TMI Blog1991 (3) TMI 390X X X X Extracts X X X X X X X X Extracts X X X X ..... rovisions of s. 263 of the IT Act and in that view in cancelling the order under s. 263 passed by the CIT ? 2. Shortly stated the facts are that the CIT exercised his jurisdiction under s. 263 of the IT Act, 1961 in respect of the asst. yr. 1977-78 as, according to him, the order passed by the ITO was erroneous, inasmuch as, the ITO came to the conclusion that only 7/12th of the head office expenses should be taken into account for disallowing the expenses as provided under s. 44C. He also observed that the ITO erred in calculating the correct amount of disallowance. According to the CIT the order of the ITO was erroneous and prejudicial to the interest of the Revenue. He initiated proceedings under s. 263. The assessee protested agains ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urisdiction under s. 263. It was further argued on behalf of the assessee that the CIT(A) omitted to adjudicate on the ground taken by the assessee regarding s. 44C, and on further appeal by the assessee, the Tribunal vide its order dt. 12th Nov., 1981 directed the CIT(A) to dispose of the ground, and, therefore, the CIT had no jurisdiction to act under s. 263. It was also argued on behalf of the assessee that on the facts of the case, the order of the CIT under s. 263 cannot be upheld. Reliance was placed on the decision of the Tribunal in ITA No. 2114/Cal/1980 in the case of Singlo (India) Tea Co. Ltd. dt. 19th July, 1982 and also on another decision in the case of Assam Co. (I) Ltd. being ITA No. 228/Cal/1981 dt. 30th April, 1982. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT was quashed. From the narration of facts it would appear that the question regarding the application of s. 44C was directly in issue before the ITO. The matter also went to the CIT(A). Thereafter it was taken up before the Tribunal. The Tribunal directed the CIT(A) to reconsider the matter on the basis of the directions given in the appellate order of the Tribunal. In such a case it cannot be said that the issue was not considered by the ITO. This is a case where the order of the ITO merged with (that of) the CIT(A) as appeal was preferred and decided on the identical issue. In any event, this question has become purely academic in view of the fact that on merits the assessee was entitled to succeed. 4. Division Bench of this ..... X X X X Extracts X X X X X X X X Extracts X X X X
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