TMI Blog2012 (4) TMI 91X X X X Extracts X X X X X X X X Extracts X X X X ..... his mind in allowing the benefit u/s 54F by accepting the genuineness of the capital gain - Decided in favor of Revenue. - 2 of 2008 - - - Dated:- 29-2-2012 - ADARSH KUMAR GOEL, SAIKIA P. K. JJ. JUDGMENT Adarsh Kumar Goel C. J.- 1. This appeal has been preferred by the Revenue under section 260A of the Income-tax Act, 1961, against the order dated August 28, 2007, passed by the Income-tax Appellate Tribunal, Gau- hati Bench, Guwahati, in I. T. A. No. 07(Gau) of 2007 for the assessment year 2002-03. 2. The Assessing Officer, in the course of assessment, allowed benefit to the assessee for long-term capital gain from sale of shares under section 54F. The shares in question were purchased on April 21, 2000, for Rs.19,536 an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case, the appellant was justified and correct in law in assuming jurisdiction under section 263 of the Act and in passing the order dated Novem- ber 8, 2006, under section 263 of the Act setting aside the assessment order with the further direction to reframe the same in terms of the said order ? 2. Whether, on the facts and in the circumstances of the case, the Tribunal was justified and correct in law in cancelling the order passed by the appellant under section 263 of the Act, 1961 ?" 5. When the appeal came up for hearing, reliance was placed by the Revenue on the judgment of this court in CIT v. Daga Entrade P. Ltd. [2010] 327 ITR 467 (Gauhati) holding that jurisdiction under section 263 was validly exercised when the order re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... luded that the order was erroneous and prejudicial to the interests of the Revenue and called for exercise of revisional jurisdiction. Valid reasons for exercise of jurisdiction have been given. No doubt, mere different opinion was not enough for an order being termed as "erroneous" but the finding of the Commissioner shows that the order of the Assessing Officer suffered from non-application of mind. Distinction in cases where the Assessing Officer takes a view, after applying mind as per the settled norms and cases where settled norms are ignored and assessment is made is well known. While in former, revisional jurisdiction may not be exercised, in the latter it can certainly be exercised. Present case clearly falls in second category. Wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section 54F except that he did not utilize the entire consideration from transfer of shares for purchase of flat and as such, the claim is accepted partially in terms of section 54F." Commissioner of Income-tax "7. In my view, the Assessing Officer should have enquired about the existence of the company and should have written letters at the address given in the share certificates for verification of the assessee's claim. He should have obtained the annual accounts of the company as on March 31, 2000, and March 31, 2001, to satisfy himself whether the commercial activities of the company justified such a jump in the price of shares. He could have obtained the price quotations of the shares on a few dates during the check-period to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e tax authorities. We have also considered the case law relied upon by the learned counsel for the assessee. From the perusal of the assessment order framed under section. 143(3), we find that the Assessing Officer had made detailed enquiries in respect of share purchase and sale apart from receipt and payment relating to such share transaction. The Assessing Officer during the course of assessment proceeding has produced the photocopy of share certificates and bank statement from the assessee along with confirmation from broker regarding such share transac- tion. The Assessing Officer has also verified the claim of the assessee in respect of deduction under section 54F by perusing the documents like copy of agreement for flat, evidence of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mind. The reasons given by the Commissioner including the one that there was unusual jump of prices from Rs. 6 per share to Rs. 200 per share within a span of 13 months which could not be held to be explained without examining the sellers and buyers and making further enquiries is not shown to be irrelevant. The Tribunal committed an error of law in ignoring this aspect. In the facts and circum- stances of the case, the Tribunal was not justified in holding that the exer- cise of jurisdiction by the revisional authority was not permissible under section 263 of the Act. 9. Learned counsel for the assessee submitted that the question of per- versity having not being raised, this court must accept the finding of the Tribunal to be conclus ..... X X X X Extracts X X X X X X X X Extracts X X X X
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