TMI Blog2018 (12) TMI 316X X X X Extracts X X X X X X X X Extracts X X X X ..... raised by the AO and reply was filed by the assessee. This may be a case of inadequate enquiry but this is not a case of no enquiry. This is by now a settled position of law that for inadequate enquiry by the AO, the CIT cannot invoke section 263 and only if no query is made by the AO in the course of assessment proceedings and because of that, certain claim of the assessee for deduction stands allowed without enquiry then such an assessment order is erroneous as well as prejudicial to the interest of revenue. Hence, it is not a case of no enquiry by the AO and therefore, ld. Pr. CIT is not justified to invoke his revisional powers u/s. 263 - decided in favour of assessee. - ITA No.1193/Bang/2018 - - - Dated:- 29-11-2018 - Shri Sunil Kumar Yadav, Judicial Member And Shri Arun Kumar Garodia, Accountant Member For the Assessee : Shri S. Parthasarathi, Advocate For the Revenue : Mrs. Priscilla Singsit, CIT (DR) ORDER PER SHRI A.K. GARODIA, ACCOUNTANT MEMBER This appeal is filed by the assessee and the same is directed against the order of ld. Pr.CIT, Bangalore-7, Bangalore dated 05.03.2018 for Assessment Year 2013-14 passed u/s 263. 2. The grounds raise ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessing officer during assessment proceedings vide Letter dated 26.11.2015 and vide Letter dated 18.12.2015 providing details of trade payables. other loans and advances with specific reference to TATA Teleservices write off and ICD written off has not been disputed or has the facts been found to be erroneous or false. 10. The fact that the assessment order was passed after considering the response by the appellant on specific query raised during the course of hearing, details with regard to TATA Teleservices and ICD have been ignored. 11. The learned Commissioner ought to have considered the fact that the same ground was further discussed on 25.1.2016 and details with respect to earlier assessment submitted. 12. The appellant submit that the assessing officer has applied his mind and considered all aspect of the claim before passing the order and all details called for were provided during the course of assessment proceedings. Especially the fact that the appellant had accounted as payable to TATA Teleservices an amount of ₹ 1.1.7.92,967. It was further brought to his notice that an amount of ₹ 17,53,418 was received back by the assesse during 2009-10. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A and AR of assessee has filed written submissions dated 12.02.2018 which was received on 26.02.2018 by ld. Pr. CIT. The Pr.CIT has considered the replies of the assessee but he was not satisfied and he held that the assessment order passed by the AO u/s. 143(3) dated 01.03.2016 for Assessment Year 2013-14 is erroneous and prejudicial to the interest of the revenue. The Pr. CIT directed the AO to re-examine all the relevant facts de novo by making full and complete enquiry on facts and law as to the aforesaid two issues. Now the assessee is in appeal against this order passed by ld. Pr.CIT u/s. 263 of IT Act. 4. In course of hearing before us, ld. AR of assessee was asked to furnish the enquiry letter issued by the AO to the assessee in the course of assessment proceedings. He submitted copy of notice issued by the AO u/s. 142(1) of IT Act. He also submitted that in addition to various queries as per the notice u/s 142 (1), various other queries were raised by the AO orally in course of hearing and the same were replied as per letter dated 18.01.2016, paper book pages 9 to 12 and also as per letter dated 21.11.2016, paper book pages 1 2. Reliance was placed on Tribunal order r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... query raised by the AO with regard to bad debts written off and advances written off by assessee of ₹ 1,00,39,549/- and ₹ 79,75,474/- respectively. But as per these two replies dated 18.01.2016 and 21.11.2016, the details about these write offs were submitted by the assessee and this is the submission of the learned AR of the assessee that these submissions are in reply to oral queries of the AO. Hence, it is seen that details were filed by the assessee before the AO in course of assessment proceedings in replies filed before him and this is the submission of the learned AR of the assessee that the reply on this account of write off is with reference to oral queries of the AO and we find no reason or basis to doubt this submission. Hence, it is seen that in the facts of the present case, queries are raised by the AO and reply was filed by the assessee. This may be a case of inadequate enquiry but this is not a case of no enquiry. This is by now a settled position of law that for inadequate enquiry by the AO, the CIT cannot invoke section 263 and only if no query is made by the AO in the course of assessment proceedings and because of that, certain claim of the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Finance Act, 2000 the loss of a sec. 10A unit is eligible to be carried forward and set off against profits of subsequent years. This is in terms of sec. 10A(6) of the I.T Act. The Karnataka High Court in the case of Himatasingike Seide Ltd., 286 ITR 255 stated that the computation of total income has to be in terms of the IT Act. The judgment of the High Court makes it clear that the computation of eligible profits for sec. 10A has to be in accordance with the provisions of the Act and the profit of the undertaking cannot be determined in isolation of the other provisions of the Act. It is therefore held that the provisions of sec. 70 and sec. 72 are applicable in determining the profits of the business for the purposes of sec. 10A as far as unabsorbed depreciation is concerned, carry forward and set off are governed by sec. 32(2) and the unabsorbed depreciation assumes the character of current year s depreciation and has to be allowed as a deduction from current year s income. Therefore the claim u/s 10A is allowed from total income of the assessee after setting off the brought forward losses. 8. The above order of the assessing authority clearly shows that he has ap ..... X X X X Extracts X X X X X X X X Extracts X X X X
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