u/s. 263 of the Act. We, therefore, set aside the order of the CIT and restore that of the AO made u/s. 143(3) of the Act. - Decided in favour of assessee.
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