TMI Blog2017 (10) TMI 1096X X X X Extracts X X X X X X X X Extracts X X X X ..... scussion on the issues. In the present case the assessing officer mechanically accepted the claim with regards to the depreciation on fixed asset/ Multiplex Building and on the issue of TDS certificate, if the corresponding income was offered to tax as no reconciliation was made. Further the assessing officer without calling and examining the scheme of Government of Maharashtra on entertainment tax treated the entertainment tax same as revenue receipt. In the present case the order sought to be revived reflects that it was passed in mechanical way and without application of mind by assessing officer. Thus, in view of the forgoing reasons the assessment order was passed without making requisite inquiries will satisfy the condition of the order being erroneous and prejudicial to the interest of revenue - Decided against assessee. - ITA No. 2583/Mum/2015 - - - Dated:- 25-10-2017 - SHRI B.R. BASKARAN, ACCOUNTANT MEMBER AND SHRI PAWAN SINGH, JUDICIAL MEMBER For The Assessee : Shri Vijay Mehta (AR) For The Revenue : Shri H.N. Singh (CIT DR) Order Under Section 254(1) of Income Tax Act PER PAWAN SINGH, JUDICIAL MEMBER: 1. This appeal by assessee unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t require knowledge rocket science to conclude that no building can survive for 900 years. The premium has been paid for acquiring possession for land for 900 years on which superstructure has been built and not for obtaining lease for superstructure, simplicitor for 900 years. The payment of consideration of ₹ 46,87,50,000/- is paid as a premium for obtaining lease for 900 years for purchase/possession of land alone. Depreciation of superstructure would amounts to granting of depreciation on the amount paid for land. The AO failed to carry out relevant and meaningful enquiry as warranted by the facts of the case which tantamount to assessment order being erroneous and prejudicial to the interest of Revenue. (iii) The assessee claimed deduction for portion of ticket amount as entertainment tax. The assessee not offered the same as income and treated as capital receipt covered by Capital subsidy scheme of Government of Maharashtra for Multiplex Theatre. The AO treated it as revenue receipt without examining the scheme. The AO concluded on the basis of ticket issued by assessee, wherein no separate collection for entertainment tax. Thus, there is failure on the part of AO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orresponding income of books of account. The assessee has furnished all TDS in the form of Form 16A. The assessee furnished proper reconciliation of income as per Form 26AS and as per books. The AO has not committed any error as he has verified the books and certify himself with the returned income. For third issue, with regard to treating the entertainment tax as revenue receipt, the assessee contended that the assessing officer decided issue after examining the nature of subsidy being capital in nature. 4. The contention of assessee was not accepted by ld. PCIT. The ld PCIT concluded that the assessee obtained the sub-lease for 900 years which includes a bundle or right over the piece of land with superstructure in form of Multiplex cinema unit is constructed. The assessee has right to mortgage, charge, transfer, assign, sub-let income encumber, create third party right over the Multiplex cinema unit, the assessee is free to construct whatever superstructure they wants over the land during the lease period. About of objection of assessee that assessee also claimed depreciation on lease-hold building during the AY 2009-10. The ld. PCIT concluded that the case was not taken up f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sus Vikas polymers[2012] 341 ITR 537 (Delhi). It was argued that before setting aside the issue the learned PCIT should examine the issue first and then to set aside the same to the assessing officer. To support his submission the learned AR of the assessee relied upon the decision of Tribunal in Gaurav Mathrawala Vs CIT in ITA 2378/M/2015 dated 6 January 2016, AV Industries Versus ACIT in ITA 3469/M/2010, HSBC Asset Management Versus DCIT in ITA 2028/M/2009 dated 15 June 2001, Bharat Homes Ltd Vs CIT in ITA 6792/M/2011 dated 27 May 2016 and the decision of Hon ble Gujarat High Court in JMC Projects (India) Ltd Versus ACIT in ITA 3434 of 2015 dated 21 December 2015. On merit it was argued that assessee entered into agreement with Phoenix Mills Ltd whereby Phoenix Mills Ltd agreed to grant sub-lease of Multiplex Cinema unit to the assessee for a term of 900 years. After availing the sub-lease and making necessary improvements in Multiplex units and installing the fit outs equipment fixture and other asset necessary for running the Multiplex cinema the assessee started its business of exhibiting films from the said Multiplex cinema. The assessee claimed depreciation on Multiplex Cine ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e decision of Hon ble Supreme Court in case of CIT Versus Amitabh Bachchan [2016] 69 taxmann.com 170(SC) and decision of Andhra Pradesh High Court in CIT versus Varanasi Khanta Rao [2015] 59 taxmann.com 175(Andhra Pradesh). 7. We have considered the rival submission of parties and have gone through the orders of authorities below. We have also perused the various decision relied by the respective learned representative of the parties. The perusal of grounds of appeal raised by assessee in the present appeal reveals that the assessee has challenged only the validity of order passed by learned PCIT under section 263 of Income tax Act. The assessing officer passed the order of assessment under section 143(3) on 18 March 2013. The perusal of assessment order reveals that assessing officer has not made any reference with regard to the verification of TDS certificates and the claim of depreciation of asset, claimed by assessee with respect to superstructure of multiplex cinema. The perusal of the assessment order reveals that the assessing officer has not raised any query with regard to the nature of asset, lease hold period of building of Multiplex Theater. Further, the assessee clai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ficer without calling and examining the scheme of Government of Maharashtra on entertainment tax treated the entertainment tax same as revenue receipt. 10. The ld. AR for the assessee argued that the assessing officer had considered the relevant facts and the material while passing the assessment order. According to ld AR for the assessee, the mare fact that assessment order passed by assessing officer was short is neither mean failure on his part in not examining the matter carefully nor would be erroneous so long as view taken by him was possible view. In our view the submission of ld. AR for the assessee is not correct and must fail for the reasons we have explained hereinabove. 11. In Malabar Industrial Co. Ltd Vs CIT (243 ITR 83) the Hon ble Apex Court held; There can be no doubt that the provision cannot be invoked to correct each and every type of mistake committed by the assessing officer, it is only when an order is erroneous that the section will be attracted. An incorrect assumption of facts or an incorrect application of law will satisfy the requirement of the order being erroneous. In the same category falls the order passed without applying the principles o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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