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TMI Blog2012 (5) TMI 130X X X X Extracts X X X X X X X X Extracts X X X X ..... aim of generation of electricity made by the assessee by using wind power plant during the assessment year. (d) To examine the claim of the assessee for yield and shortage of rice. (e) To examine the claim of current liability amounting to Rs. 48.28 crores". 2. The brief facts of the case are that the assessee has filed its return of income electronically on 29.11.2006 declaring an income of Rs. 1,45,51,080. The case was selected for scrutiny assessment and notices under sec. 143(2) and 142(1) of the Act were issued and served upon the assessee. The assessee at the relevant time was engaged in the business of manufacturing, trading and export of rice. Assessing Officer has passed an assessment order on 16.4.2008. The assessment order is a very brief assessment order, it does not contain any type of discussion rather it emerges out that Assessing Officer has briefly noticed activities of the assessee, g.p. shown by it and the expenses claimed towards vehicle running and maintenance and telephone etc. Learned Commissioner received a report from the Additional CIT, Central Range-2, in August 2008. He found that the Assessing Officer had issued a questionnaire on 20.3.2008 whereby h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ads as under: "7) Reg. Purchase of Wind Turbine Plant The assessee has purchased Wind Turbine Plant and has diversified into production of wind energy. The plant has been purchased from M/s. Suzlon Energy Ltd. The assessee company had entered into Power Purchase Agreement with Bangalore Electricity Supply Co. Ltd. a Government of Karnataka Undertaking. Photo copy of power purchase agreement and sales bill for sale of electricity during the month of March 06 to above company is enclosed. In view of the fact that Wind Turbine Plant was functional during the assessment year 2006-07 evidence for the same is enclosed and electricity was generated, the depreciation on the same after being put to use is justified and allowable to the assessee". 6. He further submitted that the assessee has produced copy of the Power Purchase Agreement between Bangalore Electricity Supply Co. Ltd. and the assessee. It was executed on 28.3.2006. The assessee has also produced commissioning certificate which is available on page 159 of the paper book. The assessee has produced sale bill of the electricity and realization of the power charges on such sales. According to the learned counsel for the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions. 7. On the strength of these decisions, he pointed out that no discussion is discernible in the assessment order in respect of grant of deprecation to the assessee on Wind Power Generation Project and, therefore, Learned Commissioner has rightly taken cognizance under section 263 of the Income-tax Act, 1961. 8. We have duly considered the rival contentions and gone through the record carefully. We do not deem it necessary to recite and recapitulate all the decisions on the legal aspect as to how the order of the Learned Commissioner passed under sec. 263 is to be judged. The ITAT in the case of Mrs. Khatiza S. Oomerbhoy Vs. ITO, Mumbai, 101 TTJ 1095, has analyzed in detail various authoritative pronouncements including the decision of Hon'ble Supreme Court in the case of Malabar Industries 243 ITR 83 as well as Hon'ble Bombay High Court rendered in the case of Gabriel India Ltd. reported in 203 ITR 108 and has propounded the following broader principle to judge the action of CIT taken under section 263. (i) The CIT must record satisfaction that the order of the A.O is erroneous and prejudicial to the interest of the Revenue. Both the conditions must be fulfilled. (ii) Sec. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... can regard the order as erroneous on the ground that in the circumstances of the case the Income-tax Officer should have made further inquiries before accepting the statements made by the assessee in his return. The reason is obvious. The position and function of the Income-tax Officer is very different from that of a civil court. The statement made in a pleading proved by the minimum amount of evidence may be adopted by a civil court in the absence of any rebuttal. The civil court is neutral. It simply gives decision on the basis of the pleading and evidence which comes before it. The Income-tax Officer is not only an adjudicator but also an investigator. He cannot remain passive in the face of the return which is apparently in order but calls for further inquiry. It is his duty to ascertain the truth of the facts stated in the return when the circumstances of the case are such as to provoke an inquiry. It is because it is incumbent on the ITO to further investigate the facts stated in the return when circumstances would made such an inquiry prudent that the word "erroneous" in section 263 includes the failure to make such an enquiry. The order becomes erroneous because such an i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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