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2020 (8) TMI 166 - AT - Income TaxRevision u/s 263 - HELD THAT:- We find that the order was passed by the Hon’ble Bombay High Court for demerger on 14.11.2014 and appointed date was fixed as 01.01.2014. Accordingly, the income and expenses of pharma division of Jay Precision Products (India) Pvt. Ltd. for the period 01.01.2014 to 31.03.2014 was transferred to the assessee-company. From examination of the documents filed by the assessee before the AO during the course of assessment proceedings, we find that during the year the job work charges payable to pharma division of Jay Precision Products (India) Pvt. Ltd., upon merger of the pharma division of Jay Precision Products (India) Pvt. Ltd., the sales shown by them to the assessee were therefore adjusted and cancelled against expenses of same account debited to the P&L account and accordingly the net amount was claimed and the said net amount was reported in the tax audit report and in Form 3CEB, the labour/processing charges and electricity and fuel charges as mentioned in the impugned order are related to and incurred by the pharma division of Jay Precision Products (India) Pvt. Ltd. for the period 01.01.2014 to. 31.03.2014. The expenses referred in the impugned order were incurred by the pharma division of Jay Precision Products (India) Pvt. Ltd. so acquired by the assessee pursuant to the order of the Hon’ble High Court and the sale of pharma division of Jay Precision Products (India) Pvt. Ltd. for the period 01.01.2014 to 31.03.2014 were also transferred to the assessee-company due to the effective demerger, the amount reported in the tax audit report (Form 3CD) and Form 3CEB are the gross amount of the said purchases including duties, taxes and freight. All the above details were filed by the assessee before the AO during the course of assessment proceedings. In the case of Moil India Limited [2017 (5) TMI 258 - BOMBAY HIGH COURT] it is held that the Assessing Officer is not expected to raise more queries if he was satisfied about admissibility of claim on the basis of materials and details supplied and therefore, the order is not erroneous or prejudicial to the Revenue. In view of the above factual matrix and position of law, we cancel the order u/s 263 passed by the Pr. CIT. In the case of Nirav Modi [2016 (6) TMI 1004 - BOMBAY HIGH COURT] held satisfaction of the Assessing Officer on the basis of documents was not shown to be erroneous in the absence of making a further inquiry. This was a case where a view was taken by the Assessing Officer on inquiry. Even if this view, in the opinion of the Commissioner was not correct, it would not permit him to exercise power u/s 263 of the Act. The Tribunal was right in setting aside the order u/s 263 of the Act. - Decided in favour of assessee.
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