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TMI Blog2009 (6) TMI 607X X X X Extracts X X X X X X X X Extracts X X X X ..... iginal assessment without considering the eligibility. Even though several questions are raised in the appeal filed, we feel the only issue which is the substantial question of law that requires consideration is whether on the facts, the Tribunal was justified in setting aside the order of the Commissioner issued under section 263 of the Act directing fresh assessment of the assessee for the year 1995-96. 2. The assessee which is engaged in mining of clay as its main business in Trivandrum filed its return for the assessment year 1995-96 claiming full depreciation of Rs. 5 crores under two heads. Out of this, Rs. 1 crore represent the value of aluminium cops, each priced at Rs. 50, purchased and leased out by the assessee to a yarn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . He found that the very same assessee made a bogus claim of depreciation in the immediately preceding assessment year pertaining to purchase and lease out of aluminium cops to a company and the Commissioner of Income-tax (Appeal)'s finding about the bogus nature of transaction was accepted by the assessee and the assessee settled the tax liability under the Kar Vivad Samadhan Scheme for that year. Therefore, the Commissioner was of the view that the assessee's claim for depreciation of a big amount of Rs. 4 crores should have been considered carefully by the Assessing Officer. The Commissioner noticed that without even a reference in the assessment order about the claim, the Assessing Officer allowed depreciation on the entire amount of Rs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Scheme. During this year also, the assessee claimed full depreciation on the value of 2 lakhs aluminium cops purchased from JCT Ltd. and leased out to the same company with whom a bogus transaction was established by the Department for the previous year. Therefore, the Assessing Officer scrutinised the genuineness of the claim of depreciation in respect of the transaction with JCT Ltd. and limited the depreciation to Rs. 12,50,000 as against Rs. 1 crore claimed by the assessee. In other words, 87.5 per cent. of thedepreciation claimed for the transaction with JCT Ltd. was rejected by the Assessing Officer. However, so far as the assessee's claim for depreciation on the purchase and sale of bottles and crates to M/s. Dhillon Kool Drinks and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the assessee, that too, without addresses of the parties from whom the assessee purchased the articles, the Assessing Officer would not have allowed the claim had he scrutinised the return and the records filed in support thereof. During hearing, even though assessee's counsel filed detailed argument note and offered to produce entire records pertaining to the purchases to prove genuineness of the claim, we do not think it is for this court to consider the matter for the first time. The only question to be considered is whether the order issued by the Assessing Officer granting the claim without examining the eligibility of the assessee for the claim is an order prejudicial to the interest of the Revenue entitling the Commissioner to i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessment passed without reference to the claim and without considering the eligibility of the assessee for depreciation for the lakhs of items said to have been purchased and leased out in the previous year, was rightly found to be an order prejudicial to the interest of the Revenue by the Commissioner. So much so, the Commissioner rightly exercised the jurisdiction under section 263 and set aside the assessment. We, therefore, allow the appeal by reversing the order of the Tribunal and by restoring the order of the Commissioner. It will be open to the assessee to produce evidence and establish the case before the officer in the fresh assessment proceedings based on the order of the Commissioner. X X X X Extracts X X X X X X X X Extracts X X X X
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