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2023 (2) TMI 812 - HC - Income TaxRevision u/s 263 - Exemption u/s 11 - depreciation made in the return - distinction between ‘lack of inquiry’ and ‘inadequate inquiry’ - difference between purported incomplete or inadequate verification or no verification whatsoever by the assessing office - HELD THAT:- As it is not gainsaid by the Revenue that the respondent-assessee has been following the practice of claiming depreciation in earlier years as that is claimed in the present year under assessment. There is no denial of fact by the Income Tax Department that the assessee is consistently claiming the depreciation as application of income without making the claim u/s 11 of the IT Act at the time of acquisition or purchase of assets as application of income. Mere statement in the appeal filed by the Revenue before this Court that “no documentary evidence is submitted by the assessee in support of its claim” cannot be countenanced in view of categorical finding of fact by the AO as also the learned ITAT that the assessee-respondent did furnish statements, documents and details as sought for in compliance of notice issued for assessment u/s 143 of the IT Act before the Assessing Officer. Therefore, such finding of fact falsifies the statement of the Revenue in paragraph 7 of the appeal that “no documentary evidence is submitted by the assessee in support of its claim”. Thus, the view of the Tribunal in allowing the Assessee-Respondent’s appeal on the principle of consistency cannot, in the present facts, be faulted with. Proceeding initiated by the Commissioner of Income Tax (Exemption), Hyderabad by exercise of power under Section 263 of the IT Act is not tenable either on facts or in law, the learned ITAT has rightly quashed the consequential proceedings and orders allowing claim of depreciation on the assets. Interpretation of statutory provision and views expressed by different Courts qua dispute sought to be raised by initiating proceeding for revision - Revisional Authority- CIT (E) in his order, while exercising power under Section 263 placed reliance on a decision of Grama Vidiyal Trust [1985 (10) TMI 67 - GUJARAT HIGH COURT] without mentioning anything as to how there was factual similitude with that of the case of the respondent-assessee. Since the Revisional Authority has mechanically sought to apply the decision of learned ITAT in Grama Vidiyal Trust (supra) without application of mind, the impugned Order passed in exercise of power of suo motu revision stands vitiated.
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