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TMI Blog2019 (3) TMI 1260X X X X Extracts X X X X X X X X Extracts X X X X ..... e u/s 263 on the ground that the appellant had land maintenance expenditure which was a capital expenditure and hence needs to be disallowed. After going the reply submitted by the appellant that the land maintenance expense was a revenue expenditure, the Principal Commissioner of Income Tax passed revision order under section 263 of the Act stating that the assessing officer had failed to enquire into the details of land maintenance expense. Thus the Principal Commissioner of Income Tax has not assumed the jurisdiction correctly and hence is not justified in passing revision order u/s 263." 3. The brief facts of the case are as follows: The assessee is a company engaged in the business of manufacture and marketing of ice cream and other ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er passed u/s 263 of the I.T.Act, the assessee has filed the present appeal before the Tribunal. The learned Counsel for the assessee submitted that there is no error in the assessment order since the nature of the expenses is nothing but revenue in nature and would not tantamount to capital expenditure. The learned AR submitted that the details of the expenses in the course of assessment proceedings were furnished to the assessee vide letter dated 12.08.2016. Further, the learned Counsel submitted that as per tax audit (under item 21), the auditors did not indicate any capital account debited to the profit and loss account. Therefore, the Assessing Officer had allowed the expenditure since he was convinced that it was a revenue expenditur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich assessee is having its sales outlet 1,88,769 Cost of materials used for the above 3,222 Sub Total 1,91,991 Labour charges incurred in land at let out premises 12,017 Total 7,33,636 As regards expenses at factory amounting to Rs. 5,29,628, we notice that the assessee has two factories in Trichur District. The assessee being engaged in food and edible items business, has to obtain periodical permission from Kerala State Pollution Control Board with regard to waste management and effluent treatment. The approval granted by the Board for both factories which were valid till 2012 and later renewed till 30.6.2015. Paragraph 5.1 of the approval letter reads as follows: "5.1 Trees and curtain ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Tribunal in the case of Acumen Capital Marketing (I) Ltd. (supra) had held that in order to invoke the provisions of section 263 of the I.T.Act, the assessment order has to be erroneous and such order has to be prejudice to the interest of the revenue. The relevant portion of the Tribunal order read as follows:- "6.7 Section 263 is attracted only if order of assessing officer is erroneous in so far as it is prejudicial to the interest of the revenue. Thus, if one of the twin conditions namely; (i) the assessment order is erroneous and (ii) prejudicial to the interest of revenue, is not satisfied, the CIT does not have power to exercise his revisionary powers u/s 263 of the Act. In the instant case, as mentioned earlier, on examinat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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