TMI Blog2019 (7) TMI 661X X X X Extracts X X X X X X X X Extracts X X X X ..... 263 of the Act on the basis that the assessee failed to disclose the sale consideration and also did not work out long term capital gain in accordance with the value adopted by the stamp valuation authority as per section 50C. The contention of the assessee is that provisions of section 50C of the Act are not applicable as the assessee is engaged in the real estate business. However, this fact is contrary to the records as per the audited report, wherein the nature of business is stated to be contractors/civil contractors. Hence, we do not have any hesitation to come to the conclusion that the Ld. Principal CIT was justified in invoking the provisions u/s 263. The grounds raised in the appeal are dismissed. However, before parting we wish to clarify that A.O. would decide claim of deduction u/s 54F in accordance with law. - Decided against assessee. - IT(SS)A Nos.45 And 46/Ind/2018 - - - Dated:- 10-7-2019 - Shri Kul Bharat, Judicial Member And Shri Manish Borad, Accountant Member For the Appellant : Shri S.S. Deshpande, A.R. For the Respondent : Smt. Ashima Gupta, D.R. ORDER PER KUL BHARAT, J.M: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he sale deed of plot for ascertaining the value as per section 50C of the Act. It was further revealed that the assessee had neither purchased any residential house as per details of immovable assets furnished during the assessment within prescribed limit nor the long term capital gain was deposited in capital gain account scheme. Therefore, the assessee was not eligible for claiming exemption u/s 54F of the Act. Accordingly, long term capital gain was required to be assessed at ₹ 20,82,201/- for the assessment year 2010-11, which was not done. This omission resulted in under assessment of long term capital gain to the extent of ₹ 20,82,201/-. Therefore, the Ld. Pr. CIT was of the view that the assessment order so framed was erroneous and prejudicial to the interest of the revenue on the ground that the long term capital gain was not assessed and the exemption u/s 54F of the act was allowed without ascertaining the conditions laid down u/s 54 of the Act. Thereafter, a notice to the assessee was issued. In response to the notice, the assessee filed a reply which was not found to be acceptable by the Ld. Pr. CIT and he directed the A.O. t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ra 7.4 of his order by observing as under: 6. We do not find any merit into this contention of the assessee that impugned order is hit by limitation as in the case in hand, there was no assessment u/s 143(3) of the Act. It was merely a processing where the assessing officer had processed the return of the income and did not scrutinise the claim of the assessee. We are also in agreement of the finding of the Ld. CIT(DR) that section 147 of the Act and section 153A of the Act operate in two different and distinct fields. Therefore, the judgement of Hon'ble Apex Court rendered in the case of CIT Vs. Alagendran Finance Ltd. (supra) would not help the assessee. Hence, we find no merit in the ground raised and the same is dismissed. 7. Ground Nos.2 3 are inter-related. Ld. Counsel for the assessee reiterated the submissions as made before the Ld. Principal CIT. It was contended that a search was conducted at the premises of the assessee on 29.1.2014. In pursuance of notice u/s 153A of the Act return was filed and the deduction as claimed in the original return was also made. Assessment u/s 153A of the Act was c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s erroneous in so far as it is prejudicial to the interest of the revenue. The law is well settled merely an erroneous order would not be sufficient to make such order subject matter of revision u/s 263 of the Act unless such order is prejudicial to the interest of the revenue. In our considered view, consideration by the Principal CIT for ascertaining that any order passed is erroneous so far as it is prejudicial to the interest of the revenue is not mechanical. There has to be some material or the basis of such consideration. In our view, revisionary power is not a tool to correct any error or mistake. But if any error in exercising of jurisdiction or appreciating of any fact or law is of such nature that cause prejudice to the interest of the revenue, the spirit of law to be followed in true sense. The scope of powers u/s 263 of the Act has already been examined in catena of judgements. The Hon'ble apex court in the case of Malabar Industrial Company Vs. CIT 243 ITR 87 has held as under: A bare reading of this provision makes it clear that the prerequisite to exercise of jurisdiction by the Commissioner suo moto under it, is that the order of the Income-ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... too narrow to merit acceptance. The scheme of the Act is to levy and collect tax in accordance with the provisions of the Act and this task is entrusted to the Revenue. If due to an erroneous order of the Income-tax Officer, the revenue is losing tax lawfully payable by a person, it will certainly be prejudicial to the interests of the revenue. The phrase prejudicial to the interests of the revenue has to be read in conjunction with an erroneous order passed by the Assessing Officer. Every loss of revenue as a consequence of an order of Assessing Officer cannot be treated as prejudicial to the interests of the revenue, for example, when an Income-tax Officer adopted one of the courses permissible in law and it has resulted in loss of revenue; or where two views are possible and the Income-tax Officer has taken one view with which the Commissioner does not agree, it cannot be treated as an erroneous order prejudicial to the interests of the revenue unless the view taken by the Income-tax Officer is unsustainable in law. It has been held by this Court that where a sum not earned by a person is assessed as income in his hands on his so offering, the order passed by the Assessing Offic ..... X X X X Extracts X X X X X X X X Extracts X X X X
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