TMI Blog2020 (2) TMI 205X X X X Extracts X X X X X X X X Extracts X X X X ..... LT was not available. Therefore, there is no question of taking cognizance of such order while exercising the power under section 263 of the Act. Be that as it may, since, we have directed the Assessing Officer to examine the nature and character of the lease premium receipt and its taxability, the assessee is at liberty to furnish all the material/evidence including the order passed by the NCLT, Mumbai Bench, as referred to above, to advance its case. With the aforesaid observations, grounds raised are partly allowed for statistical purposes. - ITA No.2317/Mum./2018 - - - Dated:- 31-1-2020 - Shri Saktijit Dey, Judicial Member And Shri G. Manjunath, Accountant Member For the Assessee : Shri K.K. Ved For the Revenue : Shri Abhijit Patankar ORDER PER SAKTIJIT DEY. J.M. The captioned appeal has been filed by the assessee challenging the order dated 11th December 2017, passed under section 263 of the Income Tax Act, 1961 (for short the Act ) by the learned Principal Commissioner of Income Tax 2, Mumbai, pertaining to the assessment year 2013 14. 2. Brief facts are, the assessee, a resident company, is engaged in the business of development ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, is to be treated as revenue receipt in the hands of the assessee. He observed, while completing the assessment under section 143(3) of the Act, the Assessing Officer has not examined/verified the taxability of the lease premium and has omitted to bring it to tax at the hands of the assessee. Thus, he was of the view that due to non consideration of the aforesaid issue, the assessment order is erroneous and prejudicial to the interests of Revenue. Accordingly, he issued a show cause notice to the assessee requiring it to explain as to why the assessment order should not be revised. In response to the show cause notice, the assessee filed its reply objecting to the initiation of proceedings under section 263 of the Act. Further, it was contended by the assessee that the lease premium being in the nature of capital receipt is not taxable. Learned PCIT, however, was not convinced with the explanation of the assessee. He observed, while completing the assessment, the Assessing Officer has neither enquired into nor applied his mind to the facts on record. Further, on verifying the terms of concession agreement as well as the sub concession agreement, he held that the lease premiu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t all made any enquiry relating to the issue. He submitted, it is also not clear whether the Assessing Officer has examined the concession agreement and sub concession agreement and other relevant facts to arrive at a proper conclusion relating to the nature of amount received by the assessee, whether revenue or capital. He submitted, the assessment order reveals complete lack of enquiry by the Assessing Officer on the issue. Therefore, due to non consideration of the issue, the assessment order is not only erroneous but prejudicial to the interests of Revenue. He submitted, the order passed by the NCLT was neither available before the Assessing Officer nor before learned PCIT. Therefore, no cognizance can be taken of such order to decide the issue of validity of exercise of power under section 263 of the Act. 5. We have considered rival submissions and perused the material on record. On a careful reading of the impugned order passed under section 263 of the Act, it becomes amply clear that learned PCIT held the assessment order to be erroneous and prejudicial to the interests of Revenue primarily for the reason that the Assessing Officer has not made absolutely any enquiry wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te failure on the part of the Assessing Officer in examining the nature and character of the lease premium received by the assessee from IMICL Dighi Maritime Ltd. and its taxability or otherwise at the hands of the assessee. Therefore, to that extent, the assessment order passed by the Assessing Officer is erroneous and prejudicial to the interests of Revenue. Therefore, learned PCIT was well within his jurisdiction to invoke his power under section 263 of the Act to revise the assessment order. So far so good. In our view, considering the fact that the Assessing Officer has not at all enquired into the issue relating to the nature and character of the lease premium received by the assessee and its taxability, learned PCIT should have stopped at that stage and directed the Assessing Officer to examine the issue afresh and decide it after considering all aspects. Instead of doing so, it is evident, learned PCIT has himself determined the nature and character of the lease premium received as revenue receipt and has directed the Assessing Officer to add the amount to the income of the assessee. In our view, when learned PCIT is of the opinion that the Assessing Officer has not ma ..... X X X X Extracts X X X X X X X X Extracts X X X X
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