TMI Blog2013 (5) TMI 971X X X X Extracts X X X X X X X X Extracts X X X X ..... engaged in the business of Stevedoring, Clearing Forwarding, Shore handling and Steamer Agency etc. The assessing officer noticed that the assessee firm did not file its return of income, though the partners of the firm were declaring the share income from the firm in their respective returns of income. Hence, the assessing officer issued notices u/s 148 of the Act for both the years under consideration. In response thereto, the assessee filed the returns of income declaring income on estimated basis i.e. @ 7.5% of the gross receipts. The assessing officer after carrying out necessary enquiries, completed the assessment by estimating income at 10% of the gross receipts. 3. On examination of the records, the Ld. CIT noticed that gr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me-tax Department. Subsequently, one of the main partners Shri K. Gangi Reddy expired on 11.12.2004 and thereafter differences cropped up amongst the partners, which went to the level of court litigation also. On account of these reasons, the assessee could not maintain proper books of accounts and could not file returns of income also. Hence, the assessing officer issued notices u/s 148 of the Act for three assessment years, viz., assessment years 200506 to 2007-07. In response thereto, the assessee firm filed returns of income declaring an income on estimated basis @ 7.5% of the gross receipts. During the course of assessment proceedings, the assessing officer made detailed enquiries with regard to the estimate made by the assessee. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9) He further submitted that the assessing officer has completed the assessment under identical fashion for the assessment year 2005-06 also at the very same point of time and the Learned CIT has thought fit not to revise the same, though the time limit for revision was very much available. 5. The Learned D.R submitted that the assessee was having two different sources of income and the assessing officer has failed to examine this aspect during the course of assessment proceedings. He further submitted that the lack of enquiry on the part of the assessing officer would make the assessment order erroneous only and hence it is susceptible for revision under section 263 of the Act. In this regard, the Learned D.R placed reliance on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... invoked to correct each and every type of mistake or error committed by the Assessing Officer and it is only when an order is erroneous that the section will be attracted . The Supreme Court held that an incorrect assumption of fact or an incorrect application of law will satisfy the requirement of the order being erroneous. An order passed in violation of the principles of natural justice or without application of mind, would be an order falling in that category. The expression prejudicial to the interests of the Revenue , the Supreme Court held, it is of wide import and is not confined to a loss of tax. What is prejudicial to the interest of the Revenue is explained in the judgment of the Supreme Court (head note) : The phras ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o to the notice of the assessing officer. On being convinced with the difficulties of the assessee, the assessing officer has also proposed to enhance the estimate made by the assessee. The Assessing Officer has also noticed the fact that the assessee has declared the rental income from godowns separately in the earlier years. Thus, we notice that the assessing officer has considered all aspects while completing the assessment. Under these circumstances, in our view, the assessing officer has properly applied his mind and the view taken by him is one of the possible views. 8. The Learned A.R has also pointed out that the view expressed by Learned CIT that the expenses relating to rental receipts can be ascertained is not correct in ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
