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2019 (2) TMI 49 - AT - Income TaxRevision u/s 263 - claim of the assessee, on the agricultural activity - Held that:- The assessment order need not discuss all the points, but, AO or assessee should bring on record that AO has made enquiry and relevant information was submitted before him. In our view, the claim of the assessee, on the agricultural activity particularly peculiar, as in the case of assessee, AO should have called for the leased agreement with the farmers and evaluated how the activities of the assessee are exactly similar to M/s Prabhat Agri Biotech. No doubt AO asked for the information, but, there is no record that assessee has actually submitted that before the AO. It clearly shows that AO has not made enquiry in this case, but, merely accepted the contention of the assessee. Further, in our view, no doubt, AO has not applied his mind, but, the CIT has not established how the order of AO is prejudicial to the interests of revenue. Looking at the facts submitted before us seeds cannot be produced without basic agricultural activities, in our view, CIT should not stop merely on finding that the order is erroneous but also has to establish that the order of AO is prejudicial to the interests of revenue. Only missing link is the verification of lease agreement with the farmers and activities whether it is similar to the Prabhat Agri Biotech or not. This could also be verified by CIT and established that it is prejudicial to the interests of revenue. CIT has failed in this aspect. This is in line with the decision in the case of Malabar Industrial co. Ltd.(2000 (2) TMI 10 - SUPREME COURT) and CIT Vs. Green World Corporation (2009 (5) TMI 14 - SUPREME COURT OF INDIA). Therefore, no doubt, the assessment order is erroneous but not prejudicial to the revenue considering the case law submitted before us. Seeds cannot be produced without basic agricultural activities. The assessee has sold the seeds and must have carried out the agricultural activities in order to produce the seeds. Hence, we set aside the order of CIT passed u/s 263 of the Act and the order of the AO is restored. Accordingly, ground raised by the assessee are allowed.
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