2019 (10) TMI 927

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..... the case the Tribunal was correct in law in cancelling the order of the Commissioner of Income Tax passed under section 263 of the Income Tax Act, 1961 without appreciating that the Assessing Officer has not brought anything on record to indicate that he had applied his mind while accepting the claim of operating loss of Rs. 8,79,80,896/-?" 3. The Respondent- assessee is engaged in the business of financing and trading in shares. The Respondent filed its return of income for the subject assessment year on 27 September 2011 declaring total loss at Rs. 11.29 crore. The Assessing Officer passed an order under section 143(3) of the Act making few disallowances/ additions resulting in the assessment of Respondent's income at Rs. 35.50 crore. 4 .....

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..... e operating loss as mentioned above is accepted by the Assessing Officer without any verification or proper application of mind. It is not known, how the assessee has debited the net other operating loss in its P & L account without specifying the details of opening stock, purchases, sales and closing stock and the Assessing Officer has accepted the same without seeking any further details and making enquires thereof. Therefore, to this extent the assessment order passed by the Assessing Officer is prima facie appear to be erroneous and prejudicial to the interest of revenue within the meaning of the provisions of section 263 of the Act." 5. In spite of the Respondent's objection, the Commissioner of Income Tax by order dated 20 March 2015 .....

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..... he Assessing Officer in respect of the Respondent's claim that there was an operating loss of Rs. 8.79 crore. On merits, it held that the view taken by the Assessing Officer after examination of exhaustive details and evidence was a possible view. In the above circumstances, the order dated 20 March 2015 of the Commissioner of Income Tax was quashed and set aside. 7. We find that the finding of fact order of the Tribunal that the proceedings under section 263 of the Act, on the face of it, have been initiated without examination of records before the Assessing Officer is not shown to be perverse. It is clear that the show cause notice proceeds on the basis that the books of accounts, transaction accounts of share trading carried out by the .....

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