TMI Blog2015 (5) TMI 937X X X X Extracts X X X X X X X X Extracts X X X X ..... he direction issued by the first appellate authority and which was given effect to by the Assessing Officer. All these would denote that something which was very much part and parcel of the appellate authority's order and dealt with extensively therein is now sought to be revised and revisited. We fully agree with the Tribunal when it concluded in para 14 that it is evident from the order of the Commissioner (Appeals) that the claim of cost of production of film was a subject matter of Appeal before him and after consideration of remand report of the Assessing Officer he gave his findings. Therefore, this order of the Assessing Officer dated 31st December, 2009 undisputedly had merged with the order of the first appellate authority dated 12th October, 2011 as far as the claim of cost of production of the film is concerned. Similarly, the other argument that applicability of Rule 9A has not been considered by the Commissioner, the Tribunal in para 15 found that this was also very much before the authorities and hence, even in relation thereto, it cannot be said that the Assessing Officer at the time of making the assessment order did not consider the applicability of Rule 9A vis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (Appeals), then, the power under section 263 of the Income Tax Act, 1961 cannot be exercised. That power also cannot be exercised because the Commissioner, while seeking to revise the order of the Assessing Officer, failed to note that the order of the Assessing Officer was challenged in Appeal. That Appeal was decided on 12th October, 2011. The Asessing Officer has given effect to the direction in the appellate authority's order. It is that order, whereby the Assessing Officer gives effect to the above direction, which is sought to be revised by the Commissioner under section 263 of the Income Tax Act, 1961. That was plainly and clearly impermissible given the above doctrine. Thirdly, the Commissioner did not put the Assessee to notice on certain aspects which he took into consideration, inasmuch as he directed by the order passed on 29th March, 2012 that the Assessing Officer must inquire into an issue as to whether the Assessee had sold its share of theatrical rights in the film Darna Zaroori Hai to M/s. RGV Enterprises for 25 lacs as is claimed by it. The Assessing Officer must give specific finding whether this claim is acceptable or not. Mr. Mistri submits that the Trib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the tune of ₹ 11 crores was provided by the Assessee to the Assessing Officer. The Assessing Officer, therefore, had before him explanation of the Assessee that this amount of ₹ 11,25,00,000/- could not be considered as income from film Darna Zaroori Hai . The income was only ₹ 25 lacs. The Assessing Officer did not accept this claim of the Assessee and took the income at ₹ 11,25,00,000/-. He, therefore, took into consideration this sum while passing the assessment order. Then, the Assessee had, before the Assessing Officer, pointed out that if this sum and as computed above can be termed as the income from the film, then, in terms of Rule 9A of the Income Tax Rules, when the film is released for exhibition on a commercial basis at least ninety days before the end of previous year, then, the cost of production of the film is to be allowed as deduction and that is restricted to the extent of income earned and the balance part of cost of production expenses are to be allowed as income of the previous year. Film Darna Zaroori Hai was released on promotional basis on 22nd February, 2006 and its commercial release was on 28th April, 2006. The computation o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de by the Assessing Officer came to be deleted. Thus, as against the expenses or cost of production to the tune of ₹ 27,19,28,504/- only a sum of ₹ 4,01,467/was deleted. 10. We find that despite this position emerging from the record and being undisputed, the order under section 263 of the Income Tax Act makes detailed reference to the show cause notice. The show cause notice as also this order passed under section 263 make detailed reference to the claims of the Assessee and which were part of the Appeal before the Commissioner and dealt with by him in his order dated 12th October, 2011. The order of the Commissioner under section 263 dated 29th March, 2012, from paras 8 onwards, makes extensive reference to these aspects. In the circumstances, what further emerges is that not only did the revisional authority purport to revise the Assessing Officer's order, but he purported to deal with the same direction which was issued in the order of the first appellate authority and which was given effect to by the Assessing Officer. Meaning thereby, the contents of the remand report, giving effect to the order of the first appellate authority, as submitted by the Assessin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ined and in consonance with the factual material placed cannot be termed as either perverse or vitiated by any error of law apparent on the face of the record. We fully agree with the Tribunal when it concluded in para 14 that it is evident from the order of the Commissioner (Appeals) that the claim of cost of production of film was a subject matter of Appeal before him and after consideration of remand report of the Assessing Officer he gave his findings. Therefore, this order of the Assessing Officer dated 31st December, 2009 undisputedly had merged with the order of the first appellate authority dated 12th October, 2011 as far as the claim of cost of production of the film is concerned. Similarly, the other argument that applicability of Rule 9A has not been considered by the Commissioner, the Tribunal in para 15 found that this was also very much before the authorities and hence, even in relation thereto, it cannot be said that the Assessing Officer at the time of making the assessment order did not consider the applicability of Rule 9A vis a vis the claim of the Assessee on the aspect of cost of production of the film. Therefore, on both grounds, we do not find that the Appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X
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