TMI Blog2022 (4) TMI 1395X X X X Extracts X X X X X X X X Extracts X X X X ..... As rightly pointed out by the ITAT in the impugned order, the AO had in fact called for the details of the closing WIP which had been furnished by the Assessee and had examined it. If the CIT was of the view that the AO had not examined this issue at all, it could then led to the conclusion that the order of assessment was erroneous. That is not, however, the case here. The CIT simply decided that even for verification of the correctness of the submission of the Assessee, the matter had to be remanded to the AO. Section 263 of the Act requires the CIT, after hearing the Assessee, to pass an order by making such enquiry as he deems necessary . The purpose of such an enquiry would be to arrive at a subjective view that the order of the AO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... losed in its return of income and further, the profit element contained therein? 3. The facts in brief are that the Respondent Assessee which is inter alia engaged in the construction of buildings filed its return of income for the AY in question disclosing an income of ₹ 9,20,48,485/-. In terms of a revised computation, the Assessee declared a taxable income to the extent of ₹ 11,58,48,250/-. The return was selected for scrutiny and notice under Section 143 (2) of the Act was issued to the Assessee. Thereafter, notice under Section 142(1) of the Act along with questionnaire was also issued. 4. In the assessment order dated 22nd December 2011, the AO dealt specifically with two issues in which the discrepancies were foun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... estored to the file of the AO for redoing the assessment after offering proper opportunity to the Assessee. While redoing the assessment, the AO is to verify the total income shown in the revised computation of income as well as the calculation of interest U/s.234C of the Act. 7. The above order was assailed by the Assessee before the ITAT by filing ITA No.223/CTK/2014. 8. In the impugned order dated 7th June 2017, the ITAT noticed inter alia in Para-6 as under: We find that in the instant case, it is not in dispute that during the course of assessment, the Assessing Officer called for details of closing work-in-progress, which was furnished by the Assessee and was also examined by the Assessing Officer. It is not the case of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment. According to him, it was sufficient that the CIT formed an opinion that the assessment order was erroneous and prejudicial to the interests of the Revenue. 12. Mr. Parija, learned Senior Counsel on the other hand, pointed out that after noting the submission of the Assessee that it had in fact accounted for the profit element in the WIP, the CIT simply remanded the matter to the AO stating that the said submission required to be verified. There was no doubting by the CIT of the submission made by the Assessee that in fact it had accounted for the profit element in the WIP. In other words, there was no real formation of an opinion that the order of the AO was erroneous much less that it was prejudicial to the interests of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... requires the CIT, after hearing the Assessee, to pass an order by making such enquiry as he deems necessary . The purpose of such an enquiry would be to arrive at a subjective view that the order of the AO was erroneous in so far as it is prejudicial to the interest of Revenue. Even if such enquiry may not be mandatory, there has to be some basis on which the CIT can form such a view. In the present case, the basis for forming a view that the profit element in the WIP was not accounted for by the Assessee is absent in the order of the CIT. 15. Consequently, the Court is unable to find any error having been committed by the ITAT in interfering with the said order and setting it aside. No substantial question of law as urged by the Revenu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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