TMI Blog2017 (2) TMI 1185X X X X Extracts X X X X X X X X Extracts X X X X ..... ear 2006 2007 is allowable as set-off during the year or not. The Ld. CIT has further stated that only on 02/06/2008 the principal Corporation of Google was constituted and further the certificate obtained by the assessee dated 7 07/04/2015 also shows that during the course of original assessment proceedings for assessment year 2007 – 08 the issue was not at all examined whether the impugned land sold in assessment year 2006 – 07 was situated within 8 km or beyond 8 km of the limits of the municipal corporation. Therefore, according to us the assessing officer has allowed the set-off of the loss to the assessee without examining the facts at all. With respect to the capital gain on sale of shares of a company assessing officer has allowed the claim of the assessee under section 10 (38) of the income tax act without examining whether the security transaction tax has been paid on the sale of the shares or not. The query letter as relied upon by AR only shows that the assessing officer has enquired about the details about acquisition of those source and mode of payment for acquisition of the same as well as evidence for sale of shares and mode of receipt of sale proceeds. Accordin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der u/s 143(3) dated 30th December 2009 and directing the Assessing Officer to modify the assessment order in light of the directions stated in his order u/s 263, and his such direction is bad in law and void and contrary to the provisions of law, as the assessment order u/s. 143(3) was neither erroneous nor prejudicial to the interest of the revenue. 4. Without prejudice to the above, The Ld. Commissioner of Income Tax erred in law as well as in facts in holding that the Assessing Officer accepted the sale consideration as declared by the assessee on the sale of Property at Village Shorkha (Dadri), without appreciating the relevant statutory provision of the Income Tax Act, are based on his surmises and guesses and are contrary to the provisions of law. 5. The Ld. Commissioner of Income Tax erred in law as well as in facts in holding that the A.O. in his assessment order has allowed the claim of brought forward Long term capital loss of ₹ 36,75,100/-, without any verification, examination and application of mind, are based on his surmises and guesses and are contrary to the provisions of law. 6. The Ld. Commissioner of Income Tax erred in law as well as in fac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. CIT that assessee in the return of income has claimed set-off of long term capital loss of ₹ 3675100/-in assessment year 2006.07 however same was not declared in the return filed by the assessee in form number 2D. Further the documents filed by the assessee during the course of assessment proceedings for assessment year 2007-08 shows that the alleged losses on account of sale of agricultural land at Haryana which is not chargeable to tax as per the provisions of section 2 (14 ) of the income tax act. Therefore, it was observed by the Ld. CIT that the Ld. assessing officer did not consider this before allowing the assessee's contention for the set-off of the above loss. In response to the show cause notice the assessee submitted that there is no quarrel provided under form number 2D well-placed carried forward loss can be shown and further same was disclosed in the return of income for assessment year 2006 2007 through the computation of income Annexure of capital gain or loss which were part of the return of income. He further submitted that according to the map of municipal area from the official website of municipal Corporation, Gurgaon, the land is situated within t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... taken for the stem duty purpose was ₹ 58.75 lakhs however the stamp duty rates cannot be applied to the facts of the cases of the sale of the land because the property was situated in flood prone area and for this he referred to page No. 71 to 73 of the paper book which is a valuation report submitted by the approved valuer valued the property is 19.97 lakhs stating that the said land is situated in water logging area low-lying area so that the land rate is lower than the other land. He further referred to the page No. 38 of the paper book which is a inquiry letter dated 13/07/2009 issued by the Ld. assessing officer before framing the assessment under section 143 (3) which is subject to challenge under section 263 of the income tax act. He referred to para No. 2 of that letter wherein the sale deed in respect of immovable property sold was asked for. The Ld. authorized representative also stated that the stem valuation date is not applicable to the land sold for the reasons stated by him before the Ld. CIT With respect to the set off of brought forward long-term capital loss it was submitted by him that this issue was also examined by the assessing officer wide serial No. 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... usal of the query letter issued by the Ld. assessing officer it was noted that he has asked information about the copy of sale deed in respect of immovable property sold as well as cost of acquisition of those property. The Ld. assessing officer has apparently not applied his mind to the applicability of the provisions of section 50 C of the income tax act to the sale consideration shown by the assessee when the sale deed was also available before him where the fair market value of the property was shown as 58.75 lakhs. In view of this we are of the opinion that Ld. assessing officer has not conducted any Inquiry on this aspect of the computation of capital gain and therefore the order of the Ld. assessing officer is erroneous and prejudicial to the interest of the revenue on this count. b) With respect to the claim of the long-term capital loss shown by the assessee on per usual of query letter dated 13/07/2009 issued by the Ld. assessing officer he has asked the details of loss of ₹ 36.75 lakhs claimed by the assessee while computing the long term capital gains. Further there is no evidence on record that the Ld. assessing officer before allowing the set-off has consid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o be erroneous. 'Due application of mind' implies that if the assessee has merely responded to the AO's query and the AO, without proper verification of replies, accepts the same, then, it cannot be said to be a case of due application of mind. 28.1 Ld. Special counsel has rightly pointed out that the expression, 'inquiry', 'lack of inquiry' and 'inadequate inquiry', have not been defined and, therefore, when the action of the AO would be suggestive of lack of inquiry or inadequate inquiry, will depend upon the facts obtaining in a particular case. What emerges as a broad principle from the various decisions is that where the AO has reached a rational conclusion, based on his inquiries and material on record, the Commissioner should not start the matter afresh in a way as to question the manner of his conducting inquiries. It is not the province of the Commissioner to enter into the merits of evidence; it has only to see whether the requirements of essential inquires and of law have been duly and properly complied with by AO or not. 28.2 It is well settled that before the Commissioner can invoke his powers u/s 263, he has to arrive at ..... X X X X Extracts X X X X X X X X Extracts X X X X
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